HSBC Lost About $200 Million in One Day on Gold Market Turmoil; Saudi Aramco’s Stock Trades on a Different Planet

May 13, 2020

First Read

Patience is a Virtue When Looking Toward the Future
Suzanne Cosgrove – John Lothian News

How do you run a business based on IPOs when the global economy is contracting? Stay calm and look forward to the next generation of stocks.

Not surprisingly, during a pandemic and U.S. economic slump, the current calendar of U.S. initial public offerings is slim, but Josef Schuster, founder and CEO of the Chicago-based index company IPOX Schuster LLC, is undaunted. IPOX Schuster designs indexes that are tied to the performance potential of global IPOs and company spin-offs.

The onset of the coronavirus in the first quarter slowed what had promised to be an active first half of 2020. “We were expecting a wave of activity in ETFs,” as well as some IPOs, said Drew Voros, the editor-in-chief of ETF.com. “The filings are out there,” he said, “But it’s like going sailing in rough seas.”

To read the rest of this story, go here.

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Hits & Takes
By JLN Staff & John Lothian

From Anonymous JLN Editor: John made an error in his comment yesterday on the Bloomberg story about the firms that were opening banking relationships with JP Morgan. It was Gemini, not Genesis, that is now a client of the bank. John makes errors infrequently, in fact only about one a year. He is, however, up to the year 2206.

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I want to give a shout out to The Technancial Company for their new contract with INTL FCStone Inc. to implement the JANUS Risk Management solutions. This will give INTL FC Stone a state of the art risk management platform for its U.S., London and Singapore-based FCM operations. Now is as good a time as any to improve risk management capabilities.

I also wanted to give a shout out to SGX for some highlights, which has seen ETF records jump 140% with year on year growth in turnover. Also, market turnover value in SPDR® Gold Shares increased by 2.5 times year on year to S$172M. Lastly, SGX RegCo removed the minimum trading price rule while enhancing other anti-manipulation tools.~JJL

Tomorrow is the JLN Bachelier Options Model Virtual Panel at 3:30 PM featuring Don Wilson, Jerry Hanweck and Lee Betsill. You can still sign up by emailing me at johnlothian@johnlothian.com

Also, don’t miss the FIA webinar today at 10:30 AM ET on negative prices, why they happen and their implications.

Stay safe!~JJL

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American Financial Exchange (AFX) Announces American Electric Power as First
Electric Utility to Join Exchange
Press Release
American Financial Exchange (AFX), an electronic exchange for direct lending and borrowing for American banks and financial institutions, announced today that American Electric Power (NYSE: AEP), one of the largest energy companies in the United States, has joined the Exchange, the first electric utility to do so.
The AFX facilitates the determination of AMERIBOR, a transaction-based interest rate benchmark for banks via its electronic trading platform.
/bit.ly/3bxDyY1

*****AFX gets more powerful by the day.~JJL

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Fed Officials Warn of Risk of Widespread Business Failures
Steve Matthews, Matthew Boesler, and Catarina Saraiva – Bloomberg
Bullard sees possible depression if shutdowns are prolonged; Kashkari says recovery from crisis will be ‘gradual, muted’
Federal Reserve officials warned the virus outbreak and a partial shutdown of the U.S. economy would result in a decline in the current quarter of historic proportions and risk the potential of massive bankruptcies that could create a lasting scar. “You will get business failures on a grand scale and you will be taking risks that you would go into depression” if shutdowns persist, Federal Reserve Bank of St. Louis President James Bullard said in a video speech from that city Tuesday.
/bloom.bg/2LnNush

*****This is the biggest challenge of my lifetime. It has the potential to kill my business. It has the potential to kill me. The risk of this pandemic and its impact on the economy should not be underestimated.~JJL

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The Work-From-Home Trader Who Shook Global Markets; A new book reveals fresh details about the man authorities blamed for the Flash Crash that erased $1 trillion of value in a matter of minutes.
Liam Vaughan – Bloomberg
On March 9, U.S. stocks had their biggest one-day point drop ever as the economic fallout from the novel coronavirus sank in. Within a week that record had been broken twice, only for the S&P 500 to register its greatest weekly gain in decades in April, after the Federal Reserve intervened by slashing interest rates and buying bonds.
/bloom.bg/2WpEaua

******More hype and more baloney.~JJL

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Tips to U.S. Securities and Exchange Commission surge in recent weeks – official
Chris Prentice – Reuters
The U.S. Securities and Exchange Commission (SEC) has handled a surge in tips, complaints and referrals and opened hundreds of new probes since mid-March despite being forced to work remotely due to the coronavirus outbreak, an official said on Tuesday.
/reut.rs/35WAB1Z

******The number one tip is, “Don’t bet on slow horses” followed by, “Always make your bed.”~JJL

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New threat to the economy: Americans are saving like it’s the 1980s
Matt Egan – CNN
Americans are slashing their spending, hoarding cash and shrinking their credit card debt as they fear their jobs could disappear during the coronavirus pandemic.
US credit card debt suddenly reversed course in March and fell by the largest percentage in more than 30 years. At the same time, savings rates climbed to levels unseen since Ronald Reagan was in the White House.
/cnn.it/3fJdBrF

***** Tom Price would always share this saying his father used to tell him: “When your outflow exceeds your income, then your upkeep will be your downfall.”~JJL

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Tuesday’s Top Three
Our top story on Tuesday was actually Matthew Scharpf’s MarketsWiki page. Scharpf – as mentioned in yesterday’s Hits & Takes – is doing his charity happy hour show at 7pm CT Thursday on Facebook Live @matthewscharpfmusic as a fundraiser for Misericordia. Our second most read story was JPMorgan Extends Banking Services to Bitcoin Exchanges from The Wall Street Journal. (Those exchanges are Coinbase Inc. and Gemini Trust.) Third was What the history of market crashes teaches us about the coronavirus crisis, from the Financial Times.

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MarketsWiki Stats
177,452,309 pages viewed; 24,127 pages; 224,144 edits
MarketsWiki Statistics

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CryptoMarketsWiki Website»
CryptoMarketsWiki, our archive of the cryptocurrency and blockchain world, is going strong and keeping pace as this area of finance grows and evolves.Recently Updated Pages

Recently updated pages include
Grayscale Investments
Cumberland DRW LLC
ErisX
CME Group, Inc.

CryptoMarketsWiki Stats

1,380 pages; 12,234 edits
CryptoMarketsWiki Statistics

Lead Stories

HSBC Lost About $200 Million in One Day on Gold Market Turmoil
Jack Farchy and Harry Wilson – Bloomberg
Loss was in late March as New York and London markets diverged; Bank is one of the leading traders of precious metals
HSBC Holdings Plc lost around $200 million in one day in March because of disruptions to the gold market that caused prices to diverge dramatically in key trading hubs, according to a filing by the bank.
/bloom.bg/35TZJWQ

Saudi Aramco’s Stock Trades on a Different Planet; The world’s biggest oil major doesn’t hold an earnings call in the middle of an oil crisis, and it barely matters.
Liam Denning – Bloomberg
Don’t worry if you missed Saudi Aramco’s earnings call: There wasn’t one. Now the sticklers and bores among you might raise a hand and suggest that, what with the global pandemic, oil crash and assorted what-have-yous, it might be advisable for the biggest oil major in the world to spare an hour for an update. But honestly, does it really matter? I mean, look at this:
/bloom.bg/3bmCnug

CLOs: ground zero for the next stage of the financial crisis? Having boomed over the past decade, these complex securities could be vulnerable if loan defaults spike
Joe Rennison and Robert Smith – FT
In the midst of a global pandemic, emergency rooms across the US have fallen strangely quiet as patients with other illnesses have stayed away for fear of contracting Covid-19. As a result, one of the surprising corporate casualties of the coronavirus crisis could be some of the companies that provide staff for hospitals.
/on.ft.com/3bqNgva

