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Irish airline Ryanair brought forward plans to pay its first dividend
since being floated in 1997 as it swung back to a full-year profit
ahead of most rivals and expected to grow earnings further this year.

Europe’s biggest low-cost carrier earlier said it could end its
no-dividend policy around 2013 when it will scale back growth, though
some analysts have thought the comment was a move in its bargaining
with Boeing over aircraft orders.

“People often listen to what
Ryanair says and say this is just palaver or putting it on,” Deputy
Chief Executive Michael Cawley told reporters.

“It’s probably
come a little bit sooner than others would have expected but
notwithstanding that, it’s here for real now,” he said of the dividend.

Ryanair expects to generate up to one billion euros of surplus cash by
the end of 2013, of which he would propose to pay 500 million in a
one-off dividend in October 2010 and possibly another 500 million later
as a dividend or share buyback.

Ryanair, which is vying with
Deutsche Lufthansa for the position of Europe’s biggest airline by
market value, has not paid dividends in the past but it has spent more
than 300 million euros on share buybacks in the past three years.

Ryanair, which last year posted its first loss in 20 years after
writing down the value of its stake in former takeover target Aer
Lingus, has posted an adjusted net profit of 319 million euros ($391m)
for the year to the end of March, before writing down another 13.5
million for Aer Lingus.

That compared with analysts expectation
for a net profit of 311.74 million euros according to the average of 18
forecasts and Ryanair’s own projection in April for at least 310
million euros in net profit.

Bookings not fantastic
Ryanair expects profit in the coming year to rise by between 10 and 15
percent excluding exceptional costs from disruptions caused by a
volcanic ash cloud which drifted over European airspace from Iceland.

It estimated the ash-related costs so far at about 50 million euros.

Cawley said forward bookings for the summer period, which generates a
big bulk of earnings, were looking “reasonable” but “not fantastic” and
he was not expecting the European economy to return to healthy growth
for at least six to 12 months.

Ryanair, which has some of the
industry’s lowest costs, has thrived in the recession, while legacy
carriers and weaker low-cost airlines struggled.

British
Airways posted a record full-year loss and its ambitions to break even
next year were seen threatened by strikes, which non-unionised Ryanair
has been immune from.

Cawley said however: “In a more long-term
scenario we’d prefer if the economy returned to some growth and demand
picked up. Ultimately we need people to travel and we need them to pay
fares.”

NATO Secretary General Anders Fogh Rasmussen has been quoted as saying economic growth was dependent on global security and that governments should be aware of this when cutting defence budgets.

Rasmussen said in an interview that pressure on governments to reduce budget deficits would undoubtedly lead to cutbacks in defence spending but urged NATO countries not to undermine security.

“All governments should be aware of the long-term impact of too deep cuts in defence budgets because we know from experience that economic growth is very much dependent on a secure international environment,” said Rasmussen.

“We know that instability and insecurity hamper economic growth. So if we make too deep cuts in defence budgets it might have a long-term negative impact on economic growth,” he said.

Rasmussen said it was important to ensure limited budgets concentrated on making armed forces capable of adapting to the demands of modern warfare.

“If cuts are made primarily within the more stationary parts of our military and if new investments are directed towards more flexible and more mobile and more modern armed forces, then budgetary constraints could be turned into something positive,” he said.

US Treasury Secretary Timothy Geithner told future Chinese leaders that the Obama Administration will cut its budget deficit once it is sure the economy is safely growing.

In a speech to about 30 middle-aged cadres at the Central Party School, Geithner said Washington is aiming to steadily lower its deficit as a percentage of national output.

“The basic strategy is to make sure that our economy is growing, then institute long-term reforms, and restore the basic discipline to the budget process that we abandoned in the previous decade,” Geithner said.

China, which holds some $895bn of US treasury debt, has previously expressed concern over the size of US deficits and the safety of Chinese investments.

Geithner, who heads for London after the conclusion of a two-day Strategic and Economic Dialogue with China, said leaders there were also coming to grips with their fiscal woes.

He expressed confidence that Europe would find a way to meet “the difficult challenge of trying to restore sustainability” to a budgeting process that was no longer working.

He suggested that the EU had set out a budget restraint program that failed to include a mechanism for dealing with imbalances between member countries.

“Europe’s leaders recognise that and now are acting forcefully to put strong reforms in place,” he said.

Geithner was at pains throughout the China visit to try to assure Chinese officials that budget discipline was coming back to the US.

“We went through a period in the US when it was popular to think that deficits don’t matter,” he said.

