Hits & Takes
By John Lothian
Always start with WHO. The World Health Organization (WHO) yesterday declared the coronavirus outbreak to be a pandemic. Stories emerged about Italy shutting down everything but food stores and pharmacies. Word came out that March Madness would live up to its name in the form of no fans in the stands. Late in the day, after President Trump banned visitors from Europe to the U.S. for 30 days, the NBA cancelled its season indefinitely after a player tested positive for the virus.
CME Group closed its trading floor as of the market close on Friday the 13th, an appropriate date. NYSE is restricting access to its trading floor and getting ready to close it. Business Insider reported that Intercontinental Exchange is closing its London office, home to its European futures business, for the rest of the week after an employee tested positive for coronavirus.
Friday, John Lothian News will go to a work at home mode to test systems to make sure everyone has what they need to work effectively. We are suspending video shoots for the time being as well. And given the speed with which this all this happening, we could be working at home for a while. JP Morgan is planning to ask staff to work from home too.
I am feeling especially vulnerable as I have health conditions that might make the virus worse for me should (when) I contract it. A few weeks back, I was diagnosed with blood clots in my right lung and in both my legs. I am taking blood thinners to battle this. I am trying to be more safe, so I am not sorry. Or to use a popular phrase, I am using an “abundance of caution.”~JJL
My son Robby’s school, the University of Missouri, is suspending in-person classroom teaching and moving to all online. They will operate that way until after spring break, but it could be extended, as many universities are doing.
Other firms around the street have already moved to a work from home mode, or are testing it to make sure everything works. The CBOT Building was looking somewhat empty yesterday and will only be getting more so with the CME Group trading floors closing.
The CFTC postponed its Ag conference set for Kansas City and moved its meeting back to Washington, DC.
NFA: Due to maintenance, the following systems will be unavailable from 7:00 a.m. until 12:00 p.m. CT on Sunday, March 15, 2020: Online Registration System (ORS), BASIC Data Entry, Security Futures Products Training, Online Payments, Online Arbitration Claims, Arbitrator Profile, Arbitrator Training, Employment Application and Profile System, and all Electronic Filings Systems including EasyFile, Exemptions, Questionnaire, and Disclosure Documents.~JJL
My alma mater sent me an update about its COVID-19 policy. They’re extending Spring Break through the week of March 16-22. Starting March 23, they’re resuming classes, but only online, and regular classes aren’t starting again until March 30. They’re also cancelling all on-campus events until then, including sporting events. They’re also “not asking students who are studying abroad to return home” – which of course means that they’re asking students who are studying abroad not to return home, if possible.~MR
Young people capitalize on cheap coronavirus flights: ‘If I die, I die’
Ben Kesslen – NBC News
As people around the world canceled their trips because of fears of the new coronavirus, Ashley Henkel booked three.
Henkel, 20, is taking advantage of cheap flights to see North America. She lives in California’s Central Valley, but this summer she’ll be in Vancouver, New York City and Portland, Oregon.
A college student itching to travel, she’s one of many people staring the deadly virus in the face and saying, “Whatever.”
*****It might not kill you, but you can give it to someone it will kill.~JJL
Cancel Everything; Social distancing is the only way to stop the coronavirus. We must start immediately.
Yascha Mounk – The Atlantic
We don’t yet know the full ramifications of the novel coronavirus. But three crucial facts have become clear in the first months of this extraordinary global event. And what they add up to is not an invocation to stay calm, as so many politicians around the globe are incessantly suggesting; it is, on the contrary, the case for changing our behavior in radical ways—right now.
*****I am in this court.~JJL
UK more nostalgic for empire than other ex-colonial powers
Robert Booth – The Guardian
A third of people in the UK believe Britain’s colonies were better off for being part of an empire, a higher proportion than in any of the other major colonial powers, a global survey has revealed.
Britons are also more likely to say they would like their country to still have an empire than people in France, Italy, Spain, the Netherlands, Belgium, Germany or Japan, the YouGov polling found.
******That is what happens when you watch too much Netflix.~JJL
Wednesday’s Top Three
Readers took our story from CNN, Take this seriously. Coronavirus is about to change your life for a while seriously on Wednesday, making it the most-read story. Our second most-read story was the big news about The Small Exchange, CFTC Approves New Futures Exchange Aimed at Individual Traders. Third was the new study from The Futures Industry Association, FIA, Greenwich Associates release new derivatives market research. We will have a video coming out soon in which FIA CEO Walt Lukken discusses the results of the study, among other topics.
173,822,621 pages viewed; 24,068 pages; 223,535 edits
|CryptoMarketsWiki, our archive of the cryptocurrency and blockchain world, is going strong and keeping pace as this area of finance grows and evolves.Recently Updated Pages
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CME to Close Its Trading Floor Amid Coronavirus Outbreak
Matthew Leising – Bloomberg
CME Group Inc. will close its trading floor at the end of the week as exchanges alter their operations to control the spread of the coronavirus. CME Group said all products will continue to be available to trade on its Globex electronic system, according to a statement released Wednesday. The move by the Chicago-based market operator follows the New York Stock Exchange, which on Wednesday restricted access to its iconic trading floor in downtown Manhattan.