Old school trading under threat as insurers rethink life at Lloyd’s; Coronavirus forces one of the last face-to-face financial markets to go digital
Oliver Ralph – FT
On a regular day, about 7,000 people would funnel through the doors of Lloyd’s of London and make their way to the insurance market’s giant four-storey underwriting room. There, they would discuss policies for clients around the world, make new contacts and catch up with industry gossip, just as they have done for more than 300 years, since the market was founded in a coffee shop.
/on.ft.com/35VV1I9

Manhattan Faces a Reckoning if Working From Home Becomes the Norm; Even after the crisis eases, companies may let workers stay home. That would affect an entire ecosystem, from transit to restaurants to shops. Not to mention the tax base.
Matthew Haag – NY Times
Before the coronavirus crisis, three of New York City’s largest commercial tenants — Barclays, JP Morgan Chase and Morgan Stanley — had tens of thousands of workers in towers across Manhattan. Now, as the city wrestles with when and how to reopen, executives at all three firms have decided that it is highly unlikely that all their workers will ever return to those buildings.
/nyti.ms/3btFalx

The U.S. Is Testing the Patience of Bondholders It’s no longer impossible to think the Treasury Department might not be able to find buyers for all the debt it’s selling.
Jared Dillian – Bloomberg
It’s now clear in hindsight that a global pandemic was one of those things that financial markets never truly considered a real threat. This raises the question of what other so-called black swans might be lurking out there? Here’s one that might happen sooner rather the later: a failed auction of government bonds by the U.S. Treasury Department.
/bloom.bg/3cu6GAr

Keep trading from the kitchen: UK bankers face months more of homeworking
Huw Jones – Reuters
Many of the City of London’s bankers and traders will be working from their kitchens or bedrooms for at least a year under some scenarios being planned by finance companies in Britain.
/reut.rs/35ZqgCb

Druckenmiller Says Risk-Reward in Stocks Is Worst He’s Seen
Katherine Burton and Melissa Karsh – Bloomberg
Prospect of a V-shaped recovery in U.S. ‘a fantasy,’ he says; Druckenmiller says stimulus programs aren’t building growth
Stan Druckenmiller said the risk-reward calculation for equities is the worst he’s seen in his career, and that the government stimulus programs won’t be enough to overcome real world economic problems. “The consensus out there seems to be: ‘Don’t worry, the Fed has your back,'” said Druckenmiller on Tuesday during a webcast held by The Economic Club of New York. “There’s only one problem with that: our analysis says it’s not true.”
/bloom.bg/2WsNIov

The Fed Is Calling the Shots in Markets; That makes it tricky to determine fair values for equities.
Barry Ritholtz – Bloomberg
The coronavirus pandemic has led to a historic economic collapse, both here and around the world. The Federal Reserve responded by slashing rates to zero and vowing to buy trillions of dollars in new assets. What will be the impact of these Fed actions is the question that this week’s guest on Masters in Business, Jim Bianco, president of Bianco Research, tries to answer.
/bloom.bg/2WtEuZ5

BlackRock throws support behind US exchange start-up MEMX; World’s largest asset manager takes board seat at venue that aims to shake up equity market
Philip Stafford – FT
BlackRock has joined a host of Wall Street banks, brokers and high-speed traders throwing their support behind Members Exchange, the new US stock-trading venue mounting a challenge to the New York Stock Exchange and Nasdaq.
/on.ft.com/2WuY730

ECB rebuffs bank complaints on negative interest rates; Radical policy ‘broadly neutral’ for profitability at eurozone lenders, central bank paper maintains
Martin Arnold – FT
Six years of negative interest rates have done as much to boost profitability at eurozone banks as they have to weigh it down, the European Central Bank said in a research paper that is likely to raise eyebrows among financiers.
/on.ft.com/2xYoHrL

There’s Plenty of Meat in America — For Those Who Can Afford It
Lydia Mulvany, Deena Shanker, and Kim Chipman – Bloomberg
Specialty protein producers are expanding output, hiring staff; Grass-fed and organic meats can be twice as expensive, or more
While many regular American grocers are running out of meat, specialty food producers have plentiful supplies — for those who can afford it. Production of luxe varieties like heritage pork, grass-fed beef and Amish-raised chicken are expanding at a time when coronavirus outbreaks at mammoth plants operated by Tyson Foods Inc. and Cargill Inc. have wiped out about 40% of conventional U.S. beef and pork capacity in recent weeks.
/bloom.bg/3coZvtk

Firm With Ties To Former ‘Sheriff Of Wall Street’ Discloses $140 Million Bitcoin Fund
Michael del Castillo – Forbes
New York Digital Investment Group (NYDIG) today disclosed it has sold nearly $140 million in a previously unknown bitcoin fund. The New York Company, granted a BitLicense from the state in 2018, revealed the fund in a Form D filing for exemption to the U.S. Securities and Exchange Commission dated today.
/bit.ly/2zufszT

Hedge Funds, Go Home — Japan Is Closing the Door; Tokyo is playing the national security card against activist foreign investors. They shouldn’t come back.
Anjani Trivedi – Bloomberg
Japan is casting an even wider protectionist net to shield its big companies. It has less to do with defending against unsolicited overtures into strategic assets than with squeezing out troublesome foreign investors. The moves will strangle what’s left of the drive to reform corporate governance and undermine long-suffering households as an economic crisis takes hold.
/bloom.bg/3cFl7BG

Bond Traders Cling to Negative-Rate Bets Despite Fed Pushback
Emily Barrett – Bloomberg
Futures hedges against negative fed funds rate in 2021 persist; Eurodollar options show bets on Fed rate of -0.5% by mid-2021
Rates traders are stubbornly holding onto hedges against the risk that the Federal Reserve will drop borrowing costs below zero next year, even as officials signal they’re not headed down that path.
/bloom.bg/3czB4tu

The Fed Is Buying ETFs But Mostly Still Hawking a Placebo; The markets have turned around in seven weeks without the central bank buying a single corporate bond.
Brian Chappatta – Bloomberg
For financial markets, March 23, 2020, is a day that will go down in history. On that day, the S&P 500 Index fell to 2,191.86, easily wiping out all the gains since President Donald Trump was sworn into office. It also marked what as of now appears to be the turning point in the coronavirus crisis. Not because of any epidemiological breakthrough, mind you, but rather because the Federal Reserve announced an array of programs in conjunction with the Treasury Department that went above and beyond the response to the 2008 financial crisis. Most notably, the central bank unveiled a facility to buy U.S. corporate bonds and exchange-traded funds tracking that market.
/bloom.bg/3cvT87B

EU Banking Watchdog to Crack Down on ‘Cum-Ex’ Trading Schemes
Reuters
The European Union’s banking watchdog has proposed a crackdown on so-called cum ex trading schemes that could pose a threat to financial markets and national budgets.
/nyti.ms/2yV1AyB

Miscellaneous

How the Coronavirus Poses an Existential Threat to the EU
Nikos Chrysoloras – Bloomberg
The European Union is in crisis, again. Effectively the world’s third-biggest economy, the 27-nation bloc is struggling to muster a united response to the deepest recession in almost a century unleashed by the coronavirus. Old divisions have resurfaced and legacies of past crises are threatening to pull it apart. While this isn’t the first time the EU has faced an existential threat, German Chancellor Angela Merkel says none has been as serious as this one.
/bloom.bg/2LnulXg

Deadly Equations Confront Asia’s Virus Reopening; Leaders are faced with a painful choice between economic paralysis and the threat of resurgent infections.
Daniel Moss – Bloomberg
The trade-off between health and economic well-being is arriving with brutal speed in parts of Asia. Governments itching to return to normal activity are being confronted with a spike in Covid-19 infections. That’s forcing them to choose between putting reopening on ice or reviving commerce at the potential cost of lives. Faced with this unenviable bargain, they appear to be leaning toward the latter. It’s a question that leaders hoped they’d never be forced to face, or at least not until economies had already stabilized: What increase in cases is acceptable to get the workforce back on the job?
/bloom.bg/2zvu2Ho

