Major U.S. stock exchanges are preparing to release their latest earnings reports this week, with trading volumes getting a lift from recent market turbulence — but analysts say regulatory uncertainty and new competition could overshadow those gains.
A combination of factors has fueled a surge in trading activity, including the U.S.-Iran conflict, an unclear interest rate outlook, and shifting investor sentiment around artificial intelligence. That volatility has pushed traders to reposition their portfolios, driving up volume across the exchanges. A rebound in IPO activity is also expected to provide a boost to Nasdaq and Intercontinental Exchange, the parent company of the NYSE.
Despite those tailwinds, the sector faces growing unease over a recent decision by the Commodity Futures Trading Commission to allow Kalshi and Coinbase to offer perpetual futures contracts for cryptocurrencies — a move seen as a potential threat to the established exchanges’ market share. Perpetual futures, sometimes called “perps,” are contracts with no expiration date that track the price of an underlying asset and typically allow traders to take on high levels of leverage.
The regulatory shift has taken a toll on exchange stocks. Three of the four major exchange companies have seen their share prices fall so far this year — Nasdaq, CME, and ICE have dropped between 5.4% and 12.6% — while Cboe has bucked the trend with a gain of roughly 11%.
“The majority of the multiple compression year to date has come from a combination of a shift in regulatory posture and the perceived threat of perpetual futures,” Piper Sandler analyst Patrick Moley told Reuters.
The CFTC’s move has raised broader questions about whether the regulator, which has historically taken a cautious approach, is signaling a more permissive stance going forward. Analysts have largely ruled out a major industry shakeout, but they acknowledge the uncertainty is real.
“It seems like the CFTC is open to things that in the past they might have been slower to move on,” said Barclays analyst Benjamin Budish.
Exchange executives are expected to face pointed questions during their earnings calls about the regulatory environment, trading volume trends, and whether the current capital markets momentum is sustainable.
“We expect a lot of questions on the competitive risks from perpetual futures and other new products being launched. Investors are interested in how the products differ, what customers they appeal to, and how the incumbent exchanges may react to new competition,” said Alex Kramm, an analyst at UBS.
Still, analysts note that perpetual futures have seen limited uptake among large institutional investors, which they say provides some insulation for the traditional exchanges.
“It’s just like this big question: here’s this new product and what’s going to happen? Is it disruptive? Will institutions want to trade? I think the answer is no,” Budish said.
As for the earnings themselves, analysts are forecasting a mixed quarter. Last year’s results were boosted by the extreme market swings triggered by the Trump administration’s “Liberation Day” tariff announcements, making for tough year-over-year comparisons.
“We expect results to be more mixed on a year-over-year basis as trading businesses faced tough comps… Non-transaction-driven business lines, such as market data, should remain strong,” Kramm said.
CME is the first to report, with its results expected Wednesday. Analysts surveyed by LSEG anticipate a slight decline in both revenue and profit compared to a year ago. Nasdaq is scheduled to follow on Thursday and is projected to post record quarterly revenue and profit, driven in part by high-profile listings including SpaceX’s record-breaking IPO and strong demand for its data services. Cboe and ICE are slated to report the following week and are both expected to show higher revenue and profit, supported by strong trading volumes and demand for proprietary data.
