Chinese Newspaper Editor Moving Markets With His Tweets; Exchanges Shy Away From Mini-IPOs

Jun 11, 2019

First Read

Hits & Takes
JLN Staff

Colleen Sullivan, CEO of CMT Digital, will be a keynote speaker at the June 25th Crypto Evolved event in New York. Other speakers include former CFTC Chairman Timothy Massad, LMAX Exchange Group CEO David Mercer and IHS Markit Senior Vice President and Global Head of Loans and CEO of Markitserv Brad Levy. Register for Crypto Evolved HERE.~JJL

The NFA Board Update from their May 2019 meeting is up on their website. In the video, NFA Vice-Chairman Maureen Downs and President Tom Sexton discuss highlights and other notable information from NFA’s May board meeting. Look for a new format for their August board update video.~JJL

Don’t forget to sign your interns and new employees up for the MarketsWiki Education World of Opportunity series in Chicago on July 16 and 17. Sign them up HERE.~JJL

Have you seen any of the Options Exchange Leader Series? See the following links for updates on MIAX, Cboe, NYSE and BOX. (Nasdaq’s video is below.)~SD

IllinoisTech is honoring Chicago native and retired chairman of CME Group John (Jack) F. Sandner at Tech-X 2019. Join them on Monday, June 24 at the Skylight Board of Trade to celebrate student-driven innovation and tech entrepreneurship. More details are here.~[[JJL

CCN, a well-known, oft-quoted, cryptocurrency-focused news site, is going out of business. The site posted this article yesterday, which said that due to Google’s recent core update, web traffic algorithms have changed in such a way that CCN’s web traffic plummeted over 90 percent overnight, making the business of running the site untenable. The article also includes a list of other web-based businesses that were affected negatively, as well as another list of websites whose web traffic increased after the update.~MR

ABN AMRO has something called “Vitality Week” where they are connecting three of their offices by cycling, running and sailing. The first leg consists of 350 miles from Frankfurt to Amsterdam.~JJL

It is always fun when NASA comes to visit you, which is what happened Friday at Nasdaq. Three senior members of the NASA leadership were at Nasdaq to promote the International Space Station.~JJL

Starbucks launched a reusable cup trial at Gatwick Airport in London. How about a penny for FFK for every cup you reuse?~JK

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Options Industry Leader Series: Volatility Products, Interacting with Order Flow and Complex Order Books – Nasdaq
JohnLothianNews.com

In this video from the Options Exchange Leader Series, Nasdaq Vice President and Head of US Options Greg Ferrari discusses the exchange’s plans for its own volatility products, trading technology developments and how market participants interact with options order flow.

Watch the video »

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R.J. O’Brien Appoints Harrington Global Head of Internal Audit; New Position Brings Function In-House
R.J. O’Brien & Associates
Chicago-based R.J. O’Brien & Associates (RJO), the oldest and largest independent futures brokerage and clearing firm in the United States, announced today the appointment of William Harrington to the new post of Managing Director, Global Head of Internal Audit. Harrington has more than 25 years of experience providing audit and consulting services to financial services companies, including the past several years spearheading the outsourced internal audit function for RJO at FGMK, LLC.
/prn.to/2F51d4t

***** An all Irish news release.~JJL

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Should You Worry About Intercontinental Exchange, Inc.’s (NYSE:ICE) CEO Pay Cheque?
Simply Wall St.
Jeff Sprecher has been the CEO of Intercontinental Exchange, Inc. (NYSE:ICE) since 2000. First, this article will compare CEO compensation with compensation at other large companies. After that, we will consider the growth in the business. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.
/yhoo.it/2F5asSd

*****There are things I worry about. Jeff Sprecher’s paycheck is not one of them. You might not be able to pay him enough for what he accomplished.~JJL

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Monday’s Top Three
Our top story of the day was Crain’s Chicago Business’ Futures broker R. J. O’Brien & Associates banks on international expansion. Second was the FT’s ‘Flash Boys’ challenger IEX struggles in quest to transform trading. Third was the JLN mention of our 2013 interview with the late Joe O’Neill, of the former New York Board of Trade, in When Joe O’Neill Went Hollywood: “Trading Places” 30 Years Later. If you want to know the real story on how the movie got everything so right, this is the interview to watch. It also includes one of my favorite lines in the movies. “Pork bellies, which is used to make bacon, which you might find in a BACON and LETTUCE and TOMATO sandwich.”