Facebook Removes 2.5 Million Posts Selling Masks, Covid Kits
Sarah Frier – Bloomberg
Company relying more on artificial intelligence to flag issues; About 1.7 billion fake accounts taken down in first quarter
Facebook Inc. said it has removed 2.5 million posts since March 1 offering masks, sanitizers, cleaning wipes and Covid-19 test kits, in an attempt to prevent users from price-gouging or selling counterfeit and dangerous products.
/bloom.bg/2LqQtA4

Clean Lockdown Air Saves Lives, Especially in L.A., Study Finds
Alexandre Tanzi – Bloomberg
America’s air is cleaner as a result of the Covid-19 lockdown, and that’s likely to reduce the number of premature deaths caused by pollution, according to a new study.
/bloom.bg/2y2vLUi

Virus Survivors Could Suffer Severe Health Effects for Years
Lisa Du – Bloomberg
Research shows long-term health issues can stem from virus; Boris Johnson’s physician calls it ‘this generation’s polio’
More than one million people around the world have been deemed recovered from the coronavirus, but beating the initial sickness may be just the first of many battles for those who have survived.
/bloom.bg/2Wrf4Lo

U.K. Employers Told to Protect Staff From Virus or Be Prosecuted
Robert Hutton – Bloomberg
Government reminds employers of their legal duties to workers; Aim is to encourage staff to return to work as economy opens
U.K. employers have been told they face prosecution if they fail to comply with rules designed to keep staff safe from coronavirus as they return to work. “Employers have a duty to keep employees safe in the workplace — that is absolutely enshrined in law,” Business Secretary Alok Sharma said at a press briefing from Downing Street on Tuesday.
/bloom.bg/2Wrerl0

Iceland to Test Visitors Upon Arrival at Keflavik Airport
Ragnhildur Sigurdardottir – Bloomberg
Iceland will test all airline passengers arriving at Keflavik Airport for coronavirus by June 15, with those resulting negative spared a mandatory two-week quarantine, the government said Tuesday. Testing will take place inside the terminal of the international airport. Visitors will be allowed to head to their accommodation while they wait for the result of their test, which is expected to be delivered on the same day.
/bloom.bg/2LphcNA

Risks of a Second Virus Wave Are Making Market Watchers Nervous
Eddie Spence – Bloomberg
New outbreaks in Wuhan, South Korea could hammer risk appetite; Options traders have warned that cases may flare up for weeks
Sign up here for our daily coronavirus newsletter on what you need to know, and subscribe to our Covid-19 podcast for the latest news and analysis. There were only six new cases, but the resurgence of the coronavirus in Wuhan, the city in China where the pandemic began, was enough to startle market analysts.
/bloom.bg/3bwNxwu

Coronavirus Is Giving Cost-Benefit Analysts Fits; Social scientists are struggling to apply proven measurement tools needed to weigh mortality risks against economic ones.
Cass R. Sunstein – Bloomberg
I love cost-benefit analysis. But for the coronavirus pandemic, cost-benefit analysis and I are going to have to see a marriage therapist. We might be headed for a divorce. Consider the following questions: What kinds of restrictions should states be imposing on work, play and freedom of movement? When should they open up for business? How open should they be, exactly, and exactly when?
/bloom.bg/2LBLPQ9

Covid Crisis Will Be Overshadowed by Climate Threat, Engie Says
Francois De Beaupuy – Bloomberg
Energy transition must be part of any stimulus package: Engie; Utility wants more spending on building renovation, renewables
Governments must prioritize the fight against global warming in stimulus packages aimed at alleviating the coronavirus crisis because climate change may cause much greater chaos in the future, Engie SA interim Chief Executive Officer Claire Waysand said.
/bloom.bg/2Ws0LGF

As Death Toll in Nursing Homes Climbs, Calls to Redesign Them Grow; Advocates are challenging layouts that are efficient and cost effective but that may allow the coronavirus to spread faster.
Jane Margolies – NY Times
Shortages of safety gear and staff. Workers who may inadvertently be carriers. A disease that preys on older people with underlying health conditions. There are many reasons the coronavirus has hit nursing homes so hard. Add the design of the buildings to the list.
/nyti.ms/3cwunrO

Coronavirus crisis leads to largest U.S. consumer price decline since 2008
Lucia Mutikani – Reuters
U.S. consumer prices dropped by the most since the Great Recession in April, weighed down by a plunge in demand for gasoline and services including airline travel as Americans stayed home during the coronavirus crisis.
/reut.rs/35Zor8y

GM has had no transmission of COVID-19 in plants with new safety protocols
Reuters
General Motors Co’s(GM.N) global manufacturing chief said Tuesday the automaker has not seen transmission of COVID-19 in any of its plants worldwide since it instituted new safety protocols requiring workers to wear masks, maintain social distancing and take other preventive measures.
/reut.rs/2LqxAgQ

Exchanges, OTC and Clearing

Members Exchange Closes Strategic Financing Round with Five New Investors, including BlackRock; Wells Fargo, Flow Traders, Manikay Partners, and Williams Trading also invest, bringing total raised in round to more than $65 million
Business Wire
Members Exchange (MEMX), a market operator founded by members to benefit all investors, announces strategic financing from BlackRock, Wells Fargo, Flow Traders, Manikay Partners, and Williams Trading, closing the round with more than $65 million raised. The amount invested since inception now exceeds $135 million.
/bwnews.pr/3czymUQ

TRADE Talks: A reflection on volatility with LSEG; As the editorial team discuss the top stories catching their attention in recent weeks, LSEG’s Scott Bradley shines a light on the market volatility during this episode of TRADE Talks.
Kiays Khalil – The Trade
In the fourth episode of the TRADE Talks podcast, multimedia journalist, Kiays Khalil, and editor Hayley McDowell, run through the stories that have caught their eye recently while in lockdown. Joining both is the London Stock Exchange Group’s Scott Bradley, who reflects on the recent market volatility. Also in this episode, a new ‘people moves’ segment sees the editorial team run through some of the high-profile movers.
/bit.ly/3bznMfe

Nasdaq CEO Says Returning to Office Will Probably Be Voluntary
Bloomberg
Nasdaq Inc. Chief Executive Officer Adena Friedman says she would like to open up offices again soon, but that it will be voluntary for workers to return. She talks about how the offices will be ready and safe after the coronavirus pandemic. She appears on the latest episode of “Leadership Live With David Rubenstein.”
/bloom.bg/2xZ1pC7

Cboe Global Markets Announces 2020 Annual Meeting Results
Cboe Global Markets, Inc.
Cboe Global Markets, Inc. (Cboe: CBOE), one of the world’s largest exchange holding companies, today announced the preliminary shareholder voting results from its 2020 Annual Meeting held today.
/bit.ly/3brkqKX

Cboe Global Markets Declares Second-Quarter 2020 Dividend
Cboe Global Markets, Inc.
Cboe Global Markets, Inc. (Cboe: CBOE), one of the world’s largest exchange holding companies, today announced its Board of Directors has declared a quarterly cash dividend of $0.36 per share of common stock for the second quarter of 2020. The second-quarter 2020 dividend is payable on June 15, 2020, to stockholders of record as of May 29, 2020.
/bit.ly/3cu3FjD

BlackRock throws weight behind new NYSE and Nasdaq challenger MEMX
John McCrank – Reuters
The Members Exchange on Tuesday said BlackRock Inc (BLK.N), the world’s biggest asset manager, was among its latest financial and strategic backers as the new bourse gears up to take on the New York Stock Exchange and Nasdaq Inc (NDAQ.O) with a third-quarter launch.
/reut.rs/35UjopP

