HKEX and LSE, A Capitalist’s Conundrum
Jim Kharouf, JLN
Today’s bid by Hong Kong Exchanges & Clearing (HKEX) to buy the London Stock Exchange Group for $36.6 billion is a conundrum in what otherwise would be a continuation of global consolidation among exchanges. But it is muddied by the geopolitical backdrop that could make the London Stock Exchange off limits to certain suitors, especially those under the control of the Chinese government.
To read the rest of this commentary, go here.
Bakkt readies CME challenge
Thom Thompson – John Lothian News
On Friday last week Bakkt opened the Bakkt Warehouse for its bitcoin custody business, as it prepares for ICE US’s launch of futures trading on September 23. Bakkt is counting on the warehouse to be the unique selling point as it goes head-to-head with the CME’s 21-month old bitcoin futures. Many people in the cryptocurrency community have made much of Bakkt’s delivery feature, seeming to think this feature alone will push the price of bitcoin higher. (If higher cash market prices indeed were a reliable consequence of there being deliverable futures contracts, we would see far more support for futures markets from corn, wheat and soybean farmers!)
The ICE futures contracts are the first futures contracts in the U.S. which call for physical delivery of a bitcoin at final contract expiration. Bakkt is trying to bring futures trading closer to spot trading by listing every-day contracts – separate futures contracts that expire daily, listed out up to 70 days in the future – in addition to monthly expiring contracts. The two-day delivery process is the same for both the daily and monthly contracts.
To read the rest of this commentary, go HERE.
Hits & Takes
By JLN Staff
Today, 9/11, the silence says everything.~JJL
On Wednesday, September 11, 2019, the NYSE will observe a one-minute moment of silence at 9:20 a.m. Eastern Time (ET) to recognize the anniversary of 9/11 and honor the victims, survivors and their families. A single strike of the NYSE Bell at 9:20 a.m. ET will indicate the start of the moment of silence.~JJL
While we are in a somber mood, we are sorry to report the passing of two industry giants, J. Robert (Bob) Collins and Peter Todebush. Mr. Collins, who died yesterday at the age of 77, was an FIA Hall of Fame member and former president of the MidAmerica Commodity Exchange. He was one of the founders, with Les Rosenthal, of Rosenthal Collins. Former CBOT member and Second Vice President of the Board Peter Todebush passed away in March of this year, but we did not learn about it until today. His name had been mentioned as someone to interview for the History of Financial Futures documentary series we are working on, but he is no longer with us. Condolences to the family, friends and colleagues of these two extraordinary futures market legends.~JJL
Want to learn more about Ameribor? Join American Financial Exchange (AFX) and Trading Technologies on September 12 at 11:30am CT for an exclusive look at the new AMERIBOR futures contracts on the TT platform. Did I mention this is exclusive?~JJL
In 1585, on September 9 the Frankfurt Stock Exchange was created when merchants met at the Frankfurt fair to establish uniform exchange rates.~JJL
Nice work by some employees of Clearstream who helped clip hedges and painted fences on Social Day for the Marymount Hospice, a Specialist Palliative Care Centre for Cork City and County.~JJL
Following yesterday’s Crain’s New York Business piece on pending Wall Street layoffs, I took a look for other articles on the trend. A Forbes piece from July 31st astounded, stating that Goldman Sachs’ equities trading desk employed 600 traders in 2000. Today, with the rise of technology, it has two – as in two equity traders left.~JK
A tale of two markets. The Initial Coin Offering market showed an epic plunge. In the first eight months of 2019, ICOs raised $366 million, down from $6.7 billion January through August of 2018, according to ICOdata.io. Wow.~JK
In the first half of 2019, 507 IPOs globally raised $71.9 billion, down from 660 IPOs and $94.3 billion raised a year earlier, according to EY.~JK
Yesterday we interviewed Marc Nagel and Jeff Carter for the Open Outcry Traders History Project. Both were very good interviewees. See the Jordan Melamed interview for the project below. He was a terrific interview!~JJL
Jordan Melamed – Open Outcry Traders History Project
Jordan Melamed is a former trader at the Chicago Mercantile Exchange and a filmmaker. He is the son of CME Chairman Emeritus Leo Melamed. He followed his father’s footsteps to the trading floor of the CME. After a career trading in the open outcry markets he pursued a career as a filmmaker. He is the director of “Futures Past,” a story of the end of open outcry trading and the human element of trading and family.
