John Lothian Newsletter: Big Banks Accused of Monopolizing Interest Rate-Swap Market; FCA fines Barclays £72 million for poor handling of financial crime risks; China Calm Shattered as Brokerage Probe Sparks Selloff in Stocks

Nov 27, 2015

First Read

What I believe is Not a Generality
John Lothian – JLN

My staff will tell you I hate generalities. I do not believe in grouping and condemning people together because of a common heritage, political philosophy, religion, gender, sexual orientation or other commonality. Or height even.

I believe in the merits and uniqueness of individuals. I believe in judging people by their character, not the color of their skin, the God they believe in (or don’t), the party they belong to, who they chose to love or the place they live.

For the rest of the column, click here


Want to Get Richer? Accept Refugees
By Leonid Bershidsky – Bloomberg View
As political debates about Syrian refugees rage on both sides of the Atlantic, initial assessments of their economic impact on receiving countries are coming in: The influx is good for growth.
***** Funny how that works.

**A story worthy of debate and dialog. In fact, there was some spirited debate among the team this morning.


Trying To Stop The Next Flash Crash

The CFTC announced its new automated trading rules, marking a major shift on how automated trading will be developed and implemented in the coming years.
View the Story »
**Check out our updated story on automated trading regulation.

***For a complete summary of the rule, and related documents, plus links to related topics, visit the rule’s page in MarketsReformWiki.


Doug Ashburn – JLN
Have you ever heard of Grace Hopper? Yeah; neither had I until last Friday, when I attended a private screening of CODE: Debugging the Gender Gap, followed by a panel discussion that included the movie’s director Robin Hauser Reynolds and several tech experts, including Trading Technologies executive (and MarketsWiki Education contributor) Katie Burgoon. The 90-minute documentary explores the shortage of female software engineers in the U.S. and abroad, and what can be done to narrow the gap.


Bloomberg: U.S. climate ‘crazies’ are being forced to accept reality
By Mick Krever, CNN
Bloomberg: U.S. climate ‘crazies’ forced to accept reality 02:16
(CNN)The realities of climate change will force American deniers — or “crazies” — to accept reality, Michael Bloomberg told CNN’s Christiane Amanpour in an interview that will air Friday.

***** There are so many different definitions or reality, but I like where Mike is going with this.


How do I … reduce my carbon emissions?
Emma Howard – The Guardian
In order to avoid climate calamity, global temperatures must not rise by more than 2C. Here’s how you can do your bit
On Monday, one of the biggest meetings in the world will begin in Paris. COP21, or the 21st conference of the parties, is the UN’s most significant summit on climate change since the 2009 meeting in Copenhagen, bringing together political leaders and delegates from just about every country in the world. Their mission is to negotiate a new deal on cutting greenhouse gas emissions after 2020 – a deal on which the earth’s future may depend.

***** This is a job for everyone.


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Congrats to Rumi Morales, CME Group Exec. Director of Strategic Investments, on making @crainschicago 40 Under 40

***** I have parts that are under 40.


Adrienne Seaman, CME Group – Legal Aspects of a Career in Futures

In 2008, Adrienne Seaman was looking for a change, for fear of getting “bored” in her job as a partner in a London law firm. As a lawyer with a degree in computer science, she was particularly well suited to join CME Group as it began its expansion in Europe. Two weeks after she joined, Lehman Brothers filed for bankruptcy, and the wheels of regulatory change were set in motion for the entire financial market. Today she has no worries about being bored.

Seaman asks, “who in the business will be worrying about law and regulation?” The answer, of course, is everyone. In this MarketsWiki Education talk, she offers tips not only for the would-be lawyers in the room, but also the 95 percent of people in the room who will not be lawyers, but will invariably need to deal with lawyers and legal issues throughout their professional careers.

Watch the video »

Liquidity is King!
Steve Claussen – OptionsHouse
While today, the Wednesday prior to the Thanksgiving holiday is a full trading day, I expect the liquidity in the markets to dry up this afternoon as many traders head home early. Black Friday may be a big day at the stores, but don’t expect much in the markets for the ½ day we are open. (Remember the markets close at 1pm ET)
This got me thinking about how important it is for all investors to understand the importance liquidity plays in successful trading. For active investors, liquidity is defined as how quickly and cheaply a marketable asset can be bought or sold.