Strengthening liquidity: successful pilot phase for Eurex’s Passive Liquidity Protection
Eurex
As investment behavior and regulation evolve, we at Eurex constantly review our market models and adapt and enhance them when needed. Next to our RfQ platform Eurex EnLight and the new tool Eurex Improve, we launched the Passive Liquidity Protection (PLP) in June 2019 to strengthen order book liquidity.
/bit.ly/2Lrmat4

Time to switch to Total Return Futures when dividends are uncertain
Eurex
In this interview, Amy Borgquist from Goldman Sachs explains how dividend uncertainty affected the equity index futures roll and how TRFs can be an alternative to price index futures.
/bit.ly/3cutRe6

Euro Fixed Income Futures: Definition of reporting and position limits for June 2020
Eurex
Position limits apply only to long positions in the front month contracts of the products concerned. Reporting limits will be valid from 29 May 2020 after close of trading until 3 June 2020 after close of trading.
/bit.ly/3cvHcTj

Passive Liquidity Protection: Further rollout to remaining equity options and DAX® index option
Eurex
With this circular, we would like to inform you about the further rollout of the Passive Liquidity Protection (PLP) which will start on 24 August 2020.
/bit.ly/2Wt0007

Deutsche Börse and SAP are setting new standards for the financial industry with regulatory-compliant cloud usage; Strategic partnership creates reference for the digitalization of processes for the entire industry
Deutsche Börse
With a strategic partnership, Deutsche Börse and SAP are setting new standards for the digitalization of processes in the financial industry. The framework for cloud infrastructure and services developed jointly by both partners can serve companies across the industry as a reference for regulatory-compliant use of cloud technology in a strictly regulated environment. With the help of this framework, innovations can be rolled out and driven forward faster in the cloud.
/bit.ly/2Lr1Uru

Handling of ex-dividend when the record date is changed
JPX
Due to the Coronavirus (COVID-19), some listed companies have decided to postpone their annual general meeting of shareholders and change the record date for dividends and other rights due to the safety of financial statement and audit workers, etc. The Tokyo Stock Exchange would like to notify as follows of the handling of ex-dividend when the record date for dividends is changed along with the postponement of the annual general meeting of shareholders.
/bit.ly/2zDklXe

Revisions to Trading Rules in Connection with Launch of J-GATE 3.0
JPX
Osaka Exchange, Inc. (OSE) will partially revise the trading rules in line with the launch of the Next-Generation Derivatives Trading System (J-GATE3.0) scheduled for the third quarter of FY2021.
/bit.ly/2WsfCAL

Cessation of TOPIX Dividend Index Futures and TOPIX Core30 Dividend Index Futures
JPX
TOPIX Dividend Index Futures and TOPIX Core30 Dividend Index Futures have been tradable since July 26, 2010. However, considering the current trading conditions, OSE will cease all the contracts on August 17, 2020. Please note that trading will be halted and creations of new contracts will be suspended from the night session starting on August 14, 2020.
Due to the above cessation, calculation and publication of TOPIX Dividend Index and TOPIX Core30 Dividend Index will also be suspended from August 17, 2020.
/bit.ly/2zCuELy

Nasdaq ‘Rolls’ Report on Legal Cannabis Industry Data ;The report provides data on Canada’s legal cannabis market for US investors associated with the industry.
Max Bowie – Waters Technology
Nasdaq has begun producing a new report aggregating cannabis sales data from Canada, via a partnership with Cannabis Benchmarks, a division of Stamford, Conn.-based New Leaf Data Services that provides Cannabis spot price indexes and research, to respond to growing demand for information that investors can use as an indicator of market performance for US-based companies or investment funds tied to the cannabis industry, as Nasdaq weighs its options to develop tradable products in the space.
/bit.ly/2T3wVGf

Fintech

Maven Wave Teams Up with Snowflake As Cloud Data Warehouse’s First Google Cloud Platform Partner
PR Newswire
Maven Wave, an Atos company, announces that it is the first Google Cloud partner to launch a partnership with Snowflake cloud data platform. This collaboration will further empower Maven Wave to provide customers with a proven, fast journey to the cloud for data analytics, enabling seamless, secure data integration and analytics. Snowflake announced general availability on Google Cloud in February, bringing together its cloud-native platform with Google Cloud’s robust capabilities in AI, machine learning, and analytics. A Gartner Magic Quadrant Leader, Snowflake combines the power of data warehousing, the flexibility of big data platforms, and the elasticity of the cloud at a fraction of the cost of traditional solutions.
/yhoo.it/2WqOYID

Fintech firms predict coronavirus will speed up digitalization
Bennett Voyles – FIA.org
Times of crisis have always tended to foster innovation and accelerate technological change. When it comes to the futures industry, coronavirus (COVID-19) looks like it will be a similar driver. Fintech executives believe the pandemic is speeding up a digitalization of trading systems that was already underway, as trading firms adopt more virtual tools that help them cope with the triple threat of high volume, extreme volatility, and the lockdown life.
/bit.ly/2YW0BZN

Five Lessons From Y2K That Resonate Today; While we fight the coronavirus pandemic, we should remember the crises that didn’t happen — like the meltdown averted two decades ago.
Matt Chapman – Bloomberg
As we address the tragedies of Covid-19, we should learn from past calamities, whether epidemics or economic collapse. But we can also learn from a crisis that was successfully managed — the Y2K threat to computer operations 20 years ago.
/bloom.bg/2Lror7L

KRM22 surges as it exceeds fundraising target; The software firm also reported lower losses and higher revenues for its 2019 financial year in a brief trading update ahead of its results due next week
Proactiveinvestors.com
KRM22 PLC (LON:KRM) confirmed it has received a firm commitment to undertake a £1mln equity investment at 30p per share, a 27.7% premium to its closing price last Thursday, exceeding its initial fundraising target.
/bit.ly/3bssXxl

For Chip Makers, Government Involvement Won’t Come Free; Intel and Taiwan Semiconductor Manufacturing face growing costs in trying to maintain their edge
Dan Gallagher – WSJ
Chip-making giants and their investors understandably like the idea of the U.S. government pitching in on a very expensive business. They should be careful what they wish for, though, as recent history has shown that growing political involvement in the sector hasn’t been cost-free.
/on.wsj.com/3bnY4df

Pico Chairman and Founder, Jarrod Yuster, Announces Strategic Hire of Frank Troise as Co-Chief Executive Officer; Strategic hire underscores Pico’s commitment to being the market leader in financial technology infrastructure provision and analytics
Globe Newswire
Pico, the leading provider of technology services for the financial markets community, today has announced that Frank Troise will join Pico as Co-Chief Executive Officer alongside Chairman and Founder, Jarrod Yuster. The firm has had exceptional growth since inception over the past decade and Troise will partner with Yuster to build on Pico’s strong foundation and accelerate further expansion.
/on.mktw.net/2y2sSmq

Cryptocurrencies

Crypto exchange ErisX announces launch of physically settled ETH futures
Celia Wan – The Block
Crypto exchange ErisX announces launch of physically settled ETH futures
Cryptocurrency derivatives exchange ErisX announced Monday the launch of physically settled Ether (ETH) futures contracts, a first-of-its-kind debut in the U.S. Announcing the news in a media post, the Chicago-based firm said users can trade the contracts starting today. The contracts are based on ETH-USD with monthly and quarterly expirations.
/yhoo.it/2zz19dv