Watch the video »
ESG: We’re Only at the Tip of the Iceberg
At FIA IDX 2019 in London, John Lothian News sat down with Clive Furness, the managing director of Contango Markets Ltd., to talk about ESG (environmental, social and governance) and how it fits into commodity and index products, and why it’s a “social revolution” and not a fad.
Watch the video »
RCG Division of Marex Spectron Statement on the Passing of Futures Industry Pioneer J. Robert Collins
The Rosenthal Collins Group (RCG) Division of Marex Spectron today issued the following statement on the Sept. 10 passing of its co-founder and former Managing Member J. Robert (Bob) Collins at the age of 77.
***** RCG has now lost both its founders, Les Rosenthal and Bob Collins.~JJL
How David Swensen Made Yale Fabulously Rich; He walked away from the stock market, built a network of elite private funds, and created a fortune with no end in sight.
Drake Bennett, Janet Lorin, Michael McDonald – Bloomberg
On a Tuesday in early April, David Swensen sat onstage in a gradually filling lecture hall. Sunlight slanted through a Tiffany stained-glass window of angels personifying various pursuits of the mind. Outside, tour groups moved along the paths of Yale’s Old Campus, spilling onto topsoil ventilated with small holes to speed the growth of the grass upon which undergrads would picturesquely recline in warmer weather.
***** Some people go to Yale voluntarily and some involuntarily.~JJL
The Honorable Christopher Giancarlo Joins Board of Directors of the American Financial Exchange (AFX)
Richard L. Sandor via LinkedIn
The American Financial Exchange (AFX) announced today that the Honorable J. Christopher Giancarlo will serve as an independent director on its Board of Directors. AFX is an electronic exchange for direct lending and borrowing for American financial institutions. AMERIBOR is a transaction-based benchmark interest rate and is calculated as the volume weighted average of unsecured overnight transactions on the AFX electronic exchange.
***** AFX adds Keyser Söze to its board?~JJL
Nomura Americas’ Chung Moves to Intermarket
Kevin McCauley – Odwyer’s
Mary Chung, who headed marketing, media relations and internal communications at Nomura Americas, has joined Intermarket, the New York-based financial PR specialist that is part of the UK’s Lansons.
***** Mary Chung joins a great firm. Congrats to both!~JJL
Tuesday’s Top Three
Our top read story of the day on Tuesday was about the man with the real estate plan in Bloomberg’s Ken Griffin Adds a $99 Million Florida Beach House to His Property Empire. Second was Crain’s New York Business’ A wave of layoffs looms for Wall Street. Third was The Wall Street Journal’s SEC Pressures Exchanges on Long-Delayed Market-Surveillance Project. SEC Chairman Jay Clayton is threatening financial penalties for any more delays on CAT.
163,025,126 pages viewed; 23,913 pages; 221,484 edits
Hong Kong Exchange Makes Surprise $36.6 Billion Bid for LSE
Kiu Yan Wong and Viren Vaghela – Bloomberg
Asian bourse operator was considering a deal for many months; LSE recently agreed to purchase Refinitiv for $27 billion
Hong Kong Exchanges & Clearing Ltd. made an unexpected $36.6 billion bid for London Stock Exchange Group Plc, a bold move that would upend the U.K. bourse’s combination with Refinitiv.
9/11 Memorial Is a Beacon for Communities Facing Tragedies; Museum is finding a role for itself far beyond its lower Manhattan home
Charles Passy – WSJ
On any given day, the National September 11 Memorial & Museum welcomes thousands of visitors to its site at the location of the former World Trade Center. But as the institution prepares to mark the 18th anniversary on Wednesday of the event that claimed nearly 3,000 lives, it is finding a role for itself far beyond its lower Manhattan home.
Brokerage Charles Schwab says to cut about 600 jobs
Discount brokerage company Charles Schwab Corp (SCHW.N) is cutting about 600 jobs after an internal review, a company spokeswoman confirmed on Tuesday.
Hong Kong protesters pause to mark Sept. 11
Jessie Pang – Reuters
Hong Kong activists called off protests on Wednesday in remembrance of the Sept. 11, 2001 attacks on the United States and denounced a Chinese state newspaper report that they were planning “massive terror” in the Chinese-ruled city.
Cantor Fitzgerald remembers 9/11 with charity day
Howard Lutnick, Cantor Fitzgerald chairman and CEO, is known for rebuilding his firm after September 11th. Cantor Fitzgerald lost about two-thirds of its New York employees. Howard Lutnick joins ‘Squawk Box’ to discuss the 9/11 anniversary and the firm’s charity day.
