The City of London's Financial Services and Markets 1. The City of London’s financial Services and Markets: The City of London is one of the world’s three leading financial centres, along with Tokyo and New York, and is by far the largest in Europe. While New York and Tokyo rely on very large domestic economies to fuel their business, London’s success can be attributed to its international business. Major financial institutions and markets in the City include the Bank of England, the London Stock Exchange, Lloyd’s insurance market, and the London International Financial Futures and Options Exchange. 1.1 Facts and figures of Britain’s financial services industry: There are more overseas banks in London than in any other city in the world: 555 branches, subsidiaries and representative offices at the end of February 1999. Financial services account for almost 7 per cent of Britain’s Gross Domestic Product (GDP). Net overseas earnings of Britain’s financial sector reached a record £25,200 million in 1997. The London Stock Exchange is the largest market in the world for trading foreign equities, accounting for 63 per cent of global turnover. London is one of the world’s three major international bond centres. Some 70 per cent of international bond trading in the Euromarket take place there. It has by far the biggest foreign exchange market in the world, handling about 32 per cent of worldwide dealing, and with an average daily turnover, which is more than that of New York, and Tokyo combined. It is one of the world’s largest international insurance markets, with a leading share of aviation and marine insurance. It is the largest fund management centre. It is the world’s most important centre for advice on privatisation. Supervision and regulation 2. Financial markets: 2.1 The Stock Exchange: This is one of the world’s oldest marketplaces for the buying and selling of shares, but its advanced trading systems mean it is also one of the most modern. It is the world’s leading marketplace for international shares – more international companies choose to list in London than on any other exchange. It therefore plays a vital role in maintaining London’s position as a major financial centre. The main market is where most British and international shares are listed, while the Alternative Investment Market (AIM), established in 1995, is for younger and fast-growing businesses.
Its trading volume increased to over 17.7 million contracts, up 21 per cent from the previous year. This significant growth is largely due to strong growth in interest-rate and index derivatives products, which increased 40 per cent and 15 per cent respectively. In addition, the underlying value of contracts traded averaged more than $30 billion (currency is of Canadian Dollars) on a daily basis, compared to $20 billion in 2002.Though the Montreal Exchange was doing fine on its own joining together with the Toronto Exchange has made the
the world. " The Big Three" hold nearly 75% of the market and produce over 8
The stock market is a centralized area where buyers and sellers comes together to perform stock transaction. When one thinks of the stock market, the first thing comes to mind is Wall Street which is sometimes referred to as the New York Stock Exchange as well as the NYSE.
The coins made in gold, silver and bronze were traded during Roman Empire and the shortage of coins created a barrier for money circulation. However with the establishment of paper money, a sophisticated banking, global clearing system and electronic money, the global financial system evolved with a worldwide framework of legal agreements. In the Global Financial market, foreign currencies issued by the world, countries are traded by the buyers and sellers using currency exchange rates. Now a day, it is very common practices of companies in one country to raise capital in a foreign country by listing their stocks on major foreign exchanges given the growth of equity markets are becoming more globalized (SNHU, 2015).
In 1 year, completes about 550000 transactions, and serves 12000 customers across more than 140 countries.
Howells, Peter., Bain, Keith 2000, Financial Markets and Institutions, 3rd edn, Henry King Ltd., Great Britain.
of USD, it would need to put more weight in long futures contracts as much as they believe in by
Barclay’s group practices integrated global banking that which serves their clients and customers and also optimizing risk adjusted for their shareholder returns. In this case, it moves, protects and invests money for over 38 million customers and clients globally. This group is the third largest in the world in assets and in terms of financial provider provision all over the world with a core tier one ratio of 11 per cent (Barclays PLC SWOT Analysis, 2013). In the UK, it is the third largest on the market capitalization, with its headquarters at Churchill in London, England.
countries and has about forty million customers for today. In most of these countries it supports bank withdrawal service
Japan has one the most advanced economies in the world, with an advanced economy comes an advanced equity market. As other advanced equity markets are, the Japanese market is similar to the U.S. in its essential functions and its operation by the exchanges that allow its existence. The Japanese stock market is third largest in the world by market capitalization, surpassed only by the United States and China. Market participants trade over the Tokyo Stock Exchange and the Osaka Securities Exchange which combined to form the Japan Exchange Group (JPX) in 2013 (JPX.com). As of November 2015 there were 3500 companies listed as part of the JPX and over $400 billion dollars of shares traded in 2014 (World Federation of Exchanges).
The biggest stock exchanges are the New York Stock Exchange and NASDAQ. The New York Stock Exchange is a large building in Lower Manhattan that does auction-style trading with a lot of face to face interaction through specialists, brokers, and buyers. There are upper floors in this exchange on which specialists determine the prices of all the stocks. This information then travels to the brokers who work auctions face to face with buyers in order to sell the stocks. America’s biggest companies, like Coca-Cola and McDonald’s, sell their stocks through this exchange. NASDAQ is a virtual stock exchange with no physical building. This exchange was created during the 1970s but began thriving during the tech boom of the 1990s. The tech boom helped this exchange become the home of more technological companies li...
Mexican and Canadian markets appear strong economically and politically. In addition, Eastern European, Japanese, and Chinese markets will be logical markets in the near future.
According to the British think tank Z/Yen, London is the top-ranked center for global finance. According to another think tank, the Centre for Cities, London generates as much tax revenue as the next 37 largest cities in the United Kingdom. The tax alone on financial services in London is immense. The European Union combined has the highest GDP in the world (above that of the United States) (GDP SOURCE). One of the principal reasons for which London is the leading international finance center is its access to the European Union, the world 's largest economy. Obviously, the United Kingdom being a member of the European Union is enormously helpful to ease the operations of the incredible amount of financial services that happens between London and the European
The foreign exchange market is one of important mechanism in the international business because foreign exchange is an intermediary for all nations in term of the growth of the economy. There are many functions of foreign exchange market in the global economy. In the international business, it uses the foreign exchange markets in four ways. First, the pay...
Global cities are key command areas in the organization of the world economy, acting as a focus for trade flows and world finance and containing the principal marketplaces for the leading industries. These cities hold major corporate headquarters of TNCs, international banks and international division of labour (Macionis & Plummer 2012). Almost all of the world’s finance is controlled by twenty-five of these cities, with New York, London and Tokyo emerging as the three most powerful centres of world finance. But although these cities are the residences of large corporations and international systems of finance, they also have an increasing number of poor people. In Global cities, there is a sharp c...