In Apparent First, SEC-Approved Security Token Offering Seeks Listing on Coinbase;
Singaporean blockchain project BitcoinHD claims to have submitted the first SEC-approved security token offering for prospective listing on major U.S. exchange Coinbase.
Marie Huillet – Cointelegraph
Shortly after sealing an approval from the United States Securities and Exchange Commission for its security token offering, Singaporean blockchain project BitcoinHD (BHD) is seeking a listing on major exchange Coinbase. On March 30, the SEC had approved BHD’s blockchain-based STO under what is known as a Form D exemption.
/bit.ly/3bqJr9i

R3 And Kaleido Partner To Speed Enterprise Digital Transformation Efforts – Organizations Globally Can Now Accelerate Their Collaborative Cross-Industry Digitization Initiatives Through Kaleido’s Consortium-As-A Service Offering Announced Today
Mondovisione
At the State of Enterprise Adoption session at this year’s Consensus: Distributed conference, R3 Co-Founder Todd McDonald and Kaleido Founder Steve Cerveny announced the companies formally partner to offer R3’s Corda Enterprise software on Kaleido’s digital platform.
/bit.ly/2LnLoIV

Telegram Halts Work on Blockchain Network After Court Decision
Olga Kharif – Bloomberg
Enterprise ran afoul of regulators after raising money in 2018; Pavel Durov: ‘We hope that you succeed where we have failed’
Telegram Messenger LLP officially scrapped plans to build a digital ledger for transactions. In a blog post Tuesday, Chief Executive Officer Pavel Durov said his instant-messaging platform is discontinuing work on the project, which ran afoul of regulators. Others may continue working on the technology, he said.
/bloom.bg/3bstLlR

Total stablecoin supply surpasses $10B, growing more than 70% since February
Celia Wan – The Block
The total stablecoin supply hit an all-time high of $10.4 billion on Tuesday, crossing the $10 billion mark for the first time. Tether still dominates the stablecoin sector with 85.1% of the market share and over $8.8 billion in total supply. USDC ranks second with 7.2% of the market share.
/bit.ly/2xXd6Jl

What is China’s cryptocurrency-like sovereign digital currency and why is it not like bitcoin?
Karen Yeung – South China Morning Post
Alibaba’s Alipay and Tencent’s WeChat Pay are already popular payment methods in China. Photo: EPA What is China’s sovereign digital currency? China’s version of a sovereign digital currency, the so-called Digital Currency Electronic Payment (DCEP), will be used to simulate everyday banking activities including payments, deposits and withdrawals from a digital wallet. Once launched, consumers would download an electronic wallet application authorised by the People’s Bank of China (PBOC), which they would then link to a bank card to start to pay with or receive digital yuan using a mobile phone with merchants or make transfers with an ATM machine and other users.
/bit.ly/2Z0szDO

Bitcoin’s hash rate appears to drop 16% after miner revenue declines by 44%
Larry Cermak – The Block
Bitcoin’s hash rate, the measure of miner’s performance, appears to have dropped by about 16% after the third halving as miners now generate twice less from the block subsidy. According to The Block’s estimates, the daily miner revenue has dropped by about 44% after the halving – from $16.1 million to $9.0 million. Most of the older ASIC mining equipment, such as Antminer S9, is now unprofitable. The new-gen devices, such as Antminer S17 and Whatsminer M30S, remain vastly profitable.
/bit.ly/2WQiJBD

Bank of England: No Compromise on Our Principles for Any Future CBDC
Paddy Baker – Coindesk
The Bank of England (BoE) has dug its heels in and said it won’t be told what to do by any tech providers about what is and isn’t possible when designing a future central bank digital currency (CBDC). Speaking briefly during Consensus: Distributed’s Future of Fiat Workshop, the BoE’s senior fintech specialist, Simon Scorer, underlined the U.K. central bank will not negotiate on its design principles with tech providers, should BoE ever move forward with developing a digital pound.
/bit.ly/2yRUomZ

IRS solicits contractors to audit tax returns relating to cryptocurrency
Yogita Khatri – The Block
The Internal Revenue Service (IRS), is looking for outside contractors to assist with calculating taxpayers’ gains or losses as a result of their transactions involving cryptocurrency. The email from the IRS, published by Cryptotrader.tax, further stated: “We are placing a few single-case contracts as pilots with a goal of publishing a solicitation and request for proposal for a larger multi-case contract.”
/bit.ly/3cvIXjn

MakerDAO shuts down the Single-Collateral DAI system
Yilun Cheng – The Block
The MakerDAO community has shut down the Single-Collateral DAI (Sai) system as the protocol fully transitions to the new Multi-collateral DAI (MCD or Dai) system. In Nov. 2019, MCD was activated on MakerDAO as an upgrade to the Dai protocol. While Sai is backed only by ETH collateral, MCD is backed by several types of assets, which currently include ETH, BAT, USDC, and WBTC. The update offered users more collateral options and introduced the Dai Savings Rate, which rewards holders with a variable interest rate paid out in Dai.
/bit.ly/2zy9heg

Nearly 17,000 Creditors Claim Refunds from QuadrigaCX
Arnab Shome – Finance Magnates
As many as 16,959 people have claimed assets from the now-defunct cryptocurrency exchange QuadrigaCX, according to a document published on Tuesday by Ernst & Young (EY), the court-appointment bankruptcy monitor. The former users of the exchange are filing claims for digital assets including Bitcoin, Bitcoin Cash, Bitcoin Gold, Bitcoin SV, Ethereum, and Litecoin, along with Canadian dollars and US dollars.
/bit.ly/2Lr2Mg0

Plaintiffs claim they are owed $540 million in amended BitMEX investor lawsuit
Yogita Khatri – The Block
An amended investor lawsuit has been filed against crypto derivatives exchange BitMEX and founder Arthur Hayes, with the plaintiffs claiming that they are owed $540 million compared to the $300 million cited in an earlier complaint. Last December, plaintiffs Frank Amato and RGB Coin Ltd – claiming to be BitMEX’s first seed investors – sued the exchange for $300 million. Their $30,000 initial investment in BitMEX in 2015 was allegedly supposed to be converted into equity upon the exchange’s first fundraising event, but they weren’t given the equity, per the lawsuit at the time.
/bit.ly/2xVvItc

Politics

Trump orders federal pension fund not to invest in Chinese stocks; White House cites risk of ‘future sanctions’ over pandemic
Demetri Sevastopulo – FT
President Donald Trump has ordered the main federal government pension fund not to invest its portfolio in Chinese companies, which his administration says pose a serious national security risk to the US.
/on.ft.com/2zy2NvW

Beijing hits back at Trump call to block US pension fund investment in China; Investors’ fears rise that trade conflict could spread to financial markets
Tom Mitchell and Don Weinland – FT
Donald Trump’s order to stop the US government’s main pension fund from investing in Chinese equities will only hurt US investors, Beijing has warned as trade tensions between the countries threatened to turn into a “financial fight”.
/on.ft.com/2LsHHS4

Former Watergate prosecutors urge judge to buck Justice Department and not dismiss Michael Flynn case
Katelyn Polantz, David Shortell – CNN
Sixteen former Watergate prosecutors have told a federal judge he has the authority to sentence former Trump national security adviser Michael Flynn to prison despite the Justice Department’s effort to toss the case.
/cnn.it/2LrczT3

Trump Shows Frayed Nerves With Pandemic’s Toll Climbing
Justin Sink – Bloomberg
President picked up attacks as polls showed drop in key states; Virus infected White House staffers as Trump urges reopening
As the coronavirus inflicts ever more death and economic carnage across the U.S., President Donald Trump is resorting to his preferred and battle-tested tactic to fight the biggest threat to his re-election: diversion.
/bloom.bg/35TQohQ

Tapping Social Security Would Be a Big Mistake; The political precedent is too dangerous, and there are better ways to support struggling families.
Natasha Sarin – Bloomberg
Conservatives in the Trump Administration are reportedly considering a crisis-fighting measure that my colleagues and I have researched: Ease people’s financial strains by allowing them to access Social Security benefits early.
/bloom.bg/3bxlhcZ

