That’s more like it: LSE shares are now down almost 10 per cent. I was amazed to see them only off 3 per cent or so earlier this morning after the story that major investment banks are clubbing together to create a rival to the exchange. If they pull this off it could be immensely significant.

What distinguishes this effort from others – remember Tradepoint and Jiway? – is that this time the users are right behind it. But why stop at equities? It is often said, even by the LSE, that if they were starting again the LSE would not limit itself to equities.

So, what about a more integrated platform including derivatives? The margins are good enough in cash equities but derivatives are where the really big money is. One problem with all of this: are there not huge conflict issues? Will the banks’ proprietary trading desks not have a much better view of flows than other investors? Arguably, this risk already exists but the new proposal might exacerbate it: now everybody would get to see what you’re up to and, as my colleague Emiliya Mychasuk says, diversifying your order book would become much harder. How galling, Chris Hughes points out, for Lehman Brothers and JP Morgan Cazenove not to be in the group of banks putting the new proposals together. Lehman, especially, has been making a huge push in equities. Must be because they are both advisers to the LSE. But what about Merrill Lynch, which also advises the LSE? The traders are clearly calling the shots round there.

This is not the only great story around today. Sir Martin Sorrell, chief executive of WPP, speaking at the Morgan Stanley TMT conference in Barcelona, has made some very interesting comments about ITV. I’m embargoed from telling you any more for now but Sorrell’s word counts: our man in the Hotel Arts says he controls about 25 per cent of the advertising expenditure on ITV. Stay tuned to for full details around 5pm London time. We will have more good stuff from the conference in the paper tomorrow.

And Sainsbury’s has produced some strong H1 results. Interesting, though, to see its margins are lower than Morrisons’. There seems to be quite a recovery taking place among some of the sector’s walking wounded, what with Asda saying yesterday it has increased sales as well. We expect some TNS market share data later, which should tell us more about who is losing ground. The other question is to what extent these rising sales are at the expense of margins, and whether Tesco will begin to come under pressure (I can hear Sir Terry Leahy droning already: “We feel under pressure every day and we know that our customers always have a choice of where to shop…”).

Scottish & Southern, which posted strong first-half profits today, has ruled out bidding for local rival Scottish Power, which already in Iberdrola’s sights. Not really a big surprise really but our energy editor Ed Crooks wants to do loads. “Bear in mind this is the most exciting takeover target as yet not bid for in the FTSE,” he says.

Some good news for Sir Tony O’Reilly: signs of recovery at Waterford Wedgewood (at long last). First half sales were flat (the world surely has enough dowdy china already) but costs are down very sharply.

Great H1 results from Land Securities, plus some good news about the pay-out after it becomes a Reit next year, and strong annual numbers also from Lonmin, which is riding the platinum boom and is buying a South African rival for $440m.

EMI’s figures, however, don’t look too strong at first glance and a lot hangs on Christmas.

Rumour of the day: RSA shares are up 2 per cent on talk of a bid from Aegon.

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