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Lead Stories

This Chinese Newspaper Editor Is Moving Markets With His Tweets
Bloomberg News
Global Times chief Hu Xijin’s posts have power to move markets; Hu has forecast retaliatory moves on U.S., FedEx investigation
Investors anxious to know how China’s opaque government is prosecuting the trade war are paying close attention to an unlikely source: the editor of one of the country’s most combative state-run newspapers.
/bloom.bg/2EXACX5

Exchanges Shy Away From Mini-IPOs After Fraud Concerns; Nasdaq is toughening requirements for Reg A+ IPOs in the wake of cryptocurrency venture Longfin’s 2017 listing
Alexander Osipovich – WSJ
Nasdaq Inc. and the New York Stock Exchange are pulling back from a fast-track IPO process to help small companies go public, following a spate of problematic listings.
/on.wsj.com/2EZKYpi

Boris Johnson Is Underpriced By the Financial Markets; Sterling could well get a lift if the former Mayor of London becomes prime minister. International investors want clarity before they return to the U.K.
Marcus Ashworth – Bloomberg
Sterling is in the dumps as the interminable delay to resolving Brexit is clearly holding back the U.K. economy. Perhaps the contest to choose a new leader for the ruling Conservative party, which started in earnest on Monday, can provide a change in direction for the currency.
/bloom.bg/2F2Rg7I

SGX plans push into foreign exchange markets; Exchange seeks to capitalise on regulator’s efforts to promote Singapore as currency trading hub
Philip Stafford – FT
SGX, the Singapore exchange, is planning an aggressive expansion in foreign exchange markets over the next five years, aiming to capitalise on efforts from local regulators to strengthen the country’s grip as Asia’s largest currency trading hub.
/on.ft.com/2F1PWSw

Nasdaq Partners with CryptoCompare to Offer Institutions Access to Market-leading Cryptocurrency Data
CryptoCompare
CryptoCompare, the leading provider of cryptocurrency data and indices, and Nasdaq, a leading global provider of trading, clearing, exchange technology, listing, information and public company services, today announced a strategic partnership to launch a cryptocurrency pricing product, the Nasdaq/CryptoCompare Aggregate Crypto Reference Prices. The product will be made available on Quandl, a Nasdaq owned leading-edge data platform and the premier source for financial, economic and alternative datasets.
bit.ly/2F1MSWA

BOE Warns of Downside Risks From No-Deal Brexit and Global Trade
Lucy Meakin, Jill Ward and David Goodman – Bloomberg
Policy makers Saunders, Broadbent and Vlieghe comment Tuesday; Disorderly Brexit seen as weakening U.K.’s global trade clout
Bank of England policy makers reiterated the downside risks to the U.K. economy from Brexit and global trade tensions, even as they emphasized that interest rates could still rise.
/bloom.bg/2Ff0a2b

US regulators ill prepared for next downturn; Congress must restore powers that were stripped away after the financial crisis
Eugene Ludwig – FT
Central bankers have been warning that rising levels of corporate debt pose risks to the financial system because they could amplify a downturn. Some private-sector investors whisper that the downturn is on the horizon and could be ugly. They cite a witches’ brew of leverage, too much money chasing too few deals and the growing trade war.
/on.ft.com/2F3keEt

US, Canada and Australia join forces to tackle metal shortage risk; Concern grows over increase in consumption to support shift to electric vehicles
Ed Crooks – FT
The US and allied countries have launched an international effort to encourage responsible development of materials needed for new energy technologies, including lithium, copper and cobalt, as they attempt to ensure future supplies of critical resources.
/on.ft.com/2F53xsd

Do-Good Capitalism Has to Act as If the World Depends on It; Impact investors have deployed $502 billion but it’s only just scratching the surface of the world’s problems.
Emily Chasan – Bloomberg
Climate change, extreme poverty, and all the world’s other big problems will be expensive to solve.
/bloom.bg/2F2N4F0