China’s Field of Dreams Attitude to Opening Markets Won’t Work; The quotas on western investment into Chinese financial markets are no longer the main limiting factor on inflows
Mike Bird – WSJ
If we open it, they will come. Or so the logic of the Chinese government goes, when it comes to Western investment in its financial markets. That dream is unlikely to become reality.
IRS Is Ignoring Potential Corporate Tax Cheats, Watchdog Says
Laura Davison – Bloomberg
The Internal Revenue Service isn’t doing enough to audit corporate mergers and acquisitions and is wasting tens of thousands of days on cases that aren’t likely to generate more tax dollars, the agency’s watchdog said.
U.K. Parliament Suspension Is Ruled Unlawful by Scottish Court; The decision will now head to the Supreme Court for a final ruling
Max Colchester – WSJ
Prime Minister Boris Johnson’s decision to suspend Parliament for several weeks has been ruled unlawful by Scotland’s highest civil court, a decision that shunts the issue to the U.K.’s Supreme Court for a final ruling.
Assessing Risk in Custodial Solutions; An In-depth Look at the Scope and Requirements for Digital Asset Custody
How do you assess the risk to your assets entrusted to third party custodians, or yourself when you self custody your digital assets? The second installment in our series looking at custody and safekeeping your digital assets explores how federal regulators approach custody, policies and procedures that need to be in place at all holding entities and what to look for if selecting a custodial solution.
Knowing the financial services industry’s four primary roles can help you identify where to do business.
Timothy Clifford – via LinkedIn
Let me throw some numbers at you. The financial services industry has four primary roles designed to help clients with their investments and financial decisions. Some of the business models have all four, while others may only have two or three of the four. And while some clients want and utilize all four, others only want or need some of the four.
Intermarket Expands Management Team with New Senior Hire and Several Additional Executive Appointments
Matt Zachowski – via LinkedIn
Intermarket, the Top 10 financial PR specialist firm now part of London-based reputation management firm Lansons, today announced that it has expanded its management team with a new senior level hire and three additional executive appointments to position the firm for accelerated growth from an expanded array of services.
Don’t bet on decentralised exchanges becoming the new crypto frontier…
Izabella Kaminska – FT
After much self denial, the hypocrisies of the crypto world are finally dawning on even the sector’s greatest delusion-ists. They’re that obvious. One such hypocrisy is the space’s longstanding claim that crypto removes the need for trusted intermediaries and therefore democratises finance.
Exchanges, OTC and Clearing
Hong Kong Exchanges bids $39 billion to take over London Stock Exchange
Huw Jones, Sinead Cruise – Reuters
Hong Kong Exchanges and Clearing has made an unsolicited $39 billion takeover bid for the London Stock Exchange (LSE.L), an offer contingent on the LSE ditching its acquisition of data company Refinitiv.
Hong Kong Stock Exchange Bids Nearly $37 Billion for London Rival
Hong Kong’s stock exchange made an unsolicited $36.6 billion offer to acquire its London-based rival, a deal that would unite two of the world’s major trading hubs when both are under severe political pressure.
Hong Kong exchange puts in £32bn bid to buy the London Stock Exchange Group; Proposed mega deal would see two of the world’s largest market infrastructure groups combine as Hong Kong exchange chief proposes connecting ‘East to West’.
Jonathan Watkins – The Trade
Hong Kong Exchanges and Clearing Limited (HKEX) has made a £32 billion offer to buy the London Stock Exchange Group (LSEG) in a colossal move to combine two of the largest market infrastructures in the world.
Hong Kong exchange makes £30bn bid for London Stock Exchange; Proposal threatens to torpedo the LSE’s £20bn-plus acquisition of US data provider Refinitiv
Fareed Sahloul and Samuel Agini – Financial News
The London Stock Exchange has received a surprise £29.6bn takeover offer from Hong Kong Exchanges and Clearing — a bid that threatens the UK group’s £20bn-plus acquisition of US data provider Refinitiv.
WFE letter to ESMA regarding market data & consolidated tape
World Federation of Exchanges
The WFE has published a letter in response to the European Securities and Markets Authority’s (ESMA) consultation paper on prices for pre- and post-trade data and the consolidated tape for equity instruments. The WFE’s letter details its concern about how the ESMA proposals may in practice give rise to a loss of competitiveness of EU stock markets, and work against the EU’s goal of increasing levels of stock-market financing.
How a single index card helps the president of the New York Stock Exchange keep her chaotic day in check
Long gone are the days of traders frantically running around the New York Stock Exchange floor, but running America’s largest exchange still gets chaotic.