Key Justices Look for Middle Ground on Trump’s Financial Records
Greg Stohr and David McLaughlin – Bloomberg
Supreme Court hears arguments on House, New York subpoenas; Chief justice questions both sides in House clash with Trump
Key justices explored possible middle ground as the U.S. Supreme Court considered President Donald Trump’s bid to keep his financial records secret in a pair of cases that could have sweeping constitutional significance and affect the November election.
/bloom.bg/3crCRAw

U.S. Posts Record $737.9 Billion Budget Deficit on Virus Relief
Vince Golle – Bloomberg
Spending more than doubles from year earlier to $980 billion; Revenue plummets after government delays tax deadline
The U.S. government’s sweeping fiscal effort to contain the economic damage from the coronavirus pandemic came to light Tuesday in its monthly budget statement, with a record $737.9 billion deficit in the month of April alone.
/bloom.bg/2y1Ge2g

House Democrats Unveil $3 Trillion Aid Bill With Cash for States
Erik Wasson and Laura Davison – Bloomberg
State aid paired with cash payments, expanded safety net; Republicans signal they’re in no rush to begin negotiations
House Democrats proposed a $3 trillion virus relief bill Tuesday, combining aid to state and local governments with direct cash payments, expanded unemployment insurance and food stamp spending as well as a list of progressive priorities like funds for voting by mail and the troubled U.S. Postal Service.
/bloom.bg/35VQJR6

Trump again urges Fed to adopt negative U.S. interest rates
Reuters
President Donald Trump on Tuesday again pushed the Federal Reserve to adopt negative interest rates, even as several members of the U.S. central bank have said they do not see a need for rates – now near zero – to move into negative territory.
/reut.rs/2zBRd2B

Fed’s Quarles defends decision to let banks maintain dividends
Michelle Price, Pete Schroeder – Reuters
A senior Federal Reserve official on Tuesday defended before Congress the central bank’s decision to allow lenders to continue issuing dividends, even as the regulator seeks permission from lawmakers to further relax capital rules.
/reut.rs/361G0oj

Putin’s spokesman becomes fifth senior Russian official to get coronavirus
Gleb Stolyarov, Gabrielle Tétrault-Farber – Reuters
Russian President Vladimir Putin’s spokesman Dmitry Peskov said on Tuesday he had tested positive for the novel coronavirus, as a new surge in infections gave Russia the third highest number of reported cases in the world after the United States.
/reut.rs/2Wqwx6T

Kelly Loeffler considers SEC ‘Hail Mary’ over stock sales
Charlie Gasparino – Fox Business
Kelly Loeffler, the U.S. senator from Georgia and former top executive at the parent company of the New York Stock Exchange, continues to trail in most polls to keep her Senate seat following her controversial stock sales before the coronavirus pandemic rocked the markets. Now her campaign is considering an unusual “Hail Mary” to turn the tide, FOX Business has learned.
/yhoo.it/2Wv6j3f

Regulation

Morgan Stanley pays $5 million fine to settle SEC charges it misled investing clients
Jonathan Stempel – Reuters
A unit of Morgan Stanley agreed to pay a $5 million fine to settle U.S. Securities and Exchange Commission charges it misled retail investing clients about the costs of a “wrap fee” program, the regulator said on Tuesday.
/reut.rs/35X6VBS

Morgan Stanley Hid Fees From Some Customers, S.E.C. Says; For nearly five years, the Wall Street bank spent customers’ money on trades it said would be included in a flat fee but weren’t, a regulator claims.
Emily Flitter – NY Times
Morgan Stanley agreed to pay a $5 million fine to settle a Wall Street regulator’s complaint that it loaded extra fees onto accounts of some customers who were expecting to pay only a flat rate for its investment advice.
/nyti.ms/2LmLksL

SEC Charges Morgan Stanley Smith Barney With Providing Misleading Information to Retail Clients; Settlement Will Create $5 Million Fund to Benefit Harmed Investors
SEC
The Securities and Exchange Commission today announced that Morgan Stanley Smith Barney LLC (MSSB) has agreed to settle charges that it provided misleading information to clients in its retail wrap fee programs regarding trade execution services and transaction costs. MSSB has agreed to pay a $5 million penalty that will be distributed to harmed investors.
/bit.ly/2Wpv2pw

Energy Chief Says Fed Asked to Expand Lending for Oil Firms
Saleha Mohsin and Ari Natter – Bloomberg
Dan Brouillette says mid-cap companies were targets of changes; Watchdog group member Ramamurti scrutinizing Fed decision
The Trump administration asked the Federal Reserve to modify its Main Street Lending Program to include more mid-size companies in order to help oil firms cope with the plunge in crude prices, Energy Secretary Dan Brouillette said.
/bloom.bg/3cu7Pbd

U.S. federal court tells SEC, Justice Dept to review RBS whistleblower case
Michelle Price, Sinead Cruise – Reuters
The U.S. Justice Department and Securities and Exchange Commission must review whether an ex-Royal Bank of Scotland employee is owed a whistleblower payout and provide documents relating to his case, a federal U.S. court said on Tuesday.
/reut.rs/2Ws4Dav

U.S. federal court tells SEC, Justice Dept to review RBS whistleblower case
Michelle Price, Sinead Cruise – Reuters
The U.S. Justice Department and Securities and Exchange Commission must review whether an ex-Royal Bank of Scotland employee is owed a whistleblower payout and provide documents relating to his case, a federal U.S. court said on Tuesday.
/reut.rs/361KafV

ASIC secures over $160 million in remediation for junk consumer credit insurance
ASIC
Today ASIC announced the final tranche in over $160 million in remediation for consumers sold junk consumer credit insurance (CCI). This follows ASIC’s 2019 report (REP 622) on the sale of CCI by 11 major banks and lenders across eight years, which found that the design and sale of CCI had consistently failed consumers.
/bit.ly/2Lpus4O

ASIC to further extend financial reporting deadlines for listed and unlisted entities and amends ‘no action’ position for AGMs
ASIC
ASIC will extend the deadline for both listed and unlisted entities to lodge financial reports under Chapters 2M and 7 of the Corporations Act (the Act) by one month for certain balance dates up to and including 7 July 2020 balance dates.
/bit.ly/35UvpLS

FINRA Enforcement: Protecting Investors and Markets in Good Times and Bad
FINRA
FINRA Enforcement works on the front lines of investor protection—not just now, as some look to take advantage of these uncertain time to defraud investors or manipulate the markets – but always. On this episode, we meet Jessica Hopper, FINRA’s new Executive Vice President and Head of Enforcement, to hear what her team is doing today, and every day, to prevent investor harm and to maintain the integrity of our markets. Plus, we hear what keeps Jessica motivated to do what she does.
/bit.ly/3brMy0z

Regulation Best Interest: Compliance Inspections and Examinations
FINRA
Attend this session to hear from OCIE, FINRA staff and industry experts as they discuss how they intend to examine and inspect for compliance with Reg BI, including a discussion of implementation challenges, frequently asked questions, and issues that are being considered.
/bit.ly/35WUENE

SEC Obtains Receiver Over Florida Investment Adviser Charged With Fraud
SEC
The Securities and Exchange Commission today announced that it has obtained the appointment of a receiver over Florida-based investment adviser TCA Fund Management Group Corp., its affiliate TCA Global Credit Fund GP Ltd. (TCA-GP), and several funds managed by TCA to protect investors from a fraudulent scheme allegedly conducted by TCA.
/bit.ly/2xXcZNV

Investing and Trading

ESG Investing Shines in Market Turmoil, With Help From Big Tech; The strength of socially responsible funds suggests they have staying power; ‘ESG is not a fad’
Caitlin McCabe – WSJ
Funds focused on socially responsible investing have been a rare bright spot in this year’s market meltdown, the latest evidence that the practice is more than a bull-market trend.
/on.wsj.com/3bo8Wrz

