How UK regulators are missing a chance to make the best of Brexit

Feb 27, 2024

First Read

Hits & Takes
John Lothian & JLN Staff

I am headed to downtown Chicago today with Robby Lothian, who is in town to help me with a video shoot. I am going to wear a short-sleeved shirt and bring no jacket on this winter day in late February that may break the record for the warmest day ever for February 27, according to Bloomberg. The all-time February high for the Chicago area is 75F (24C) degrees, according to the National Weather Service, Bloomberg said.

This kind of weather makes you wonder why you need to go to Florida in March, but in a few days we are expecting colder weather and perhaps some snow. The great thing about Chicago is that if you don’t like the weather, just wait 10 minutes, it will change.

This is about the Langer lawsuit. In accordance with the court’s order dated January 30, 2024, the exchange member plaintiffs and defendants, CME Group Inc and the Board of Trade of the City of Chicago Inc, have agreed upon a briefing schedule related to the defendants’ motions for summary judgment, class decertification, and exclusion of plaintiff’s expert testimony. The timeline is as follows: plaintiffs’ opposition due by April 12, 2024, defendants’ replies by May 14, 2024, followed by a status conference on May 29, 2024, at 9:30 a.m. via Zoom.

The CME Group is looking for an Education Content Sr. Specialist in Chicago. The position requires having a background in writing various formats of educational content and being excited to explore how AI can accelerate content development and production.

Ensuring the authenticity and integrity of luxury goods has become a vital consideration for both brands and buyers in the retail market, and our good friends at NovaFori explore the role of auction technology in shaping consumer perceptions and driving industry trends in a blog post titled “The role of Auction Technology in promoting trust and transparency.”

At the Derivatives Forum Frankfurt 2024 at the Congress Center Frankfurt from February 28-29, veteran journalist Jeremy Grant will moderate a discussion about how index evolution propels further growth of derivatives in the index leader panel featuring Axel Lomholt from STOXX, Arne Staal of FTSE Russell (an LSEG Business), and Maya Beyhan from S&P Dow Jones Indices.

Nicolas Jegou, the CEO at Euronext FX, announced on LinkedIn the new leadership of the EuronextFX sales team. He said Wyman Shing is the CEO of Euronext Markets Singapore Pte. Ltd., Euronext’s Singapore-based trading platform for spot and NDFs. Also, Stuart Parris is the new head of sales, with global sales coverage in New York, London and Singapore.

Have a great day and stay safe and treat people the same way you want to be treated: with respect, equality and justice.~JJL

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In January, the worldwide volume of exchange-traded derivatives surged to a record high of 16.79 billion contracts, marking a 10.7% increase from December 2023 and a 97.2% rise from January 2023, according to the latest data from the FIA. Options also gained, with global trading reaching 14.49 billion contracts, a 128% surge compared to the previous year, predominantly driven by activity in the Asia-Pacific region. Futures trading also saw growth, totaling 2.3 billion contracts in January, up by 6.1% year-over-year. Total open interest at the end of January amounted to 1.20 billion contracts, reflecting a 13.2% increase from the previous year. The FIA makes data on futures and options trading available in two formats: a spreadsheet and a set of interactive visualizations called the FIA ETD Tracker. Access the FIA data tracker HERE. ~SAED

Our most read stories from our previous edition of JLN Options were:
How the Rise of ‘Pod Shops’ Is Reshaping the Way Markets Trade from Bloomberg.
Options Industry Conference Agenda from OIC.
Nvidia bets dominate US options market as AI fervor grows from Reuters. ~JB

Subscribe to the JLN Options Newsletter HERE (it’s free).

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Sponsored Content

Russell 2000 Index Quarterly Chartbook – February 2024

The Russell 2000 Index provides live index tracking data, with historical performance dating back to January 1984. Academic and practitioner research confirms that large-cap stocks behave differently to small-cap stocks and performance is variable. There are sub-periods during which the Russell 1000 outperforms the Russell 2000 and vice versa. Quarterly performance assessments provide valuable datapoints for understanding market sentiment and US economic activity. View the report: HERE

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Vermiculus delivers VeriClear clearing system to nuam exchange; nuam exchange and Vermiculus Financial Technology establish partnership to create technological core for Central Counterparty Clearing Houses in Chile, Colombia and Peru; Construction of an integrated cloud-native clearing system for the three clearing houses have begun, while progress is being made in parallel to create the clearing house in Peru.
Vermiculus Financial Technology
nuam exchange, the entity resulting from the integration of the Lima, Santiago and Colombia stock exchanges, announced a partnership with Vermiculus Financial Technology, a technological solutions vendor for the financial industry, to implement a modern, flexible technological core for the Central Counterparty Clearing Houses (CCP) in Chile, Colombia and Peru. “With Vermiculus as a partner in developing the nuam exchange post-trade systems, we are marking a new milestone for the unification of our markets. In addition to gaining a cutting-edge technological partner, we envision the possibility of enhancing our customers’ experience through dynamic technological architecture in line with the needs of the integrated market,” said Juan Pablo Cordoba, CEO of nuam exchange.
/jlne.ws/3UW5y1E

***** Vermiculus continues to make progress, one deal at a time.~JJL

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Warren Buffett says the stock market is increasingly ‘casino-like’-and young investors need to remember this ‘one fact of financial life’ to avoid the mess
Will Daniel – Fortune
Berkshire Hathaway CEO Warren Buffett shared a moving tribute to his fallen friend and right-hand man Charlie Munger in his annual shareholder letter over the weekend. The Oracle of Omaha lauded Munger as the “architect” of Berkshire’s success, eulogizing the “abominable no-man” by discussing some of his favorite whipping posts-including his comparison of the modern stock market to a casino. “For whatever reasons, markets now exhibit far more casino-like behavior than they did when I was young,” Buffett wrote, adding that “though the stock market is massively larger than it was in our early years, today’s active participants are neither more emotionally stable nor better taught than when I was in school.”
/jlne.ws/4bOAp6d

****** Warren and Charlie don’t like speculators.~JJL

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FCA plans to name firms under investigation in UK deterrence drive; Agency has historically published little about probes until they are resolved, only commenting in ‘exceptional circumstances’
Suzi Ring – Financial Times
The UK Financial Conduct Authority is planning to name firms under investigation more frequently and at a much earlier stage in an effort to increase the deterrence effect such probes can have on the market. The new approach, outlined in a consultation paper set to be published on Tuesday, would mainly apply to firms rather than individuals due to legal constraints around privacy, the FCA said.
/jlne.ws/3wx50Fi

***** Shame can be a powerful regulatory tool.~JJL

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Monday’s Top Three
Our top clicked item on Monday was the agenda for the Options Industry Conference, to take place this year from April 30 – May 2 in Asheville, North Carolina. Second was a tie between DRW’s CMCO on Thought Leadership, AI and Why Mentors Matter, from DRW and Two Years of War in Ukraine Has Changed the Way Armies Think, from Bloomberg. Third was a tie between You Say Bitcoin Is Digital Gold? Maybe It’s Digital Pearls, from The Wall Street Journal and Women in Listed Derivatives’ announcement on LinkedIn that they appointed Maura Durkin as board president and elected three new members to the board of directors.