DTCC Re-imagines the Institutional Post-Trade Lifecycle and Charts Path for Achieving Optimal No-Touch Processing; Shares vision for institutional trade processing that achieves straight-through processing by eliminating inefficient manual touch points
Depository Trust & Clearing Corporation
The Depository Trust & Clearing Corporation (DTCC), the premier post-trade market infrastructure for the global financial services industry, today outlined
a vision for institutional trade processing that realizes the goal of straight-through processing by eliminating inefficient manual touch points.
Trading Technologies Contracts with Goldman Sachs for Global Distribution of the TT® Platform; Goldman Sachs’ execution algos to be available to firm’s customers via the TT platform
Trading Technologies International, Inc.
Trading Technologies International, Inc. (TT), a global provider of high-performance professional trading software, announced that Goldman Sachs Group, Inc. (Goldman Sachs), has contracted with Trading Technologies to distribute the TT platform to the firm’s client base.
Why You Are Probably Using the Wrong Technology in Capital Markets
Steve Grob – via LinkedIn
Einstein famously said that “Insanity is doing the same thing over and over again but expecting different results”. Likewise, the fabric of capital markets has changed so much since the financial crisis that the old ways of doing business just don’t make sense anymore. And so trying harder with the same approaches simply is not going to work. Einstein’s claim, therefore, should demand our attention and compel us to seek new ways to deliver and extract value from the investment cycle.
Razer Fintech Appoints Mr. Lim Siong Guan to Its Board of Advisors
Business Wire via Yahoo Finance
Mr. Lim is recognized globally as a thought leader in the global financial services industry Razer Fintech, the financial technology arm of Razer Inc. and one of the largest offline-to-online (“O2O”) digital payment networks in South East Asia (“SEA”), has appointed Mr. Lim Siong Guan as an advisory board member.
ELITE & Global Accelerated Ventures (GAV) launch of FinTech Lounges
AccessWire via Yahoo Finance
ELITE and Global Accelerated Ventures sign collaboration agreement to advance growth of FinTech companies in New York & London ELITE is London Stock Exchange Group’s (LSEG) international business support and capital raising initiative for private high-growth companies More than 1,200 companies from across 45 countries now part of dynamic ELITE community Demonstrates ELITE’s commitment to strengthening ties with FinTech Community
Goldman Sachs is offering a credit line to another Latin American fintech
Mekebeb Tesfaye – Business Insider
Konfio has become the latest Latin American fintech Goldman Sachs has bet on, reports Bloomberg. The credit line will help the startup, which provides small-and medium-sized businesses (SMBs) with unsecured working capital, to lend around $250 million in the next year, founder and CEO David Arana told Bloomberg.
SMBC Nikko London replaces Bloomberg SSEOMS with Itiviti’s multi-asset OMS platform; Investment firm also adds Itiviti’s Middle Office solution to automate post-trade workflows.
Itiviti, a leading technology, and service provider to financial institutions worldwide, today announced that SMBC Nikko London Capital Markets, a full scope IFPRU investment firm, has successfully replaced Bloomberg’s SSEOMS platform with Itiviti’s multi-asset OMS for high-touch trading in London and extended its offering using Itiviti’s Middle Office solution.
Volante Technologies offers FREE SaaS Real-Time / Instant Payments processing; Any bank, regardless of size, can offer immediate payment capabilities to their customers
Volante Technologies Inc.
Volante Technologies Inc., a global provider of technology and software as a service to accelerate digital transformation and payments modernization, today announced the launch of free RTP / instant payments processing on the cloud as a service.
WATCH: He Admitted to Faking Crypto Volumes, Then Got 5 New Clients
Anna Baydakova – Coindesk
How do you get into the business of market manipulation? It’s easy if you try. Alexey Andryunin, a 20-year-old college student from Moscow, became a sensation after he quite openly told CoinDesk how his company was helping little-known token projects get traction via inflated trading volumes.
Bakkt to Require $3.9K Down Payment on Bitcoin Futures Contracts
Nikhilesh De – Coindesk
Bakkt has officially revealed the initial deposits its customers will have to make to margin trade its bitcoin futures products. In a new notice posted Tuesday, ICE Futures U.S. – the actual futures exchange Bakkt’s contracts are trading on – announced the initial hedge and speculative requirements for customers, as well as its monthly rate add-ons.