NYSE Braces for Coronavirus With Potential Trading Floor Closing; Some fear plan could lead to trading disruptions when markets are already fragile
Alexander Osipovich – WSJ
Fears over the coronavirus pandemic are prompting the New York Stock Exchange to prepare to implement an unprecedented contingency plan to close its iconic trading floor and switch to backup electronic trading systems.
U.S. Travel Restrictions Fuel Fresh Global Selloff; S&P 500 futures briefly hit daily trading limit as investors pour into U.S. government bonds on worries about the coronavirus’s economic toll
S&P 500 futures
Caitlin Ostroff and Joanne Chiu – WSJ
The global market selloff that plunged U.S. stocks into a bear market continued at a furious pace Thursday, as investors absorbed news of a travel ban between the U.S. and Europe. Futures linked to the Dow Jones Industrial Average dropped roughly 5%, suggesting the blue-chips gauge could open over 1,000 points lower as it heads into another punishing session. Contracts linked to the S&P 500 index also briefly hit the 5% daily limit.
NBA suspends season after positive coronavirus test; US basketball league is pandemic’s latest sporting casualty after European events disrupted
Anna Nicolaou and Alice Woodhouse – FT
The US National Basketball Association has suspended the season after a player tested positive for coronavirus, in the latest sporting casualty of the outbreak.
Why Virus Fight Shifts to Mitigation, Social Distance
Michelle Fay Cortez – Bloomberg
The first phase in the fight against the coronavirus was containment — efforts to keep it from entering or spreading in a community. In many places around the globe, the task has shifted to mitigation — slowing the spread once the virus is established within a population. Mitigation means adjusting old-fashioned approaches like quarantines and turning to newer tools such as “social distancing.”
Coronavirus Can Live in Patients for Five Weeks After Contagion
Claire Che – Bloomberg
Patients with the new coronavirus keep the pathogen in their respiratory tract for as long as 37 days, a new study found, suggesting they could remain infectious for many weeks.
Markets Are Functioning, but It’s Getting Harder to Trade; Activity in some markets has crumbled in recent days, exacerbating price changes and making it difficult for investors to trade at all in some corporate bonds
Paul J. Davies – WSJ
Investors struggling to follow the wild swings in prices across financial markets are also having to cope with another issue: finding people to trade with.
CME Group to close trading floor to combat coronavirus; While no cases of coronavirus have been reported on the trading floor, CME has said it will shut down at close of business on Friday.
Hayley McDowell – The Trade
US derivatives exchange operator CME Group has confirmed it will close its trading floor in Chicago, in the first major move by an exchange to combat the spread of coronavirus. In a statement, CME Group confirmed the trading floor will close at the end of the business day on Friday 13 March.
The TRADE Talks Podcast: Coronavirus shut down; The TRADE is back with its brand new podcast featuring the editorial team’s thoughts on the biggest news from the first quarter this year, and the impact of coronavirus on the industry.
Kiays Khalil – The Trade
The newly appointed editor of The TRADE, Hayley McDowell and fresh-faced multimedia journalist Kiays Khalil bring you a renewal of the best podcast for the buy-side. Join them for the first episode looking at the biggest news The TRADE has been covering and a look at the impact of coronavirus on the financial industry.
Women Are Bearing the Brunt of Coronavirus Disruption; While the illness hits men harder, women are on the front lines at work and at home.
Janet Paskin – Bloomberg
In strictly medical terms, the new coronavirus seems to hit men harder than women. In an analysis of nearly 45,000 cases in China, the death rate was 2.8% for men, compared with 1.7% for women. And men made up a slight majority of the infected, at 51%. One theory is that men, particularly in China, are more likely to smoke cigarettes, so have weaker lungs. Cardiovascular disease, which is highly correlated with coronavirus fatalities, is also more prevalent in men. But as the virus spreads globally, it appears women are bearing the brunt of the social and economic disruption.
New Weather Patterns Are Turning Water Into a Weapon; The melting glaciers of the Himalayas have become a political tool in the tussle between China, India, Pakistan and Bangladesh.
Archana Chaudhary and Faseeh Mangi – Bloomberg
It’s well below freezing as Renoj Thayyen climbs to the weather station high up in India’s Karakoram mountains, his Koflach boots crunching shin-deep into the snow.
Wealthy New Yorkers Flee to Hamptons, Hudson Valley to Escape Coronavirus
Amanda L Gordon and Katya Kazakina – Bloomberg
Private schools have closed, galas canceled, vacation scrapped; ‘Looking forward to return to normalcy,’ a consultant says
When Steve Schwarzman’s grandson went on break from boarding school at the end of February, he brought home a classmate from China, who wasn’t able to fly back home for obvious reasons.
Trump Administration to Delay April 15 Tax Deadline for Most Individuals; Tax filing extension would be part of broader fiscal stimulus effort
Kate Davidson, Richard Rubin and Andrew Restuccia – WSJ
The Trump administration plans to delay the April 15 tax deadline for most individual taxpayers as well as small businesses as part of an effort to mitigate the effects of the spread of the novel coronavirus, Treasury Secretary Steven Mnuchin said Wednesday.