Regulators Alarmed by Risky Loans, But Don’t Know Who Holds Them
Sally Bakewell and Thomas Beardsworth – Bloomberg
The steady drumbeat of warnings over the surge in risky corporate borrowing is growing louder and louder. Time and again, regulators in the U.S. and Europe have pointed to the hazards of businesses taking on too much debt.
/bloom.bg/2F2L9jM

Woodford Faces New U.K. Regulatory Pressure to Waive Fees
Silla Brush and Suzy Waite – Bloomberg
FCA’s Bailey says suspension helps avoid fire sale of assets; Top lawmaker, Hargreaves Lansdown also call for fee reprieve
The City of London’s top regulator added his voice to calls for Neil Woodford to rethink charging management fees while investors are barred from withdrawing money from his flagship fund.
/bloom.bg/2F0ariA

Deutsche Bank Tax Probe Targets About 80 Current, Former Staff
Karin Matussek and Steven Arons – Bloomberg
About 80 former and current employees of Deutsche Bank AG are suspects in an investigation by German prosecutors into an alleged tax fraud, according to a person familiar with the matter.
/bloom.bg/2F39BBr

Fired Cantor Fitzgerald Trader Drops Lawsuit Over ‘Wash Trades’
Kaye Wiggins – Bloomberg
Ash Nadershahi pulls his case part-way through a 13-day trial; He said he’d blown the whistle; Cantor called case ‘baseless’
A former Cantor Fitzgerald LP trader dropped an employment lawsuit against the bank in which he’d claimed he was fired because he blew the whistle on so-called “wash trades.”
/bloom.bg/2F5h5ns

The World Federation Of Exchanges Responds To IOSCO’s Sustainable Finance Network Survey
WFE
The World Federation of Exchanges (“WFE”), the global industry group for exchanges and CCPs, has today responded to the International Organization of Securities Commissions’ (IOSCO) Sustainable Finance Network (SFN) survey, which aims to inform the SFN of sustainable finance-related initiatives taken or planned by securities regulators and market participants, and initiatives taken by international bodies, industry lead groups and standard-setters regarding sustainable finance and how these relate to the role of securities regulators.
bit.ly/2Wxcpg6

Exchanges, OTC and Clearing

Cboe looks to add speed bump to equities exchange; LP≤ four millisecond delay mechanism will be applied to the Cboe EDGA exchange to protect market makers from HFTs.
Hayley McDowell – The Trade
Exchange operator Cboe Global Markets has submitted an application to US authorities to implement a ‘speed bump’ on its equities exchange.
bit.ly/2F5dZjk

TMX Group Equity Financing Statistics – May 2019
TMX
TMX Group today announced its financing activity on Toronto Stock Exchange (TSX) and TSX Venture Exchange (TSXV) for May 2019.
bit.ly/2F4sPXD

The World Federation Of Exchanges Responds To IOSCO’s Sustainable Finance Network Survey
WFE
The WFE’s response summarised the work the association has done on environmental, social and governance (ESG) issues since the inception of its Sustainability Working Group in 2014. This work ranges from the annual Sustainability Survey (2016; 2017; and 2018), to its ESG Guidance & Metrics (in 2015 and 2018), and last year’s Sustainability Principles. The WFE also recently responded to IOSCO’s Growth and Emerging Market Committee (GEMC) consultation on ‘Sustainable Finance in Emerging Markets and the Role of Securities Regulators’.
bit.ly/2Wxcpg6

DTCC widens trade repository partnerships
FINEXTRA
The Depository Trust & Clearing Corporation (DTCC), the premier post-trade market infrastructure for the global financial services industry, today announced new partnerships with Catena Technologies, Compliance Solutions Strategies (CSS) and Finastra, to further support our mutual clients who will leverage DTCC’s Global Trade Repository (GTR) service in support of forthcoming Securities Financing Transactions Regulation (SFTR) obligations, which are anticipated to take effect in April 2020.
bit.ly/2F3jA9M

