While 84% of respondents at the forum believe the current proposals for liquidity calibration related to MiFID II pre- and post-trade transparency could be improved upon, nearly 100% of respondents believe calibrated transparency will ultimately be beneficial to the market. This is a sharp increase from last year where attendees were evenly split on the benefits of pre- and post-trade transparency.

MiFID II preparations remain on course
There was a reverse in participants' readiness for MiFID II, with nearly two thirds (62%) stating their preparations for implementation are proceeding as planned. Last year, 73% stated that they were holding off progress as the industry waited for the publication of the level-2 text, yet in contrast, only 38% stated this year they are delaying in order to see the outcomes of any possible further revisions.

Interestingly, a large majority (88%) voiced support for an equivalent regulation to MiFID II in the UK, should the country vote to leave the EU, due to the benefits of increased harmonisation outweighing the potential costs.

European corporate bond market conditions continue to be challenged
A total of 87% of participants indicated concerns that MiFID II will disrupt growth in European corporate bond markets, with a small subset (22%) voicing concern in a significant disruption to market growth. Furthermore, over three quarters (79%) believe that European fixed liquidity will either stay the same or deteriorate over the course of the next 18 months.

CSDR continues to challenge participants
The Central Securities Depositories Regulation (CSDR) continues to prove challenging to market participants, with only 3% stating that they were "very confident" in meeting the 100% settlement mandate and just over half (53%) stated that they were somewhat confident, which is consistent with responses to last year's survey.

Commenting on the results, Scott Eaton, Chief Operating Officer, MarketAxess Europe and Trax, said: "This year was the largest European Capital Markets Forum to date with over 260 institutional investors, dealers, regulators, trade bodies and media attending on the day to discuss the current and future challenges for European capital markets. It is encouraging to see such strong support for greater transparency in European fixed income markets but it's widely recognised that further calibration of the MiFID II liquidity rules is necessary. The survey echoed concerns from attendees towards the short term strength and depth of the European fixed income market as political and economic uncertainty continue to put pressure on the market. Our investor and dealer clients are increasingly demanding smarter trading technology and quality market data to help them approach the market."