Hits & Takes
John Lothian & JLN Staff
Prometheum announced it will offer custody services for Ethereum’s ether (ETH) token. Once live, ETH can be custodied at Prometheum Capital, which is subject to U.S. federal securities laws, marking the first time ETH will be custodied at a FINRA member firm and an SEC-registered broker-dealer. Additionally, Prometheum’s signup process is now active for institutional clients including asset management firms, hedge funds, registered investment advisors (RIAs), banks, and other financial institutions, in anticipation of the platform’s custodial services launch in the first quarter of 2024.
Thinking Crypto interviewed Prometheum Co-CEO and Co-Founder Aaron Kaplan in a podcast titled “Prometheum’s Ethereum Custody Launch, Crypto Strategy, SEC & FINRA Approvals with Aaron Kaplan.”
Bakkt filed amended Form S-3 registration statements with the SEC to issue up to $150 million of registered securities, aiming to raise capital for its long-term vision. Bakkt also needs to amend its Q3 2023 10-Q to update business risks, excluding new products or markets without a track record. CoinDesk’s take on this is a story titled “Crypto Firm Bakkt Warns It Might Not Be Able to Remain in Business.”
The latest version of the game “Where’s Waldo?” is Where are the Chinese bitcoin miners? Since China banned it in 2021, Chinese bitcoin miners have been on the move. Their latest destination is Ethiopia, according to a Bloomberg story.
Bloomberg reports that January marked the warmest on record, with temperatures nearly 1.7C above the pre-industrial average, continuing a trend of record-breaking temperatures for the eighth consecutive month, according to Europe’s Earth observation agency Copernicus. Bloomberg said, “Thermometer readings were well above the average of the past three decades in southern Europe, eastern Canada, northwestern Africa, the Middle East and Central Asia.” Personally, I remember freezing my butt off in January in Chicago.
JLN is continuing to convert its Open Outcry Traders History Project videos to audio podcasts, and the latest one is with Tom Gould. The story is titled “Open Outcry Traders History Project Podcast: From Trading Floors To Life’s Crossroads, Tom Gould’s Journey Through Trading And Giving Back.”
Patrick Young‘s latest episode of IPO-VID featured Brad Schaeffer, whom Young described as a polyglot commodities trader, maestro musician, and celebrated columnist extraordinaire. The title of the episode is “From the Floor To The Future with Brad Schaeffer.”
Inspired by the last CFTC advisory notice rewritten by Little Orphan Annie about “AI Won’t Turn Trading Bots into Money Machines,” I asked ChatGPT and Cupid to rewrite the CFTC notice “CFTC Customer Advisory Alerts App and Social Media Users to Financial Romance Fraud.” The Cupid/ChatGPT version can be found HERE. I really liked the conclusion of the piece and contact info: For more information on how to protect yourself from financial romance fraud, visit the CFTC’s website or contact the OCEO directly. Together, we can spread love, not scams, this Valentine’s Day. Contact: Cupid,C/O Commodity Futures Trading Commission, Phone: 1-800-CUPID-LOVE
Have a great day and stay safe and treat people the same way you want to be treated: with respect, equality and justice.~JJL
Women In Listed Derivatives (WILD) is offering a Zoom event on February 20 titled, “Show Up, Stand Out, Break Through (Part II): A Founder and CEO’s Authentic Leadership Journey,” with speaker Odessa Jenkins, the CEO of Bonfire and founder of the Women’s National Football Conference. This is the follow-up to Jenkins’ first session with WILD on January 9, which prompted so many questions it “sparked the need for more time to learn about Jenkins’ advancements, and … even more time for Q&A.” Registration is available here, and for those who missed Part 1, the video is available here.~SR
The Eurex Derivatives Forum Frankfurt takes place February 28-29, 2024. This is a leading European event focused on trading and clearing for derivatives across asset classes. Participants can join the forum either in Frankfurt or by viewing selected slots on the Eurex virtual platform. Joining online is free. An ESG Innovation Lab workshop will feature moderated roundtable discussions including: How to enrich your client relations by integrating sustainability topics; The linkage of positive contribution and products; Circular Commodity Exchange: New asset classes on the horizon – a Deutsche Boerse Network Initiative. Learn more and register here. ~SAED
Our most read stories from our previous edition of JLN Options were:
– Get to Know OCC’s Operational Risk Management and Controls Team from the OCC.
– Traders Boost Bearish China Options Bets Even as Stocks Surged from Bloomberg.
– The significance of ‘Theta’ for options traders: Options 101 from Yahoo Finance. ~JB
Subscribe to the JLN Options Newsletter HERE (it’s free).
Open Outcry Traders History Project Podcast: From Trading Floors to Life’s Crossroads, Tom Gould’s Journey Through Trading and Giving Back
In this podcast version of the Open Outcry Traders History Project video interview, Tom Gould reflects on his trading career and the life-changing experience of a heart attack that led him to give back to the community. Gould’s journey began unexpectedly when he took a summer job at the Chicago Board Options Exchange and then after a second summer received a call from his boss with an offer to forego law school and join the Chicago Board Options Exchange (CBOE). His time on the trading floor had been eye-opening, filled with excitement and learning opportunities, so he took the job.
SEC Broadens ‘Dealer’ Definition
James Brady, Susan Light, Richard Marshall – Katten
On February 6, 2024, the Securities and Exchange Commission (SEC) adopted two new rules that expand who may be considered a dealer or a government securities dealer under the Securities Exchange Act of 1934, as amended (Exchange Act) and be required to register in such capacity. The new rules depart significantly from decades of established precedent distinguishing between “dealer” activity necessitating registration and “trader” activity that does not. The SEC adopted the new rules in a controversial 3-2 vote. As background, the Exchange Act defines the term “dealer” as “any person engaged in the business of buying and selling securities . . . for such person’s own account through a broker or otherwise.” In addition, the Exchange Act excludes from the “dealer” definition any “person that buys or sells securities . . . for such person’s own account, either individually or in a fiduciary capacity, but not as a part of a regular business.” The Exchange Act also sets forth parallel language applicable to government securities dealers.
***** I know lots of dealers who don’t advertise. Their business is all word of mouth. It is a different commodity being sold, but… ~JJL
The Global Association Of Central Counterparties CCCP Global: CCP Global Releases The Quick Access Transparency Links (“QATL”) Template For CCPs
CCP Global – The Global Association of Central Counterparties – Releases the Quick Access Transparency Links (“QATL”) template to enhance accessibility to existing CCP disclosures. To enhance clearing participants’ existing access and for ease of reference to CCPs’ disclosures, today CCP Global officially announced the release of the QATL template. This document provides a series of links to CCPs’ rulebooks and disclosures in accordance with CCP Global’s template format the “QATL template”. The information contained in this document will be compiled by the CCP for general informational purposes in order to enhance the accessibility of information from a CCP’s documents. While some relevant CCP rules may be discussed, hyperlinked to or referred to in the QATL template, all matters and information provided is subject to, and superseded by, the specific CCP’s rules and disclosures. It is advised that the current versions of the CCP’s rules and disclosures should always be consulted and are those that should be relied upon by the CCP’s participants.
***** I think this QATL is a bunch of bull.~JJL
Sports Gambling a Growing Money Laundering Risk, U.S. Says; The cautionary note comes as Americans get ready to bet more than ever on the Super Bowl
Richard Vanderford – The Wall Street Journal
Online sports gambling poses an increasing risk of money laundering, the U.S. Treasury Department said in a warning that comes as a record number of Americans are expected to place bets on the coming Super Bowl. The rapid growth of the sports betting sector and a lack of uniform regulations contribute to “significant and increasing money-laundering risks,” the Treasury said Wednesday as part of an expansive report on money-laundering concerns.