Standard Life Aberdeen hit by investor backlash over virtual AGMs; FTSE 100 asset manager is the first large British company to suffer revolt
Chris Flood – FT
Standard Life Aberdeen suffered the first significant revolt against virtual shareholder meetings at a large UK company this year.
/on.ft.com/2zDf3ek

Big ExxonMobil shareholder to vote against chief; UK’s LGIM adds to pressure on US oil major over governance and climate change
Attracta Mooney and Derek Brower – FT
ExxonMobil is facing its latest shareholder clash after the UK’s biggest asset manager said it would oppose the re-election of chief executive and chairman Darren Woods at the US oil group’s annual meeting this month.
/on.ft.com/3bzISKt

Wall Street Mines Apple and Google Mobility Data to Spot Revival
Ksenia Galouchko – Bloomberg
LGIM, SocGen among the firms using Apple, Google mobility data; Innovative data gains in popularity as analysts gauge recovery
To navigate these unprecedented times, market participants are getting creative with how they monitor economic activity. As some countries relax their lockdowns, investors and strategists are poring over mobility data from Apple Inc. and Alphabet Inc.’s Google to track the pace of economic recovery and estimate consumer spending across different regions. Such information can provide early clues on which countries will exit the worst recession in decades faster than others, and which will fall behind.
/bloom.bg/3cFoQza

Britain’s Silly Flirtation With Negative Interest Rates; Sub-zero rates aren’t the way to get banks to lend more money. They should only be used if nothing else manages to stimulate the economy.
Marcus Ashworth – Bloomberg
Andrew Bailey, the Bank of England’s new governor, tried out a little bit of “whatever it takes” central banker language last week by opening up the possibility of negative interest rates in the U.K. “I don’t want to say we’re nearer” to that eventuality, he said “but we’re not ruling anything out.”
/bloom.bg/2zANhz8

Farmers Swap Soybeans for Corn as Coronavirus Scrambles Demand; Prices have fallen further for corn than soybeans as ethanol production stalls
Kirk Maltais – WSJ
Some farmers are shifting acres from corn to soybeans this year, a reversal that reflects the coronavirus pandemic’s broad impact on demand for many agricultural products.
/on.wsj.com/2WuSDFs

Resurgent Wall Street disconnected from reality on the ground
Noel Randewich – Reuters
With the U.S. economy facing its potentially deepest economic decline in nearly a century, Wall Street is pulling further and further ahead from Main Street. Trillions of dollars of fiscal and monetary stimulus to dampen the impact of the coronavirus pandemic on the U.S. economy and financial markets have sent stocks soaring off their lows, while the worst of the fallout on growth and employment has yet to be felt.
/reut.rs/2y1J6fy

Stocks Manage to Be Irrationally Exuberant in a Pandemic; Are we sure we’ve accounted for all the risks?
Mark Gongloff – Bloomberg
A disquieting feature of this pandemic has been the optics of the stock market soaring while people die and lose their jobs in unthinkable numbers. To be fair to the stock market, it’s not meant to be a barometer of the economy or public health. But it appears to be flirting with danger, and not just of the bad karma variety.
/bloom.bg/3cu4Qj1

Richard Branson Scrambles to Save His Flailing Virgin Empire
Benjamin Stupples – Bloomberg
He’s selling as much as $500 million of Virgin Galactic stock; U.K. lawmakers reluctant to bail out billionaire entrepreneur
Sign up here for our daily coronavirus newsletter on what you need to know, and subscribe to our Covid-19 podcast for the latest news and analysis. Covid-19 is exacting a heavy financial toll on one of the world’s most-recognizable entrepreneurs. Richard Branson already has pledged a Caribbean island and at least $250 million to shore up a leisure and travel empire roiled by the coronavirus pandemic. Now he’s selling a chunk of his stake in Virgin Galactic Holdings Inc., his most valuable listed asset, to raise as much as $500 million.
/bloom.bg/3coF9At

Specter of Deflation Rises Again; Supply-chain snarls are boosting certain prices, but the big risk for the U.S. economy is deflation
Justin Lahart – WSJ
In 2002, former Federal Reserve Chairman Ben Bernankegave a speech titled “Deflation: Making Sure ‘It’ Doesn’t Happen Here.” Now, the severity of the recession brought on by the novel coronavirus crisis could make that task very hard.
/on.wsj.com/2y2s9Se

Institutions

Byron Trott’s BDT Raises $9.1 Billion for Its Latest Fund
Tom Maloney – Bloomberg
Most of the investors own businesses or have family offices; Firm’s clients have included Warren Buffett and the Pritzkers
BDT Capital Partners raised $9.1 billion for its third investment fund, exceeding the amount it had initially sought, according to a regulatory filing Tuesday. The merchant bank’s latest fund has about 150 investors and will focus on buying stakes in family-owned businesses, said a person familiar with the strategy who asked not to be identified because the information is private. More than 90% of the investors have their own businesses or significant family office operations, and about a third are based outside the U.S., the person said.
/bloom.bg/2zDdtsU

ABN Amro Loss Worse Than Expected After $1.2 Billion Hit
Ruben Munsterman – Bloomberg
New CEO Robert Swaak prioritizes revamp of investment bank; Dutch bank says provisions may rise to $2.7 billion this year
ABN Amro Bank NV’s new chief executive officer will review the bank’s strategy after the Dutch lender posted its first loss since 2013 and set aside almost twice as much as expected to cover future loan losses.
/bloom.bg/2Wrk4j8

Hedge Fund That Never Loses Bets Big on South Africa Debt
Selcuk Gokoluk – Bloomberg
ProMeritum allocates one-fifth of money to the county’s bonds; Fund has made profits for investors every year since founding
A London-based hedge fund that has made gains every year since it was founded, through risky bets including Ukrainian GDP warrants and sanctioned Russian bonds, is now putting its money on South Africa.
/bloom.bg/3bzpflK

Deutsche Bank Resumes Job Cuts as Bosses Forgo a Month’s Pay
Steven Arons and Nicholas Comfort – Bloomberg
Lender in better position now for consolidation, Sewing says; Bank had stopped firings in March as coronavirus crisis hit
Deutsche Bank AG abruptly ended a hiatus on staff dismissals, becoming the first major bank to say it will resume job cuts after the coronavirus outbreak put the plans on hold.
/bloom.bg/2WtDC6s

JPMorgan Says Benefit of Negative U.S. Rate Might Outweigh Costs
Joanna Ossinger – Bloomberg
A negative Federal Reserve policy rate is still improbable, but if it were to happen it could be a net benefit, according to JPMorgan Chase & Co. “Mildly negative rates such as -10 basis points for a year or two could be beneficial in the current conjuncture,” strategists led by Nikolaos Panigirtzoglou wrote in a note Tuesday. However, he added that “we still view a negative Fed policy rate as unlikely,” and emphasized that rates would need to be just slightly negative, and not for too long, in order to be effective.
/bloom.bg/35VuPNN

World’s biggest wealth fund blacklists 4 Canadian firms for greenhouse emissions
Reuters
The Norwegian central bank on Wednesday excluded four Canadian oil and gas companies from its $1-trillion wealth fund, the world’s largest, for producing too much greenhouse gas emissions, its first use of carbon emissions as a criterion to blacklist firms.
/reut.rs/3cvw5K5

Steve Cohen, Jeff Bezos Achieve Scroll Fame at Robin Hood Telethon
Amanda L Gordon – Bloomberg
Virtual benefit helps raise $115 million for pandemic relief; Jimmy Fallon writes thank-you notes; Tina Fey gets teary-eyed
At the Rise Up New York! benefit Monday night, the names scrolling across the bottom of the screen were an indication of how the Robin Hood Foundation raised $115 million for Covid-19 relief and recovery efforts. Each one had given consent to appear in the donor scroll, and it was just a sampling of the contributors, Robin Hood spokesperson Courtney Ridgway said in an email.
/bloom.bg/2LmNJnh