***** Long live liquidity!


Lead Stories

Big Banks Accused of Monopolizing Interest Rate-Swap Market
Joel Rosenblatt – Bloomberg
Buy-side investors portrayed as stuck in antiquated OTC market
Dealers accused of blocking competition to preserve profits
Twelve of the biggest players in interest-rate swap trading were sued for allegedly conspiring to block fund managers from entering the exchange market.

Big banks accused of interest rate-swap fixing in U.S. class action suit
By Mike Kentz – Reuters
A class action lawsuit, filed Wednesday, accuses 10 of Wall Street’s biggest banks and two trading platforms of conspiring to limit competition in the $320 trillion market for interest rate swaps.

FCA fines Barclays £72 million for poor handling of financial crime risks
The Financial Conduct Authority (FCA) has today fined Barclays Bank (Barclays) £72,069,400 for failing to minimise the risk that it may be used to facilitate financial crime.

China Calm Shattered as Brokerage Probe Sparks Selloff in Stocks
Bloomberg News
Citic Securities leads losses after revealing investigation
Industrial profits drop 4.6% in October as slowdown deepens
China’s stocks tumbled the most since the depths of a $5 trillion plunge in August as some of the nation’s largest brokerages disclosed regulatory probes, industrial profits fell and two more companies said they’re struggling to repay bonds.

Paris Climate Talks Face High Barriers and High Hopes
The goal for next week’s Paris summit was lofty all along: to hatch a climate accord strong enough to keep global warming at bay, built on promises from nearly 200 countries to limit their greenhouse-gas emissions.

Wall Street Poised for Swaps Collateral Victory at CFTC
Silla Brush – Bloomberg
CFTC considering parallel version of swaps rule from Fed, FDIC
Bank units wouldn’t have to post initial margin to affiliates
Wall Street banks may be close to winning one of their biggest lobbying fights this year by beating back U.S. requirements that would have led to billions of dollars of additional costs on derivatives trading.

China’s ‘national team’ owns 6% of stock market
Gabriel Wildau in Beijing – FT
China’s “national team” owns at least 6 per cent of the mainland stock market following the summer rescue to prop up prices, putting even more of the $4.2tn bourses into state hands.

When do U.S. markets close on Black Friday?
By Mark DeCambre – MarketWatch
U.S. financial markets were closed on Thursday for the Thanksgiving Day holiday. But market participants have reason to be thankful on the day after Turkey Day as well. That’s because markets are scheduled to close early on Friday.

EU strikes deal on rules to prevent rigging of market benchmarks
European Union negotiators reached a preliminary agreement on Wednesday on new rules to stop the rigging of market benchmarks, after attempted manipulation of the Libor and Euribor interest rates indexes by banks.

“Lord Libor” broker tells London trial he was always honest
By Kirstin Ridley – Reuters
A former ICAP broker charged with conspiracy to manipulate benchmark yen interest rates told a London criminal court on Wednesday that 1,000 rate predictions he had sent out over four years had only ever reflected his honest opinion.

Strong interest in making London gold market more transparent – LBMA
Exchanges, brokers and data vendors are interested in providing clearing or reporting services to make the gold market more liquid.

Markets must get used to price quirks
Dan McCrum – FT
A number causing much scratching of heads has been the price of one of the most common forms of derivatives. Usually expressed as positive numbers, prices are now negative and more than a few investors have lost money betting it will revert to its long established position in the financial order.

China Taking Another Step to Limit Stock Leverage, Caixin Says
Bloomberg News
China’s securities regulator told brokerages to stop offering leverage financing to clients through so-called total return swaps, Caixin magazine reported, citing an unidentified person.

Presidential Election Years Aren’t a Good Time to Be a Fed or Treasury Nominee; Candidates can measure their wait times in hundreds of days
Kasia Klimasinska – Bloomberg
Allan Landon, one of President Barack Obama’s nominees for the Federal Reserve Board, has been waiting for more than 300 days to be confirmed and has yet to get a nomination hearing.