****** What better time to launder some money in sports betting than the Super Bowl week when billions of dollars are being bet?~JJL
Wednesday’s Top Three
Our top clicked item Wednesday was, once again, Intercontinental Exchange Reports January 2024 Statistics, from the Intercontinental Exchange (ICE). Second was SEC Increases Oversight for Hedge Funds, High-Speed Traders, from The Wall Street Journal. And third was the John Lothian News video Options Discovery Episode 29: Understanding the Foundations to Become a Successful Options Trader; Mark Esposito, Options Mentor at McMillan Analysis Corps., Discusses This and More With JLN’s Asma Awass.
CFTC Customer Advisory Alerts App and Social Media Users to Financial Romance Fraud
Valentine’s Day Brings Romance Investment Scams Back to Forefront
The Commodity Futures Trading Commission’s Office of Customer Education and Outreach (OCEO) today issued a customer advisory alerting dating/messaging app and social media users to a scam asking for financial support or giving investment advice using the platforms. Just in time for Valentine’s Day, the Customer Advisory: Six Warning Signs of Online Financial Romance Frauds, reminds app and social media users to be wary of texts and messages from strangers that promote cryptocurrency investments. The text could actually be from international criminal organizations. These criminal organizations trick victims into investing money in cryptocurrency or foreign currency scams only to defraud them. The scam can take advantage of even the savviest of investors because fraudsters develop relationships with their victims through weeks of seemingly authentic text messaging conversations, a practice known as “grooming.” The financial grooming gangs refer to this fraud as “sha zhu pan” or pig butchering.
Cybercriminals raked in record $1.1 billion in ransom payments in 2023
Sean Lyngaas – CNN
Cybercriminals extorted a record $1.1 billion in ransom payments from victim organizations around the world last year despite US government efforts to cut off their money flows, crypto-tracking firm Chainalysis said in a report released Wednesday. The surge in ransom payments, which nearly doubled the $567 million by Chainalysis in 2022, coincided with a “major escalation in the frequency, scope, and volume of attacks,” the New York based-firm said. After the FBI announced an operation that thwarted $130 million in ransom payments for several months in 2022, a variety of cybercriminal groups have struck US casinos, hospitals and schools in 2023, and have sometimes collected big payouts.
A Hedge Fund Manager’s Guide to Handling GOP Attacks on ESG; Man Group CIO says talks with GOP clients look at financials; ESG investing is under ongoing attack in Republican states
Alastair Marsh and Gautam Naik – Bloomberg
The best defense against Republican attacks on ESG is to persuade naysayers that the investing strategy can actually help financial performance, according to the chief investment officer for responsible investment at Man Group. The world’s largest publicly traded hedge fund doesn’t screen for environmental, social and governance risks “just to try to make the world a better place,” Rob Furdak, Man Group’s CIO overseeing its ESG assets, said at a panel hosted by Bloomberg Intelligence in London on Thursday. “We do it because we think it improves our investment process.”
UBS, Wells Fargo Invest in Nasdaq-Backed Market for Pre-IPO Shares
Alexander Osipovich – The Wall Street Journal
More banks are backing Nasdaq Private Market, a trading platform for shares in companies that haven’t yet gone public. UBS, Wells Fargo and BNP Paribas are among the new investors in Nasdaq Private Market, the venture said as it announced the closing of a $62.4 million funding round. Trading giant DRW Holdings also joined as an investor. Nasdaq spun out Nasdaq Private Market into a separate company in 2021. The venture is hoping that Wall Street banks can help steer deals into its marketplace. Existing investors include Goldman Sachs, Morgan Stanley and Citigroup.
TradeStation to pay $3 mln to settle charges from SEC, states over unregistered crypto product
Cryptocurrency platform TradeStation Crypto will pay $3 million to settle charges from the U.S. securities regulator and multiple states that it offered and sold unregistered securities through an interest-earning program. TradeStation failed to register its crypto lending product that allowed U.S. investors to deposit or purchase assets on TradeStation’s platform in exchange for yield, the Securities and Exchange Commission said. The product was offered to customers beginning in 2020 and was shut down in 2022.
SEC Charges TradeStation Crypto for Unregistered Offer and Sale of Crypto Asset Lending Product; Florida-based company agrees to settle charge concerning interest feature on crypto asset accounts
The Securities and Exchange Commission today announced charges against TradeStation Crypto, Inc., based in Plantation, Florida, for failing to register the offer and sale of a crypto lending product that allowed U.S. investors to deposit or purchase crypto assets in a TradeStation account in exchange for the company’s promise to pay interest. To settle the SEC’s charges, TradeStation agreed to pay a $1.5 million penalty.
A 99% Bond Wipeout Hands Hedge Funds a Harsh Lesson on China; Firms have long been aware of state’s role in restructurings; Yet heavy-handed position in Evergrande caught many off guard
Alice Huang, Dorothy Ma, and Pearl Liu – Bloomberg
From afar, China Evergrande Group had all the makings of a killer distressed-debt trade: $19 billion in defaulted offshore bonds; $242 billion in assets; and a government that appeared determined to prop up the country’s faltering property market. So US and European hedge funds piled into the debt, envisioning big payouts to juice their returns. What they got instead over the course of the next two years is a harsh lesson in the dangers of trying to bargain with the Communist Party. The talks are now dead – a Hong Kong court has ordered Evergrande’s liquidation, and the bonds are nearly worthless, trading in secondary markets at just 1 cent on the dollar.
Google releases ‘Gemini’ in new effort to cash in on generative AI; Tech giant includes latest system within subscription offerings in race to commercialise cutting-edge technology
Madhumita Murgia – Financial Times
Google is releasing Gemini, its latest generative artificial intelligence system, alongside new offerings for businesses and consumers, as the tech giant races Microsoft and OpenAI to commercialise the cutting-edge technology. The search giant said its “largest, most capable and most general” AI system would be available as a free app through Google’s Android and Apple’s iOS app stores.
FIA response to provisional EMIR 3.0. agreement
FIA congratulates the Council of the EU and the European Parliament on reaching a provisional political agreement early this morning on the review of the European market infrastructure regulation and directive (EMIR 3.0). The review aims to make the EU clearing landscape more attractive and resilient, support the EU’s strategic autonomy, and preserve the EU’s financial stability. FIA is pleased a provisional agreement has been reached and supports positive incentives to further enhance the attractiveness of EU clearing and EU capital markets.
Bitcoin ETFs Are Changing the Crypto Conversation. An Industry Insider Explains How; Coinbase CFO Alesia Haas sees growing engagement with cryptocurrencies-and longs for regulatory clarity.
Jack Denton – Barron’s
Shares of the cryptocurrency brokerage Coinbase Global have been on a wild ride. They have lost two-thirds of their value since the company’s initial public offering in April 2021, although the stock price rose nearly 400% last year. While shareholders have been strapped into this roller coaster, Alesia Haas, Coinbase’s chief financial officer, could be thought of as the grim-faced technician on the ground. In reality, she’s quite cheerful.
Einhorn Says Markets ‘Fundamentally Broken’ By Passive, Quant Investing; Greenlight Capital adapted as investors ignored value stocks; Einhorn also said the SEC stopped policing corporate benavior
Matthew Griffin – Bloomberg
Greenlight Capital was forced to shift its strategy as the growth of passive investing and algorithmic trading transformed markets, founder David Einhorn said. “I view the markets as fundamentally broken,” Einhorn, 55, said on Barry Ritholtz’s Masters in Business podcast. “Passive investors have no opinion about value. They’re going to assume everybody else has done the work.”
US to Release More Details on Individual Treasury Trades; Finra post-trade rule will publicize time, price and volume; Parties in transactions will not be identified: regulators
Lydia Beyoud – Bloomberg
US regulators will begin making available key details on completed Treasuries transactions on a trade-by-trade basis in the latest push by Washington to increase transparency in the world’s biggest government bond market. The Securities and Exchange Commission said Wednesday that specific trades’ time, price, direction, venue, and volume would all be made public under a new rule. The regulation by the industry-backed Financial Industry Regulatory Authority, which is overseen by the SEC, was proposed last November.