Netherlands May Block Foreign Crypto Firms Under Anti-Money Laundering Laws
William Foxley – Coindesk
Cryptocurrency entities based outside of the Netherlands may get the boot under new crypto regulations. Following up a report by CoinDesk on the DNB’s recent registry mandate for cryptocurrency companies, DNB spokesperson Tobias Oudejans said the current legislation before the Dutch House of Representatives will not only force domestic companies to register with the central bank but that foreign entities will also not be allowed to conduct services within the country.
Cryptocurrency Exchange OKEx Announces Support for ETC Hard Fork
Ana Alexandre – Cointelegraph
Cryptocurrency exchange OKEx has announced support for Ethereum Classic’s (ETC) upcoming Atlantis hard fork. In a blog post published on Sept. 10, OKEx announced that the exchange will support ETC’s hard fork, estimated to take place between Sept. 12 and Sept. 13, 2019 at block height 8,772,000.
Chainlink cryptocurrency trading shows signs of pump-and-dump scam
Dean Takahashi – VentureBeat
The trading pattern of Chainlink’s Link cryptocurrency suggests a suspicious “pump-and-dump” scam, or an attempt to manipulate the price of the cryptocurrency token, according to an analytics company. The unusual market pattern was discovered by the team at AnChain.ai, a blockchain transaction analytics company. And it is significant because Chainlink’s token has a market value of $650 million, and it has lost about $600 million in value in recent weeks.
Cryptocurrency Trading Investigation: Market Manipulation & the LINK Token
The AnChain team’s recent analysis of the LINK token, inclusive of transactions between April 1, 2019 and July 26, 2019, revealed a pattern of suspicious activity that we believe to be indicative of a coordinated pump and dump manipulation.
Bitcoin millionaire jumps off balcony after being threatened with shotgun
Anthony Cuthbertson – The Independent
A Norwegian multi-millionaire jumped from a second-story balcony in Oslo following an attempted armed robbery, according to local reports. Prior to the attempted robbery, the victim had allegedly boasted about making a fortune through investing in bitcoin and other cryptocurrencies, Norwegian broadcaster TV2 reported.
‘Bad things could happen’: Turning to tech to tame the crypto jungle
Tom Wilson – Reuters
LONDON (Reuters) – “Hi guys, could you please show me a firm bid for 100 bitcoin?” a seller texts on Skype. “One sec. $10270.” Two minutes later: “Sorry guys, that was an old order from Friday when skype wasn’t working.” “I really think we should get off skype. Bad things could happen. Someone is going to make an expensive mistake.”
Vulnerability Fixed in Facebook Contract Language for Libra Cryptocurrency
William Foxley – Coindesk
A vulnerability in Libra’s open-source code that would have enabled malicious actors to manipulate smart contracts has been uncovered and patched by a third-party audit firm specializing in cryptocurrency. Specifically, developers working for startup OpenZeppelin found vulnerabilities in Move, the scripting language developed by Facebook for the open-source Libra cryptocurrency project, an effort backed by major companies including Facebook, Lyft, Uber and MasterCard.
Proud to launch the expanded Gemini Custody Solution
Jeanine Hightower-Sellitto – Via LinkedIn
At Gemini, security is the bedrock of our culture, and one of our key pillars. From the start, Gemini has operated with a security-first mentality and put a relentless focus on building trust in the market. Nowhere is this philosophy more important than when custodying cryptocurrency. At its core, custody of cryptocurrency is security and trust. This offering requires a new kind of infrastructure—one that is far different from the approach for traditional assets.
CoinGecko Releases ‘Trust Score 2.0’ to Boost Crypto Exchange Transparency
Wolfie Zhao – Coindesk
Market data aggregator CoinGecko has upgraded its “Trust Score” metric in a bid to bring more transparency to the crypto trading environment.
Coinbase May Soon Launch an Initial Exchange Offering Platform
Christine Kim – Coindesk
San Francisco-based cryptocurrency exchange Coinbase may soon issue a proprietary exchange token, according to Coinbase’s head of institutional sales in Asia, Kayvon Pirestani.
Legacy Trust to Launch Independent Crypto Custody Business
Christine Kim – Coindesk
Trust and custody services provider Legacy Trust is spinning out a new business focused entirely on institutional-grade cryptocurrency custody solutions.
New Data Gives Unprecedented Insight Into How Iranians Use Bitcoin
Leigh Cuen – Coindesk
Out of 1,650 Iranian bitcoiners surveyed in Persian Telegram groups, 25 percent earned $500 to $3,000 a month from working with cryptocurrency, according to a survey conducted by the analytics firm Gate Trade.