Everything Is Awful All at Once for U.S. Banks; Epidemic triggers risks from low interest rates, slow loan growth and sliding stock and energy prices
Peter Rudegeair – WSJ
Add together some of the biggest challenges U.S. banks weathered in the dozen years since the financial crisis, and you get an idea of how bad the coronavirus epidemic could be for them.
Judi Hart Named Chief Operating Officer at PEAK6; Growth-Oriented Executive Will Oversee Operational Execution Across Portfolio Companies and Brands
PEAK6, an investing and technology company empowering disruptors and forward-thinking entrepreneurs to build the world the way it ought to be, announced today that Judi Hart is being elevated to a new role as Chief Operating Officer, effective immediately. Based in the greater Los Angeles area, Ms. Hart will serve as a strategic partner to PEAK6’s core businesses and be responsible for safeguarding the culture and overseeing the optimization and execution of operations across all portfolio companies and brands.
Electronic platforms are challenging bond broker-dealers; Their success is key to providing liquidity in stressed markets
One of the minor miracles of financial markets is that, in volatile periods such as these, sellers of securities can be readily matched with buyers. Though the direction of prices is uncertain, trading volumes are solid. Yet worrywarts say that while liquidity is plentiful at first when volatility rises, it cannot be relied on if markets stay jumpy for a while.
Exchanges, OTC and Clearing
CME Group to Close Chicago Trading Floor as a Precaution
CME Group today announced it will close its Chicago trading floor as of the close of business Friday, March 13, 2020, as a precaution to reduce large gatherings that can contribute to the spread of coronavirus in line with the advice of medical professionals. All products will continue to trade on CME Globex as they do today. No coronavirus cases have been reported on the trading floor or in the Chicago Board of Trade building. The reopening of the trading floor will be evaluated as more medical guidance on the coronavirus becomes available. The company’s headquarters at 20 S. Wacker Drive will remain open.
CME Group Energy Futures and Options Reach All-Time Daily Volume Record of 6.8 Million Contracts
CME Group, the world’s leading and most diverse derivatives marketplace, announced an all-time daily volume record for energy futures and options of 6.8M contracts on March 9, surpassing the previous record of 6.2M set on September 16, 2019. In addition, CME Group WTI Light Sweet Crude Oil futures and options also reached a record 4.8M contracts, surpassing the previous record of 4.3M contracts traded on September 16, 2019.
Matching Mechanism for the First Day of Listing: for Startups,Inc.
The matching mechanism to be applied to for Startups,Inc. until the initial price is determined is shown below. This special matching mechanism is applied to a directly-listed stock until its initial price is determined.
REGIS-TR teams up with GLMX on delegated reporting services for SFTR
Deutsche Börse Group
The European trade repository REGIS-TR will collaborate with GLMX, a market leader in pre- and post-trade technology solutions for repurchase agreements and secured lending, to provide an interoperable, full-service reporting solution for Securities Finance Transaction Regulation (SFTR) requirements.
SGX welcomes United Hampshire US REIT to Mainboard
Singapore Exchange (SGX) today welcomed United Hampshire US REIT to its Mainboard under the stock code “ODBU”.
Eurex Improve – Joint usage of Eurex Improve by affiliated Exchange Participants
With this circular, Eurex Deutschland (hereafter: “Eurex”) announces that as of 14 April 2020, Eurex Improve can also be jointly used by different, but affiliated Exchange Participants and hence independent of the individual organisational set-up of an Exchange Participant.
Eurex expands reach of its OTC clearing services to Japan
Further potential for Eurex Clearing to increase activity in euro clearing; Japanese banks to benefit from a one-stop-shop for their euro listed and OTC fixed income business
Japan’s Financial Services Agency (FSA) has granted Eurex Clearing a license as a “foreign financial instruments clearing organization”. This enables Eurex’s central counterparty to offer its clearing services not only in the European Union and the U.S. but also in Japan.
Euronext announces annual review results of the AEX, AMX, AScX
Euronext today announced the annual reweighting of the AEX®, AMX® and AScX® indices, that will take place after close of the markets on Friday, 20 March 2020. The changes due to the review will be effective from Monday, 23 March 2020.
Annual review of the BEL 20®, BEL MID® and BEL SMALL®
Euronext today announced the annual reweighting of the BEL 20®, BEL Mid® and BEL Small® indices, that will take place after close of the markets on Friday 20 March 2020. The changes due to the review will be effective from Monday 23 March 2020.
Euronext today announces annual review for the PSI 20®
Euronext today announced the results of the annual review for the PSI 20® index. The changes due to the review will be effective from Monday 23rd March 2020.
SGX hires MAS director for financial chief role; Chng Lay Chew will step down as CFO at SGX after nine years with the exchange, and will be replaced by Ng Yao Loong in October.
Kiays Khalil – The Trade
Singapore Exchange (SGX) has confirmed it has hired Monetary Authority of Singapore (MAS) director Ng Yao Loong as its new deputy chief financial officer.
Intercontinental Exchange is closing its London office, home to its European futures business, for the rest of the week after an employee tested positive for coronavirus
Brand Finance Exchanges 10 2020.