China Is Oversupplied With Commodities as Deflation Persists; Last year’s import binge included record hauls of coal and oil; Metals traders eye Beijing’s fiscal response to economic woes
China’s commodities markets are heading into the Lunar New Year break on a glum note, with deflation embedded on both the consumer and producer sides of the economy. Agricultural goods were at the forefront of the steepest decline in consumer prices since 2009, according to Bloomberg Economics, after the fall in food costs widened to 5.9% year-on-year in January from a 3.7% drop in December. The outlook for pork, which has a heavy weighting in the basket of goods measured, is particularly gloomy. Grain markets face similar issues around oversupply after last year’s binge on imports.
Hedge Funds Are Dealers Now; Also Adam Neuman maaaaaybe buying WeWork, Carlyle pay and bankroll size.
Matt Levine – Bloomberg
In the olden days, there were two sorts of people who traded stocks or bonds for a living. We can call them “dealers” and “investors,” though those terms are imperfect.1 An investor is someone who buys stocks or bonds because she thinks they are a good investment, and sells them when she thinks they aren’t. She does analysis, decides that Bond X is worth $80, sees it trading at $78, and goes out to buy some Bond X. When it trades up to $82, she sells it. She makes her money by buying low and selling high, by predicting price trends or understanding fundamental value. Investors include ordinary retail investors, but mutual funds and hedge funds are also in this category. Their job is to buy stuff that they think will go up.
China is facing the US financial crisis ‘on steroids’ as its real-estate market collapses, famed hedge-fund boss says
Filip De Mott – Business Insider
China’s overreliance on real estate has sent its economy tumbling toward what could be a version of the US’s 2008 financial crisis, Kyle Bass said on CNBC on Tuesday. “This is just like the US financial crisis on steroids,” the Hayman Capital founder said. “They have 3 Â½ times more banking leverage than we did going into the crisis, and they’ve only been at this banking thing for a couple of decades.” Bass said the years of economic growth China enjoyed prior to the pandemic were made possible by an unregulated real-estate market, which leaned too heavily on debt to expand.
Citadel Among Hedge Funds That Got Morgan Stanley’s Block-Trading Leaks; CaaS, Evolution also got tips on blocks in bank’s settlement; Citadel and other hedge funds weren’t accused of wrongdoing
Sridhar Natarajan and Katherine Burton – Bloomberg
When the US punished Morgan Stanley for leaking upcoming stock trades to favored clients, it kept the list of recipients secret. They include one of Wall Street’s biggest players: Citadel. A trader at Ken Griffin’s giant hedge fund was among a coterie of executives described anonymously in Morgan Stanley’s settlements with the government, according to people with knowledge of the matter.
Complex Forms of Markets Abuse on the Rise for US Banks
Anna Lyudvig – Traders Magazine
Last year saw a surge in markets abuse fines and high profile cases of deceptive trading particularly from large investment banks. “As financial markets have become increasingly complex, so have the forms of market abuse we’re seeing,” said Mike Coats, Chief Technology Officer, TradingHub. “Manipulators have developed more sophisticated methods that often span multiple financial instruments and trading venues,” he told Traders Magazine.
Bond market venues tussle over market share amid volumes surge
Alex Pugh – FI-Desk
Fixed income trading venues have reaped the rewards of rising trading volumes, but a highly competitive landscape is having an impact on market share. Market operator MarketAxess has reported that January saw credit trading at record levels, with average daily volume (ADV) of US$15 billion, up 6.9% year-over-year (YoY) from US$14 billion.
The world just marked a year above a critical climate limit scientists have warned about
Angela Dewan – CNN
Global warming surpassed 1.5 degrees Celsius over the past 12 months for the first time on record, new data shows, breaching a critical threshold that, if it continues, will push the limits of life on Earth to adapt. The past year was 1.52 degrees hotter on average than temperatures before industrialization, according to data from Copernicus, the European Union’s climate and weather monitoring service. That 12-month average was boosted by the hottest January on record, which was 1.66 degrees warmer than the average January temperature in pre-industrial times.
A Hedge Fund Manager’s Guide to Dealing With GOP Attacks on ESG; Man Group CIO says talks with GOP clients look at financials; ESG investing is under ongoing attack in Republican states
Alastair Marsh and Gautam Naik – Bloomberg
The best defense against Republican attacks on ESG is to persuade naysayers of the investing strategy’s ability to generate returns, according to the chief investment officer for responsible investment at Man Group. The world’s largest publicly traded hedge fund doesn’t screen for environmental, social and governance risks “just to try to make the world a better place,” Rob Furdak, Man Group’s CIO overseeing its ESG assets, said at a panel hosted by Bloomberg Intelligence in London on Thursday. “We do it because we think it improves our investment process.”
Digital ecosystems to be included in Big Tech antitrust, merger probes, EU regulators say
Foo Yun Chee – Reuters
EU antitrust regulators investigating Big Tech’s merger deals or their market power will now also take their digital ecosystems and the impact of their free products or services into account, EU competition chief Margrethe Vestager said on Thursday. Vestager made the comment as she announced an update to nearly three-decade old rules known as the Market Definition Notice that determine whether companies have the market power to throttle rivals or control prices.
US says leading AI companies join safety consortium to address risks
David Shepardson – Reuters
The Biden administration on Thursday said leading artificial intelligence companies are among more than 200 entities joining a new U.S. consortium to support the safe development and deployment of generative AI. Commerce Secretary Gina Raimondo announced the U.S. AI Safety Institute Consortium (AISIC), which includes OpenAI, Alphabet’s Google, Anthropic and Microsoft, along with Facebook-parent Meta Platforms, Apple, Amazon.com, Nvidia, Palantir, Intel, JPMorgan Chase, and Bank of America.
Front-line Ukrainian infantry units report acute shortage of soldiers
Isabelle Khurshudyan and Anastacia Galouchka – The Washington Post
The Ukrainian military is facing a critical shortage of infantry, leading to exhaustion and diminished morale on the front line, military personnel in the field said this week – a perilous new dynamic for Kyiv nearly two years into the grinding, bloody war with Russia. In interviews across the front line in recent days, nearly a dozen soldiers and commanders told The Washington Post that personnel deficits were their most critical problem now, as Russia has regained the offensive initiative on the battlefield and is stepping up its attacks.
EU Sanctions Set to Target Russian Military and Tech Firms; Bloc proposes penalties on more than 100 individuals, entities; Proposals include firms shipping ammunition from North Korea
Alberto Nardelli – Bloomberg
The European Union has proposed sanctioning about 55 companies and more than 60 individuals as part of a new package of measures to mark two years since Russia invaded Ukraine. The restrictions would target individuals and firms involved in producing weapons and supplying key technologies and electronics used by Russian defense firms to build the armaments, according to documents seen by Bloomberg.
U.S. Drone Strike Kills Iraq Militia Leader Behind Deadly Attack on American Base; Strike kills senior commander of Iran-backed group Kataib Hezbollah
Gordon Lubold and Nancy A. Youssef – The Wall Street Journal
A U.S. drone strike in Baghdad killed a commander of the Iran-backed Iraqi militia blamed for a deadly strike at a U.S. base in Jordan last week, part of a sharpened effort by the Pentagon to deter attacks on its forces. The commander, of the Iraqi militia group Kataib Hezbollah, was responsible for directly planning and participating in attacks on American forces in the region, the Pentagon said.
Exchanges, OTC and Clearing
NYSE-parent ICE’s profit beats as commodity markets boost trading volumes
Intercontinental Exchange beat Wall Street estimates for fourth-quarter profit on Thursday as commodity markets powered growth in trading volumes at the New York Stock Exchange parent. The global commodity and energy markets saw significant volatility last year due to extreme weather conditions in parts of the U.S. and the world over. Meanwhile, the Middle East conflict also led to an increase in oil trading volumes.