Alibaba’s Hong Kong Share Offering Should Worry U.S. Markets; The company isn’t abandoning New York, but its plan to add a listing in Asia tells other Chinese companies they have an IPO option closer to home.
Nisha Gopalan – Bloomberg
Alibaba’s $25 billion debut on the New York Stock Exchange in 2014 was, at the time, the largest-ever initial public offering in the U.S. Now that the company is said to be planning to raise $20 billion from a secondary stock offering in Hong Kong, the operators of America’s top exchanges should be worried that business from China will start to dry up.
/bloom.bg/2EZFZVt

Fintech

What a debut securitisation tells us about fintech
Thomas Hale – FT
Today, Lendinvest, a company which makes property loans over the internet, launched its first securitisation.
/on.ft.com/2F5d8z8

Naspers Makes Its Biggest Takeover in Digital Payments
Alastair Marsh – Bloomberg
Naspers Ltd.’s PayU agreed to buy Turkish digital payments company Iyzico for $165 million in its biggest fintech acquisition yet.
/bloom.bg/2FeVmKb

ACA Compliance Group Announces Enhanced Trade Blotter Review Analysis Powered by ACA’s Decryptex Surveillance Technology
ACA Compliance Group
ACA Compliance Group (ACA), a leading provider of governance, risk, and compliance advisory services and technology solutions, today announced enhancements to ACA’s trade blotter review analysis offering. Available today, this new automated trade blotter review tool is designed in response to challenges faced by SEC-registered investment adviser clients in keeping pace with the SEC’s enhanced use of technology to detect insider trading, market abuse, and other potential misconduct.
bit.ly/2R1mosZ

Hitachi Solutions America Named to Four Microsoft 2019 Partner of the Year Awards
PR Newswire
Hitachi Solutions America, Ltd., a leading provider of global industry solutions powered by the Microsoft Cloud, is proud to announce it has won the Microsoft Global Dynamics 365 for Field Service Partner of the Year Award and the Global Government Partner of the Year Award. Hitachi Solutions was also named Finalist for Dynamics 365 for Customer Service Partner of the Year Award and Finalist for the Global Manufacturing and Resources Partner of the Year Award.
/yhoo.it/2R4RL5L

Cryptocurrencies

Who’s buying and selling bitcoin futures? An analysis of the CFTC COT report
Ryan Todd – The Block
The total number of unique bitcoin futures traders has come back down to around 40 accounts since CBOE halted its product. There currently isn’t any sell-side/bank representation in making markets for bitcoin futures, and only 4 asset managers/institutional investors have ever registered as a reportable trader in the report. Of the outstanding contracts that are net long, hedge funds currently have by far the greatest outstanding notional value, now north of $100 million. As of this past week, hedge funds have now flipped to a more neutral net positioning, while Other traders are significantly net short (80/20).
bit.ly/2WuZ3FY

CCN is closing and says Google is to blame
The Block
Leading crypto publication CCN.com announced it’s shutting down due to a stark drop in traffic arising from Google’s June 2019 Core Update. In an editorial from Hawkfish AS and CCN Markets founder Jonas Borchgrevink, the site reported daily revenue was down by more than 90% within two days of the update.
bit.ly/2MD15zy

Yahoo Japan-Backed Exchange Launches Crypto-Yen Markets and Margin Trading
Jamie Redman – Bitcoin.com News
Back in April 2018, it was revealed that Yahoo Japan was planning to launch a cryptocurrency exchange licensed by Japan’s Financial Services Agency (FSA). Now, a year later, Yahoo Japan’s trading platform Taotao is open offering BTC and ETH trading while also providing users with margin trading available in litecoin (LTC), ripple (XRP) and bitcoin cash (BCH).
bit.ly/2wN2AAa

Cryptocurrency CEO who paid $4.6M for lunch with Buffett: ‘It might be unrealistic’
Daniel Roberts – Yahoo Finance
Warren Buffett has called cryptocurrency a “gambling device” with “a lot of fraud,” and declared, “That is not investing.” Justin Sun is going to attempt to change Buffett’s mind. Sun, cofounder and CEO of the cryptocurrency project Tron, bid $4.56 million in the annual eBay charity auction earlier this month to win lunch with Buffett. Sun has not shared when the lunch will take place, but tweeted on Monday that he has confirmed the lunch with Buffett. The location will be Smith & Wollensky in New York City, and Sun can bring seven friends to join.
/yhoo.it/2ZfRGPD