“Nobody thinks that today.”

Both China and the US share a responsibility to work toward balanced growth that will benefit the global economy, he said, adding that the US would hew to a line of stricter deficit control.

“We are committed to make sure that we will be a source of stability and growth in the future,” Geithner told the assembled students.

China struck a conciliatory note at the opening of talks with the US by vowing to spur domestic demand and keeping a guarded opening to exchange rate reform, which the Obama administration says is needed to rebalance the global economy.

The US treaded softly on the subject and welcomed Beijing’s long-standing pledge to reform the yuan as the two sides held their second Strategic and Economic Dialogue.

The one slight point of discord were US calls for a tougher line against North Korea over an alleged sinking of a South Korean warship, contrasting with China’s appeals for restraint.

The world’s biggest and third-biggest economies are seeking to steady relations after a burst of tensions early this year. While Chinese President Hu Jintao broke no new ground on the currency dispute that has divided them, he set an amicable tone for the two days of talks.

“China will continue to steadily advance reform of the renminbi exchange rate formation mechanism following the principles of being independent, controllable and gradual,” he said. The renminbi is another name for the yuan.

Hu said his government wanted to expand domestic demand to create more balanced growth, something that Washington – worried about its yawning trade deficit with China – has also advocated.

At the meeting, US Treasury Secretary Timothy Geithner appealed to Beijing to work together to reduce trade barriers and develop a more balanced global economy.

On the yuan, which has been effectively pegged to the dollar since the global financial crisis worsened in mid-2008, Geithner said the Chinese government was moving in the right direction.

“We welcome the fact that China’s leaders have recognised that reform of the exchange rate is an important part of their broader reform agenda,” he said.

Trying to press the case that yuan appreciation would be in China’s own interest, Geithner said that a more market-driven exchange rate would help suppress inflation while also driving private firms to move up the value chain.

Pressing North Korea
The vows of closer economic coordination were partly offset by Secretary of State Hillary Clinton’s effort to coax China into joining international pressure on North Korea after South Korea found it responsible for torpedoing its warship in late March, killing 46 sailors.

China is the sole major backer of North Korea, and has not publicly criticised Pyongyang over the alleged sinking, instead issuing broad calls for restraint. Earlier in May, China hosted the North’s leader, Kim Jong-il, on a visit.

“We must work together to address this challenge and advance our shared objectives for peace and stability on the Korean peninsula,” Clinton told the meeting.

Tensions flared between Beijing and Washington in the first months of 2010, when China denounced US criticism of its internet censorship, Washington’s arms sales to Taiwan, and President Obama’s meeting with the Dalai Lama, Tibet’s exiled leader.

Beijing considers Taiwan a part of its territory, and Hu said that it was important for countries to respect one another’s sovereignty.

Beijing officials have said they want only “quiet discussion” of US complaints that the Chinese currency is held too low in value, giving Chinese manufacturers an unfair advantage.

The Obama administration so far appears willing to go along in the hope that a quieter approach will give Beijing more political space to let its currency appreciate.

Zhang Xiaoqiang, vice chairman of the National Development and Reform Commission, told a news conference that the euro, not the yuan, had come up for discussion in the opening session of the dialogue.

“With uncertainties over the impact of the European sovereign debt crisis, we believe that we must be cautious about the choice of timing of exit strategies,” he told a news briefing.

The annual US trade deficit with China fell to $226.8bn in 2009 from a record $268bn in 2008. But the Obama administration is keen to lift exports, and the deficit remains a point of friction with Beijing.

US officials have sought to concentrate attention on policies they claim may unfairly impede US companies hunting for customers in China.

The Bank of Japan has outlined a loan scheme aimed at supporting growth industries and upgraded its assessment of the economy, but said Europe’s debt debacle needed watching for its impact on the global economy.

The eurozone’s struggle to limit the fallout from the Greek debt crisis and the yen’s ensuing rise against the euro clouded the outlook for Japan’s economy, which the BOJ described as “starting to recover moderately” even as the finance minister warned of the potential damage of sharp yen gains.

As widely expected, the central bank kept interest rates on hold at 0.1 percent and refrained from any new monetary easing steps.

“The BOJ is aware of what is going on in Europe, but they want to avoid giving unintended policy signals,” said Kyohei Morita, chief Japan economist at Barclays Capital.

“The new funding scheme isn’t a policy change. It is just a new system.”

Morita said this was the kind of step the government should be taking in fiscal policy, “but the government has budget constraints. I think the BOJ is working hard here”.