Intercontinental Exchange Reports Strong Full Year 2023 Results
Intercontinental Exchange (NYSE: ICE): a leading global provider of technology and data, today reported financial results for the fourth quarter and full year of 2023. For the quarter ended December 31, 2023, consolidated net income attributable to ICE was $373 million on $2.2 billion of consolidated revenues less transaction-based expenses. Fourth quarter GAAP diluted earnings per share (EPS) was $0.65. Adjusted net income attributable to ICE was $760 million in the fourth quarter and adjusted diluted EPS was $1.33.
Deutsche Boerse urges swift introduction of EU rules to shift euro clearing from London
Huw Jones – Reuters
Deutsche Boerse Chief Executive Theodor Weimer said on Thursday that he had wanted more from newly-agreed European Union rules aimed at shifting euro derivatives clearing from London to the bloc, but they were still a step in the right direction. EU policymakers reached a provisional deal on the rules on Wednesday, forcing banks and asset managers in the bloc to have an “active account” with an EU-based clearing house for widely-used derivatives such as euro interest rate swaps (IRS).
Nasdaq Private Market Closes $62.4 Million Series B Financing, Led by Nasdaq, with New Investments from BNP Paribas, DRW Venture Capital, UBS, and Wells Fargo
Nasdaq Private Market (NPM), a leading provider of liquidity solutions to private companies, their employees, and investors, announced today that it has closed its Series B financing. The $62.4 million round was led by Nasdaq with participation from current investors including Allen & Company, Citi, and Goldman Sachs. New investors in the Series B include BNP Paribas, DRW Venture Capital, UBS, and Wells Fargo.
ULTUMUS, a SIX company, publishes its ETF AUM & Flow Reports; Discover the January 2024’s set of reports produced by ULTUMUS for Europe and the US of the inflows and outflows for ETPs by region, issuers, and asset class.
At the heart of the ETF Eco-System, ULTUMUS develops and enhances a suite of data and technology services to support this growing market segment, including an ETF and Index managed data service, PCF (Portfolio Composition File) calculation and a universal ETF creation/redemption platform, COSMOS. Leveraging this expertise, ULTUMUS produces a monthly report of flows and assets under management for Europe, US and Asian ETFs.
SGX Group welcomes Bright Point International Financial (SG) Pte. Ltd. as Derivatives Trading and Clearing Member
Singapore Exchange (SGX Group) is pleased to welcome Bright Point International Financial (SG) Pte. Ltd. to its derivatives market as a trading and clearing member. Bright Point International Financial (SG) Pte. Ltd. is a subsidiary of BPI Financial Group Limited (BPI Financial), a boutique financial services firm. The company provides a full suite of financial services which include trading access to global markets, clearing of exchange traded and over-the-counter (OTC) products, inter-dealer brokerage services in OTC commodity markets, access to Chinese commodity derivatives markets, hedging solutions and structured trade services. It has a diverse client base comprising producers, traders, consumers and proprietary trading group.
JSE Clear to accept securities as collateral to improve investors’ cash liquidity.
Johannesburg Stock Exchange
JSE Clear has introduced a new service to accept securities as collateral against open JSE derivative positions. Previously, only cash was accepted as collateral. By now accepting SA government bonds as collateral, investors are able to utilise their cash for different purposes, alleviating cash liquidity pressures and reducing their costs of cash funding. This service offering marks a proactive approach by JSE Clear to support investors who wish to improve efficiency. Investors with listed JSE derivative exposures may now meet their margin collateral requirements by providing a combination of ZAR cash and liquid South African fixed-rate government bonds.
NSE Indices launches Nifty MidSmallcap400 Momentum Quality 100 index
National Stock Exchange of India
NSE’s index services subsidiary, NSE Indices Limited today launched a new strategy index – Nifty MidSmallcap400 Momentum Quality 100 index. The Nifty MidSmallcap400 Momentum Quality 100 Index aims to track the performance of the midcap and smallcap stocks which are selected based on the combination of momentum and quality factors from the Nifty MidSmallcap 400 index. 50 stocks from the Midcap universe (stock forming part of the Nifty Midcap 150 index) and 50 stocks from Smallcap universe (stock forming part of the Nifty Smallcap 250 index) based on the combination of momentum and quality factors are selected to be part of the Nifty MidSmallcap400 Momentum Quality 100 index.
CME Group Declares Quarterly Dividend
CME Group Inc., the world’s leading derivatives marketplace, today declared a first-quarter dividend of $1.15 per share, a 5% increase from the prior level of $1.10 per share. The dividend is payable March 26, 2024, to shareholders of record as of March 8, 2024.
Deutsche Boerse is ending 2023 with strong results and continues to be on a growth path
Deutsche Boerse Group
Deutsche Boerse Group has just published its preliminary results for the 2023 financial year. You can find the link to the entire report at the bottom of the page. The result at a glance: Net revenue increased by 17 percent to eur 5,077 million and EBITDA to eur 2,944 million, also an increase of 17 percent.
Intercontinental Exchange Announces 7% Increase to its Quarterly Dividend
Intercontinental Exchange (NYSE: ICE), a leading global provider of data, technology, and market infrastructure, announced board authorization of its first quarter 2024 dividend of $0.45 per share, up 7% from its previous $0.42 per share quarterly dividend in 2023. The first quarter cash dividend is payable on March 29, 2024 to stockholders of record as of March 15, 2024. The ex-dividend date is March 14, 2024.
Trader Alert 24-12: Holiday Reminder – Closed February 19, 2024
MEMX Equities and MEMX Options will be closed Monday, February 19, 2024, in observance of the Presidents’ Day holiday. Normal trading will resume on Tuesday, February 20, 2024.
National Stock Exchange and Government of Maharashtra sign MoU to facilitate fund raising for SMEs in the State
National Stock Exchange of India
India’s leading stock exchange, the National Stock Exchange (NSE) and the Government of Maharashtra have signed a Memorandum of Understanding (MoU) to spread awareness amongst MSMEs of the state regarding fund raising via IPO mechanism using NSE Emerge which is the SME platform of NSE. MOU exchanged, in the presence of Shri Uday Samant, Honorable Minister of Industries, Government of Maharashtra, between Shri Deependra Singh Kushwah, Development Commissioner, Industries, Government of Maharashtra and Shri Jayesh Taori, Associate Vice President, National Stock Exchange, today at Pune. https://jlne.ws/3UzT4g6
NYSE US Exchanges To Close In Observance Of Washington’s Birthday
In observance of Washington’s Birthday, the New York Stock Exchange, NYSE American Equities, NYSE Arca Equities, NYSE Chicago, NYSE National, NYSE American Options, NYSE Arca Options, and NYSE Bonds markets will be closed on Monday, February 19, 2024.
Moscow Exchange launches futures trading on new currency pairs
On February 13, 2024, trading in settlement futures contracts for the currency pairs “Belarusian ruble – Russian ruble” and “US dollar – Kazakh tenge” will begin on the Moscow Exchange derivatives market. Market participants and their clients will have access to contracts expiring in March, June, September and December 2024, with dates updated quarterly. Calculations are made in Russian rubles.
CUSIP Global Services Assumes Administration of Card Issuer Identification Numbering System; Industry Standard 8-Digit Issuer Identification Number (IIN) Supports Identity Resolution and Seamless Transactions with Card-Issuing Institutions
CUSIP Global Services
CUSIP Global Services (CGS) today announced that it has assumed administration of the industry standard Issuer Identification Number (IIN), also known as the Bank Identification Number (BIN), an 8-digit identifier used to uniquely identify card-issuing institutions, such as credit, debit and points/rewards card issuers. The American Bankers Association (ABA) has served as the registration authority for the IIN standard (ISO/IEC7812) since it was developed in the early 1970s. ABA will continue in that capacity, but day-to-day operations will now be managed by CGS.