The Ballad of the Repo Trader
From bad to verse.; Tracy Alloway – Bloomberg
Times are tough for traders in the so-called repo market, where a wide variety of banks and investors pawn their assets in exchange for short-term loans. The market was ground zero for the financial crisis, with a pullback in repo funding blamed for Lehman Brothers’ collapse. New rules implemented in the wake of the crisis have seen a dramatic decline in repo usage in recent years, with many now looking to shrinking repo to help explain a series of recent dislocations in the wider market.

China allows first foreign institutions into interbank FX market
The first batch of foreign central banks, sovereign wealth funds and international financial institutions have been registered to enter China’s interbank foreign exchange market, the country’s central bank said on Wednesday.


EU MiFID Market-Law Delay Nears as Lawmakers Pledge Backing
Julia Verlaine and John Glover – Bloomberg
Parliament informs EU Commission’s Hill of stance in letters
Implementing rules must be wrapped up swiftly, Ferber says
The European Union moved closer to pushing back the start date of financial-market rules known as MiFID II, as the bloc’s parliament threw its support behind a one-year delay.

Sebi likely to issue draft regulations on green bonds next week; Draft regulations to be cleared at Monday board meeting, will have guidelines on end use monitoring and incentives for domestic listing
Jayshree P Upadhyay – Business Standard
The Securities and Exchange Board of India (Sebi) in its board meeting slated for Monday is expected to clear draft regulations for ‘green bonds’. This will be one of the first major steps taken by the government to promote these bonds which invest only in companies and projects that help in reducing carbon footprint.

Obama Won’t Tolerate Wall Street Gifts, His Treasury Secretary Declares
Sam Stein – Huffington Post
Treasury Secretary Jack Lew on Tuesday warned Congress against attempting to slip financial deregulation efforts into must-pass year-end spending bills, saying he’d advise the president to veto the measures if they did.

Wall St. Faces Mounting Criticism From Regulators
NY Times
Despite the fallout from the 2008 financial crisis, Wall Street still has a tendency to dismiss as frivolous some of the ethical issues it faces daily.

Hong Kong securities regulator proposes expanded short position rules
Hong Kong’s securities regulator has proposed to expand the financial centre’s rules on reporting short positions as the watchdog steps up scrutiny of the Hong Kong market. The Securities and Futures Commission (SFC) published a consultation on Friday outlining plans to extend short-position disclosure requirements to a broader range of securities, in a bid to improve monitoring and aid regulatory investigations.

Exchanges & Trading Facilities

ASX And The Perth Mint To Develop Precious Metals Derivatives Products
ASX and The Perth Mint (Gold Corporation) have signed an agreement to develop new precious metals derivatives products that will be quoted and traded on ASX.

LME releases results of consultation on queue-based rent capping
The London Metal Exchange (LME) today announces its intention to introduce a cap on the rent that can be charged by an LME-approved warehouse for metal held in a delivery queue, and an increased minimum load-out rate for metal stored in LME warehouses. The LME’s decision comes in response to market-wide discussion and consultations.

London Metal Exchange finalises warehouse rent caps to tackle queues
By Eric Onstad – Reuters
The London Metal Exchange (LME) finalised further reforms of its warehousing policy on Wednesday by introducing caps on rents and boosting load-out rates to cut waiting times to access metals.

Dalian Commodity Exchange Holds Forum On Integrity In Changchun
Recently Dalian Commodity Exchange (DCE) held the “2015 First Forum on Integrity Construction in Futures Market” in Changchun City, Jilin Province, with the aim of pushing the investors in the futures market to understand and participate in the integrity construction of the futures market.

War of words over IEX goes up a notch
Philip Stafford – FT
The knockabout war of words for putative US share trading venue IEX Group to win approval to become a regulated stock exchange has moved up a notch after it turned its guns on both the New York Stock Exchange and Nasdaq.

SGX welcomes Axcelasia Inc to Catalist
Singapore Exchange (SGX) today welcomed Axcelasia Inc (Axcelasia) to Catalist under the stock code “42U”.

