CME Group to Close Most of Its Chicago Trading Pits Permanently – The Wall Street Journal

The exchange operator CME Group Inc. said it would permanently close most of its open-outcry trading pits in Chicago, ending one of the world’s last vestiges of old-fashioned floor trading.

CME said Tuesday that a number of trading pits that it closed temporarily in March 2020 to prevent the spread of Covid-19 wouldn’t be reopened. Many U.S. workplaces are coming back to life as the pandemic eases.

Some of the CME pits being shut down include pits for trading agricultural commodities, where traders had haggled over options on soybeans, wheat, cattle and hogs.

Floor trading for agricultural commodities has existed in Chicago since the mid-19th century and has long been part of the heritage of CME Group, which took its name from the Chicago Mercantile Exchange, now one of the company’s subsidiaries. The rise of electronic trading has made floor traders nearly irrelevant in most financial markets, and exchanges have been shutting down trading pits in Chicago and elsewhere during the past two decades.

The only part of CME’s trading floor that will remain open is the Eurodollar options pit, which the exchange operator reopened in August with social-distancing requirements and other measures to protect traders from the coronavirus. Eurodollars are a type of interest-rate contract and represent one of CME’s biggest marketplaces.