The annual report on the most valuable and strongest exchange brands.
CME continues to dominate as world’s most valuable exchange brand, with brand value of US$2.1 billion; US exchanges account for five of top ten in ranking; Germany’s Eurex drops in brand value, but remains in top 10; NYSE is sector’s stronget brand, scoring 75.0 out of 100
BGC closes acquisition of Algomi; Algomi will be integrated with BGC’s electronic trading and software division Fenics, after the deal closed late last week.
Hayley McDowell – The Trade
Interdealer broker BGC Partners has finalised its acquisition of bond trading software and pre-trade analytics provider Algomi, The TRADE understands.
Twitter Makes Working From Home Mandatory for Employees Globally
Vlad Savov – Bloomberg
Escalates the company’s previous recommendation to go remote; Will pay contractors and hourly workers during disruption
Twitter Inc. escalated its coronavirus response by mandating that all employees must work from home, having previously only recommended the practice.
The Budget has recognised the potential of UK fintech
Charlotte Crosswell – City AM
All eyes were on the chancellor yesterday, as he delivered his first Budget against a challenging backdrop for the UK’s economy and health system alike.
Security tokens, blockchain settlement draw interest from institutions: MIT Bitcoin Expo panel
Yilun Cheng – The Block
Amid growing competition between providers, institutions in the traditional finance space are looking at blockchain as another way to offer value to their clients – but it might not be their top priority, according to experts who appeared at the MIT Bitcoin Expo this weekend. “If you remove yourself from the crypto space, there are tons of events happening in finance,” said Ada Kokoshi, vice president and digital asset lead at State Street. “For example, the stock market last week just didn’t behave well. And with things like 401(k) plans, exchange-trusted funds (ETF), and mutual funds, there are tons of competition between providers which are driving the fees down.”
Senior IBM and Amazon Web Service executive joins R3; R3 confirms the appointment of Dorothy Copeland as its new global head of partner ecosystem & alliances amid expansion strategy.
Kiays Khalil – The Trade
Blockchain enterprise R3 has appointed a former IBM and Amazon Web Services (AWS) executive as global head of its partner ecosystem and alliance division.
Crypto derivatives exchange Phemex raises $3.5M in Series A led by NGC Ventures
Yogita Khatri – The Block
Singapore-based crypto derivatives exchange Phemex has raised $3.5 million in Series A funding. The round was led by NGC Ventures, with participation from “a number of Morgan Stanley executives and a leading team of quants.” Notably, Phemex is founded by eight former employees of Morgan Stanley, who primarily worked as core developers. Phemex co-founder Jack Tao spent 11 years at Morgan Stanley as the global development leader of e-trading benchmark execution strategies. Today’s round brings Phemex’s total funding to date to $5 million and valuation to $50 million, Tao told The Block.
Bitcoiners Are Biohacking a DIY Coronavirus Vaccine
Alyssa Hertig – Coindesk
Anonymous bitcoiners are taking the search for a coronavirus vaccine into their own hands — bypassing academia, pharmaceutical companies and the U.S. Food and Drug Administration (FDA). The “biohacking” effort by a group known as CoroHope is being funded with crowdsourced bitcoin (BTC) donations. The group claims it has a biologist on board with 10 years of experience building similar vaccines for the FDA. Prominent community members such as Blockstream cofounder Mark Friedenbach are vouching for the unknown team. (“It is not a scam,” he tweeted.)
Members of Facebook’s Libra Are Making Contingency Plans
Olga Kharif – Bloomberg
A rival effort attracts Libra members who see similar appeal; Celo wants to enable payments, microlending, humanitarian aid
Many members of the Libra Association — a Facebook Inc.-led effort to create a global cryptocurrency — are now also backing a rival effort. The project, the Celo Alliance for Prosperity, announced its 50 founding members Wednesday. They include Libra supporters Anchorage, Bison Trails Co., Coinbase Ventures, Andreessen Horowitz and Mercy Corps. The effort is designed to deliver humanitarian aid, facilitate payments and enable microlending through a cryptocurrency called the Celo Dollar, which is scheduled to launch in April.
Russia Updates Its Laws for Cryptocurrencies
Selva Ozelli – Cointelegraph
The volume of cryptocurrency flows on darknet markets — which are involved in illegal drug and arms trafficking, remittance and transfer of illicit funds — have doubled for the first time in four years, a new report says. Accordingly, Russia has been updating its bribery and Anti-Money Laundering laws regarding cryptocurrencies to aid its burgeoning digital economy.
Digital Pound Could Present ‘Challenges’ for UK, Says Mark Carney
Daniel Palmer – Coindesk
The outgoing governor of the Bank of England (BoE) has highlighted the potential risks to monetary governance if a central bank digital currency were to be launched in the U.K. In a foreword to a BoE working paper on Thursday, Mark Carney wrote, “While CBDC (central bank digital currency) poses a number of opportunities, it could raise significant challenges for maintaining monetary and financial stability.” As reported by Reuters, Carney added that a digital pound would have to be “very carefully designed” if the central bank went ahead with a launch.