A Bloomberg rival is giving its users access to BitMEX’s derivatives data
Celia Wan – The Block
Cryptocurrency derivatives shop BitMEX is looking to tap into a pool of institutional investors via the rival of the ubiquitous Bloomberg Terminal. The Eikon Terminal, a spin-off of Thomson Reuters and Bloomberg’s main rival, now supplies traders with cryptocurrency futures data from BitMEX. The collaboration between the terminal and the crypto derivatives shop is facilitated by crypto market data firm CryptoCompare, which has a long-term partnership with Reuters, according to CryptoCompare CEO Charles Hayter.
bit.ly/2Zh6nC8

Coinbase Earn Now Supports Ethereum-Based Dai Stablecoin
Max Boddy – Cointelegraph
Major crypto platform Coinbase has added a course on MakerDao’s stablecoin dai in its educational portal Coinbase Earn, according to an official blog post by Coinbase on June 10. According to the post, dai is the first stablecoin covered by Coinbase Earn, which will offer videos and quizzes to help users learn about the token, and receive some Dai for their efforts. As summarized in the announcement, the Ethereum-based stablecoin Dai is backed by its sister token maker (MKR) and is balanced around retaining a stable value of $1 over time.
bit.ly/31ncKpl

The Rick Santorum-backed coin for Catholics
Jemima Kelly – FT Alphaville
Rick Santorum, the former senator for Pennsylvania and two-time Republican presidential candidate, has long been known for his religious zeal. An aide to Santorum told the New York Times back in 2005 that Santorum was “a Catholic missionary who happens to be in the Senate”, and his comments on homosexuality and same-sex marriage once spawned a campaign for the neologism “santorum”.
/on.ft.com/2F3SCio

Korea’s Biggest Bank Is Preparing to Custody Digital Assets
Daniel Palmer – Coindesk
KB Kookmin, the largest bank in South Korea, is preparing launch a digital asset custody offering.
bit.ly/2F3lR53

Lex Sokolin joins ConsenSys as Global Head of FinTech, expanding London team and hinting at payments focus
Isabel Woodford – The Block Crypto
Lex Sokolin, a former Partner at Autonomous Research, has joined the ranks at ConsenSys as Global Fintech Co-head, The Block has learned.
bit.ly/2F5eU3g

Metaco Offering Crypto Custody Insurance via Giant Broker Aon
Ian Allison – Coindesk
Aon, the world’s second-largest insurance broker by revenues, has lined up a panel of insurers to provide cryptocurrency coverage for clients of Metaco, a digital asset custody technology firm.
bit.ly/2F2Rpbg

Messaging Giant Telegram’s ICO Token Is at Last Going on Public Sale=
Daniel Palmer – Coindesk
Messaging app giant Telegram’s gram token, previously sold to accredited investors in the biggest ICO of all time back in early 2018, is at last to be offered to the public.
bit.ly/2F3KHSb

Politics

Justice Dept. Agrees to Turn Over Key Mueller Evidence to House
Nicholas Fandos – The New York Times
The Justice Department, after weeks of tense negotiations, has agreed to provide Congress with key evidence collected by Robert S. Mueller III that House Judiciary Committee members said could shed light on possible obstruction of justice and abuse of power by President Trump, the House Judiciary Committee said on Monday.
/nyti.ms/2X3HvjC

Trump Says He’ll Raise China Tariffs If Xi Won’t Meet at G-20
Margaret Talev and Kathleen Hunter – Bloomberg
President again suggests Huawei could be part of trade talks; Says again that part of Mexican migration deal is secret
President Donald Trump threatened to raise tariffs on China again if President Xi Jinping doesn’t meet with him at the upcoming Group of 20 summit in Japan.
/bloom.bg/2F33Vrc

