The Nasdaq stock market is to begin "a quick, orderly and friendly process" to explore an alliance with the London Stock Exchange (LSE).

Mr John Hilley, chairman of Nasdaq International, said yesterday "a window of opportunity has just reopened" after the failure last week of a hostile bid for the LSE by Sweden's OM Group.

His remarks confirm that Nasdaq, the world's second largest stock market, is intent on exploring a deal as the basis of a broader European strategy. "It makes profound business logic for the LSE and Nasdaq to do a deal," Mr Hilley said. Nasdaq is also in talks with Deutsche Borse, Euronext and other European exchanges that could lead to the formation of a pan-European trading platform.