New | Chicago futures pits closing bell rings for last time

CME rang the closing bell on open-outcry futures markets on Monday after a few dozen Chicago traders donned their multicolored jackets to buy and sell soybean and Eurodollar futures the old-fashioned way one last time.

The world’s largest futures exchange operator ended most of its open-outcry futures operations in Chicago and New York without an extended review from US regulators, concluding a tradition that once epitomized global financial markets but succumbed to the efficiency and speed of machines.

The din of raucous shouting and frenzied hand gestures at CME’s cavernous Chicago Board of Trade and Chicago Mercantile Exchange floors has faded over the years, and made up only 1 per cent of total volume by this year. The exchanges’ more active options pits will remain open for now, although they too are losing ground to electronic dealing.

Veteran traders returned to the grain floor in Chicago to witness the end of 167 years of open-outcry trading in the city where it was born. Many drifted into the octagonal trading pits before the closing bell after initially sharing stories on the sidelines.

"It felt like saying goodbye to an old friend, someone who’d been with you most of your adult life," said John Pietrzak, a corn broker for more than 35 years. He was the last person out of the corn futures pit.

The CME shut the pits despite resistance from a small group of floor brokers and traders in Chicago, who argued the closures would hurt end-users in the Treasury and Eurodollar markets. Last month, they asked the US Commodity Futures Trading Commission (CFTC) to open a 90-day review of the plan.

The CFTC said on Monday it would not extend its review. The closures were not considered "novel or complex" and were adequately explained by the CME, an agency spokesman said.