Single Stock Dividend Futures: Changes of the Designated Market Maker obligations for Single Stock Dividend Futures
As of 1 December 2015, the Designated Market Maker obligations for Single Stock Dividend Futures will be changed. Detailed changes to the quotation requirements are highlighted (in bold and underlined) in attachment 1 to this circular. These changes are related to the quarterly review of the market-making scheme.

Euronext Extends Contract with Luxembourg Stock Exchange
Euronext today announced that it has signed a three-year contract with the Luxembourg Stock Exchange (LuxSE) to provide trading platform hosting and technology services for market management. The contract builds on the relationship established between the two exchanges in 2007 and allows LuxSE to outsource its technology needs while focusing on client satisfaction and product innovation.

Hedge Funds & Managed Futures

Copper Faces at Least Two More Years of Pain, Rio Estimates
David Stringer – Bloomberg
Metal fell below $4,500 a ton for first time since 1999
Producer says is more optimistic on longer term demand
The copper market is facing two or three years more of pain, though the good news for the metal, which hit a six-year low this week, is that it will recover faster than other commodities, according to Rio Tinto Group.

A Kinder, Gentler Steve Cohen? Just Ask These Ex-McKinsey Gurus
Heather Perlberg – Bloomberg
Husband-and-wife team hired to help remake Point72’s culture
Overhaul is part of billionaire’s effort to rebrand firm
Just try competing with five of your hyper-numerate colleagues on a math puzzle while your boss, billionaire Steve Cohen, and a team of his senior managers look on.

China Taking Another Step to Limit Stock Leverage, Caixin Says
Bloomberg News
Country’s credit metrics not `going over a cliff,’ Reuss says
S&P questioning whether outlook captures lack of improvement
South Africa is unlikely to immediately face credit downgrades that will rank the country’s debt junk at two ratings companies, according to Standard & Poor’s.

Big Banks Cut Back on Loans to Small Business; Small businesses get fewer loans from banks, turning to alternative lenders that charge significantly higher rates
The biggest banks in the U.S. are making far fewer loans to small businesses than they did a decade ago, ceding market share to alternative lenders that charge significantly higher rates.

Banks & Brokers

Banks likely to pay big bonuses for top talent despite profit fall
Laura Noonan in London, Ben McLannahan in New York and Lucy Colback in Hong Kong – FT
Investment banks will do whatever it takes to keep their top performers happy in 2016’s bonus season — even though pay in some parts of their industry will drop as much as a third.

Brazil bank chief André Esteves arrested in Petrobras inquiry
Joe Leahy and Carina Rossi in São Paulo – FT
Brazil’s Petrobras scandal engulfed one of the country’s highest-profile business figures on Wednesday when André Esteves, the billionaire banker, was arrested as part of the sweeping investigation into corruption at the state-owned oil company.

Broker’s home searched after EUR20m fraud against Franciscan friars; Friars Minor, an 800-year-old religious order, last year announced their coffers had been emptied
Stephanie Kirchgaessner in Rome – The Guardian
Italian and Swiss police have searched the offices and homes of a financial broker suspected of committing a EUR20m fraud against the Franciscan Order of Friars Minor.

SEC Says Goldman Compliance Employee Stole M&A Secrets; Former staffer Yue Han accused of trading on information from investment bankers’ emails ahead of deals
A former Goldman Sachs Group Inc. employee is accused in a civil action of taking nonpublic information in the firm’s email system to trade ahead of client mergers, generating more than $450,000 in profit, the Securities and Exchange Commission said Wednesday.

Bonuses and the illusion of banking performance
It is rare for bankers to say they are paid too much. It is rarer still for them to make such confessions in public. So John Cryan, the recently-appointed chief executive of Deutsche Bank, deserves credit for admitting to something many that many non-bankers have long had reason to suspect.

Standard Chartered Facing Highest Hurdle in BOE Stress Tests
Richard Partington – Bloomberg
BOE to publish stress-test results, stability report on Dec. 1
Officials may tell banks to build buffers to counteract risks
For Bill Winters, things could go from bad to worse.