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Lead Stories

How UK regulators are missing a chance to make the best of Brexit; Leaving the EU was supposed to liberate Britain’s cumbersome approvals system and unlock new industries. What is going wrong?
Peter Foster and Madeleine Speed – Financial Times
The smell of fried pork permeates the kitchens of Hoxton Farms in east London and yet no pig was slaughtered to make the dish sizzling away on the hob. Thanks to advances in biotechnology, the meat on this pork belly is plant-based but the fat is identical to the real thing, only cultured from cells at the company’s office in a trendy block for life science start-ups. Ed Steele, the mathematician who co-founded Hoxton Farms with synthetic biologist Max Jamilly in 2020, believes that lab-grown fat is the secret to creating tasty meat alternatives because, as the company’s website puts it, “the fat is where the flavour’s at”.
/jlne.ws/3OTtxun

Bankers Will See Three-Quarters of the Workday Transformed by AI; Accenture says banking sector has more to gain than any other; AI offers opportunity for firms to re-evaluate ways of working
Katherine Doherty – Bloomberg
Artificial intelligence is likely to replace or at least lend a hand in tasks that take up almost three-quarters of the time bank employees now spend working. That’s the conclusion of a new analysis by consultancy Accenture, which said banking has the potential to benefit more from the technology than any other industry. Just 27% of employees’ time currently has a low potential of being transformed, according to the analysis.
/jlne.ws/4bPlsB1

Investors poured $4tn into US ETFs over past decade; Mutual funds saw net outflows of $950bn over the same period
Alyson Velati – Financial Times
Over the past decade, ETF assets have surged substantially more quickly than the money sitting in mutual funds, data shows. In fact, when looking at the 10 largest providers of both products, assets in ETFs have ballooned three times as quickly over the past decade as the money sitting in mutual funds, according to an Ignites analysis of data from Morningstar Direct. Combined, the 10 shops had $12.01tn in open-end mutual fund assets as of the end of 2023 – up 114 per cent from a decade earlier, the data shows.
/jlne.ws/3uNr65U

Hong Kong-based Crypto Exchange BitForex Disappears After $56.5M Withdrawal
Hope C – CoinMarketCap
Hong Kong-based cryptocurrency exchange BitForex has abruptly shut down, leaving users in a state of confusion and fear. The exchange ceased all operations on February 23, with no prior warning or explanation, and has gone silent on all official communication channels. This sudden closure has sparked concerns of a potential exit scam, as significant outflows of digital currency were detected from BitForex’s hot wallets before its closure.
/jlne.ws/431Oj12

Crypto Market Cap Swells to $2 Trillion on Back of Bitcoin Rally; ETF inflows, MicroStrategy purchases bolster the token; Bitcoin is outshining traditional assets so far in 2024
Suvashree Ghosh and Sidhartha Shukla – Bloomberg
The combined value of the cryptocurrency market has jumped to around $2 trillion for the first time on almost two years on the back of the ETF-fueled rally in Bitcoin. The largest digital asset, which data from CoinMarketCap.com shows accounts for about 52% of the entire market, rose as much as 5.1% to $57,443 on Tuesday. Bitcoin has surged around 12% already this week, and is trading at the highest level since December 2021. The value of the crypto market reached around $2.7 trillion a month earlier, when token prices were at all-time highs. Bitcoin’s price has increased 32% since the turn of the year, extending a prolonged rally that has also stoked speculative appetite for smaller tokens like Ether and Dogecoin.
/jlne.ws/3OZb9AF

Yellen Sees Moral Case to Use Russian Assets to Aid Ukraine; Treasury chief makes appeal for Ukraine to G-7 counterparts; As US aid bill languishes, some nations oppose unlocking funds
Viktoria Dendrinou and Christopher Condon – Bloomberg
US Treasury Secretary Janet Yellen called on the world’s largest advanced economies to find a way to “unlock the value” of immobilized Russian assets to help bolster Ukraine’s defense against Russia’s invasion and for long-term reconstruction after the war. “There is a strong international law, economic and moral case for moving forward,” Yellen said Tuesday in Sao Paulo in remarks before meeting with counterparts from the world’s top economies. “The G-7 should work together to explore a number of approaches that have been suggested.”
/jlne.ws/3SXcDfX

The First Total Market Stock Index Began 50 Years Ago. It Has Survived a Lot.
Allan Sloan – Barron’s
Welcome to the golden anniversary of the first U.S. total stock market index, which boasts an eventful and little-known history that can teach us a lot about how financial markets have evolved over time. The index, now known as the FT Wilshire 5000, also has a fascinating founder. And in the past few years, it has acquired an impressive list of international owners. The Wilshire 5000 was founded in 1974 by Dennis Tito, a numbers-loving guy who named his newly created market metric after the street on which his company, then known as Wilshire Associates, was located. Its address was 100 Wilshire Blvd. in Santa Monica, the upscale Los Angeles suburb. Hence the “Wilshire” in both the corporate and the index name.
/jlne.ws/49vK0NG

MFA statement on Council of the European Union approval of AIFMD
MFA
MFA issued the following statement on the Council of the European Union’s approval of the AIFMD agreement:
/jlne.ws/49sZdPv

Saudi Exchange appoints new chief of derivatives; Individual has been at the Saudi Exchange for over eight years and was most recently chief of cash markets.
Claudia Preece – The Trade
Noelle Al Jaweini has been appointed acting chief of derivatives at the Saudi Exchange following more than eight years with the business. Most recently, Al Jaweini served as chief of cash markets at the exchange and before that head of markets development. During her career, Al Jaweini has contributed to various industry initiatives, including having served as the first Saudi advisory board member for Bloomberg’s “A Fair Share” – an initiative which advocates for gender equality in the regional financial industry.
/jlne.ws/49LQd83

Nvidia bets dominate US options market as AI fervor grows
Saqib Iqbal Ahmed – Reuters
Investors’ fervor for all things AI-related is leaving its mark on the U.S. options market, as traders pile in to derivatives bets to gain exposure to the red-hot investing theme. Options on artificial-intelligence darling Nvidia accounted for 25 cents of every dollar of premium – the price of contracts – traded in U.S. single-stock options over the past month, nearly $3 billion in options premium traded in the chipmaker’s options every day on average, a Reuters analysis of Trade Alert data showed. During several recent sessions, Nvidia surpassed Tesla as the option market’s most heavily traded name for the day.
/jlne.ws/3Ic6K9J

Bitcoin ETFs Are Off to a Roaring Start. Are Other Crypto Funds Next?
Vicky Ge Huang – The Wall Street Journal
Wall Street firms launched bitcoin exchange-traded funds just a few weeks ago. Now, they want to offer everyday investors funds holding a smaller and more volatile crypto asset. At least 10 firms including BlackRock and Fidelity Investments have filed applications to launch what would be the first U.S.-listed ETFs holding ether, the second-largest cryptocurrency. As with bitcoin and other ETFs, the firms would earn management fees for any investments people make. Ether, the in-house token on the Ethereum blockchain, surged above $3,000 last Tuesday for the first time since April 2022 in anticipation of the potential approvals. That gave it a market cap of about $360 billion, compared with bitcoin’s more than $1 trillion valuation.
/jlne.ws/3OZzplV

Analysis – US SEC expected to drag its feet on new wave of crypto ETFs
Suzanne McGee and Hannah Lang – Reuters
Buoyed by the successful launch of U.S. bitcoin exchange-traded funds (ETFs), asset managers are lining up to list a second wave of more complex crypto products, setting the stage for another tussle with the U.S. securities regulator. The Securities and Exchange Commission (SEC) rejected spot bitcoin ETFs for more than a decade, hoping to protect investors from market manipulation. But the SEC was forced to approve them last month after Grayscale Investments won a court challenge. A federal appeals court ruled that the SEC had not sufficiently detailed its reasoning for rejecting the products.
/jlne.ws/3uYdrZL

