The London Stock Exchange (LSE) yesterday became the latest company to suspend a share buyback programme and said that markets would remain “difficult and uncertain”.

The LSE’s suspension of its plans to buy back £500 million of shares comes after similar actions recently by Swiss Re, the reinsurer, and GlaxoSmithKline and AstraZeneca, the pharmaceutical groups. So far, the LSE has bought back less than £100 million of shares. Although its pretax profits rose 30 per cent to £127 million for the six months to September 30, the LSE predicted gloomier times ahead. Dame Clara Furse, chief executive of the LSE, said: “Activity on the exchange will continue to reflect more difficult and uncertain market conditions.”

The volume of shares traded on the market continued to grow, increasing by 33 per cent to 739,000 trades a day.

However, as the stock market plunged, the value of stocks traded declined by 2 per cent, compared with an average 12 per cent fall in the FTSE 100, over the same period last year. Rae Maile, analyst for Cazenove, said: “There is clearly . . . uncertainty, which must have an impact on what is perceived to be the appropriate multiple for the business.”

The LSE has been facing increasing competition to its near monopoly in share trading in London. In September, the American-owned Nasdaq OMX began trading. Turquoise, a trading platform owned by a consortium of investment banks, opened for business this month. Chi-X, ultimately owned by Nomura, the Japanese bank, began in March 2007.

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