As Biden tours Iowa, farmers want to know where he stands on ethanol
Jarrett Renshaw – Reuters
Joe Biden may have an ethanol problem. The former U.S. vice president has pledged support for advanced biofuels as part of his bid for the 2020 Democratic presidential nomination.
/reut.rs/2F3f4br

Trump’s war on the media may endanger free press, leading the US down an uncertain path
Jim Acosta, CNN
Washington (CNN)It was February 16, 2017, and President Donald J. Trump had just held a news conference in the White House East Room to confront questions about his decision to fire his national security adviser, Michael Flynn. As he was jousting with reporters over the still unfolding details of the Russia investigation, Trump offered a new twist on his recent line of attack on the press.
/cnn.it/2F2RDPE

Donald Trump’s Failures Make Him Even More Dangerous; If countries keep calling the president’s bluff, as Mexico has done, there’s a good chance he may start burning things down just to prove a point.
Timothy L. O’Brien – Bloomberg
Any remaining thoughts that President Donald Trump has been playing three-dimensional chess while everyone else around him is engaged in less sophisticated pursuits should perish with his sudden abandonment of tariff threats against Mexico.
/bloom.bg/2EXAN4H

Regulation

CFTC Chairman J. Christopher Giancarlo Announces Signing of Collective Bargaining Agreement with National Treasury Employees Union
CFTC
Commodity Futures Trading Commission (CFTC) Chairman J. Christopher Giancarlo joined Tony Reardon, President of the National Treasury Employees Union, to sign a new Master Collective Bargaining Agreement (CBA) today at CFTC’s Washington, D.C. headquarters. This marks the first Master CBA that covers all bargaining unit employees CFTC-wide.
bit.ly/2EZJGKP

SEC Updates List of Firms Using Inaccurate Information to Solicit Investors
SEC
The Securities and Exchange Commission today announced that it updated its list of unregistered entities that use misleading information to solicit primarily non-U.S. investors, adding 11 soliciting entities, four impersonators of genuine firms, and nine bogus regulators.
bit.ly/2F4t9Wl

OTC Transparency Data Issue (Resolved)
FINRA
As announced in a Technical Notice on 6/3/19, there was an issue in the Tier 1 5/13/19 weekly report where some ATS data was unattributed. The issue has now been resolved. The unattributed data was actually associated with trade activity on the MLIX Instinct X ATS. The line data for MLIX has now been updated to reflect the additional activity.
bit.ly/2F2OzTJ

Commonwealth Financial Planning completes compliance with ASIC Court Enforceable Undertaking
ASIC
Commonwealth Financial Planning (CFPL) has complied with the Court Enforceable Undertaking (CEU) entered into with ASIC in April 2018 regarding CFPL’s fees for no service conduct.
bit.ly/2F2NviH

Federal Court finds Whitebox Trading Pty Ltd and its sole director did not engage in market manipulation
ASIC
The Federal Court of Australia found, on 7 June 2019, that Whitebox Trading Pty Ltd and its sole director and principal, Johannes Boshoff, did not engage in market manipulation in contravention of section 1041A, and contraventions of 1041B, of the Corporations Act in connection with orders they placed on ASX Limited for securities comprised in the S&P ASX 200 Index (Index Securities), on 18 October 2012, as well as on four earlier dates in 2012. Accordingly, the Court also found that Mr Boshoff did not fail in the discharge of his duties as a director of Whitebox.
bit.ly/2EXxMBp

FCA to scrutinise fund supermarket impartiality after Woodford saga; Watchdog to re-examine ‘best buy’ lists of Hargreaves Lansdown and others
Caroline Binham – FT
The meltdown of Neil Woodford’s flagship fund has prompted the UK’s financial regulator to scrutinise whether Hargreaves Lansdown and other fund supermarkets that create “best buy” lists have been impartial enough when they backed the fund.
/on.ft.com/2F1zFNe

Europe’s banking watchdog warns on wave of dirty money; Extra powers not enough to solve the problem, says EBA’s new head
Caroline Binham and Martin Arnold – FT
New powers given to Europe’s banking watchdog are not enough to stem the tide of dirty money sweeping through the bloc that has been revealed by recent scandals, the head of the European Banking Authority said.
/on.ft.com/2F5culc