Gensler Set To Meet South Korean Financial Regulators To Discuss NFTs, Spot Bitcoin ETF
Hope C – CoinMarketCap
South Korea and the United States are set to engage in talks regarding the regulation of cryptocurrencies and digital assets. The head of South Korea’s financial watchdog, Governor Lee Bok-hyun, is scheduled to meet with US Securities and Exchange Commission chair Gary Gensler in May to discuss two key issues: classifying non-fungible tokens (NFTs) and approving spot Bitcoin exchange-traded funds (ETFs).
/jlne.ws/3Ifka4x

Column: Vanguard, one of our top investment firms, shuns crypto ‘like the plague.’ That’s good for its customers
Michael Hiltzik – LA Times
After Jan. 10, when the Securities and Exchange Commission approved the first bitcoin exchange-traded investment products, the biggest investment firms jumped into the pool with both feet, jostling one another to offer their clients, big or small, access to bitcoin funds. All, that is, except the second-biggest private investment management fund on the planet, Vanguard Group.
/jlne.ws/3TggmXj

BlackRock Says ‘New Regime’ Calls for More Active Management; World’s largest asset manager benefited from index boom; Firm says ‘mega forces’ keeping rates above pre-Covid levels
Silla Brush – Bloomberg
BlackRock Inc., which capitalized on a decade-long boom in index investing, said investors should rely more heavily on actively managed strategies. Higher interest rates, persistent inflation and more geopolitical risk offer active managers and hedge funds a bigger opportunity to beat simple buy-and-hold portfolios, BlackRock analysts wrote Tuesday in a paper that referred to the environment as a “new regime.” “Static asset allocations – or set-and-forget portfolios – are a reasonable starting point, but we don’t think they will deliver as in the past,” BlackRock Investment Institute analysts including Vivek Paul and Andreea Mitrache said in the paper. “The era of ultra-low interest rates is in the past, and future expected returns look less attractive.”
/jlne.ws/3TemRtG

What Spot Bitcoin ETFs in Canada Say About the U.S.
Reza Akhlaghi – CoinDesk
On Jan. 10, the U.S. Securities and Exchange Commission (SEC) ended the years-long wait for spot bitcoin exchange-traded funds (ETFs). The approval, an important phase in the maturation of Bitcoin, opened the door for millions of Americans to invest in the incumbent digital currency, whose value grew by more than 160% in 2023. Futures-based crypto ETFs have been available to U.S. investors since October 2021, but unlike spot ETFs, they are not tied directly to the asset and have no requirements for custody. In other words, if spot ETFs are successful, it means there will be a lot more bitcoin buying pressure.
/jlne.ws/42T3KIG

Companies Say Push to Decarbonize Comes From Their Own Boards; Call to cut corporate carbon footprints is loudest from inside organizations, outweighing demand from customers and regulators, survey finds
Yusuf Khan – The Wall Street Journal
The pressure on companies to cut their carbon footprint is coming more from within the organizations themselves than from customers and regulators, according to a new report. Three-quarters of business leaders from across the Group of 20 nations said the push to invest in renewable energy is being driven mainly by their own corporate boards, with 77% of U.S. business leaders saying the pressure was extreme or significant, according to a new survey conducted by law firm Ashurst.
/jlne.ws/49R0MGQ

The TRADE’s D&I Survey is closing soon – don’t miss out! Providing market insight through The TRADE’s D&I survey is your chance to be a part of real change, and simultaneously unlock significant value.
Editors – The Trade
Following the success of The TRADE’s inaugural Diversity & Inclusion Survey, we’re back for a second year, offering market experts the chance to influence the industry on another level. Your opinions and insights are immensely valuable to us here at The TRADE and will help guide our content moving forward, so we would really appreciate your participation.
/jlne.ws/3TcNRJM

HSBC and the Bank of East Asia execute first Hong Kong repo trade using digital bonds; The transaction involved using HK$-denominated bonds as collateral from the largest digital bond issuance globally and is expected to help build liquidity for digital bonds.
Wesley Bray – The Trade
HSBC has executed a Hong Kong dollar repo transaction with the Bank of East Asia (BEA), which used Hong Kong government digitally native green bonds as collateral for financing purposes. The move represents the first repo in Hong Kong involving digital bonds. “Investing in Hong Kong’s first-ever digitally native bonds and transacting repo trades with the bonds as collateral has been a smooth process,” said Bryan Wong, general manager and head of treasury markets division of BEA.
/jlne.ws/49H8IL2

Ukraine Invasion

In Ukraine, Russia Is Inching Forward Death by Death
Thomas Gibbons-Neff and Anatoly Kurmanaev – The New York Times
As the Russian military launched its offensive on the eastern Ukrainian city of Avdiivka last fall, Ukrainian troops noticed a change in their tactics as column after column of Russian forces were ravaged by artillery fire. Russian forces divided their infantry formations into smaller units to avoid being shelled, while the amount of Russian airstrikes increased to hammer the city’s defenses. It was one of several adjustments the Russians made to help reverse their fortunes after a disastrous first year. But these changes were obscured by one glaring fact: The Russian military was still far more willing to absorb big losses in troops and equipment, even to make small gains.
/jlne.ws/48ss7hr

Financial flows to Russia are drying up as global banks fear losing access to the US dollar, Treasury official says
Filip De Mott – Business Insider
The threat of secondary sanctions on financial institutions that help Russia bypass its own restrictions is proving effective, the US deputy treasury secretary, Wally Adeyemo, has told Reuters. Data cited by the Treasury shows financial flows between Russia and several countries, such as Kazakhstan, Turkey, and the United Arab Emirates, have meaningfully decreased.
/jlne.ws/3SSE1vh

Russia Buys Tens of Millions of Euros of Banned EU Weapons Tech; Tens of millions of euros in restricted goods shipped from EU Company subsidiaries, third countries moved sensitive items
Alberto Nardelli – Bloomberg
European Union states still aren’t doing enough to stop Russia getting hold of sanctioned technologies for use in weapons to wage war on Ukraine, according to officials familiar with the matter. Tens of millions of euros of trade in banned sensitive goods continue to originate from the bloc itself, despite multiple rounds of sanctions, one of the officials said, based on internal assessments of trade flows. Almost a quarter of EUR450 million ($488 million) of so-called high priority items that reached Russia from the EU in the first nine months of last year was shipped directly from Europe. Russia mostly imported the rest via third countries, according to the official, who spoke on condition of anonymity to discuss private information.
/jlne.ws/3US1Shh

Macron says sending western troops to Ukraine cannot be ruled out; French president also drops opposition to artillery purchases for Kyiv from outside the EU
Leila Abboud and Henry Foy – Financial Times
French President Emmanuel Macron said sending western troops to Ukraine “could not be ruled out” and that Paris would drop its long-standing opposition to purchasing emergency artillery supplies for Ukraine from outside the EU. Arguing that Russia’s defeat was necessary to ensure “Europe’s collective security”, Macron said a meeting of 25 European leaders in Paris on Monday had underscored a new depth of western resolve to help Ukraine, after more than two years of full-scale war in the country.
/jlne.ws/3uNLwvy

‘Naive’ Europe must spend more to deter Russia, says Danish PM; Mette Frederiksen says Moscow’s ‘aggression’ requires region to bolster defence by curbing welfare and tax cuts
Richard Milne and Andy Bounds – Financial Times
Europe must curb welfare spending and tax cuts to deter a “more aggressive Russia” with prolonged defence and security funding increases, according to Denmark’s prime minister. Mette Frederiksen told the Financial Times that the “naive” continent had to avoid the mistakes of the 1930s and “step up and scale up” its defence industry to contain an imperialist Russia, which has made Ukraine just its first target.
/jlne.ws/3IgCGtk

