Interesting contrast last week where the LSE’s market share of the FTSE 100 fell definitively below 50% whilst at the same time BME’s market share in the IBEX 35 remained stubbornly close to 100%.

Both markets are in Europe – check. Both are subject to the MiFID directive – check. Both have significant levels of liquidity – check. So what is going on?

The difference was highlighted at a Fidessa seminar in Madrid last week that brought together key participants from Spain’s equity markets to try and understand why the fragmentation dial in Spain just refuses to budge. The reason most often trotted out is that all Spanish trades still have to be “put through” the BME, although the introduction of Title V removes this requirement.

Chi-X certainly is gunning for Spain and has introduced a price promotion on 6 key Spanish stocks. Will this be enough to turn the tide? Perhaps, but as in other countries Spain will need the active participation of the high frequency liquidity providers too, and I haven’t seen too many of them getting their Spanish phrase books out just yet. The other issue, though, is that assuming Spain does follow the pattern of other countries, then it’s likely that BATS, Chi-X and Turquoise will be the winners and that may not necessarily be good for Spain plc. This fact, combined with the intertwined relationships that surround the BME and its key trading members, means that Spain may remain an anomaly for a while yet.