Up To 350,000 Aussies Receiving Crypto Tax Notices
Shehan Chandrasekera – Forbes
As news.com.au reports, the Australian Tax Office (ATO) is in the process of contacting up to 350,000 Australian taxpayers who had cryptocurrency transactions in the past couple of years. This is by far the largest crypto tax crackdown reported by a tax regulator. According to an ATO spokesperson, ATO obtained this information through crypto exchanges through a program called Data Matching Protocol for cryptocurrency. Those who receive the letters will have an opportunity to amend the return and pay the applicable taxes.
LocalBitcoins seller charged with money laundering
Yilun Cheng – The Block
The U.S. Homeland Security has charged a LocalBitcoins seller with conducting an unlicensed money transmitting business after undercover agents exchanged over $140,000 in cash for bitcoin with the alleged criminal. According to the criminal complaint, 26-year-old Kenneth Rhule has been advertising in-person cash-for-bitcoin exchanges on global peer-to-peer trading platform localbitcoins.com under the username “Gimacut93”.
Kraken Opens up FX Trading for Crypto Users, Except US Residents
Aziz Abdel-Qader – Finance Magnates
Kraken, one of the world’s longest-operating cryptocurrency platforms, has introduced FX trading to its customer base with the launch of nine new currency pairs. The San Francisco-based platform said their cryptocurrency traders are now able to expand their horizons and begin trading into a $6 trillion market, further diversifying their portfolios and trading options.
Bitcoin Approaches Key $7,500 Level Amid Worsening Plunge
Vildana Hajric – Bloomberg
Bitcoin’s sell-off is pushing it toward a key level that technical analysts say has provided support for the largest cryptocurrency. The digital asset is nearing its uptrend support line of $7,500, which formed in April 2019. Bitcoin slumped about 4.2% to $7,649 as of 2:05 p.m. in New York, according to prices compiled by Bloomberg. In addition, its 14-day relative strength index (RSI) crossed below 35 and is nearing oversold levels, potentially indicating it could fall further until it breaches 30. Assets are considered oversold if the RSI falls below that threshold.
US Court Fines ICOBox $16M for Securities Violation in SEC Case
Paddy Baker – Coindesk
A federal court has ordered ICOBox to pay a $16 million penalty to the Securities and Exchange Commission’s (SEC) for violating U.S. securities law. On March 5, Judge Dale S. Fischer of the District Court for the Central District of California granted the SEC’s motion for default judgment against the ICO-as-a-service platform and founder and CEO Nikolay Evdokimov. The SEC first brought charges against ICOBox in September 2019, accusing the company of hosting an unregistered securities sale. The regulator also accused the company of acting as an unlicensed securities broker for more than 30 token sales.
Tether’s USDT token is now listed on the DeFi lending protocol Aave
Celia Wan – The Block
Aave, one of the biggest lending protocols in the Open Finance ecosystem has added support for the USDT stablecoin. The company announced on Tuesday a collaboration with DeFi lending protocol Aave, which allows Aave users to lend and borrow USDT. As Aave’s website shows, $3.67 million worth of USDT have already been lent out, making USDT the most borrowed token on the lending platform already. Aave is listed sixth on DeFi Pulse in terms of total locked value, coming in at $25.2 million, and the fourth largest in terms of locked value among DeFi lenders.
Trump’s Error-Laden ‘Foreign Virus’ Speech Has Investors Spooked
Justin Sink – Bloomberg
S&P 500 futures trade down after president’s remarks; House Democrats release their own economic plan hours later
The America First presidency collided with a global pandemic Wednesday night. The result failed to reassure skittish markets or a nervous nation. President Donald Trump relied on a familiar playbook as he spoke in a prime-time address from the Oval Office, announcing sweeping new restrictions on travel from Europe and scattered executive actions to help workers and businesses rocked by what he labeled a “foreign virus.”
As Criticism Mounts, Trump Quarantines Europe
Alan Crawford – Bloomberg
Europeans woke up this morning to a diminished world outlook. Donald Trump’s decision to curtail travel from Europe for 30 days effectively puts the U.S. off limits for a continent of 450 million people. The president’s prescriptions in his address for tackling the spread of the virus within the U.S. left investors spooked.
Trump forced to clarify Europe travel restriction over cargo claim; President acknowledges freight not included in 30-day suspension on routes to US
James Politi – FT
Donald Trump was forced to clarify that the sweeping restrictions on travel from many parts of Europe to the US he announced on Wednesday evening did not include cargo, after causing confusion and alarm during his primetime address to Americans about the coronavirus outbreak.
Putin Saw a World in Turmoil and Decided It Needs More Putin
Andrey Biryukov and Evgenia Pismennaya – Bloomberg
Coronavirus, risk of global recession, conflicts raise risks; First Kremlin explanation of shift on plan to extend rule
Vladimir Putin changed his mind and backed a plan to allow him to run for two more presidential terms because of the current turbulent period in the world, his spokesman said, in the Kremlin’s first public explanation of a move that would let him rule until 2036.
