Image caption Deutsche Boerse's chief executive said it was a "black day for Europe" following the decision

NYSE Euronext's proposed merger with Deutsche Boerse has been blocked by the EU on competition grounds.

The proposed deal would have created the world's largest stock exchange operator.

However, the European Commission blocked the deal because it said it would have created a "near monopoly" in European financial derivatives.

NYSE Euronext and Deutsche Boerse said they would now end the deal, which was announced in February last year.

"This is a black day for Europe and its global competitiveness on financial markets," said Deutsche Boerse chief executive Reto Francioni.

NYSE Euronext chairman Jan-Michiel Hessels said: "While we are disappointed and strongly disagree with the EU decision, which is based on a fundamentally different understanding of the derivatives market, it is now time to move on."

NYSE said it would now resume a $550m (£347m) share buy-back programme.

The European Commission said the planned tie-up would have controlled more than 90% of global trade in European financial derivatives.

"These markets are at the heart of the financial system and it is crucial for the whole European economy that they remain competitive," said EU Competition Commissioner Joaquin Almunia.

"We tried to find a solution, but the remedies offered fell far short of resolving the concerns."