Bolsas y Mercados Españoles (BME) is trying to throw a lifeline to the Spanish stock market. According to sources consulted by elEconomista, BME has asked the Spanish Futures and Financials Market (MEFF following the Spanish abbreviation) "to allow deals that use futures contracts on Spanish treasury bonds." In hopes that the idea will be approved, MEFF members will prepare a trial period starting March 1 in order to determine how the futures contract deals will be executed.
If the supervisor grants approval, then the futures contracts will be listed on MEFF in the same section as futures and options for the Ibex 35 and individual stocks. Everyone in this section, called the Financial Derivative Contract Group, will have access to these new products.
Old times not forgotten, but recalled
With this initiative, MEFF will recall the beginnings of the futures market in Spain. This market was conceived by when the first futures contracts on national debt were developed in the early 1990s. After a period during which futures contracts equaled more than 80% of the deals involving Spanish debt, activity halted as yields on treasuries in other European nations balanced out and investors looked toward futures contracts for the strengthening German bund.