Barclays Chose Web Search Over Risk Check on `Elephant’ Deal
Donal Griffin – Bloomberg
Bankers stored data on clients in safe few staff were aware of
Bank fined by U.K. regulator over $2.9 billion 2011-12 deal
Barclays Plc bankers who manage money for the ultra-rich were supposed to have been even more vigilant than usual as they considered a multi-billion-dollar deal for people with high-profile political ties in 2011.

City Insider: Deutsche Bank democracy
by Harriet Agnew – FT
John Cryan: Dressing down
Does John Cryan have something of the Jeremy Corbyn about him? The Deutsche Bank co-chief has never been one to overdress. And it seems he won’t be dipping into the bonus pot to buy a flash new suit now. The reason? He hasn’t got one. On Tuesday he told a Frankfurt audience that he couldn’t fathom how bonuses were used to motivate people, fuelling chatter that staff bonuses would be slashed.

Spy at Goldman Sachs stole $460K before fleeing to China
By Kevin Dugan – NY Post
Teary Goldman banker headed to jail for stealing documents from Federal Reserve
A Goldman Sachs worker whose job was to prevent wrongdoing at the bank spied on his co-workers and used the inside information to make nearly half a million in illicit profits, regulators alleged in court papers.

Clearing & Settlement

US regulators not backing down in leverage ratio stand-off
Yellen, Gruenberg and Curry offer no concessions to agriculture committee US regulators are not budging in a stand-off with banks and politicians over the leverage ratio. The industry has been lobbying for a change to the treatment of client collateral, which results in heavy capital consumption for derivatives-clearing businesses, but a letter sent on November 24 by the heads of the three bank regulators gives no ground.

Banks eye May for margin engine launch
Futures & Options World
The tech firm at the heart of a vast project involving thirteen banks, broker Icap and clearing firms the DTCC and Euroclear to build an industry utility to allow firms to exchange margin on uncleared swaps said it plans to launch in May. Chris Walsh, the chief executive of AcadiaSoft, a tech firm owned by the diverse consortium, said the margin platform will be rolled out in the early part of next year, ahead of rules that require banks to give-up margin against uncleared swaps in September.

Financial magazine for Asia’s decision makers
The Asset
Markit and CLS Group (CLS), a leading provider of risk mitigation and operational services for the global foreign exchange (FX) market, has announced the launch of a new FX settlement service for the cross currency swaps market.

Sri Lanka CSE to launch CCP in January 2017
The Nation
The Colombo Stock Exchange (CSE) yesterday announced the proposed establishment of an Institution to act as a Central Counterparty (CCP) for all secondary market transactions on the CSE. This institution which is a 100% owned company of the CSE will act as a Central Counter Party and guarantee settlement of cash and delivery of securities for all secondary market transactions on the CSE. The CSE said it therefore expects to launch the CCP in January 2017 provided all the necessary regulations are in place.

Indexes & Products

Bond ETF Sales Surge as U.S. Ranks Last in World Debt Markets
Wes Goodman – Bloomberg
Investors withdraw most from U.S. government ETFs in 14 months
Treasuries fall 1.1% in past month to become worst performers
Investors are selling U.S. government bond exchange-traded funds at the fastest pace in 14 months as the Federal Reserve prepares to raise interest rates, helping make Treasuries the worst-performing sovereign market.

Accessing China’s Growth via Dividends
Indexology – S&P Dow Jones Indices
In recent years, with the release and implementation of a series of dividend-encouraging policies issued by Chinese authorities, the amount of dividends issued by companies listed in China’s equity markets has gradually increased. In 2014, the size of the total dividend pool for companies in the S&P China A BMI was USD 70 billion, nearly triple the size of the dividend pool in 2009. In terms of the number of companies, 70% of the S&P China A BMI universe paid dividends in 2014, which is much higher than the 55% reported in 2009.

Four new ComStage ETFs launched on Xetra; ETFs track the indices DAX, MDAX, DivDAX and EURO STOXX 50
Deutsche Börse
Deutsche Börse Cash Market: Four new equity index funds issued by Commerz Funds Solutions S.A., a Commerzbank Group fund management company, have been tradable on Xetra and Börse Frankfurt since Friday.


