Xavier Rolet, the Frenchman who has run the London Stock Exchange for the past three years is cautiously optimistic that the eurozone crisis is about to play itself out and the single currency will survive.
“It’s always th e darkest hour when people are ready to capitulate. All the issues that are known in the eurozone are on the table,” he said.
“I believe that we will end up with a fiscal compact and a mutualisation of the eurozone’s risk.
“Politicians do understand that the exit of even a single member would put the entire thing at risk.”
Rolet said that a sensible solution would be “good news for the eurozone but even better news for Britain. It will also be a long time before politicians think again that they can use debt to fuel economic growth”.
He was speaking as the LSE announced a 30% rise in full-year operating profits to £442 million on revenues up 21% at £815 million. The dividend for the year goes up 6% to 28.3p a share.
Rolet said the better-than-expected results proved his strategy of diversification into areas such as technology, retail bonds and derivatives had helped to balance income when traditional share markets were weaker.
He is particularly pleased about the two acquisitions in the first half of FTSE International and 60% of the clearing house LCH.Clearnet. He said: “I’m not ecstatic about the macroeconomic environment. The eurozone is clearly creating headwinds. But we expect to make further progress in the year ahead.”
James Hamilton at broking firm Numis said: “While market volumes and terminal numbers are all expected to remain under pressure we expect continued good growth from FTSE and elevated treasury income. The LSE has repositioned itself in the recent past.”
He said he expects to raise his current price forecast of 1167p a share. Today those shares jumped 5% or 47.5p to 1012p. Barclays analysts have a price target of 1240p on them.
Read More
MORE ABOUT