Analysts were also sceptical about how effective the new scheme would be and how it would work in practice, though they said it could help ease government pressure on the central bank for more action.

“At least the BOJ could keep away from political pressure while showing an attitude of working in tandem with the government to support growth ahead of the upper house election,” said Hirokata Kusaba, senior economist at Mizuho Research Institute, referring to elections expected in July.

Finance Minister Naoto Kan, who met Prime Minister Yukio Hatoyama to discuss the economy, said Hatoyama ordered him to monitor market conditions but the government was not considering any specific steps on the economy for now.

Worries about Europe’s financial woes pushed the euro to an eight year low against the yen on May 20, lifting the Japanese currency also sharply against the dollar.

Kan, asked after a cabinet meeting earlier whether more action should be taken globally to deal with sharp currency and stock market moves, said: “We expected the situation to calm down, but it hasn’t settled yet. But I don’t think we need to do anything additional now.”

Kan also said there were no plans so for the Group of Seven finance ministers to discuss the situation in a conference call this weekend, the way they did two weeks ago.

He added, however, that it was undesirable for the yen to rise too much. “A close watch is needed so that yen rises do not become excessive,” he said before meeting the prime minister.

Yen gains threaten to undermine economic recovery by eating into exporters’ profits and prolonging deflation by pushing down the costs of imports.

But with the direct impact of Europe’s woes on Japan limited so far, the central bank is expected to avoid easing monetary policy further for now.

Taking the view that flooding markets with cash alone would not help overcome deflation, the BOJ said in April that it would consider a new framework to redirect money to industries with potential new demand.

Under the new loan scheme, the BOJ will offer private banks fixed-rate loans at 0.1 percent with maturity of one year that can be rolled over if necessary.

Applicants of the programme will submit a plan on how they plan to “strengthen the foundations for Japan’s economic growth” through their lending. The BOJ will assess the plan in deciding how much loans it will extend to the applicants.

The BOJ has said monetary easing was not the aim of a plan that focuses on specific borrowers. But analysts are doubtful how much the scheme can boost lending and support the economy saying the problem lies in weak demand for credit, not a lack of funds.

Bank lending matched the biggest annual decline in four years in April, showing just how limp fund demand has been.

Japan’s economy posted its fastest growth in three quarters in the first three months of this year, outpacing its eurozone and US peers on solid exports to Asia.

But analysts expect growth to slow ahead and keep Japan stuck in grinding deflation for at least another year, prompting firms and consumers to delay spending.

Kenya expects economic growth to accelerate to between four and five percent this year, helped by the likely recovery of the global economy and as favourable weather conditions boost agriculture, its planning minister says.

East Africa’s biggest economy expanded by 2.6 percent in 2009, up from a revised 1.6 percent in 2008, the government said, supported by growth in tourism, construction and communications, and fiscal and monetary stimulus measures.

Last year’s growth, however, was still well below the seven percent expansion recorded in 2007 before a bloody post-election crisis, drought and the fallout from the global financial crisis cut output sharply.

“The domestic economy is expected to continue on a recovery path in 2010 with real GDP projected to grow by a rate at between four and five percent,” Planning Minister Wycliffe Oparanya said.

The government would continue to focus on infrastructure and agriculture to sustain growth. The authorities would also seek to cut energy costs and curb dumping of cheap imports to help the manufacturing sector, he said.

Last year’s growth and the projection for this year were in line with analysts’ forecasts.

“The 2.6 percent growth outcome for 2009 is in line with leading indicators … with better rains around the turn of the year, the outlook for staple crops is far brighter and on this basis we think the 2010 projection of four to five percent growth is realistic,” said Richard Segal, director of emerging market research at Knight Libertas.

“Moreover, with elections looming on the horizon again, we expect public spending to pick up later this year.”

Referendum due
Kenya is due to hold a referendum on August 4 on a proposed new constitution, which is seen as an important step towards ensuring that political instability associated with elections does not recur.

“We are all looking forward to a new constitution. This will renew investor confidence and we are very optimistic that the economy will grow,” Oparanya told reporters.

An expanded regional market after Kenya joined neighbours Burundi, Rwanda, Uganda and Tanzania in a common market last year would also help drive economic growth, he said.

One economist said Kenya’s growth rate, though better than some of its peers, still fell short in certain measures, and the debt crisis in the eurozone could cloud the outlook if it spread further.

“We are doing better than most African countries with a big GDP but the sad thing is the growth rate is still below that of population growth, it means people will get poorer,” said Prof. Michael Chege, a Nairobi economist.