Facebook’s Libra seeks Swiss payment system license
John Miller – Reuters
Facebook’s (FB.O) Libra cryptocurrency project is seeking a Swiss payment system license, financial watchdog FINMA said on Wednesday, noting the breadth of the planned services would require broad oversight.
Head tax, LaSalle Street tax, vacancy tax on progressives’ checklist for Lightfoot; A coalition of groups and a handful of aldermen are getting specific about increases to a bevy of taxes to fill Chicago’s budget hole—many of which target the business community.
A.D. Quig – Crain’s Chicago Business
A coalition of progressive groups and a handful of aldermen are getting specific about increases to a bevy of taxes to fill Chicago’s budget hole, including restoring and increasing Chicago’s corporate head tax to $16 per month for large companies, instituting a 3.5 percent tax on office leases, a hike in the hotel tax from 4.5 percent to 7.5 percent, a vacancy tax on commercial properties vacant for more than 18 months and a local income tax on those earning above $100,000 a year.
The Fed’s New Measure Of Trade Uncertainty Has Trump’s Name Written All Over It
Pedro Nicolaci da Costa – Forbes
The Federal Reserve doesn’t actually name the wayward occupant of the White House in its new report attempting to gauge the recent spike in trade uncertainty—but the measure might as well be called the Trump Index.
The Federal Reserve must be honest about Trump’s trade war; US central bank risks reputation with Americans if it pulls its punches with the White House
Barry Eichengreen – The Guardian
William Dudley, the immediate past president of the Federal Reserve Bank of New York, recently stirred up a hornet’s nest when he called for the Fed to consider the impact of its policies on the 2020 presidential election. In fact, Dudley performed a valuable public service by observing that Fed policy can influence politics, sometimes with profound implications for the course of the US. But that doesn’t mean his recommendations were on target.
Macron’s Finance and Budget Ministers Receive Death Threats
William Horobin – Bloomberg
Latest threat came with three bullets delivered to ministry; Le Maire already received death threats ahead of G7 summit
Ministers in Emmanuel Macron’s government have received death threats including bullets in the post, in the latest sign of a tense political climate after the Yellow Vest protests and attacks on the offices of the French president’s political movement.
Hopes and Fears of Markets Are in the Hands of Politicians; The U.S.-China trade war could escalate or, under Trump’s successor, end. Brexit anguish could drag on, or be put to rest.
Conor Sen – Bloomberg
Last month’s drop in long-term Treasury yields spooked many market watchers who fear recession and another prolonged period of sluggish economic growth. But they’re watching the wrong threat.
Macron’s Influence Grows as Europe Charts a New Direction
Jonathan Stearns – Bloomberg
French interests addressed in choices from trade to budgets; Appointments signal shift in EU power away from Angela Merkel
Emmanuel Macron’s growing influence was on display in Brussels on Tuesday as the European Commission unveiled a new leadership team that’s in tune with the French president’s top priorities.
Europe’s Green Deal Seeks to Anchor Carbon Neutrality Into Law
Brian Parkin – Bloomberg
New EU executive aims to get all members on board proposal; Four eastern European states still balk at backing idea
The Europe Union’s planned Green Deal includes an ambitious goal of zero net emissions by 2050, according to a top Brussels official.
CFTC Commissioner Quintenz to Participate at the Eurofi Financial Forum 2019 in Helsinki
Merrill Lynch Ordered to Pay $300,000 Penalty for Failing to Promptly Produce Audit Trail Data
The U.S. Commodity Futures Trading Commission today issued an order filing and settling charges against Merrill Lynch, Pierce, Fenner & Smith Incorporated (Merrill Lynch), a registered futures commission merchant, for failing to promptly produce to the CFTC certain required records and, separately, failing to supervise its employees and agents to ensure that they fulfilled the firm’s statutory and regulatory obligations to keep and promptly produce such records.
CFTC Commissioner Behnam to Participate in a Q&A Session at the SFA Libor Symposium
Amazon Probed by U.S. Antitrust Officials Over Marketplace; The FTC is interviewing merchants to determine whether the e-commerce giant is using its market power to hurt competition.
Spencer Soper and Ben Brody – Bloomberg
A team of Federal Trade Commission investigators has begun interviewing small businesses that sell products on Amazon.com Inc. to determine whether the e-commerce giant is using its market power to hurt competition.
Investing and Trading
There’s Too Much Negativity About Negative Rates; ECB now thinks negative rates didn’t even have that much effect on the economy or prices
James Mackintosh – WSJ
European bankers are squealing in fear that they’ll be stuck with even steeper negative interest rates by the European Central Bank this week. The banks quite rightly fret that lower rates hit their profits, and they want the ECB to help. To avoid trouble in future, it should.