Israel/Palestine Conflict

Damaged Subsea Cable in Red Sea Highlights Telecom Vulnerability
Olivia Solon – Bloomberg
A subsea cable off the coast of Yemen that connects Europe to India has been damaged, and the telecommunications carrier that owns it must now figure out how to make underwater repairs in a war zone. Seacom Ltd., the South African company that controls the cable, detected a fault on Saturday, Chief Digital Officer Prenesh Padayachee said in an interview with Bloomberg on Monday. He estimated the problem is in waters about 150 meters (492 feet) to 170 meters deep in an area where Iran-backed Houthi fighters have been targeting ships with drones and missiles.
/jlne.ws/4bTgjb1

Jailed militant becomes ultimate bargaining chip in Israel-Hamas hostage deal; Demands for release of Marwan Barghouti thrust Palestinian leader back into spotlight
James Shotter – Financial Times
For many Israelis, Marwan Barghouti is a terrorist rightly jailed for his role in the Palestinian uprising of the early 2000s who should spend the rest of his life in prison. But for Palestinians, he is a freedom fighter who embodies their just resistance to Israel’s half-century occupation of their lands. And when Hamas has been setting out its conditions for freeing the remaining 130 Israeli hostages it holds in Gaza, Barghouti’s release was among them.
/jlne.ws/3uG5ybw

Exchanges, OTC and Clearing

SIX Introduces SME Green Assessment Tool
ESG Hub Switzerland
SIX, a financial market infrastructure provider, and Greenomy, a sustainability reporting software company, have introduced a new tool to help banks assess the sustainability of small to medium enterprises (SMEs). This tool is designed to support banks in improving the environmental and social impact of their lending activities. It also helps banks comply with increasing regulations on sustainability reporting. The solution offers a comprehensive service for banks to evaluate the sustainability of SMEs, from the initial assessment to ongoing monitoring.
/jlne.ws/42WG85X

SIX Launches New SME Sustainability Assessment Solution Powered by Greenomy
BME
SIX, the global financial information provider, has today launched a new solution enabling the global banking clients of SIX to measure the sustainability performance of their small and medium-sized enterprise (SME) clients, and to assess climate and sustainability risk trajectories linked to their loan books. This product launch is following the company’s partnership with leading Brussels-based ESG assessment and reporting specialist Greenomy in December. SIX is driving forward the increased inclusion of SMEs in financial markets. With their partnership, SIX and Greenomy are recognizing the pivotal role that SMEs can play in the transition to a sustainable and low-carbon economy.
/jlne.ws/3TdCQYV

Euronext launches Daily Options on the CAC 40 index
Euronext
Euronext launches Daily Options on the CAC 40 index for short-term trading strategies and exposure to the main index of Euronext Paris; Euronext pioneered Daily Options on the AEX index in 2008 and now expands its offering to the CAC 40 index. The new Daily Options meet growing investor demand, especially from institutional and retail investors looking to respond quickly to market fluctuations. Euronext today announced the launch of Daily Options on the CAC 40 index, enabling investors to execute short-term trading strategies and gain exposure to the main index of Euronext Paris. Having been the first exchange in Europe to introduce Daily Options, with the launch of Daily Options on the AEX index in 2008, Euronext has now expanded its Daily Options offering to the CAC 40 index.
/jlne.ws/3SMhb8I

CCP Global publishes its winter bi-annual newsletter
CCP Global
Dear Reader, Another year has started, and it is a pleasure to bring you updates from the world of clearing and our membership. The second half of 2023 was marked by ever-growing volumes in centrally cleared markets – increases in key interest rates, rotations in equity and commodity values, all bringing greater need for risk management for market participants. In addition to the usual strict mark-to-market and collateralisation by CCPs for their members’ and clients’ exposures, there has been a great increase in volume of individual trades.
/jlne.ws/49li3br

Performance Bond Requirements: Agriculture and Metals – Effective February 27, 2024
CME Group
As per the normal review of market volatility to ensure adequate collateral coverage, the Chicago Mercantile Exchange Inc., Clearing House Risk Management staff approved the performance bond requirements for the following products listed in the advisory at the link below. The rates will be effective after the close of business on February 27, 2024.
/jlne.ws/3T1uzWO

NSE operationalizes Common Investors Service Centre in Gangtok
National Stock Exchange of India
Investor services, awareness & protection are the key functions of stock exchanges. In order to cater to the needs of investors of securities markets in the states of Sikkim, SEBI along with stock exchanges NSE and BSE has established an “Investor Service Centre” at Gangtok. These Investor Service Centre managed by NSE was operationalized on February 26,2024. With a view to enhance access and reach to investors, Exchange has setup new Investor Service Centres. The centre services query resolution, complaint resolution and necessary assistance in filing complaints in SEBI Scores Portal and the Smart ODR Portal.
/jlne.ws/42U4CwB

National Stock Exchange and Department of Higher Education, Government of Uttarakhand signs MoU during flag-off ceremony of Project GAURAV
National Stock Exchange of India
India’s leading stock exchange, the National Stock Exchange (NSE) and the Department of Higher Education, Government of Uttarakhand have signed a Memorandum of Understanding (MoU) in the flag off ceremony of Project GAURAV, a skill development program for youth of Uttarakhand in the BFSI sector.
/jlne.ws/4bSguTR

SGX RegCo, REITAS urge all US REIT unitholders to submit tax forms
Singapore Exchange Regulation
Singapore Exchange Regulation (SGX RegCo) and the REIT Association of Singapore (REITAS) urge all holders of REITs whose primary investment is US assets (relevant REITs) to submit the relevant US withholding tax forms and certificates in a timely manner to their stockbrokers (for non-SRS investors) or nominee banks (for SRS/CPFIS investors) when requested to do so.
/jlne.ws/48v2GMs

Fintech

Bloomberg and General Index Expand Strategic Collaboration for Commodities Market Information; GX to Provide Bloomberg Terminal Users with Access to 160 New Industry Spot Oil Benchmarks
Bloomberg
Bloomberg and General Index (GX), the world’s first technology-led benchmark provider, announced today the expansion of their strategic collaboration which builds on the foundational commodities market information available via the Bloomberg Terminal function, Bloomberg Spot Oil {BOIL}. All Bloomberg Terminal customers can now access GX’s robust, reliable pricing for the world’s commodity markets, including the most important oil and refined products prices.
/jlne.ws/3Tbp0Ge

Wirecard whistleblower slams new German law as too weak; Pav Gill says fines are ‘slap on the wrist’ as he prepares platform to help companies with compliance
Dan McCrum – Financial Times
The Wirecard insider who exposed the fraud that led to its collapse has attacked Germany’s whistleblower protection law, dismissing fines for non-compliance as a “slap on the wrist” and lamenting its failure to force companies to offer anonymous reporting channels to staff. “It’s just crazy, because it’s thrown cold water on the objective of the whole thing,” Pav Gill told the Financial Times ahead of the Tuesday launch of his start-up, Confide. “Most whistleblowing is anonymous because of the real fear of reprisal and exposure.”
/jlne.ws/3TfgEOa

Google aims to relaunch Gemini AI image tool in a few weeks
Joan Faus – Reuters
Google plans to relaunch in the next few weeks its AI tool that creates images of people, which it paused last week after inaccuracies in some historical depictions, Google DeepMind CEO Demis Hassabis said on Monday. Alphabet’s Google began offering image generation through its Gemini AI models earlier this month. Some users, however, flagged on social media that it generated historical images which were sometimes inaccurate.
/jlne.ws/48qoetu