$10 Million Artificial Intelligence Mathematical Olympiad Prize Appoints Advisory Committee Members – Fields Medallists Timothy Gowers And Terence Tao Appointed To The Advisory Committee For The Artificial Intelligence Mathematical Olympiad Prize, Alongside Po-Shen Loh, Dan Roberts And Geoff Smith
XTX Markets’ newly created Artificial Intelligence Mathematical Olympiad Prize (‘AIMO Prize’) is a $10mn challenge fund designed to spur the creation of a publicly shared AI model capable of winning a gold medal in the International Mathematical Olympiad (IMO).
Microsoft’s Nadella Calls on India to Seize Opportunity of AI; Company to help train 2 million people in the country; Microsoft reached $3 trillion market value under Nadella
Saritha Rai – Bloomberg
Sign up for the India Edition newsletter by Menaka Doshi – an insider’s guide to the emerging economic powerhouse, and the billionaires and businesses behind its rise, delivered weekly. Microsoft Corp. Chief Executive Officer Satya Nadella urged countries to aggressively invest in artificial intelligence, making the case in India that his birth country has an unprecedented opportunity to drive economic growth by capitalizing on the technology’s promise.
Coders and Analysts Feel AI’s Breath on Their Necks; Nobody’s really ready for how automation could upend white-collar drudgery.
Lionel Laurent – Bloomberg
Are white-collar workers – think analysts, coders and even the odd opinion columnist – going the way of the medieval scribe? Finance and technology accounted for around 39,000 announced layoffs in the US last month, according to one survey, and now DocuSign Inc. and Snap Inc.’s 900 more signal an ongoing race to “rip the Band-Aid” and pivot to more cost-effective AI and automation. Developers are quoting Marx in online forums and wondering if they should re-train as electricians.
French Competition Watchdog Starts AI Inquiry on Big Tech Role
Benoit Berthelot – Bloomberg
France’s competition authority has launched a public consultation process on the artificial intelligence sector, asking companies to comment on the strategies implemented by big tech players in the field. The booming generative artificial intelligence sector is rapidly taking shape around companies that “already have a strong presence in adjacent markets,” the authority said, with a risk that they use their “current market power” to expand.
CCData and BMLL Technologies Announce Strategic Partnership to Facilitate Enhanced Digital Asset Data Access
CCData, an FCA-authorised benchmark administrator and leading provider of digital asset data solutions and settlement indices, is excited to announce its new partnership with BMLL Technologies, a premier and independent provider of harmonised level 3 historical data and analytics. This partnership brings together two market-leading data providers in their fields, empowering clients with access to advanced data and metrics across both traditional and digital asset markets.
Elon Musk Says He’ll Help Fund AI Effort to Decipher Roman Scrolls; Nat Friedman’s Vesuvius Challenge gets a new financial backer.
Ashlee Vance – Bloomberg
OpenAI’s Secret Weapon Is Sam Altman’s 33-Year-Old Lieutenant; Brad Lightcap helped seal the startup’s deal with publisher Axel Springer. Now he’s experimenting with the company’s business model.
Shirin Ghaffary – Bloomberg
Crypto ransom attack payments hit record $1 billion in 2023 – Chainalysis
Medha Singh – Reuters
Payments from crypto-related ransom attacks nearly doubled to a record $1 billion in 2023, blockchain analytics firm Chainalysis said on Wednesday. Scammers targeting institutions such as hospitals, schools and government offices for ransom pocketed $1.1 billion last year, compared with $567 million in 2022.
How Investigators Solved the Biden Deepfake Robocall Mystery; This is the future security experts warned us about.
Katrina Manson – Bloomberg
When New Hampshire authorities set about tracking down the origin of a bogus, AI-enabled phone call purporting to be from President Joe Biden, they turned to a company that has long-predicted the rise of audio deepfakes for help. Nomorobo, part of New York-based Telephone Science Corp., is a service that automatically blocks robocalls and unwanted tests. It monitors 350,000 mobile phone numbers to catch robocalls, in addition to more than a million regular phone numbers they’re commercially contracted to monitor in order to protect against scams, according to founder Aaron Foss. The company is hired to offer such protection.
Federal cybersecurity agency launches program to boost support for state, local election offices
Christina A. Cassidy – AP News
The nation’s cybersecurity agency has launched a program aimed at boosting election security in the states, shoring up support for local offices and hoping to provide reassurance to voters that this year’s presidential elections will be safe and accurate. Officials with the U.S. Cybersecurity and Infrastructure Security Agency planned to introduce its new election security adviser program Thursday to the National Association of State Election Directors and on Friday to the National Association of Secretaries of State. Both groups have their annual meetings this week in the nation’s capital.
B2C2 Acquires Luxembourg VASP Registration; B2C2 expands operations into Luxembourg amid rapidly developing digital asset market; Denzel Walters is appointed Head of Luxembourg
B2C2, the leading crypto liquidity provider servicing institutional clients globally, has obtained regulatory approval to operate in Luxembourg and expand its EU presence. B2C2 has become the 12th virtual asset service provider (VASP) to be officially registered on the Commission de Surveillance du Secteur Financier’s (CSSF) public register in Luxembourg. While B2C2 has long serviced a diverse client base across the Americas, Asia-Pacific and EMEA regions, this regulatory approval marks a further milestone in the company’s growth to benefit from opportunities presented by Luxembourg’s rapidly developing digital asset market.
Austin man tried hiding millions in bitcoin sales from IRS, indictment says
Marley Malenfant – Austin American-Statesman
A federal grand jury this week indicted an Austin man on charges of falsely reporting his income after selling cryptocurrency worth $4 million, according to the U.S. Justice Department. Frank Richard Ahlgren III filed phony tax returns that underreported or did not report his gains from the bitcoin sale, according to a news release from the Justice Department. Taxpayers must report any income, gains and losses, including those involving cryptocurrency. Ahlgren is also accused of cash structuring, or depositing cash at a bank in a series of small transactions, to avoid scrutiny by financial institutions or law enforcement.
Bakkt, once touted as Bitcoin’s ‘savior,’ is running low on cash; The institutional digital asset trading platform unveiled in 2018 amid huge fanfare has just disclosed it “might not be able to continue as a going concern.”
Martin Young – CoinTelegraph
Crypto company Bakkt, which launched in 2019 and is backed by the Intercontinental Exchange (ICE), has just warned it may not have enough cash to stay in business over the next 12 months. On Feb. 7, Bakkt filed an amendment to its quarterly report with the United States Securities and Exchange Commission, with one section on risk factors containing a warning that it may “not be able to continue as a going concern.”
Chinese Bitcoin Miners Find a New Crypto Haven in Ethiopia; Cheap power and friendly relations with China have made the Horn of Africa country a top pick for Chinese Bitcoin miners
David Pan and Fasika Tadesse – Bloomberg
Last spring, cargo containers began appearing near electricity substations connected to the recently built Grand Ethiopian Renaissance Dam, Africa’s largest. Inside were stacks of powerful, energy-guzzling computers. It was a telltale sign that Chinese Bitcoin miners, having bounced from country to country in search of cheap power and benign regulations since Beijing cast them out two years before, had arrived in the Horn of Africa.
Loyalty Points Are Crypto’s New Bait; Blast has lured $1.3 billion worth of crypto since November; Most programs haven’t said what their points can be used for
Muyao Shen and Elijah Nicholson-Messmer – Bloomberg
An increasing number of digital-asset startups are offering airline-like loyalty points as they seek to attract more devoted users, even though most have yet to define what the rewards actually entail. Loyalty programs have sprung up in response to a once-favorite marketing ploy – the token airdrop – in which projects give away crypto tokens to users. But the industry is rethinking this tack because many airdrops have done little to retain users while regulatory scrutiny has swelled over tokens themselves.
Why Big Banks Are Doubling Down on Crypto
Julia Press and Sarah Holder – Bloomberg
Manchin Says LNG Export Pause Unjustified, Should Be Reversed; Senate hearing to investigate Biden’s LNG export freeze; Manchin worried ‘White House will put its thumb on the scale’
Ari Natter – Bloomberg
The White House’s pause on new liquefied natural gas export approvals is unjustified and should be “reversed immediately” if a study of the shipments is only beginning now, Senator Joe Manchin plans to say at a Senate hearing Thursday. Manchin also plans to use a Senate Energy and Natural Resources Committee hearing on the moratorium to cast doubt on the impartiality of the administration’s study of the effects of LNG exports on climate change, the economy, and national security, according to a written copy of Manchin’s opening statement.