Trump urged Mnuchin to pressure Fed’s Powell on economic stimulus in explosive tirade about coronavirus
Robert Costa, Josh Dawsey, Jeff Stein and Ashley Parker – Washington Post
President Trump, in an explosive tirade Monday, urged Treasury Secretary Steven Mnuchin to encourage Federal Reserve Chair Jerome H. Powell to do more to stimulate the economy, three officials familiar with the exchange said, revealing the president’s mounting fury as his administration struggles to corral economic fallout from the novel coronavirus.
Here’s What Investors Say About Trump’s Shock Virus Plan
By Andreea Papuc – Bloomberg
A combination of President Donald Trump’s unprecedented travel restrictions between the U.S. and Europe and underwhelming stimulus measures sparked a fresh exodus from risk assets in global financial markets Thursday.
Joint statement from the FCA, BoE, PRA, CMA, PSR on the launch of the Financial Services Regulatory Initiatives Forum
The regulators (the Bank of England, Prudential Regulation Authority, FCA, Payment Systems Regulator) and Competition and Markets Authority welcome HM Treasury’s announcement of the establishment of the Financial Services Regulatory Initiatives Forum today.
CFTC Postpones Agriculture Conference, Relocates March 31 Open Meeting to Washington; LabCFTC New York City Office Hours Also Postponed
The Commodity Futures Trading Commission today announced the following changes to previously scheduled public events due to the impact of the coronavirus:
SEC Adopts Investor Disclosure Improvements for Variable Annuities and Variable Life Insurance Contracts; Amendments would streamline and simplify critical disclosures for investors in variable annuity and life insurance products
The Securities and Exchange Commission today announced that it has adopted a new rule and related form and rule amendments to simplify and streamline disclosures for investors about variable annuities and variable life insurance contracts. The changes permit the use of a concise, reader-friendly prospectus designed to improve investors’ understanding of the contracts’ features, fees, and risks. The framework’s use of layered disclosure and technology will provide investors with a roadmap so that they can more easily access information that they need to make an informed investment decision. These changes are an important milestone in the Commission’s ongoing efforts to improve the investor experience.
ESMA recommends action by financial market participants for COVID-19 impact
The European Securities and Markets Authority (ESMA), together with National Competent Authorities (NCAs), is closely monitoring the situation in view of the continuing impact of the COVID-19 outbreak on financial markets in the European Union (EU).
ASIC Annual Forum and Annual Dinner postponed
Due to the uncertain availability of international and interstate speakers and delegates and the evolving situation surrounding the novel coronavirus (COVID-19), we have made the difficult decision to postpone the ASIC Annual Forum and Annual Dinner 2020.
ASIC and small business
ASIC engages, assists and helps protect small businesses to ensure a strong and healthy economy for all Australians. Small businesses are a key driver of the Australian economy.
Money laundering campaigners hail £100m ‘economic crime’ levy; Money will be used for law enforcement technology and hiring investigators
Kate Beioley and Matthew Vincent – FT
A £100m levy on companies to combat money laundering has been backed by campaigners concerned Britain is falling behind in the fight against illicit financing.
European Banks Seek Virus Relief in Demands to Regulators
Sonia Sirletti, Alexander Weber, and Steven Arons – Bloomberg
Lenders looking for reprieve from capital, liquidity standards; Lobby group EBF comments in letter to European authorities
European banks are asking regulators to roll back safety measures agreed after the last financial crisis so that they can deal with the impact of the coronavirus that’s crippling the region’s economy.
SIFMA Supports Proposed Changes To The Volcker Rule
SIFMA today filed a comment letter on the proposed revisions to the Volcker Rule issued in January 2020. SIFMA strongly supports the proposing Agencies’ efforts to improve and streamline the regulations implementing the Volcker Rule by modifying and clarifying the requirements related to the covered fund provisions.
Investing and Trading
Drop in hedging costs makes US high-yield bonds a bargain; Investors need to review the relative value on offer across developed markets
Vivek Bommi – FT
Amid all the drama in financial markets over the past couple of weeks, it has been easy to overlook one knock-on effect that could meaningfully influence global flows in corporate bonds. That is, the substantial decline in the cost of hedging US dollar exposure out of US credit investments.
T-Bills Are Scarce and the Shortage Is About to Get Even Worse
Alex Harris and Liz McCormick – Bloomberg
JPMorgan sees demand outstripping supply by over $1 trillion; Issuance expected to fall just as demand soars on virus threat
The shortage of T-bills is about to get a whole lot worse. All along, Wall Street has been bracing for a record decline in second-quarter net issuance as the Treasury cuts supply in response to tax season and the Federal Reserve buys bills to boost reserves.
Investors Scour Magazines to Surveys For Clues to Stock-Rout End
Abhishek Vishnoi – Bloomberg
Follow investor sentiment indicators: AMP and United First say; Stocks rallying on bad news will mark a bottom: Great Hill
As the world grapples with the question of where the bottom lies for pandemic-wrecked global equities, the answer may be on magazine covers and in investor surveys.
Global Lockdowns Slam Energy Demand
Rachel Morison, Naureen S Malik, and Will Wade – Bloomberg
Demand will slide as workers and students log on from home; Plant operators can expect lower profit as stations run less
Electricity demand in Europe and the U.S. will make weekdays seem like weekends as the coronavirus prompts a growing number of countries to consider telling people to stay home.