The population grew by 2.9 percent last year, above economic growth of 2.6 percent, he said.

“If you look at what is happening in Europe now – this is our largest international market for both tourism and agricultural goods – there is cause for worry.”

Most analysts, however, believe that domestic demand is strong enough to offset external risk.

“Concerns over the global economy and the EU in particular may cloud growth forecasts, but domestic demand has been a strong driver of growth, which should provide some insulation to the international environment,” said Stuart Culverhouse, head of research at Exotix, a London-based frontier market specialist.

ICAP, the world’s biggest interdealer broker, reported a good start to its financial year, helped by active and volatile markets, when posting a better than expected five percent drop in full-year pretax profit.

Concerns about Greece and other peripheral European sovereign debt and a 750 million euro rescue package have led to wide swings in over-the-counter currency, interest rate and credit markets. That volatility boosts trading volumes and drives growth in interdealer broking.

ICAP’s adjusted pretax profit fell to £333m for the year to end-March on revenue up one percent to 1.61 billion. That compared with consensus forecasts of £303m on revenue of 1.62 billion, according to reports.

The broker, which had aggressively added businesses in new markets, services and geographic areas, issued a profit warning in February due to losses at three new operations – equities, shipbroking and Brazil.

“We have learned some valuable lessons this past year,” chief executive Michael Spencer said. “We will concentrate this year on growing our business organically.”

In March, ICAP said it would chop the cash equities full-service business, axing up to 114 jobs. In mid-May it reported post-tax losses of £18m and exceptional costs of £46m for closing it.

The company said its Brazilian business continued to expand and had become its third-largest wholly owned office with more than 250 staff, although it showed an operating loss.

The market for its ship-broking business contracted sharply, and ICAP made a small operating loss.

New businesses accounted for an operating loss of £11m, versus a profit of £7m in 2008-09.

ICAP said its share of the interdealer market grew to 22-24 percent as overall industry revenue fell 12 percent in the year, and it aimed to increase that share to 35 percent.

Electronic broking contributed 48 percent of operating profit. ICAP said regulatory and political pressure for more electronic trading and transparency in the OTC markets should help drive growth.

“We have already successfully launched electronic trading of credit derivatives in the US earlier this year and also expect to launch electronic trading of interest rate derivatives in 2010,” the statement said.

A weak pound also added to revenue and operating profit.

The company said it took a charge of £21m for settling a Securities and Exchange industry-wide investigation of fixed income markets.

Japan’s Nikkei average fell 2.2 percent to a 10-week closing low on May 17 as the euro’s tumble to a four-year trough chilled investor sentiment and fanned worries that the eurozone’s fiscal woes could slow global economic growth.

Exporters such as Canon Inc were hit as the yen advanced, while trading houses were hurt by a fall in metals prices and China-linked shares such as Komatsu by a drop in Shanghai stocks.

Astellas Pharma pared losses and briefly turned positive after Japan’s number two drugmaker agreed to buy US biotech OSI Pharma for $4bn in cash that allows it to add OSI’s blockbuster cancer drug Tarceve to its line-up.

The euro marked a four-year low against the greenback earlier as investors worried that harsh spending cuts mandated by a bailout plan may choke off a fragile recovery in the 16-country eurozone.

“Fundamentally, the worry is really that the fiscal situation in the southern European states will hit the European economy, and then the global economy,” said Takashi Ushio, head of the investment strategy division at Marusan Securities.

“This would affect exporters not only in Japan but also China, raising fears that Chinese economic growth could cool too.”

 The benchmark Nikkei slipped 226.75 points to 10,235.76 after briefly falling nearly three percent to as low as 10,158.30, its lowest since early March. The broader Topix fell 1.7 percent to 920.43.

The Nikkei fell below its 200-day moving average, currently around 10,350, for the first time in over a week, with the next target at 10,000, a key level of psychological support.

Market players said that while a 61.8 percent retracement of the Nikkei’s rise from a Nov. 27 2009 low of 9,076.41 to its 18-month high of 11,408.17 on April 5 comes in at around 9,960, this is a far less significant support than the Nikkei’s 2010 low of 9,867.39 on February 9.

“There’s a lot of nervousness still about the tough fiscal situation in the eurozone, and while Japanese earnings were good there’s a lot of uncertainty about what lies ahead over the next year, especially given the stronger yen,” said Hiroichi Nishi, general manager at the equity division of Nikko Cordial Securities.