CFTC Commissioner Quintenz to Speak at the New York City Bar Association, Futures and Derivatives Regulation Committee
CFTC
bit.ly/2R1FOhv

Former Goldman Banker Gets Three Months for Insider Trading
Chris Dolmetsch and Bob Van Voris – Bloomberg
Woojae Jung tipped brother in Korea to $10.6 billion tech deal; Jung graduated from Wharton and made vice president at Goldman
A former Goldman Sachs Group Inc. banker was sentenced to three months in prison for using a secret account to reap thousands of dollars in illegal profits by trading on inside information about company clients.
/bloom.bg/2Ff0MVx

Investing and Trading

Russell US Indexes annual reconstitution period begins, projected additions & deletions posted
FTSE Russell Press Release (June 7)
Today FTSE Russell, a leading global index, data and analytics provider, posted its official preliminary lists of companies set to enter or leave the US broad-market Russell 3000 Index and the Russell Microcap Index following completion of the annual Russell US Indexes Reconstitution. The rebalance will take place after US equity markets close on Friday, June 28. The lists of 166 projected additions and 157 projected deletions for the Russell US Indexes are now available on the FTSE Russell website.
bit.ly/2XCriiD

The Fear Gauge Is Sounding an Alarm Even as U.S. Stocks Surge
Luke Kawa – Bloomberg
Cboe Volatility Index is up over the past three sessions; It’s unusual for VIX to stay high while stocks rally
Remain vigilant. That’s the apparent message the Cboe Volatility Index is flashing, even as cash equities race toward records.
/bloom.bg/2F1HWB2

Ethical investment needs more transparency; Investors looking for moral options depend on accurate information
The editorial board – FT
Morality is big business. So far, investors in the burgeoning $30tn responsible investment market have relied on a form of frontier justice to keep the industry honest. Less than pure companies that have tried to avail themselves of the capital on offer face public relations damage and disapproval from the markets. But if the sector is to mature and live up to its promise, the biggest players need to agree and enforce a higher standard of disclosure.
/on.ft.com/2F2Of7o

Denmark’s Investment Firms Warned Over Bad Advice Amid Low Rates
Christian Wienberg – Bloomberg
Denmark’s financial regulator is warning investment firms to ensure they don’t encourage clients to take on more risk than they can handle as negative interest rates alter the asset-management environment.
/bloom.bg/2F1KJdk

Swiss Franc Is Best Bet in History of Fed Easing, JPMorgan Says
Susanne Barton – Bloomberg
JPMorgan lowers its forecast on USD/CHF to 0.95, from 0.98; Swiss currency is up 2.2% versus the greenback in past month
Swiss franc bulls have history on their side as speculation grows that the Federal Reserve is about to cut rates.
/bloom.bg/2F0a3Ra

Institutions

Wells Fargo launches outsourced trading with new prime trade services group; Wells Fargo has unveiled its new prime trade service group with access to high- and low-touch outsourced trading functions.
Hayley McDowell – The Trade
US investment bank Wells Fargo has confirmed the launch of its new prime trade services group to provide buy-side clients with access to outsourced and agency trading.
bit.ly/2F5dK7U

Goldman’s Marcus bank teams up with Saga to target over-50s; US investment bank plans to tap into the savings potential of older UK clients
Sarah Provan – FT
Goldman Sachs plans to team up its consumer bank in the UK with Saga, which specialises in products and services for the over-50s, as part of the international expansion of its retail banking arm.
/on.ft.com/2F1N5ZI

Deutsche Bank Executive Ignored Kickback Concerns, Vestia Says
Kaye Wiggins – Bloomberg
Claus Telaar, and bank, deny allegations by housing firm; Stichting Vestia says payments invalidate trading losses
A lawyer for a Dutch housing firm said a Deutsche Bank AG executive “did nothing” about possible kickbacks to an official at the housing company, despite alarm bells that should have indicated “something suspicious” was going on.
/bloom.bg/2F5bXQe