A Giant Bet Against Natural Gas Is Blowing Up; Hedge funds, money managers went bearish before prices shot up 25%
Ryan Dezember – WSJ
A popular wager in the energy markets is backfiring. Hedge funds and other money managers in August built up a big bet that natural gas prices would decline—their most bearish position in the futures market in over a decade—only to have prices shoot up 25%.
The ECB Is Preparing to Inflict More Pain on Banks
Yuko Takeo and Nicholas Comfort – Bloomberg
ECB expected to cut deposit rate to at least minus 0.5%; Lenders such as Deutsche and UBS say policy is ruining finance
The European Central Bank is about to turn the screws again on financial institutions by diving even deeper into negative interest rates.
JPMorgan CEO Dimon Raises Specter of Zero Rates; Chief executive says bank is discussing what fees and charges could be introduced
David Benoit – WSJ
The biggest bank in the U.S. is starting to prepare for how to make money if interest rates in the U.S. drop to zero.
Why Banks Are Going to Suffer With The Upcoming ECB Decision?
Naeem Aslam – Forbes
Just how deep can negative interest rates go? Well, you do not have to wait for long to find the answer to this question because the European Central Bank (ECB) is going to occupy the stage on Thursday and this particular question will be answered.
Trillion Dollar Fund Manager Says Buy China Stocks and Dump U.S.
Adam Haigh – Bloomberg
T. Rowe Price multi-asset team favors Chinese equities; Says American stocks highly priced with profit growth waning
Investors should ignore pricey U.S. stocks and turn to their cheaper Chinese peers instead, where further stimulus will help propel earnings growth, according to T. Rowe Price.
Blackstone Plans Investing in Allcargo’s Unit
Baiju Kalesh and P R Sanjai – Bloomberg
Blackstone Said to seek 51% of logistics venture with Allcargo; PE firm’s fund said to plan investing $209 million in venture
Blackstone Group Inc. is in talks to invest 15 billion rupees ($209 million) in a venture with Allcargo Logistics Ltd. to build warehouses in India, people with knowledge of the matter said.
Woodford Loses $54 Million Selling Stocks From Frozen Fund
Suzy Waite and Carla Canivete – Bloomberg
Money manager took the biggest hit on shares in NewRiver REIT; Fund administrator Link aims to lift suspension in December
Neil Woodford has lost at least 43.5 million pounds ($54 million) from selling some stakes from his frozen flagship fund.
Credit Suisse poaches top Deutsche Bank analyst to lead strategy; Kinner Lakhani latest high-profile figure to leave German lender amid radical revamp
Stephen Morris – FT
Credit Suisse has hired Deutsche Bank’s top European company analyst and adviser in the latest high-profile departure from the German lender as it undergoes a radical retrenchment.
AllianceBernstein sends staff to climate school; Managers play catch-up after investors refocus on environmental risks
Billy Nauman – FT
US fund manager AllianceBernstein is sending its investment staff back to school. The $580bn fund house has developed a training course with New York’s Columbia University on the financial risks of climate change, which the firm’s analysts and portfolio managers will be required to attend.
American Businesses Say China’s Slowdown Is a Greater Threat Than the Trade War; For years, U.S. companies in Shanghai have been steadfastly optimistic about opportunities in China. That’s starting to change.
James T. Areddy -WSJ
American companies are downshifting in China as its economy slows and trade tensions with the U.S. persist, according to a new survey that highlights softening revenue, reduced investment and job cutbacks.
Italy Has a Golden Opportunity in the Bond Market; With a new euro-friendly coalition in place, Rome could issue more long-term debt. That would show Brussels it has the investor stamp of approval.
Marcus Ashworth – Bloomberg
The new Italian government coalition of the Democratic Party and the Five Star Movement has been gifted a golden opportunity. The sharp drop in its sovereign bond yields means it can get ahead of its borrowing requirements for this year.
South African Confidence at Lowest Since 1980s Disinvestment
Prinesha Naidoo – Bloomberg
Sacci business confidence index falls to 89.1 in August; RMB/BER confidence index falls to 20-year low in third quarter
South African business confidence slumped to the lowest level since disinvestment from the country over its apartheid policies started gaining momentum more than three decades ago.