AI Startup Gets Funds to Help Prevent Widespread Work Accidents
Saritha Rai – Bloomberg
Intenseye has raised $64 million in a funding round led by Lightspeed Venture Partners to develop AI that can detect and help fix potential hazards in the workplace, an effort it says can help save lives and reduce economic losses from millions of accidents every year. The New York-headquartered startup’s latest financing, in which existing backers Insight Partners, Point Nine and Air Street Capital also took part, takes its total funding to about $90 million to date.
/jlne.ws/48vywbN

Large Apple shareholders seek AI disclosures; Norway’s wealth fund and LGIM back resolution asking iPhone maker to outline risks associated with artificial intelligence
Patrick Temple-West and Michael Acton – Financial Times
Two large Apple investors are seeking more information about the company’s artificial intelligence risks as tech companies’ ambitions in the fast-growing sector face mounting investor scrutiny. Norges Bank Investment Management and Legal & General, Apple’s eighth and 10th-largest shareholders respectively, have said they will support a resolution at the iPhone maker’s annual shareholder meeting on Wednesday that asks the company to report about AI in its business operations.
/jlne.ws/4bVEbL5

Microsoft Partners With an OpenAI Rival, and Other Technology News Today
Adam Clark – The Wall Street Journal
/jlne.ws/3IhV8Sx

Google Mired in Controversy Over AI Chatbot Push; Search company is betting on AI for its next big business, but the tech’s pitfalls are playing out in real time
Miles Kruppa – The Wall Street Journal
/jlne.ws/42SS88G

Cybersecurity

NIST releases expanded 2.0 version of the Cybersecurity Framework
Cynthia Brumfield – CSO Online
The US National Institute of Standards and Technology released the 2.0 version of its Cybersecurity Framework, focusing more on governance and supply chain issues and offering resources to speed the framework’s implementation. After two years of work, the US National Institute of Standards and Technology (NIST) has issued the 2.0 version of its widely referenced Cybersecurity Framework (CSF), expanding upon the draft 2.0 version it issued in September. The CSF 2.0, cited in President Biden’s National Cybersecurity Strategy and several emerging government cybersecurity policy statements, has shifted its focus from protecting critical infrastructure, such as hospitals and power plants, to all organizations in any sector. The previous title of the framework, “Framework for Improving Critical Infrastructure Cybersecurity,” has been abandoned in favor of the “NIST Cybersecurity Framework (CSF) 2.0” in recognition of this shift.
/jlne.ws/431OEAQ

MicroStrategy’s X Account Hacked, Leads to $440K Crypto Being Stolen: Blockchain Sleuth ZachXBT
Parikshit Mishra – CoinDesk
MicroStrategy’s X account was hacked on Monday, leading to a phishing message being posted for its followers, blockchain sleuth ZachXBT said. The X account of Michael Saylor’s software firm sent out a post announcing the launch of an MSTR token and a link for claiming the fake token. MSTR is MicroStrategy’s stock symbol. MicroStrategy is a business intelligence software maker that has invested more than $6 billion in bitcoin {{BTC}} and is the largest publicly traded owner of the No. 1 cryptocurrency by market cap. Founder and Executive Chairman Saylor is a supporter of the token and frequently posts about it on the social media platform. Today the Tysons Corner, Virginia-based company said it bought another 3,000 BTC, taking the total owned to 193,000.
/jlne.ws/3wuruqD

8 associations that women in cybersecurity should follow or join
Linda Rosencrance – CSO Online
Still a minority in the profession, female cybersecurity professionals can expand their career development and get support from their peers by joining women-only groups. Joining a female-only association can provide crucial support for women in cybersecurity as they provide opportunities for networking, mentorship, career development, advocacy, and access to resources. These groups can also help female cyber workers build confidence and develop leadership skills while sharing their experiences.
/jlne.ws/49xOxPY

Cryptocurrencies

OANDA Opens FCA-Registered Crypto Trading Platform in the UK
Ian Allison – CoinDesk
U.S.-based forex pioneer OANDA is opening a cryptocurrency trading platform in the UK, registered with the country’s regulator, the Financial Conduct Authority (FCA), based in London and dubbed OANDA Crypto. It’s the summation of last year’s acquisition of a majority stake in FCA-registered crypto firm Coinpass, and will offer trading in over 63 cryptocurrency pairs, including Bitcoin, Ether, and Ripple, with plans to add more tokens and features over the course of the year, the company said.
/jlne.ws/49JoiGp

MicroStrategy’s Saylor Buys 3,000 More Bitcoin for $155.4 Million
Muyao Shen – Bloomberg
MicroStrategy Inc., the enterprise software firm that has made buying Bitcoin part of its corporate strategy, purchased another 3,000 or so of the cryptocurrency tokens this month for $155.4 million. That raised the value of the Tysons Corner, Virginia-based company’s holdings to around $9.88 billion, based on currency market prices. The latest purchases were made with cash between Feb. 15 and Feb. 25, according to a filing with the US Securities and Exchange Commission on Monday. That brings the company’s total cache to around 193,000 Bitcoin.
/jlne.ws/3wueD7D

Grayscale’s Bitcoin ETF Exodus Reaches $7.4 Billion in First 30 Trading Days
Katie Greifeld – Bloomberg
The $24.2 billion Grayscale Bitcoin Trust (ticker GBTC) has seen $7.4 billion exit across 31 trading days as of Monday, Bloomberg data show. GBTC has yet to post a single inflow since it converted into an ETF in mid-January. That stands in contrast to the other nine freshly launched spot Bitcoin ETFs, all of which are sitting on net inflows since trading began. A few different factors explain the dichotomy: while GBTC is by far the largest and most actively traded of its peers, its 1.5% management fee means that it’s also the most expensive offering, with the bulk of its peers charging below 0.3%. Additionally, bankrupt estates such as Genesis Global Holdco LLC have been looking to offload their holdings.
/jlne.ws/4bVbspK

Politics

Yellen urges world leaders to ‘unlock’ frozen Russian Central Bank assets and send them to Ukraine
Fatima Hussein – Associated Press
Treasury Secretary Janet Yellen on Tuesday offered her strongest public support yet for the idea of liquidating roughly $300 billion in frozen Russian Central Bank assets and using them for Ukraine’s long-term reconstruction. “It is necessary and urgent for our coalition to find a way to unlock the value of these immobilized assets to support Ukraine’s continued resistance and long-term reconstruction,” Yellen said in remarks in Sao Paulo, Brazil, where Group of 20 finance ministers and central bank governors are meeting this week.
/jlne.ws/431YK4z

Nvidia’s $70 Million Florida Supercomputer Hobbled by DeSantis Law; A block on recruiting researchers from countries ‘of concern’ including China and Iran is frustrating a top state university’s AI aspirations, professors say.
Michael Smith – Bloomberg
When Chris Malachowsky, a billionaire founder of chip giant Nvidia Corp., bankrolled one of the world’s biggest supercomputers at the University of Florida, Ron DeSantis predicted the machine would be a magnet for artificial intelligence talent. Almost four years later, the Florida governor’s anti-China crusade is preventing some highly skilled AI researchers from ever setting foot in the state.
/jlne.ws/48CHRyp