Fear of Virus-Tainted Dollars Opens New Front in War on Cash
Jennifer Surane, Olivia Rockeman, and Robert Schmidt – Bloomberg
Some banks urge Fed and Treasury to vouch for safety of bills; Yet payments firms could benefit if cash is labeled a threat
The signs began appearing around Seattle in the windows of Dick’s Drive-In, the city’s iconic burger chain: “In an abundance of caution, we ask you to please pay with credit or debit card if possible rather than cash.” Fear of dollars is now palpable in the U.S. epicenter of the coronavirus.
Dash for Cash Is On as Corporate Titans Draw Down Credit Lines
Sridhar Natarajan and Yalman Ocarina – Bloomberg
Blackstone, Carlyle advise portfolio companies to tap loans; Wave of borrowers include businesses hit by virus, oil slump
Under duress from a viral pandemic and plummeting oil prices, corporate America is facing its most severe test since the 2008 crisis. A swath of the nation’s biggest names is maxing out credit lines, grabbing cash before it can disappear.
Gold Holds Line in ‘Time of Crisis’ as Virus Disruption Spirals
Ranjeetha Pakiam – Bloomberg
Bullion investors await ECB’s policy move amid market mayhem; Palladium set to slump into bear market amid pandemic alert
Follow Bloomberg on Telegram for all the investment news and analysis you need. Gold held its ground as the disruption to the global economy from the coronavirus pandemic intensified, with President Donald Trump restricting travel from Europe to the U.S. Investors shunned risk assets from equities to industrial commodities. Palladium tanked.
Coronavirus Won’t Sink the Cruise Industry; Travelers tend to have short memories, and the ships’ key demographic won’t give up their sail-away cocktails.
Adam Minter – Bloomberg
Marketing for the Grand Princess cruise ship advises prospective passengers to “Expect the extraordinary” when they take sail. Last week, that promise was exceeded when helicopters lowered Covid-19 test kits to a poolside deck as the ship floated off San Francisco.
Blackstone, Carlyle Urge Portfolio Companies to Tap Credit
Sridhar Natarajan and Heather Perlberg – Bloomberg
Moves could avoid liquidity shortfalls amid stress in markets; Blackstone’s talks focus on sectors hit by virus, oil prices
Private equity titans Blackstone Group Inc. and Carlyle Group Inc. are sending a message to portfolio companies: Do whatever it takes to stave off a credit crunch.
The Fed Proves It Will Do Whatever It Takes in Repo; The central bank didn’t waste time in reacting to signs of a cash crunch this time.
Brian Chappatta – Bloomberg
The phrase “whatever it takes” is something of a buzzword lately when discussing how to deal with the coronavirus outbreak and its impact on the global economy.
Hedge fund Solus to close flagship investment vehicle; Distressed investment specialist knocked by heavy redemptions and sub-par performance
Robert Smith and Ortenca Aliaj – FT
Solus Alternative Asset Management, one of the best known specialists in distressed investments, is closing its flagship fund after suffering a combination of heavy redemptions and poor performance.
DNB Closes Oslo Trading Floor After Coronavirus Case Detected
Love Liman and Jonas Cho Walsgard – Bloomberg
DNB ASA, Norway’s biggest bank, has closed the trading floor of its Oslo headquarters after registering a coronavirus case among its employees. The bank was made aware Wednesday night of the infection of an employee working in DNB Markets. The person is in a “good condition under the circumstances,” spokesman Even Westerveld said. DNB has resorted to “extensive use” of home offices and restrictions on trips and meetings, he said.
Commando-Style Heists Put South African Gold Miners on Defensive; Armed gangs target gold mines and processing plants after price rally in latest challenge to struggling economy
Alexandra Wexler and Aaisha Dadi Patel – WSJ
South Africa’s city of gold is under siege. Since gold was first discovered in 1886 in the area that became Johannesburg, entrepreneurs from all over the world have flocked there to try their luck digging it out of the earth. The region has yielded nearly half of the world’s bullion that has ever been extracted, from some of its deepest mines.
Japan foreign bond buying points to state pension intervention; Traders suggest GPIF trying to weaken yen after currency strengthened on coronavirus fears
Leo Lewis – FT
Japanese investors have bought a record haul of overseas bonds in a sign of intervention by the country’s $1.6tn state pension fund to counter strength in the yen due to the coronavirus.
Mysterious Equity Fund Leads Brazil Losses With 80% Drop in 2020
Felipe Marques, Cristiane Lucchesi, and Vinicius Andrade – Bloomberg
Ponta Sul fund lost the most on Monday’s sell-off in Brazil; Fund has single shareholder, had Magazine Luiza among holdings
Among the spectacular losses in Brazilian equity funds this week, one in particular stands out: FIA Ponta Sul IE.
Virus Scare Puts India’s $6.7 Billion Cricket League in Doubt
P R Sanjai – Bloomberg
This year’s season of the Indian Premier League, which draws about 40,000 cricket-crazy spectators per match, is facing uncertainty after the government placed border curbs to contain the deadly coronavirus outbreak.