How the Rockefellers and Billionaire Donors Pressured Biden on LNG Exports; President’s decision to halt new export terminals follows an intense campaign by environmental groups funded by wealthy contributors
Benoit Morenne and Andrew Restuccia – The Wall Street Journal
Charities controlled by members of the Rockefeller family and billionaire donors were key funders of a successful campaign to pressure President Biden to pause new approvals of liquefied natural gas exports from the U.S. The Rockefellers, along with other wealthy donors including the philanthropy of Michael Bloomberg, have provided millions of dollars in recent years to front-line environmental groups that are campaigning against fossil-fuel projects, including LNG terminals that have been proposed on the Gulf Coast, according to people familiar with the effort.
Investing for Trump 2.0 Is Trickier Than You Think; The right bets may not be the obvious ones, but the base-case scenario of a second term will move markets until November – and beyond.
John Authers – Bloomberg
Yes, it could definitely happen. Everyone grasps that now. Donald Trump’s current dominance of the Republican nomination process, and his increasingly strong showing in polls for the November election, weren’t foreordained. Indeed, at the beginning of last year, he appeared to be almost out of it. Now, his chances are seen as close to 50/50, and clearly positioned better than anyone else. In testimony to how weak Biden is perceived to be, the candidate that bettors rank third, Michelle Obama, has an 8.5% chance:
Donald Trump win risks replay of UK gilt crisis for Treasuries, Amundi says; Chief investment officer of Europe’s largest fund manager warns on the dangers of ballooning US budget deficits
Jennifer Hughes – Financial Times
US Treasuries risk a brutal sell-off if an election victory for Donald Trump in November is accompanied by spending jitters similar to those that sparked the 2022 gilts crisis that ended the UK premiership of Liz Truss, Europe’s largest fund manager has warned. Vincent Mortier, chief investment officer of EUR2.1tn Amundi, told the Financial Times that while a Trump victory could be taken initially as positive news for risky assets, “then quickly the bond market will remind everyone that not everything is possible – as happened in the UK with the ‘mini’ Budget of Liz Truss”.
Lords urge City regulator pay hike as talent shifts to private sector; ‘Massive pay gap’ with private sector is now ‘almost impossible’ to ignore
Justin Cash – Financial News
City regulators should be paid more if watchdogs want to compete for talent with the private sector, according to a House of Lords committee. Banks, asset managers and law firms are frequent poachers of staff from bodies such as the Financial Conduct Authority, Prudential Regulation Authority and Competition and Markets Authority, according to an 8 February report from the Lords Industry and Regulators Committee.
UK business department ‘hampered’ inquiry into regulators, say Lords; Peers raise concerns over government’s transparency and accountability to parliament
Gill Plimmer – Financial Times
Labour ditches £28bn green investment pledge
Chris Mason- BBC
Hong Kong launches consultation on regulatory proposals for OTC virtual asset trading
Brian McGleenon – The Block
FCA’s fincrime powers under fresh scrutiny after Iran sanctions disclosure; The Financial Conduct Authority’s role as the UK’s financial crime supervisor has come under fresh scrutiny after Lloyds and Santander UK were accused of allowing Iranian front companies to evade Western sanctions
Ellesheva Kissin – TheBanker.com
The UK Treasury has consulted whether to split up the Financial Conduct Authority and give its responsibility for tackling money laundering and terrorist financing – which it undertakes with a patchwork of other bodies – to an entirely new organisation. This is the final of four options the Treasury put on the table; it will make a decision by summertime.
ESMA is seeking new members for its Securities Markets Stakeholder Group
The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, is looking for candidates representing the interests of all types of financial markets stakeholders. The Securities and Markets Stakeholder Group (SMSG) is an important body for ESMA. It facilitates our consultation with stakeholders by providing technical advice on ESMA’s policies and activities and brings information on recent market developments to our attention.
Ex-Goldman Sachs analyst thought he could ‘talk his way out’ of insider trading arrest, prosecution claims; Mohammed Zina is facing six counts of insider dealing and three counts of fraud
Suzi Ring – Financial Times
A former Goldman Sachs analyst on trial for insider dealing lied to investigators when he was arrested and thought he could “talk his way out of it”, the prosecution told the jury as his trial draws to a close. Mohammed Zina, 35, declined legal representation in his first interview with the UK Financial Conduct Authority on the day of his arrest in December 2017, Peter Carter KC said in his closing speech for the prosecution at London’s Southwark Crown Court on Wednesday.
Valentine’s Day Brings Romance Investment Scams Back to Forefront
The Commodity Futures Trading Commission’s Office of Customer Education and Outreach (OCEO) today issued a customer advisory alerting dating/messaging app and social media users to a scam asking for financial support or giving investment advice using the platforms.
Statement on Approval of FINRA Proposed Rules to Establish Post-Trade Transparency in the Treasury Markets
Chair Gary Gensler – SEC
Today, the Commission approved a rule change proposed by the Financial Industry Regulatory Authority (FINRA) to provide for the first time public dissemination of U.S. Treasury transactions on a trade-by-trade basis. I am supportive of greater post-trade transparency in the Treasury markets, which should benefit investors and issuers alike. Adam Smith, known as the father of modern economics, noted in The Wealth of Nations more than 200 years ago that the whole economy benefits when the price of information is lowered, or information is free.
SEC Charges TradeStation Crypto for Unregistered Offer and Sale of Crypto Asset Lending Product
The Securities and Exchange Commission today announced charges against TradeStation Crypto, Inc., based in Plantation, Florida, for failing to register the offer and sale of a crypto lending product that allowed U.S. investors to deposit or purchase crypto assets in a TradeStation account in exchange for the company’s promise to pay interest. To settle the SEC’s charges, TradeStation agreed to pay a $1.5 million penalty.
SEC Obtains Final Judgments Against Promoters of Multi-Million Dollar CoinDeal Scheme
On February 7, 2024, the United States District Court for the Northern District of Illinois entered final judgments on all claims against two CoinDeal promoters, Arline Woodbury of Ridgewood, New Jersey and Joyce Holverson of River Forest, Illinois.
ASIC to crack down on predatory lending
The conduct of directors has long been of interest to ASIC. Directors’ duties and the high standards that they demand set the tone for corporate Australia. When these obligations are not met there can be significant harm to consumers and investors. The most egregious governance failures can lead to corporate collapse. For directors, this means a sustained regulatory focus from ASIC on offences such as breaching directors’ duties, concealing company assets and failing to comply with obligations to assist liquidators. It also means increased attention – and accountability – for areas of emerging consumer harm.
The first ramp-and-dump case transferred to District Court
Securities and Futures Commission (SFC)
The Eastern Magistrates’ Court today granted an application by the Department of Justice to transfer a ramp-and-dump case brought by the Securities and Futures Commission (SFC) to the District Court. This is the first time a ramp-and-dump case was transferred to the District Court for criminal prosecution. The two defendants in the case, Mr Stevens Yip Chi Fai and Ms So Lung Ying, are suspected core members of a sophisticated ramp-and-dump syndicate. They were charged on 3 August 2023 at the Eastern Magistrates’ Court with the offence of conspiracy to employ a scheme with intent to defraud or deceive in transactions involving securities following an extensive investigation of the SFC (Note 1).
Investing and Trading
PayPal Tumbles After Firm Forecasts Little Profit Growth in 2024
Paige Smith – Bloomberg
PayPal Holdings Inc. shares tumbled late Wednesday after the company said it expects earnings to be flat this year as it continues to cut costs and streamline its operations. Shares of the fintech firm slid 7.9% to $58.24 at 6:28 p.m. in New York. The stock had gained 3% this year through the close of regular trading.