Trump’s Green-Bashing and Europe’s Right Put Climate Goals at Risk; Climate policy has become a political flash point in the US and Europe, risking to slow down the energy transition when it needs to speed up.
Laura Millan, Zahra Hirji, Olivia Rudgard, and Jonathan Gilbert – Bloomberg
Politicians are vowing to roll back green policies and downplaying climate change ahead of key elections on both sides of the Atlantic, casting doubt on whether countries can maintain momentum in the transition away from fossil fuels. In the US, former President Donald Trump, who has a long record of climate denial, is the frontrunner to challenge President Joe Biden in November. On the campaign trail, Trump has minimized the effects of climate change, attacked electric vehicles and pledged to repeal Biden’s signature climate law.
/jlne.ws/3TdmdfH

Oil and gas profits triple under Joe Biden even as industry decries him; Bonanza shows limited presidential role in driving returns despite warning of ‘disastrous’ second term
Myles McCormick and Jamie Smyth – Financial Times
Profits for the biggest US oil and gas producers have almost tripled under President Joe Biden, even as the industry berates his administration’s “hostile” policies and warns that a second term would be “disastrous” for the sector. The country’s top-10 listed operators by value, which will finish reporting their 2023 earnings this week, are on track to have amassed combined net income of $313bn in the first three years of the Biden administration, up from $112bn during the same period under Donald Trump.
/jlne.ws/42WwUqd

UK Needs ‘Huge Increase’ in Ammunition, Armed Forces Chief Says
Bloomberg News
The UK needs a “huge increase” in its ammunition supplies after two years of military aid to help Ukraine fight off its Russian invaders depleted stocks, the head of Britain’s armed forces said. Amid an increasing debate in the UK about how far the size of the country’s armed forces has fallen, Chief of the Defense Staff Admiral Tony Radakin said on Tuesday that Britain’s aim isn’t to recreate a military on a par with its level during the Cold War, but that nevertheless military chiefs are working to make the British Army “more deployable and more lethal.”
/jlne.ws/43aT3BD

The EU must accept that threats to economic security come from all directions; Focusing on China should not distract it from the challenges a second Trump administration would pose
Abraham Newman – Financial Times
/jlne.ws/3wtlPkl

Regulation

Supervisory Practices Regarding Depository Institutions And Borrowers Affected By Wildfires In Washington
FDIC
The Federal Deposit Insurance Corporation (FDIC) recognizes the serious impact of wildfires on customers and operations of financial institutions in affected areas of Washington and will provide regulatory assistance to institutions subject to its supervision. These initiatives will provide regulatory relief and facilitate recovery. The FDIC encourages depository institutions in the affected areas to meet the financial services needs of their communities.
/jlne.ws/3OYAwCB

India regulator asks small, mid-cap funds to disclose more about risks
Jayshree P Upadhyay – Reuters
India’s market regulator has asked the country’s asset managers to give investors more information about the risks associated with their small and mid-cap funds, according to a fund manager and two people with knowledge of the matter. Small and mid-sized funds have seen high inflows, causing concern among authorities about how they would hold up in the event of a sharp market selloff. The Securities & Exchange Board of India (SEBI) has also been reviewing stress tests conducted by such funds, sources have previously said.
/jlne.ws/49vTuZh

Commissioner Pham to Speak at Asian Professionals at Nasdaq Event
February 29, 2024, 2 p.m EST
CFTC
Commissioner Caroline D. Pham will join SEC Commissioner Mark T. Uyeda for a fireside chat hosted by Asian Professionals at Nasdaq (APAN).
/jlne.ws/3OX6LSE

CFTC Extends Public Comment Period for Proposed Rule on Real-Time Public Reporting Requirements and Swap Data Recordkeeping and Reporting Requirements
CFTC
The Commodity Futures Trading Commission today announced it is extending the deadline for the public comment period on a proposed rule that makes certain modifications to the CFTC’s swap data reporting rules in Parts 43 and 45 related to the reporting of swaps in the other commodity asset class and the data element appendices to Parts 43 and 45 of the CFTC’s regulations. The deadline is being extended to April 11, 2024.
/jlne.ws/3OZxzS3

FCA to improve pace and transparency around enforcement cases
FCA
The Financial Conduct Authority (FCA) has today committed to carrying out enforcement cases more quickly as the organisation seeks to increase the deterrent impact of its enforcement actions. In the future the FCA will focus on a streamlined portfolio of cases, aligned to its strategic priorities where it can deliver the greatest impact. The FCA will also close those cases where no outcome is achievable, more quickly.
/jlne.ws/49sSPIl

Written reply to Parliamentary Question on Treasury bills
Mr Leong Mun Wai, NCMP – Monetary Authority of Singapore
Question: To ask the Prime Minister what are the main reasons for 6-month and 1-year Treasury bills issued by the Government to bear higher interest rates than fixed deposits of the same respective maturity offered by commercial banks.
/jlne.ws/3TbQdsC

SFC secures first criminal conviction of securities fraud via illegal short selling
Securities and Futures Commission
The Eastern Magistrates’ Court today convicted Ms Christine Yeung Tak Sum, an unemployed retail trader, after she pleaded guilty to securities fraud involving illegal short selling in proceedings brought by the Securities and Futures Commission (SFC). The conviction of Yeung of a charge of employing a fraudulent scheme with intent to defraud in transaction involving securities under section 300 of the Securities and Futures Ordinance (SFO) in the context of illegal short selling is first-of-its-kind. This case stemmed from a ramp-and-dump investigation during which the SFC discovered that Yeung had engaged in a fraudulent scheme to commit the offence (Notes 1 & 2). Yeung was remanded in custody pending sentencing on 20 March 2024.
/jlne.ws/3IcwO4m

Investing and Trading

Traders Spent Over $20 Billion on Nvidia Options Last Week
Gunjan Banerji – The Wall Street Journal
Traders are throwing gobs of money at Nvidia stock options. They spent more than $20 billion on the trades last week, according to Cboe Global Markets data, based on what is known as options premium. The artificial-intelligence mania has also a driven a frenzy in trades tied to Super Micro Computer, a much smaller company. Traders spent more money on Super Micro Computer options last week than they did Tesla bets. Tesla is worth about 13 times the other company.
/jlne.ws/3TcKnqF

Nickel Faces Existential Moment With Half of Mines Unprofitable
Thomas Biesheuvel – Bloomberg
Many of the world’s biggest nickel mines are facing an increasingly bleak future as they wake up to an existential threat: a near limitless supply of low-cost metal from Indonesia. With roughly half of all nickel operations unprofitable at recent prices, the bosses of the largest mining companies last week sounded a warning that there was little prospect of a recovery. The potential collapse of nickel mining from Australia to New Caledonia comes at a time when western governments are scrambling to secure the supply chains needed to decarbonize the global economy. But in an ironic twist, Indonesia’s coal-fired nickel output is pricing out greener metal that’s so far failed to command a market premium.
/jlne.ws/3uUxEQ7

AMC’s Meme-Stock Era Is Long Gone as Box Office Sags, Debt Looms
Monique Mulima – Bloomberg
Almost three years removed from its meme-stock heights, AMC Entertainment Holdings Inc. shares are skirting record lows, adding to the scrutiny of the movie-theater chain’s recovery plans as it reports earnings this week. The stock is down 27% to start 2024, after touching an all-time low in February. The company and its peers – including Cinemark Holdings Inc. and Imax Corp. – are struggling with sinking US box-office revenue after last year’s strike by Hollywood actors and writers delayed the rollout of films, short-circuiting the industry’s Barbenheimer-assisted rebound from the pandemic.
/jlne.ws/3Te0GUi