New Groping and Stalking Claims Deepen Lloyd’s of London Scandal
Gavin Finch – Bloomberg
Two executives at Tokio Marine Kiln resigned after allegations; Unit of Japanese insurer is one of Lloyd’s largest agents
Two executives at a top Lloyd’s of London insurance company have resigned following allegations of sexual harassment. One was accused of groping colleagues at a booze-fueled party, the other of stalking a junior employee.
/bloom.bg/2F3harI

Regions

China’s Huatai looks to raise as much as $2bn in London listing; Brokerage to become first group to list in London as part of new link between UK and China
Sarah Provan – FT
Brokerage Huatai Securities said on Tuesday it seeks to raise as much as $2bn when it becomes the first Chinese company to list in London as part of a new link between the two market centres.
/on.ft.com/2F2M8k3

Nordea Spared Laundering Probe as Finland Drops Browder Case
Kati Pohjanpalo – Bloomberg
Investor Bill Browder filed complaint in Finland in October; Finnish police says there is no reason to suspect offence
Finland won’t start a formal investigation into Nordea Bank Abp after Hermitage Capital co-founder Bill Browder filed a criminal complaint accusing the Nordic region’s biggest financial firm of money laundering.
/bloom.bg/2F4BY2b

China-backed infrastructure bank AIIB to start local currency financing amid trade war, forex concerns; Infrastructure bank to pilot local currency financing in India rupee, Indonesian rupiah, says vice-president
Xie Yu – South China Morning Post
The Beijing-headquartered Asian Infrastructure Investment Bank (AIIB) will soon conduct financing activity in local currencies, in response to significant demand from member countries amid an escalating trade war between China and the United States and related uncertainties, it said on Monday.
bit.ly/2F3hBCm

Ruthless Heat Threatens California With Fires as Power Surges
Gerald Porter Jr. and Brian K Sullivan – Bloomberg
Temperatures surpassed 100 degrees Fahrenheit in some of state; Dry, hot weather combined with strong winds pose fire threat
An unrelenting heat already frying California is threatening to send temperatures to record levels across the western U.S. this week, raising the risk of wildfires and propelling electricity prices to their highest levels since March.
/bloom.bg/2F1SiRm

China introduces risk-hedging tool for bank debt amid market jitters about smaller lenders
Reuters
China’s central bank introduced a credit risk hedging tool on Monday for holders of debt issued by Bank of Jinzhou, the latest measure by regulators to calm market jitters about the health of smaller banks.
/reut.rs/2F37Vrz

Brexit

Brexit and Corbynism politics are breaking Britain’s constitution; Narrow intolerance on both sides is testing the current settlement to destruction
Robert Shrimsley – FT
British politics has become so routinely shocking that sometimes you have to remember to be surprised.
/on.ft.com/2F3cuCh

South Korea agrees deal with UK for post-Brexit trade; Britain has secured agreements accounting for 63% of commerce covered by EU deals
Song Jung-a, Naomi Rovnick and Chris Giles – FT
Britain took a big step towards shoring up worldwide trade relations in the event of a no-deal Brexit by signing a stopgap agreement with South Korea on Monday.
/on.ft.com/2F4qCvj

Harper Says ‘Not Credible’ to Leave EU by Oct. 31: Brexit Update
Alex Morales, Kitty Donaldson and Thomas Penny – Bloomberg
A record field of 10 British Conservatives are fighting to replace Theresa May as prime minister, with Brexit the dominant issue. Andrea Leadsom said she’s pushing for what she calls a “managed exit,” while outsider Mark Harper bucked the trend by saying it was “not credible” for the U.K. to leave the European Union by the Oct. 31 deadline.
/bloom.bg/2F3bJJr

Miscellaneous

Saving the Planet With Electric Cars Means Strangling This Desert; Mining lithium and copper to supply the battery boom and fight climate change is wrecking a fragile ecosystem in Chile.
Laura Millan Lombrana – Bloomberg
The oases that once interrupted the dusty slopes of the Atacama desert in northern Chile allowed humans and animals to survive for thousands of years in the world’s driest climate. That was before the mining started.
/bloom.bg/2F4tR5X

John Lothian Newsletter

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Past Newsletters

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