McKinsey Places 3,000 Staffers on Review as Economies Slow; Without improvement, some of them could be counseled to leave; Uncertain macro environment dampens outlook for consultancies
Ambereen Choudhury – Bloomberg
McKinsey & Co. has warned about 3,000 of the firm’s consultants that their performance was unsatisfactory and will need to improve. The firm gave these employees a so-called “concerns” rating as part of their performance reviews in recent months, according to people familiar with the matter. With that rating, employees are typically given about three months to show improved performance. If they’re unable to do so, the firm may begin counseling some of them to leave the company entirely.
The passive attack on bond markets; RIP bond kings
Robin Wigglesworth – Financial Times
The first passive bond fund launched nearly four decades ago, and ever since then people have mostly made fun of the whole idea as preposterous. To be fair, there are some solid reasons for scepticism:
Is it possible to master emotions when trading? Academic research suggests evolutionary hunter-gatherer traits do not serve us well when investing
Moira O’Neill – Financial Times
The chances are that someone you know is still trying their hand at day trading. It might be you. But even companies whose business it is to promote day trading are now warning that you are likely to lose money unless you can rein in your emotions. Which allows me to use the most brilliant FT Money reader comment ever written: “I lost most of our money backing internet stocks 20-odd years ago, the children were young (and at private schools – ouch). When l told my wife, she asked if I’d lost the house (which we owned outright). l said, no, even l was not that stupid. She then laughed and said that it ‘doesn’t really matter much then’. I realised at that moment she was the best investment l was ever going to make and that was a totally emotional choice.”
US Big-Tech Mania Drives Developed-Market Stocks to Record; Wall Street heavyweights are biggest contributors to its climb; The MSCI World Index has rallied 16% over the past 12 months
Alexandra Semenova and Farah Elbahrawy – Bloomberg
A roughly $61 trillion global benchmark of developed-market equities rose to an all-time high on Wednesday, with Wall Street’s technology behemoths leading the way. The MSCI World Index, which includes almost 1,500 stocks across 23 developed markets, climbed 0.5% to 3,262 at 10:17 a.m. in New York. It surpassed its closing peak set Jan. 4, 2022, following record-setting gains in the S&P 500 Index and Nasdaq 100 Stock Index. The US stock market was a major driver of the MSCI gauge’s 16% rally over the past 12 months.
Options Trader Wagers That Meta Shares Will Double Again; Trade rolls June 2025 $600 calls into June 2026 $950 strike; Meta shares doubled twice between November 2022 and now
Carly Wanna – Bloomberg
An options trader appears to be looking to parlay a winning bet on Meta Platforms Inc. into an even bigger windfall if the tech giant doubles – again – in the next 18 months. Early Wednesday, a trader sold a block of 19,000 call options that expire in June 2025 and allow the holder to purchase 1.9 million shares at $600, in exchange for twice as many calls with a $950 strike price expiring a year later, collecting $11.4 million.
Environmental, Social and Corporate Governance
Critical 1.5C threshold breached over 12-month period for first time; Data revealing hottest January ever is ‘stark warning’ of urgency of tackling climate change
Attracta Mooney, Jana Tauschinski and Steven Bernard – Financial Times
The average global temperature has for the first time breached the critical benchmark of 1.5C above pre-industrial levels over a 12-month period, according to data from the European earth observation agency showing that last month was the hottest January on record. As countries contend with bouts of extreme weather events, including floods and wildfires, the Brussels-based Copernicus Climate Change Service (C3S) said the global mean temperature for February 2023 to January 2024 was the highest ever at 15.02C, 1.52C above the 1850-1900 pre-industrial period.
UK advertising watchdog turns to AI to help police ‘dodgy’ green claims; Automated tools in marketing could amplify unverified climate buzzwords for products, says head of ASA
Kenza Bryan – Financial Times
The UK’s advertising watchdog will use artificial intelligence tools to boost the number of ads it scrutinises, in a crackdown on “dodgy claims” about environmental issues that are expected to proliferate due to the rise of generative AI. Advertising regulators around the world have to tackle “the scale, the volume and the pace of change” wrought by targeted and AI-generated marketing, according to Guy Parker, chief executive of the Advertising Standards Authority.
EU Delays New ESG Reporting Demands Amid Industry Pushback
Frances Schwartzkopff – Bloomberg
The European Union has agreed to delay additional ESG disclosure requirements by two years, as it responds to pressure from businesses leaders who warn they’re buckling under the weight of regulations. The EU’s Corporate Sustainability Reporting Directive had set a June 30 deadline for companies to report on thousands of data points, to give investors insight into their conduct on environmental, social and governance issues.
New Study Reveals Greenwashing as Key Obstacle for ESG Funds
OilPrice.com via Yahoo!finance
Investments into sustainable funds are reducing due to an increase in greenwashing and scepticism towards environment, social and governance focused investing, a new study has found. The whitepaper from Elise Gourier and Helene Mathurin at ESSEC Business School found that the issue of greenwashing had become “particularly prominent in the past five years”, especially within the financial industry. Greenwashing is when companies present misleading information about how environmentally friendly their products are.
Big Oil’s Blockbuster $114 Billion Investor Payout Is Most Ever
Kevin Crowley – Bloomberg
Oil supermajors returned more cash to shareholders than ever before last year as management teams reined in spending on new projects to free up cash for dividends and buybacks. There may be more to come. Exxon Mobil Corp., Chevron Corp., Shell Plc, TotalEnergies SE and BP Plc spent $113.8 billion on 2023 dividends and share repurchases despite a slump in crude prices. The outlays were more than 10% higher than a year earlier, when Russian’s invasion of Ukraine threw global energy markets into disarray, swelling oil-industry profits.
US Abused Power in Bid to Get Crypto Energy Data, Groups Say
Naureen S. Malik – Bloomberg
EPA Reports “Widespread Noncompliance” With the Nation’s First Regulations on Toxic Coal Ash; A glaring loophole already had allowed at least a half-billion tons of the waste to go unregulated. Now the agency says many of the facilities that are subject to the rules do not comply.
Amy Green – Inside Climate News
HSBC partners with Google to hit $1 bln climate tech finance goal
Simon Jessop and Sinead Cruise – Reuters
Dutch fund leading climate talks with Shell quits most oil investments
Ron Bousso – Reuters
France to Back Eur 2 Billion of Loans to Help Firms Tackle Climate; Le Maire says public finances too stretched to provide grants; Finance minister says immediate, radical decisions needed
William Horobin – Bloomberg
Norway oil fund boss criticises ExxonMobil’s ‘aggressive’ climate lawsuit; Top-10 shareholder weighs in on supermajor’s case against now-withdrawn emissions targets proposal
Richard Milne and Myles McCormick – Financial Times
Report: EU’s renewable energy rollout at risk due to grid connection delays
Xpansiv Promotes Janet Mihalyfi to President, Managed Solutions
StoneX Group Inc. Reports Fiscal 2024 First Quarter Financial Results; Quarterly Operating Revenues of $784.2 million, up 20%; Quarterly Net Income of $69.1 million, ROE of 19.3%; Quarterly Diluted EPS of $2.13 per share
StoneX Group Inc.
StoneX Group Inc. (the “Company”; NASDAQ: SNEX), a global financial services network that connects companies, organizations, traders and investors to the global market ecosystem through a unique blend of digital platforms, end-to-end clearing and execution services, high touch service and deep expertise, today announced its financial results for the fiscal year 2024 first quarter ended December 31, 2023.
The Multi-Family Problems at New York Community Bancorp; Another community bank runs into trouble.
Tracy Alloway and Joe Weisenthal – Bloomberg
Shares of New York Community Bancorp have plunged over 56% since Jan. 31, when the lender revealed a much larger provision for credit losses than expected. Analysts had been looking for the bank to set aside $45 million to cover bad loans. Instead, NYCB said it was putting aside $552 million, with the increased provisions “primarily attributable to higher net charge-offs, as well as, to address weakness in the office sector, potential repricing risk in the multi-family portfolio, and an increase in classified assets.”
