Europe dreams of a global exchange

SP500

Key zone: 7,550 - 7,650

Buy: 7,650 (on strong positive fundamentals); target 7,750-7,800; StopLoss 7,580

Sell: 7,500 (on a decisive break above 7,550); target 7,300--7,350; StopLoss 7,570

Europe wants to keep capital at home, but a merger alone is not enough to compete with the U.S. A potential combination of Euronext and Deutsche Börse could create the largest pan-European market infrastructure. But for now, it is only an idea, while Europe’s gap with the U.S. in terms of capital market depth remains systemic.

The EU is once again discussing a project that could change the architecture of its stock market: a combination of Euronext and Deutsche Börse. The idea is not new, but it has now gained additional economic and political momentum — the EU is trying to reduce capital market fragmentation and stop the migration of major listings to the U.S.

At the same time, it is important not to confuse statements about a potential deal with actual negotiations. As of September 17, 2026, there are no negotiations between the companies.

A reminder:

The scale of a potential combination is indeed significant. Euronext operates in eight European countries, including France, the Netherlands, and Italy, and its market capitalization is estimated at approximately €16 billion. Deutsche Börse, valued at around €50 billion, controls the Frankfurt Stock Exchange and Eurex — one of the world’s largest derivatives platforms. Europe is losing to the U.S. not because of the number of exchanges, but because of the scale of capital.

The problem is that the capital market remains fragmented among national jurisdictions, regulators, and infrastructures.

In 2024, the combined capitalization of EU stock markets amounted to around 73% of the region’s GDP. In the U.S., this figure reached 270%. Moreover, the U.S. share of global free-float market capitalization exceeded 60% by the beginning of 2025, compared with around 40% after the global financial crisis.

This is not just a statistical gap. The deeper the market, the more capital it can absorb, the higher the liquidity, and the lower the cost of large transactions.

The U.S. Nasdaq and NYSE concentrate an enormous base of issuers, institutional investors, and global capital. The European system is structured differently: companies and investors operate through numerous national markets, limiting economies of scale.

The ECB points out that U.S. stock markets already benefit from greater integration, deeper liquidity, a broader base of institutional investors, and a strong technology sector. Since 2019, the number of companies on Nasdaq and NYSE has also grown faster than on the largest European exchange groups.

This is no longer a question of listing convenience. It is a question of the market’s ability to generate high company valuations. IPOs go where there is market depth. The problem is most acute in the technology sector.

The ECB has highlighted several notable examples: Britain’s Arm chose a direct listing on the U.S. market in 2023, while CRH, Linde, Flutter Entertainment, and other companies abandoned European exchanges or moved their listings to the U.S.

The most severe manifestation of the problem is the primary market. IPOs go where there is market depth.

A potential combination would connect the German market with Euronext’s infrastructure and provide broader access to investors in France, Italy, the Netherlands, and other countries where the group operates.

Over the past decade, the U.S. has conducted more than three times as many IPOs as the EU: an average of around 360 versus 107 offerings per year.

For technology companies, the difference is particularly important. The ECB has cited specific examples of European outflows: Arm chose the U.S. for its IPO in 2023, while CRH, Linde, Flutter Entertainment, and several other companies moved their listings from European exchanges or opted against a European listing.

What a Combination of Euronext and Deutsche Börse Would Deliver

The economic rationale for the potential deal lies in scale. Today, a European issuer enters a market that is formally unified but in practice remains divided by national rules, infrastructures, and investment flows. For example, Euronext has already created an integrated system across several countries, but Germany — the EU’s largest economy — remains outside this structure.

A combination with Deutsche Börse would connect the German market with Euronext’s infrastructure and expand issuers’ and investors’ access to cross-border capital. For a German company, this would mean potential access to investors in France, Italy, the Netherlands, and other countries where Euronext operates.

The market is already pricing in a consolidation premium: share price performance shows that investors view the very possibility of a deal as a source of additional value.

Euronext and Deutsche Börse gained around 2% on September 14, while both companies have risen by approximately 26% since the beginning of the year. At the same time, London Stock Exchange Group shares rose by 3.8%, also reflecting a reassessment of the prospects for European exchange consolidation.

If no concrete details emerge, part of the speculative premium may be unwound. One exchange is not enough to catch up with the U.S.

And What Is the Result?

A potential combination of Euronext and Deutsche Börse could indeed create a world-class European exchange infrastructure. But it would not yet be a European competitor to Nasdaq and NYSE.

The main value of the deal lies elsewhere: it could eliminate part of the infrastructure fragmentation and increase market depth. If the combination helps attract more IPOs, increase liquidity, and expand cross-border capital flows, it will become one of the elements of a large-scale restructuring of the European market.

The question is whether Europe can finally create a sufficiently deep single capital market so that it becomes economically more attractive for European companies to raise money within the region rather than seek liquidity and valuations across the Atlantic.

So we act wisely and avoid unnecessary risks.

Profits to y’all!