Russian Producers Are Ready to Survive Flood of Saudi Crude
Dina Khrennikova and Olga Tanas – Bloomberg
Nation can pump until oil hits $15-$20 per barrel: BofA; Companies may face higher taxes if the oil freefall lasts
A flood of discounted Saudi crude is heading for Europe, but Russia might just have the only producers in the world equipped to compete with it.
UK’s antivirus measures disguise radicalisation of Brexit
Tony Barber – FT
The Bank of England cut interest rates on Wednesday and Rishi Sunak, the UK chancellor, unveiled other measures designed to contain the impact on businesses of the coronavirus outbreak. But these initiatives distract attention from government decisions on Brexit that threaten to have a bigger, long-term impact on the UK’s economy and its place in the international order. For the longer Prime Minister Boris Johnson holds power, the faster Brexit is evolving into a project more extreme than most British people thought likely or desirable at the time of the UK’s 2016 referendum. The pattern is familiar from other revolutions in modern history, whether violent or not. Brexit is in its Jacobin phase, for how long remains to be seen.
In the U.K., Brexit Stockpiles Become Coronavirus Stockpiles
Stephen Wilmot – WSJ
Britain’s Brexit stockpiles are finally finding a purpose: filling supply-chain holes caused by the coronavirus. “Thankfully we did have quite a bit of stock built up due to Brexit, which has been really useful,” David Lenehan, managing director of Northern Industrial, told the BBC in an interview aired Wednesday. The spread of Covid-19 is having two big economic effects: sapping demand and interrupting supply. In today’s globalized world, both are squeezing even small companies such as Northern Industrial, which sells repairs to clients including in quarantined Italy, using spare parts sometimes sourced from China.
Boris Johnson’s covert Brexit plan is self-isolation; The real story is that all traces of the EU are to be expunged from the public realm
Philip Stephens – FT
Of course there will be a Brexit trade deal. The two sides have too much to lose from failure. Boris Johnson has form on this. Britain’s prime minister will quietly submit to Brussels while claiming a famous victory. The EU will bend just enough to supply the figleaf.
Boris Johnson Expected to Say U.K. in ‘Delay’ Phase of Virus Outbreak
Robert Hutton – Bloomberg
Prime Minister to chair emergency committee Thursday afternoon; School closures and restrictions on gathering among options
Boris Johnson’s U.K. government is expected to announce Thursday that it is moving away from trying to contain the coronavirus outbreak, and focusing its efforts on trying to slow its spread, with possible options including school closures and stopping large-scale gatherings.
London Brexit talks in doubt because of coronavirus
Lisa O’Carroll – The Guardian
Brexit talks due to take place in London next week have been thrown into doubt because of the coronavirus, Michael Gove has confirmed. Gove told MPs fresh concerns about the second round of talks going ahead as planned had been raised by Brussels counterparts this morning. About 150 delegates from Brussels were due to arrive in London for three days of talks next Wednesday. Gove also said there was a question mark over the inaugural meeting of the EU-UK joint committee, on which he will sit, on 30 March.
Economic cost of Brexit laid bare in OBR forecasts
George Parker, Laura Hughes, and Jim Brunsden – FT
The economic cost of Brexit was laid bare on Wednesday by Britain’s official budget watchdog, which warned that leaving the EU would hit growth, exports and the public finances at a time of rising uncertainty. Against a backdrop of coronavirus and slowing global growth, the Office for Budget Responsibility modelled for a 5.2 per cent loss of potential GDP over 15 years if a “typical” free trade agreement was struck. The watchdog said that Britain had already lost 2 per cent of potential output since the 2016 Leave vote with a further 3.2 per cent to come, blaming rising trade friction, restrictions on migration and red tape.
U.K. Confirms Plans to Support Carbon Prices After Brexit
Mathew Carr – Bloomberg
The U.K. signaled it would continue to support higher carbon prices after Brexit than those in mainland Europe. The nation said it planned to draw up a law to create a U.K. carbon market once it leaves the European Union emissions trading system at the end of this year, according to budget documents. It’s seeking to link that program to the existing EU market and it also plans to extend its own policy to support even higher carbon prices, into 2022.
N.B.A. Suspends Season After Player Tests Positive for Coronavirus
The league said the suspension would begin after Wednesday night’s games.
Scott Cacciola and Sopan Deb – NY Times
The N.B.A. abruptly suspended its season on Wednesday after a Utah Jazz player was found to have tested positive for coronavirus moments before a game began in Oklahoma City.
Online Mass and Suspended Pilgrimages—How the Faithful Manage; Religion asks people to gather, but in a coronavirus outbreak, many rites and traditions are disrupted.
Faros Mokhtar – Bloomberg
In Milan, churches sit empty as the faithful follow Mass on television. And with five months to go before Islam’s most sacred pilgrimage, it’s unclear if Saudi Arabia will reopen holy sites to millions of foreign Muslims. Able-bodied believers are required to make the 10-day hajj, set for late July and August, once in their lives. Visas for the umrah, a shorter pilgrimage that can be made throughout the year, have been suspended.