The dollar fell 0.4 percent to just over 92 yen and the euro lost 0.7 percent against the Japanese currency, although both were off earlier lows. Investors fret about a stronger yen because it eats into exporter profits when repatriated.

Canon Inc lost 1.7 percent to 3,975 yen, Sony Corp fell 4.5 percent to 2,817 yen and chip tester maker Advantest Corp lost 4.1 percent to 2,193 yen.

Shanghai weighs
Market players said additional downward pressure came from steeper falls in many Asian share markets, with Shanghai down 4.3 percent and the MSCI Asia ex-Japan index down 3.6 percent.

“This is also putting a real chill into investor sentiment,” said Noritsugu Hirakawa, a strategist at Okasan Securities.

China-linked shares suffered, with Komatsu, the world’s second-largest maker of earthmoving equipment, down 2.2 percent to 1,678 yen after earlier falling as far as 1,667 yen – its lowest since last November. Hitachi Construction fell 3.3 percent to 1,791 yen.

Metals prices extended losses as fears over Europe’s debt crisis drove investors out of risky assets, with trading houses suffering in turn.

Mitsubishi Corp, Japan’s largest trading house, lost 3.4 percent to 2,063 yen and Itochu Corp fell 3.6 percent to 777 yen. Mitsui & Co shed 3.6 percent to 1,318 yen.

But there were a handful of gainers, mostly so-called “defensive” shares such as utilities.

NTT jumped 3.5 percent to 3,855 yen after Japan’s largest telecom firm said it would cancel all of its 251 million treasury shares, or about 16 percent of shares outstanding, over two years.

Trade was moderate, with 2.6 billion shares changing hands on the Tokyo exchange’s first section. Declining shares outnumbered advancing ones by more than 7 to 1.

Donor countries have pledged a record $4.25bn over the next four years for the Global Environment Facility, the world’s largest public green fund that helps developing countries tackle climate change.

The commitments by 30 donor countries during a session in Paris is a 52 percent increase in new resources for the facility.

GEF Chief Executive Monique Barbut said the replenishment of funds is the first “tangible confirmation of financial commitments” made during international climate talks in Copenhagen in December.

In Copenhagen, negotiators from industrialised and emerging nations sought to agree on the basic terms of a new global climate agreement in the run-up to the next summit in Cancun, Mexico in December.

Part of the agreement was aimed at providing financing to developing countries to help them adapt to climate changes. Some of those funds will be directed through the GEF into projects implemented by UN agencies and development institutions like the World Bank.

Barbut said about $1.35bn of the new funds would be directed at tackling climate change.

The rest will be used to better manage and expand protected and endangered areas, improve the management of trans-boundary water systems, reduce pollutants in land and water, and expanding and protecting the world’s forests.

The new funds are a “testimony to the international donor community’s commitment to the environmental agenda,” said Axel van Trotsenburg, the vice president for concessional finance and global partnerships at the World Bank.

British climate change expert Nicholas Stern, speaking at the IMF, called on world leaders to reach a political agreement on climate change at Cancun in order to lay the foundation for an international treaty in 2011.

He said the agreement should set out how $30bn in climate financing will be provided to developing nations over the next three years to adapt to climate change.

It should also indicate how this initial support will be increased to $100bn a year by 2020, in particular by introducing new and innovative sources of funding.

The GEF has been replenished four times since its inception in 1991 starting with $2.02bn in 1994, $2.75bn in 1998, $2.92bn in 2002 and $3.13bn in 2006.

To date, the facility has provided $8.7bn in grants for more than 2,400 environmental projects in over 165 developing countries and emerging economies.

Annualised inflation in Ghana fell to 11.66 percent in April from 13.32 percent in March, the statistics office has announced, a greater than expected drop that offers hope for further rate cuts later this year.

The drop is the 10th consecutive fall, takes inflation to its lowest level since December 2007 and is another step towards the West African nation’s single digit target by the end of the year.

“That is some decline … and even though we expect that we might reach the lower turning point of inflation around the mid-year, this should provide ample opportunity still for the Bank of Ghana to cut interest rates,” said analyst Razia Khan at Standard Chartered.

In May, the Bank of Ghana lowered its prime rate by 100 basis points to 15 percent, feeding expectation of at least another rate cut this year as long as inflation maintains its downward path.

“Another 100 bps off the prime rate in June has always looked more or less certain … but this latest inflation print opens up the possibility that the easing cycle might be extended,” Khan said.