Chinese Return to Angola After Currency Crisis Caused Exodus
Candido Mendes – Bloomberg
New forex policies attract new category of Chinese companies; Chairman of Chinese commerce group says things have improved
Angola is attracting renewed interest from Chinese business owners since it lifted curbs on money transfers, following an exodus of tens of thousands of Chinese amid an economic crisis.
Duterte Will Ignore South China Sea Ruling for China Oil Deal
Andreo Calonzo – Bloomberg
Philippine President Rodrigo Duterte said he will ignore an international court ruling affirming his country’s territorial claims in the South China Sea in order to advance oil exploration plans with Beijing.
Aramco’s Long-Awaited IPO May Be Kryptonite to Saudi Stocks
Netty Idayu Ismail and Filipe Pacheco – Bloomberg
Share offering may crowd out the kingdom’s equity market; Company may sell a 1% stake through a listing on Saudi bourse
It’s been at least three years in the making, but it’s just dawned on investors what a share sale Saudi Aramco would do to the Arab world’s biggest stock exchange.
Norway Confident Gas Supplies to Keep Flowing in Event of Hard Brexit
Sveinung Sleire – Bloomberg
U.K. is Norway’s largest export market, mostly oil and gas; Norway’s wealth fund has invested about $80b in the U.K.
The man in charge of Norway’s trade policies is sanguine about the prospects of the country’s largest export destination potentially leaving the European Union without a deal.
Deal or no-deal, Brexit’s puppet master has more strings to pull
Guy Faulconbridge – Reuters
Boxed in by parliament, British Prime Minister Boris Johnson’s next move on the Brexit chessboard will most likely be played with the ruthless bravura that his senior adviser, Dominic Cummings, built his reputation on.
Since Johnson won the top job in July, Britain’s Brexit crisis has spun more furiously, leaving investors and allies bewildered by an array of decisions that diplomats compare to the disorientating style of U.S. President Donald Trump.
Brexit risks break-up of Union if citizens are angered by different rules across UK, warns former civil service chief; Anything from agricultural subsidies to food labelling could trigger major disputes, top mandarin predicts
Rob Merrick – Independent
Brexit risks the break-up of the UK if citizens are angered by different rules and regulations in the four nations, a former civil service chief is warning.
Court Rules U.K. Parliament Suspension ‘Unlawful’: Brexit Update
Kitty Donaldson , Robert Hutton , and Jonathan Browning – Bloomberg
Boris Johnson suffered yet another setback, as a Scottish court ruled that his decision to suspend Parliament was “unlawful” because it was intended to stymie the legislature. Johnson denies this, but with British politics already gridlocked, the ruling pits the government against Parliament in a constitutional crisis that leaves Brexit in chaos.
Brexit crisis deepens, court rules parliament suspension unlawful
Michael Holden, Guy Faulconbridge – Reuters
Scotland’s highest court of appeal ruled on Wednesday that Prime Minister Boris Johnson’s decision to suspend parliament was unlawful, deepening the uncertainty over Britain’s departure from the European Union.
The Brexit Dilemma: Four Ways Johnson Could Break the Deadlock
Robert Hutton – Bloomberg
Boris Johnson hemmed in by MPs, headcounts and U.K. politics; Deal, no deal? Extension? Election along with new referendum?
Where does Brexit go next? What can Boris Johnson do? Only a fool would offer a prediction, but here are some possible paths.
Harry Potter and 007 Defy a Credit Market Battered by Brexit
Laura Benitez – Bloomberg
Junk bond sale from Pinewood Studios shines in sterling market; Disney, Netflix deals help investors look past small print
It could be the next installment in the boy wizard’s epic saga: Harry Potter and the Half-Yield Bond.
One Country’s Brexit Dismay Is Another’s Economic Boon, For Now
Milda Seputyte – Bloomberg
Britons may be fed up with uncertainty over Brexit but their indecision has boosted an economy on the opposite side of the European Union.
How Do Farmers Make Money on Corn? By Charging to Shoot It From a Cannon; Crop prices are low, but launching produce comes at a premium
Adam Thompson – WSJ
Farmers across the U.S. have stumbled onto a fertile side hustle at a time when prices for their crops are low: cramming produce into an air gun and charging people to fire it into the sky.
The Jack Bauers of Europe Love Facial Recognition; As regulators wake up to the threat of this intrusive and flawed technology, governments and police are pushing back with an unconvincing public-safety defense.
Lionel Laurent – Bloomberg
Facial recognition has friends in Europe. Live trials of real-time face-tracking have taken place over the past year in countries such as the U.K. and France, by and large without falling foul of the continent’s sweeping but haphazardly-enforced data protection laws.