NEW YORK — For more than 200 years, the New York Stock Exchange has been the symbol of American capitalism.
Now, it's poised to go global.
The exchange's parent company is nearing completion of a $14-billion deal to buy Euronext, an Amsterdam-based company that runs securities markets in five European capitals.
The combination would create the first transatlantic stock market and could become the model for future mergers with stock markets in Asia and around the planet -- a reflection of the seismic forces that are reshaping financial markets.
"It's evolving into a one-world market," said John Steele Gordon, an author and stock market historian. "There's not going to be a U.S., a British or a Japanese market. It's just going to be 'the market.' "
An overriding goal of the merger is to make it easier -- and potentially cheaper -- for investors to buy and sell stocks and other securities on the NYSE and on Euronext's markets in Belgium, Britain, France, the Netherlands and Portugal.
The exchanges plan to have a single electronic stock-trading platform within three years. The details have not yet been worked out, and regulatory and logistical hurdles could arise. But market watchers say the single platform is the inevitable next step for a financial world transformed by the spread of capitalism and the rise of instantaneous electronic trading.
For small investors, the change could reduce trading costs and, eventually, allow easy buying and selling of stocks around the globe. Although many large foreign companies now trade on the NYSE through securities known as American depositary receipts, many others -- such as cosmetics maker L'Oreal and fashion designer Christian Dior -- are either thinly traded in the U.S. over-the-counter market or not available at all.
Better gains abroad
The merger comes at a time when Americans have a voracious appetite for foreign stocks, with many overseas markets posting far better gains than the U.S. market in recent years.
In the first 10 months of 2006, U.S. investors pumped a net $124 billion of fresh cash into foreign-stock mutual funds, nearly 10 times the $13 billion they stowed in domestic funds.
By moving to meet this demand, the NYSE is continuing the watershed transformation it began two years ago when it started laying plans to abandon its ownership by seat holders.
The NYSE changed in March from essentially a members-only club to a publicly traded company. And it has ramped up electronic transactions despite the threat to the exchange's iconic trading floor, where hundreds of traders swap stocks in a raucous daily symphony.
The Big Board's next major step is the acquisition of Euronext, itself the product of a 2000 merger. The company runs stock markets in Paris, Amsterdam, Brussels and Lisbon and a fast-growing futures exchange in London.
Well-known global names that trade on Euronext's exchanges include oil titan Royal Dutch Shell, consumer electronics giant Philips and tire maker Michelin.
In part, the NYSE is simply following the lead of many of its listed multinational companies, such as General Electric Co. and PepsiCo Inc., which have invested heavily in foreign operations.
After Europe, the NYSE hopes to move quickly into Asia, said John Thain, chief executive of the exchange's parent company, NYSE Group Inc.
"Globalization is both good and inevitable," Thain said during an interview in his sixth-floor exchange office in the heart of New York's financial district. "In some ways we're lagging behind what has already happened in the marketplaces themselves. The marketplaces are already global."
After a months-long process aimed at gaining European regulators' approval, Euronext shareholders will vote on the deal Tuesday. NYSE shareholders will cast their votes Wednesday.
Though the deal is billed as a merger of equals -- in part to assuage European feelings -- NYSE Group is technically planning to buy Euronext, and Thain would run the new NYSE Euronext Inc.
Seeking global reach
The combined organization would be massive. The stock value of the companies listed on both markets is $27 trillion, or twice the size of the U.S. economy. The two markets trade about $100 billion worth of stocks and other securities each day.
For Euronext, combining with the NYSE would give European companies greater visibility among U.S. investors, said Jean-Francois Theodore, chief executive of Euronext.
The deal proceeded slowly because European regulators wanted assurances that stringent U.S. securities rules would not be extended to the continent's companies. European authorities have now given their tentative approval to the deal.
"It will be very positive for Euronext issuers and members," Theodore said. "This is a big step toward the globalization of the stock-exchange business."
Within a few years, experts predict, the result will be a handful of gigantic exchanges trading across the globe 24 hours a day.