UBS to Sell Billions More AT1 Bonds in Coming Years
Tasos Vossos – Bloomberg
UBS Group AG plans to sell billions more in Additional Tier 1 bonds over the next few years after a blockbuster deal last year that heralded a revival for the market for risky bank debt. The Swiss lender’s 2024 funding plan envisages issuing up to $2 billion equivalent of AT1s, according to its fourth-quarter investor presentation. Over the longer term, UBS plans to beef up its capital ratio while keeping its equity layer stable, “reflecting gradual build of AT1,” the statement said.
Citigroup Weighs Cutting 10% of Wealth Employees in London; Most roles are from assistant vice president to director level; Moves are separate from CEO Jane Fraser’s broader overhaul
Ambereen Choudhury – Bloomberg
Citigroup Inc. is weighing a move to cut 51 roles across its wealth business in London as the division’s new chief looks for ways to boost the returns generated by the unit. The cuts would affect about 10% of the unit’s 485 staffers in the UK and the bulk of the roles being eliminated would be from the assistant vice president to director level, according to a memo to staff seen by Bloomberg. They would include 21 roles in the firm’s private bank division, the memo shows.
Coutts poaches UBS executive after Farage ‘debanking’ scandal; NatWest hires Emma Crystal to lead its elite private bank
Akila Quinio – Financial Times
NatWest has poached UBS executive Emma Crystal to become chief executive of private bank Coutts, following the exit of Peter Flavel after the Nigel Farage “debanking” scandal. The state-backed bank said on Thursday that Crystal would join from UBS to lead its wealth division in the summer, subject to regulatory approval. She will join Coutts’s board as chief executive in the process.
US bank lobbyists ranks swell to post-crisis high amid regulatory pushback
Douglas Gillison – Reuters
A Tiny Fund Takes a Big Short on Corporate Debt Maturity Wall; Adam Schwartz is staking his own cash on a wave of defaults as ultracheap bonds start to expire.
Natasha Doff and Cecile Gutscher – Bloomberg
Quant Hedge Funds Suffer Rare Losses in China Stock Meltdown; China quants lost 7.2% in January, versus gains in 2023; Quants threatened by short-trading curbs, small-cap drop
Fidelity’s Abigail Johnson Shakes Up Executive Ranks, Again; Company names a new finance chief, among others, and reports higher operating income for 2023
Justin Baer – The Wall Street Journal
Work & Management
Sexism in the City: London Brokers to Face Harassment Scrutiny; Finance in London is still a “boys’ club.”; Women who want to join are exposed to harassment.
Damian Chmiel – Finance Magnates
Financial firms regulated by the Financial Conduct Authority (FCA) should prepare for harassment and misconduct surveys arriving next week. As confirmed by the regulator, the first questionnaires have already been sent to insurance companies, and next in line are banks and brokers.
A career of opportunities seized and change made; After taking a step back, Jos Schmitt reflects on his career so far and the changes he brought to Canadian capital markets
David Kitai – WealthProfessional.CA
Jos Schmitt was a CEO at age 28. Working in Brussels for Arthur Andersen Consulting – the firm that would become Accenture – he was assigned to a project electrifying the Brussels stock exchange. When his project was done, he told the chair of the board of the exchange that he loved the business, and he was ready to play a key role in it. Schmitt was given the strategy and operations portfolios.
Epstein Contacted Staley for Years at Barclays Using Go-Between, Court Filings Claim; Claim was made in legal documents seen by Bloomberg News; Staley previously said he cut contact with Epstein at Barclays
Harry Wilson, Ava Benny-Morrison, and Jason Leopold – Bloomberg
Former Barclays Plc Chief Executive Officer Jes Staley has long maintained that he cut off his friendship with Jeffrey Epstein once he became boss of the UK bank. Legal documents seen by Bloomberg News claim that he had indirect contact with the late pedophile financier for years after that.
‘Employers hold the cards now’ as power shifts in US jobs market; Businesses are making lay-offs, forcing staff back to offices and offering smaller wage increases
Taylor Nicole Rogers and Claire Jones – Financial Times
Headline figures pointing to a booming US job market are masking a shift in the balance of power from employee to employer, with companies becoming more demanding of their staff as they find it easier to replace them. US employers are laying off staff, forcing remote workers back into the office and becoming pickier with their hiring decisions, even as the economy continues to add jobs at a breakneck pace.
New Report Raises Concerns About Long Covid in Children; The condition is less prevalent among children than adults, but symptoms can disrupt their schoolwork and social lives.
Dana G. Smith and Dani Blum – The New York Times
A large analysis published Wednesday in the journal Pediatrics underscores the toll long Covid can take on children, in some cases leading to neurological, gastrointestinal, cardiovascular and behavioral symptoms in the months after an acute infection. “Long Covid in the U.S., in adults and in kids, is a serious problem,” said Dr. Ziyad Al-Aly, chief of research and development at the V.A. St. Louis Health Care System and a clinical epidemiologist at Washington University in St. Louis, who studies the condition but was not involved in the new report. He said that the paper, which drew on numerous studies of long Covid in children, is “important” and illustrates that the condition can affect multiple organ systems.
India Is Considering to Extend Parboiled Rice Tax in Risk to World Supply
Pratik Parija – Bloomberg
India, the world’s top rice shipper, may extend an export tax on the parboiled variety as part of efforts to ease food inflation ahead of national elections, a move that could keep world supply tight and send prices to new peaks. The government of Prime Minister Narendra Modi, who will seek a third term in the polls due in the first half of this year, is considering keeping the export levy at 20%, according to people familiar with the matter. There is no immediate proposal to ban exports of parboiled rice, said the people, who asked not to be identified as the talks are confidential. The tax is currently due to expire March 31.
In China, Deflation Tightens Its Grip; Consumer prices fall at sharpest pace in more than 14 years
Jason Douglas – The Wall Street Journal
Deflation is becoming more entrenched in China, with consumer prices falling in January at their steepest pace in more than 14 years-a stark symptom of deepening economic malaise that spells trouble for the global economy. The latest data suggest China faces a growing risk of slipping into a longer-term spell of falling prices that becomes harder to reverse the longer it lasts.
Why Angry Farmers Are Blocking Roads Across Europe
Lyubov Pronina – Bloomberg
A long-brewing crisis in European agriculture has burst into the open as farmers block roads and key border crossings and dump manure in front of public buildings. They’re angry about cheap food imports, subsidy cuts and a growing list of environmental directives that they say is pushing them out of business. Farmers represent little more than 4% of Europe’s workforce, but their grievances resonate with voters, making it hard for politicians to dismiss their demands.
Brazil Mogul Wants to Sell the World’s Best ESG Chocolate; Dengo is investing $20 million to expand its sustainable sweets in Europe and North America.
Rachel Gamarski – Bloomberg
Most people would look at the paradisiacal coast of Bahia in northeastern Brazil and think of beachy holidays and the place where F1 star driver Lewis Hamilton chose to celebrate New Year’s Eve 2023. But one enterprising businessman looks at it and sees the opportunity to produce a game-changing chocolate.
India Is Scorning the Energy Bounty That Transformed China; Touting carbon capture and storage is wishful thinking at best, and dangerous shortsightedness at worst. Just look at China.
David Fickling – Bloomberg
You know an electricity policy is bankrupt when its advocates start touting the virtues of carbon capture and storage. Decades of promoting the technology, also known as CCS – which aims to filter the carbon dioxide from smokestacks and inject the pollution deep underground – have failed to produce more than a handful of operating plants. So plans by India’s government think tank Niti Aayog to capture as much of 70% of the country’s power-sector emissions should be treated as wishful thinking at best, and dangerous shortsightedness at worst. “We have abundant coal and we want to use it, in a sustainable way,” the body’s energy adviser Rajnath Ram told Bloomberg News.