Wall Street Needs Kolanovic’s Pluck Even If He’s Wrong; The celebrity JPMorgan strategist misjudged markets – but doesn’t add to the research pile that says a lot without saying very much at all.
Jonathan Levin – Bloomberg (opinion)
This year’s remarkable US equity rally has converted many market bears, but JPMorgan Chase & Co.’s Marko Kolanovic clearly isn’t one of them. In a recent note, Kolanovic – who was incorrectly bullish in 2022 and bearish in 2023 – effectively doubled down on his latest out-of-consensus call, highlighting January data for consumer and producer price increases to warn that the market narrative risks taking a turn for “something like 1970s stagflation.” He said that could lead to a period of sustained underperformance for stocks, like the one that prevailed from 1967-1980.
/jlne.ws/48yjdyY

Shein considers London listing if US IPO blocked over ties to China; Online fast-fashion group considers UK as back-up plan, following scrutiny by American regulators and politicians
Eleanor Olcott, Mercedes Ruehl and Jim Pickard – Financial Times
Shein is considering London as a back-up option for a blockbuster flotation if US regulators block the online fast-fashion group’s preferred choice of a New York IPO over its ties to China. The Singapore-headquartered company has pitched the UK as an alternative destination if it is unable to list in the US, according to two investors in the company.
/jlne.ws/3OXHHej

Environmental, Social and Corporate Governance

US Queries Solar Importer Supply Chains Amid China Crackdown; Survey seeks detailed information about use of forced labor; Move seen as prelude to tougher enforcement of UFLPA ban
Ari Natter and Sheridan Prasso – Bloomberg
The Department of Homeland Security is expanding its scrutiny of solar companies in the US, asking for information about their supply chains, an indication the Biden administration is poised to toughen enforcement of a ban on products linked to Chinese forced labor. An extensive questionnaire was sent to companies by US Customs and Border Protection earlier this month, according to two people familiar with the matter, marking a widening effort to seek disclosure about the provenance of modules, panels and other products. Previously, importers only had to provide such information to the agency if it detained their shipments for inspection.
/jlne.ws/49uAPgv

Private lakes emerge as symbol of water inequity in elite Mexican holiday town
Cassandra Garrison – Reuters
The shores of the giant dam in Valle de Bravo, a popular weekend spot for Mexico City’s rich and famous, have turned to cracked, dry mud. Mario Garcia, a boat driver of more than 30 years, pointed to a red truck in the distance about 100 meters away and says that’s where the shores used to begin. The dam is at less than 32% of its capacity, a historic low, according to available government data, experts and local officials.
/jlne.ws/3Tb3nGe

How Germany’s steelmakers plan to go green; Europe’s biggest producer is moving away from carbon-intensive blast furnaces and towards hydrogen-powered processing
Patricia Nilsson – Financial Times
In the depths below every iron-producing blast furnace lurks a salamander – an angry black and yellow mix of boiling iron, slag and coke, so named owing to the ancient belief that the amphibians were born in fires. “It’s the heart,” explains Rene Rockstroh, operations director of the blast furnaces at German steelmaker Salzgitter, as he wanders around an eerily quiet oven that would normally be filled with liquid iron at 1,500C.
/jlne.ws/49qZAu0

A Clear Human Rights Policy Helps Steer Corporate ESG Priorities
Chris Audet – Bloomberg
As pressure grows over ESG policies, companies that establish cohesive human rights policies would clarify expectations for stakeholders and customers, Gartner’s Chris Audet says. Legal and compliance leaders are rightly concerned about growing environmental, social, and governance imperatives from investors, internal stakeholders, global regulators and enforcers, and the public. These concerns are driving organizations to create statements that express their company’s international commitment to human rights.
/jlne.ws/3SSVV18

Chicago May Break Record High Winter Temperature: Weather Watch; Milder-than-normal temperatures are on Bloomberg Green’s radar today.
Brian K Sullivan – Bloomberg
Chicago may post its warmest winter day on Tuesday as mild temperatures break records across the Midwest, Great Lakes and into upstate New York. The all-time February high for the Chicago area is 75F (24C) degrees and that will be threatened Tuesday as the high in downtown may reach 76, according to the National Weather Service.
/jlne.ws/48z1LdV

Programme to scale corporate science-based targets for nature reaches milestone
Sidhi Mittal – edie
/jlne.ws/3OXxm1S

Bank CEO shrugs off U.S. war on ‘woke’ capital, says ESG investing is good for business
Sam Meredith – CNBC
/jlne.ws/49xOnIm

Wall Street is paring its bets on ESG and DEI as political pressure rises
Ben Werschkul – YahooFinance
/jlne.ws/4bPviCV

Why working on solutions to climate change means trying to solve other world problems, too
Associated Press on LinkedIn
/jlne.ws/4bPlXLp

Ministers urge EU to increase subsidies as farmers protest in Brussels; French President Emmanuel Macron says crisis in sector cannot be fixed ‘in a few hours’
Alice Hancock – Financial Times
/jlne.ws/3uYcVeh

Institutions

Mizuho Courting India Elite Shows Japan Banks’ Global Ambition
Preeti Singh, Saikat Das and Taiga Uranaka – Bloomberg
Mizuho Financial Group Inc.’s showcase of its business ties at Mumbai’s luxury St Regis hotel this month underscored its growing foothold in India, a market that has lately been endorsed by Wall Street giants. An awards ceremony to fete financial professionals drew more than 150 executives from companies, including those backed by the country’s richest men Mukesh Ambani and Gautam Adani, according to people familiar with the matter. The Japanese bank hosted the event that’s now in its second year to build closer ties with the business community. It came as Mizuho announced its biggest-ever acquisition in India.
/jlne.ws/3uUDely

Goldman Sachs Trades at a Discount. Here’s Why.; The firm’s annual 10-K filing reminds us why investors are wary of investment banks’ shares
Marc Rubinstein – Bloomberg
Anyone wondering why investment banks trade at a perennial discount to the wider stock market need only glance at Goldman Sachs Group Inc.’s annual 10-K filing, which dropped Friday. First, there’s the pay. Chairman and Chief Executive Officer David Solomon’s compensation had already been disclosed: His earnings rose 24% to $31 million in a year when net profit fell 24%. The board’s compensation committee, perhaps feeling defensive, highlighted seven factors in support of their decision, including Solomon’s “decisive leadership in recognizing the need to clarify and simplify the firm’s forward strategy.”
/jlne.ws/49AMGde

BMO Misses on Capital Markets, Higher Loan-Loss Provisions
Christine Dobby – Bloomberg
Bank of Montreal missed analysts’ estimates as it grappled with weak capital-markets revenue and reported an increase in loan-loss provisions. The Toronto-based bank earned C$2.56 per share on an adjusted basis in the fiscal first quarter, it said in a statement Tuesday, falling short of the C$3.02 average estimate of analysts in a Bloomberg survey.
/jlne.ws/3OWZPVs

Hedge Fund Carlson Shrinks to One Office After Assets Fall 90%
Liza Tetley and Nishant Kumar – Bloomberg
Carlson Capital is shuttering its London office as part of a restructuring after the hedge fund’s assets dropped 90% to about $1 billion since 2016. The Dallas-based investment firm applied to cancel its authorization with the UK regulator Financial Conduct Authority, meaning it plans to stop doing business there within six months. London-based money manager Jesse Ho will relocate to Dallas, and the firm has given others an option to stay at the firm, according to a person with knowledge of the matter.
/jlne.ws/3SWxtvX