“However, an important factor countering this would be growing evidence of pressure on the fiscal deficit relative to budget plans,” she said, referring to the need for budget cuts due to the repayment of arrears.

Ghana, one of the few sub-Saharan countries with a Eurobond, expects its first oil revenues from offshore finds by the end of the year, and some analysts expect growth to more than double to 15 percent in 2011.

US market watchdogs and six major exchanges have agreed that new safeguards were needed to curb trading when markets are plunging, including circuit breakers for individual stocks, a source familiar with regulators’ talks said on May 10.

Securities and Exchange Commission Chairman Mary Schapiro, the leaders of major stock and option exchanges, and broker-dealer watchdog, the Financial Industry Regulatory Authority, met in Washington to discuss the causes of the market free fall on May 6 and possible reforms.

“As a first step, the parties agreed on a structural framework, to be refined over the next day, for strengthening circuit breakers and handling erroneous trades,” Schapiro said in a statement.

The SEC did not provide details on what the fixes would look like.

A source familiar with regulators’ talks said they have still not pinpointed the exact cause of the 20-minute market roller coaster, when stocks usually regarded as safe dropped precipitously for several minutes before recovering most of their losses.

Despite not knowing the cause, regulators have reached a general agreement on a three-part revamp of market safety valves, including a circuit breaker that applies across markets if individual stocks fall precipitously.

The agreement also covers the need for clear rules on dealing with erroneous trades, and on the need to update existing market-wide circuit breakers for severe market declines, the source said. The source spoke on condition of anonymity because the talks are private.

Currently, if the market falls more than 10 percent in a day before 2pm local time, a circuit breaker is triggered and shuts the market down for one hour. If the market falls more than 20 percent after 2.30pm, a circuit breaker is triggered, shutting down the market for the rest of the day.

Both the Dow Jones Industrial Average and Standard & Poor’s 500 Index never reached the crucial trigger point on May 6. The Dow fell as much as 9.2 percent and the S&P was off as much as 8.6 percent during the latter half of the trading day.

Schapiro held a two-hour meeting with the leaders of the New York Stock Exchange, the Nasdaq Stock Market, BATS, Direct Edge, the International Securities Exchange and Chicago Board Options Exchange.

NYSE Euronext Chief Executive Duncan Niederauer, Finra CEO Richard Ketchum and others told reporters afterward that the discussions were constructive, without providing  details.

The exchange heads also met at the Treasury Department with Treasury Secretary Timothy Geithner, along with Schapiro and Commodity Futures Trading Commission Chairman Gary Gensler.

Continuing to gather data
Four days after the market plunge and quick rebound, regulators are still scrambling for answers. The Dow Jones Industrial Average briefly went into a 1,000-point tailspin on May 6, rattling investors worldwide.

But a massive $1trn rescue package to safeguard indebted European nations cheered investors on the day of the meeting, with US stocks racking up their best one-day gain in over a year.

The CBOE VIX volatility index, known as Wall Street’s fear gauge, fell 29.6 percent – the largest percentage drop in its history – to end at 28.84 after leaping to its highest level in more than a year on May 7.

One prevailing theory is that the sharp fragmentation of the US stock marketplace and the accompanying patchwork of circuit breakers and safeguards exacerbated the market swoon.

That fragmentation is also slowing down regulators’ ability to piece together what happened, two sources familiar with the matter said.

The SEC continues to aggregate data from the 50 electronic trading venues, one source said, suggesting the fragmentation is hampering the ongoing investigation.

Senator Charles Schumer, a Democrat from New York, called for new systemwide circuit breakers that would put the brakes on free-falling individual stocks when a circuit breaker on one of the major exchanges is triggered.

NYSE curbs as template?
The NYSE introduced a trading curb on its floor May 6 that forced most trading to all-electronic exchanges such as the Nasdaq Stock Market and NYSE Euronext’s electronic Arca venue, which did not have similar curbs – a lack of uniformity seen as having worsened the wider market’s drop.

Now, regulators and the industry appear to be eyeing something like NYSE’s system as a template for the whole marketplace.

Trading speeds and volumes have ramped up over the last decade as regulators encouraged the proliferation of new trading venues to challenge the NYSE’s and Nasdaq’s near monopoly.

About five years ago, the NYSE executed more than 80 percent of trading in its listed securities. Now, parent company NYSE Euronext executes about 34 percent.

The SEC recently raised some red flags about the fragmented marketplace, proposing rules late last year that would shine more light on so-called dark pools, which are alternative trading venues that keep investors’ intentions anonymous.