Reuters has unveiled plans to add fixed income trading functionality to its 3000 Xtra and Trader desktop products in a bid to compete against rivals Bloomberg and Thomson Financial in the bond markets.
Reuters says the new fixed income trading functionality will be available over 372,000 desktops in the first quarter of 2005, and will provide users with real-time, executable prices from more than 12,000 fixed income securities across 21 currencies.
ABN Amro, Deutsche Bank, Dresdner Kleinwort Wasserstein, Goldman Sachs, JPMorgan, Rabobank, RBC Capital Markets and UBS have agreed to join the platform, with other banks to be added during the course of 2005.
Jon Robson, EVP and global head of focus group accounts, Reuters, says: "There is increasing market demand for efficient fixed income trading and Reuters is opening up the full reach of its unique distribution to enable capital markets participants to interact and execute trades across our global network."
Trading functionality on Reuters terminals has so far been restricted to foreign exchange and equities. The move into fixed income brings the company into direct competition with rival Bloomberg, which has an established bond dealing platform. Competition between the two companies remains fierce, particularly after Bloomberg moved into Retuers territory last year when it launched an electronic foreign exchange dealing system with bank-backed network EBS.
Furthermore, Thomson Financial - another Reuters rival - acquired online fixed income trading network TradeWeb in April this year.
Reuter's fixed income trading initiative, along with plans to extend trading capabililties for foreign exchange and equities trading, follow extensive cost cuts at Reuters, implemented under CEO Tom Glocer's Fast Forward plan which was introduced in February 2003 when the group reported its biggest ever loss.
Today's announcement follow rumours that electronic brokerage Instinet, in which Reuters has a 67% stake, is up for sale. According to a report by The New York Times, Instinet has retained UBS for an auction which is expected to fetch more than $2 billion.
Reuters has hived off and sold stakes in a number of businesses under its cost cutting plans, including Tibco Software. The group recently confirmed it was selling off the Radianz network to UK telco BT.