Brevan Howard Adds Tekmerion Macro Hedge Fund to Its Platform
Katherine Burton and Matthew Griffin – Bloomberg
Tekmerion Capital Management is moving its macro hedge fund to Brevan Howard Asset Management’s platform, where it will manage money for the firm as well as its own clients. Zachary Squire and Reed Morrissey, Tekmerion’s co-founders, will join Brevan Howard along with partner Jay Dweck and operations director Eric Gelsinger, according to people familiar with the deal. In addition to their BH-Tekmerion Fund, they’ll manage money for Brevan Howard’s Master and Alpha Strategies funds.
/jlne.ws/3OUF8cT

EQT Raises EUR22 Billion for Its Largest-Ever Private Equity Fund
Swetha Gopinath – Bloomberg
/jlne.ws/3wywJWh

DWS launches first active U.S. ETF to focus on commodity producers
Suzanne McGee – Reuters
/jlne.ws/42Y8EEu

Abrdn chief rules out breaking up asset manager; Company reports better than expected results but faces challenge to turn around its fortunes
Oliver Ralph and Sally Hickey – Financial Times
/jlne.ws/49P8Ojt

Work & Management

Hedge Fund Founder Says UK Migration Curbs Pose Risk to Economy; Ewan Kirk warns lack of talent could throttle UK’s ambitions; Says government also needs lower-skilled migrants for NHS
Lucy White – Bloomberg
The government’s migration crackdown risks damaging UK higher education institutions and setting back the country’s ambitions to be a leader in science and technology, according to an influential British entrepreneur. Recent steps by Prime Minister Rishi Sunak to make the UK less attractive for overseas students will lead to a university funding shortfall and a reduced pool of talent for British employers, Ewan Kirk, founder of quantitative hedge fund Cantab Capital Partners and a former entrepreneur-in-residence at the University of Cambridge said. The measures will chafe against the premier’s ambition to make Britain a hub for high-growth industries such as biotechnology and artificial intelligence, he said
/jlne.ws/42T4VrA

The Many Benefits of Working Out in the Workplace; Exercise is good for your health – and your career – in more ways than one.
Julia Hobsbawm – Bloomberg
Arriving in New York from London recently the first thing I did was go to a spin class at SoulCycle. I needed to clear my head but I’m also on a job: to complete a fundraiser of 60 cycles before I turn 60 this summer. As I pedaled away to the beat I wondered: Is my workout benefitting my work? The evidence is compelling that exercise has professional advantages, which would make the working assumption that it’s de facto separate from work wrong. Time to physically work out must become sanctioned – if not mandated – in the workplace.
/jlne.ws/49urvcC

Morgan Stanley, UBS and BofA gender pay gap more than double Australian average; First-time published government data exposes top companies breaching average gap of 19%
Nic Fildes – Financial Times
Morgan Stanley, UBS and Bank of America have some of the biggest gender pay gaps in Australia, according to a government survey, more than twice as high as the average of 19 per cent. The survey of almost 5,000 companies employing more than 100 workers published for the first time on Tuesday showed that the country’s gender pay gap remains widest in the construction, banking and consulting sectors.
/jlne.ws/3IcZDxJ

Wellness Exchange

A Spike in Heart Disease Deaths Since Covid Is Puzzling Scientists; Mortality data of the past four years show a wave of deadly cardiovascular and metabolic illness.
Jason Gale – Bloomberg
Almost three weeks before Covid-19 was reported to be spreading in the US, Patricia Cabello Dowd dropped dead in the kitchen of her San Jose, California, home. A previously healthy 57-year-old, Dowd had complained of body aches and flu-like symptoms days earlier, but nothing could explain why she died so suddenly. Lab results 10 weeks later revealed Dowd, a manager at a Silicon Valley semiconductor firm, was one of the first US Covid fatalities. Inflammation of the heart muscle led to a finger-sized rupture which caused lethal hemorrhage, an autopsy report showed.
/jlne.ws/3UXjRDi

Regions

China’s State-Backed Funds Have Bought $57 Billion of Stocks, UBS Says; UBS estimate is based on excess transactions of 54 ETFs; Swiss bank says national team holdings can rise further
John Cheng – Bloomberg
China’s state-backed funds have poured more than 410 billion yuan ($57 billion) into onshore shares this year in a bid to prop up the market, according to estimates by UBS Group AG, which expects further purchases. The Swiss bank based its calculations on “excess” transactions of 54 Chinese exchange-traded funds. More than 75% of the inflows went into products tracking the benchmark CSI 300 Index while another 13% flowed to those mirroring the CSI 500 Index, according to strategists including Lei Meng.
/jlne.ws/3Terhkg

China’s repo market: what changes are in store for banks, global bond investors
South China Morning Post
The People’s Bank of China (PBOC) and the Hong Kong Monetary Authority (HKMA) announced several policy steps to deepen two-way financial cooperation. Two of these measures specifically focus on strengthening the bond market, the biggest outside the US. One pertains to expanding the list of eligible collateral in the RMB Liquidity Facility in Hong Kong to include yuan-denominated bonds sold by the Chinese government and the nation’s policy banks, effective February 26. The second involves wider access to the onshore repurchase agreement or repo market, pending legal and regulatory fine-tuning.
/jlne.ws/3uQi73T

LNG Demand Will Surge 50% in Next Decade, Woodside CEO Says; Australia’s top producer continues to study projects and M&A US pause on export project approvals is ‘concerning signal’
Stephen Stapczynski, David Stringer, and Haidi Lun – Bloomberg
Woodside Energy Group Ltd., Australia’s top liquefied natural gas exporter, expects consumption of the fuel to rise 50% over the next decade, pushing the supplier to consider further expansions. “We’re seeing signs of that demand growth in emerging Asia,” Chief Executive Officer Meg O’Neill said Tuesday in an interview. “There’ll be points in time where we’ll see a fair amount of new supply arriving, but the demand growth is really likely to absorb that over the course of the coming years.” The outlook is one of the most bullish in the industry, as energy companies and environmentalists debate the role of gas in the world’s transition to cleaner fuels. Shell Plc, a major LNG supplier, earlier this month pared back its forecast for consumption to an increase of more than 50% by 2040.
/jlne.ws/48ykIgA

Germany’s Slow-Motion Property Crash Is a Looming Risk for Banks’ A long-term view of property values has shielded banks so far; That could change soon if more forced sales hit the market
Jack Sidders, Nicholas Comfort, and Neil Callanan – Bloomberg
As fears about US commercial real estate roiled German banks this month, their message was clear: don’t worry, the vast majority of our property exposure is domestic. That may not prove the comfort it seems. While the country has so far avoided the rapid market corrections that rattled the US, experts argue that reflects arcane accounting practices shielding its lenders and investors from taking immediate hits. Relatively modest adjustments and benign provisions obscure the fact that German lenders are more exposed to commercial real estate than most of their European peers and, according to one study, extended loans more aggressively.
/jlne.ws/431Q91W

Miscellaneous

Commodities Trader and Lifelong Art Student: Sidney Rothberg’s Collection Comes to Market
Abby Schultz – Barron’s
The late Sidney Rothberg’s passion for art began with the first impressionist painting he ever saw on the streets of Paris as a soldier during World War II. Rothberg turned down the opportunity to acquire that unidentified painting for a pack of cigarettes, figuring it was stolen, but the beauty of the work stuck with him, and sparked a lifelong investigation into art and artists. This week, more than 240 works of art that Rothberg collected over decades, and hung floor-to-ceiling in his Philadelphia house, will be offered at Freeman’s | Hindman in his home city during live auctions at noon on Tuesday and Wednesday.
/jlne.ws/3TcWCUb

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