Bank of America’s summer internship will be entirely virtual. A talent exec runs through how the bank’s 2,000 global interns will learn, network, and volunteer without stepping into an office.
Shannen Balogh – Business Insider
For many college juniors and seniors, a summer internship on Wall Street is the first step to a career in banking. At all of the top banks and investment firms, rising juniors and seniors typically spend 10 weeks of their summers learning, working, and networking in the hopes of getting a full-time offer.
/bit.ly/3czyjbC

Regions

China-focused hedge funds record best month in half a decade; Gains in April helped by optimism over rebound by world’s second-biggest economy
Hudson Lockett – FT
China-focused hedge funds recorded their best monthly performance in half a decade in April, as a rebound in the country’s markets following the coronavirus sell-off helped investors outperform their global peers.
/on.ft.com/35WGzzV

China Convertible Bonds Are Having Busiest Month Since 2018
Julia Fioretti – Bloomberg
Chinese companies listed overseas are raising the most since December 2018 through convertible bonds as low interest rates and volatile markets make them attractive.
/bloom.bg/2LrfPhf

World’s Biggest Wealth Fund Dumps $3 Billion in Fossil Fuels
Stephen Treloar and Mikael Holter – Bloomberg
Glencore, Anglo, RWE among firms hit by latest withdrawals; Climate rules used for first time to target oil-sands firms
Norway’s $1 trillion wealth fund is doubling down on its climate action by making deeper cuts to its fossil fuel exposure.
/bloom.bg/3buyHqr

Locust Swarms Due in June Raise Risk of Food Crisis
Brian Parkin – Bloomberg
FAO to ask for about $110 million in fresh finance on May 20; Weather may push locust swarm into West and North Africa
The United Nations agency leading the fight against a desert-locust upsurge in East Africa will lodge a new appeal for funding next week, warning the plague could still cause a food crisis.
/bloom.bg/3ctYvnT

RBA Owns Nearly 7% of Australian Government Bond Market
Kevin Varley – Bloomberg
RBA has bought A$51.348 billion in general government bonds; 78% of purchases have been federal government issues
The Reserve Bank of Australia has purchased A$51.348 billion by face value in government securities since March 20, when it started buying bonds to hold down borrowing costs in the economy. Of those, 78.4% are federal government notes. The RBA, which last purchased debt on May 6, now owns close to 7% of the overall Australian government bond market.
/bloom.bg/2zCkACg

Ghost of 1992 Italy Devaluation Returns to Haunt Euro Unity Aims; Gut check for investors in Italy relying on history, hope and the ECB
Alessandra Migliaccio, Luca Casiraghi, and Viktoria Dendrinou – Bloom erg
On the September night in 1992 when George Soros famously broke the Bank of England, it wasn’t just the British pound that crashed. The Italian lira cratered too, the last of its numerous 20th century devaluations.
/bloom.bg/2zvk494

Recycled Battery Metals Being Tested for Use as Crop Fertilizer
Sybilla Gross – Bloomberg
Lithium Australia has begun trialing zinc, manganese on wheat; Large-scale tests to be carried out later in year: MD Griffin
It might seem an unusual ingredient for plant fertilizer, but metal dust from spent household batteries are being tested as potential crop nutrient supplements by an Australian recycler and supplier of battery materials.
/bloom.bg/2Ws4F2h

Cargill registers ‘some’ COVID-19 cases at Brazil plant -statement
Ana Mano – Reuters
A plant operated by U.S. grain trader Cargill Inc in southeast Brazil has registered an unspecified number of COVID-19 cases, according to a written statement sent to Reuters on Tuesday.
/reut.rs/2LBP61T

German Judges Strike Back, Saying ECB Isn’t ‘Master of Universe’
Karin Matussek and Stephanie Bodoni – Bloomberg
Judges Huber, Vosskuhle comment on controversial QE ruling; Vosskuhle says national courts must intervene in ‘rare’ cases
Members of Germany’s top court continued to defend their controversial decision that questioned the underpinning of the European Central Bank’s asset repurchase program, saying national courts have a limited oversight role over the bloc’s judges.
/bloom.bg/3coT4Xc

Luckin Coffee Terminates CEO Jenny Qian Amid Investigation Into Fabricated Sales; Chinese coffee chain names director Jinyi Guo as acting chief executive
Jing Yang and Julie Steinberg – WSJ
Luckin Coffee Inc. said its board of directors has terminated chief executive Jenny Qian amid a deepening internal investigation into the company’s fabricated sales, suggesting she played a role in a scheme to inflate its revenue.
/on.wsj.com/2xWWvFx

Brexit

‘Foretaste’ of Brexit: Virus cuts off much of UK farm labor
Sylvia Hui – AP Newswire
Britain’s fruit and vegetable farmers have long dreaded their country’s exit from the European Union, worrying that it would keep out the tens of thousands of Eastern European workers who come every year to pick produce.
/bit.ly/2AmW3Bj

What Rules Will Apply to Jurisdiction and the Enforcement of Judgments After Brexit?
Latham & Watkins LLP – JDSupra
The UK has recently requested to join the Lugano Convention 2007, which is the UK’s preferred regime for governing questions of jurisdiction and the enforcement of judgments with EU countries post-Brexit. These rules will be critically important for all parties when they consider which jurisdiction clauses to include in their contracts.
/bit.ly/3dN9glz

No-deal Brexit could be second shock for Europe in 2020, Opinion
The Business Times
JUST as Europe gets over the peak of the novel coronavirus health crisis, a second major “shock” could be on the horizon: A new Brexit crisis is brewing between London and Brussels that could see talks collapse in May or June.
/bit.ly/2ZbcGdR

Letter: France has power to cut off UK over fishing dispute
Robin Healey – FT
The UK is inviting fierce physical retaliation from the French labour unions if it does not compromise over EU fishing rights after Brexit (“Plans drawn up to bypass Calais”, May 7). In solidarity, no doubt, with their fishermen confrères, the French port, customs, immigration, dock and railway workers could paralyse and lock down all Calais-Dover transport facilities; no commercial or private traffic could move in either direction.
/on.ft.com/2T0hA9y

Miscellaneous

The Crisis on Campus Is Here To Stay; A looming shortage of students will upend the business model of higher education. To survive, colleges need to do more with less.
Tyler Cowen – Bloomberg
The Covid-19 pandemic has forced American colleges and universities to shut dormitories, cancel sporting events, halt graduation ceremonies and shift lectures and classroom instruction online. This has caused unprecedented disruption to institutions that are averse to change in the best of times. As the economic crisis deepens, higher education will face even more serious problems, which are likely to persist even after the worst of the public health dangers has passed.
/bloom.bg/3crz7iE

Luxury Dorm Financed With Muni Bonds Falls Into Bankruptcy
Amanda Albright and Danielle Moran – Bloomberg
Trustee plans to make June debt payment from reserves; Housing project included swimming pool, scooter parking spots
The operator of a student housing complex built for University of Florida students fell into bankruptcy, the latest municipal-bond financed project in fiscal crisis amid the coronavirus fallout. Midtown Campus Properties LLC sold $78 million in unrated taxable municipal bonds in 2019 for the 310-unit facility in Gainesville, Florida. The mixed-use complex, whose website promises an “elite” experience for students, was set to include parking spaces for scooters, a resort-style swimming pool, fitness center and arcade with one-bedroom apartments renting for $1,380 per month, bond documents show. Instead, the operator filed for Chapter 11 last week, less than 16 months after selling bonds.
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Brokers shun oil ETF providers over regulatory risks

Brokers shun oil ETF providers over regulatory risks

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