Airbnb to Boost Japan Listings, Its Fastest-Growing Market
Kathleen Chu – Bloomberg
Guest numbers are up 529% this year from a year earlier
The number of listings in Japan has gained 373% to 21,000
Airbnb Inc. is seeking to increase its number of short-stay listings in Japan, its fastest-growing market.

Cisco’s New CEO Embraces the Cloud; The company isn’t letting go of its high-end services, but it’s selling more networking equipment with custom software.
Ian King – Bloomberg
This year, Chuck Robbins inherited one of the toughest gigs in technology, replacing John Chambers as chief executive officer of Cisco Systems. From 2000 to 2010, the networking equipment pioneer averaged 13 percent annual sales growth. Since then, 4.3 percent. Robbins says Cisco has already seen the clouds on the horizon. “You cannot deny what may be happening in the marketplace because it doesn’t feel good for your portfolio,” he says.

Ex Barclays’ Chief: Fintech Will Significantly Disrupt Banking Sector
The former Group CEO of Barclays, Anthony Jenkins, predicts a future within the next ten years wherein financial technology or fintech will substantially disrupt traditional banking systems and the banking industry as a whole. He is convinced banking installations and those employed in banking institutions will be reduced by at least 20% in the coming ten years, if not up to as much as 50%.

Fintech start-ups beware: customers are expensive
Financial News
When mentoring start-ups, I sometimes hear a pitch like this: “With our revolutionary fintech service, we are looking to get 10,000 customers in the first year and need $300k of funding”. This immediately tells me I am talking to a first-time entrepreneur – or that they have the most amazing product. It is usually the former.

Google Lunar X prize: India’s moonshot at the space race
The Guardian
Sometime in late 2017, a tiny vehicle will blast into space from India on a 10-day journey to the moon. As it finally lands on the lunar surface some 238,900 miles later, its fate will rest entirely on four small aluminium parts in its shock absorbers. They need to work in a vacuum, with lubrication that doesn’t freeze or jam no matter what the angle. And if they fail, there’s no one to go up and fix it – meaning that eight years of work and $20m (£13.2m) in prize money will be lost in space.


Barclays hit with record £72m fine over financial crime risks
By Emma Dunkley – FT
Barclays has been hit with a record £72m penalty by the UK financial watchdog because it “ignored its own process” when handling a £1.9bn transaction for a group of wealthy and politically connected customers.

Magistrate court initiates proceedings against Ketan Shah
BS Reporter
The additional metropolitan magistrate court at Ballard Pier in Mumbai has ordered the defamation case filed by Financial Technologies (India) (FTIL) against Ketan Shah, founder member of NSEL Investors’ Action Group, be processed.

Environmental & Energy

Victorians take to the streets to demand urgent action on climate change; Thousands of people march through Melbourne’s city centre in one of many climate change protests that will take place across the world this weekend
Melissa Davey – The Guardian
Thousands of people were marching through Melbourne’s CBD on Friday evening in what is expected to the largest in a series of climate change protests being held throughout Australia over the weekend.

Abandoning Coal Is Only a Start for U.K.
By Editorial Board – Bloomberg
Britain, the country whose great coal-burning factories started the Industrial Revolution, now plans to retire nearly all its coal plants. The closures, part of an energy policy “course correction” announced last week, lay down an important marker ahead of the upcoming climate talks in Paris.

China’s Major CO2 Emissions Seen Stalling Amid Climate Push
Bloomberg News
Emissions tied to fossil fuels may see only slight gain: BNEF
Slower economic growth also helping to curb carbon emissions
China’s emissions of carbon dioxide from burning fossil fuels such as oil and gas are forecast to stall this year as the nation installs more clean energy capacity to tackle climate change.

Sustainable Cocktails and ‘Zero-Waste’ Bars Are Changing How You Drink; Eco-responsibility comes to the speakeasy.
Kara Newman – Bloomberg
Behind the bar at New York’s The Daily, Iain Griffiths whipped up a “Green” Sour in a blender: Ford’s Gin, a coin of fresh cucumber, a whole egg, orange bitters, sea salt, raspberries, crushed ice, and a lemon half, with the peel already removed. There was nothing left over but a single egg shell.

Saudi counters ‘lower for longer’ oil mantra
Anjli Raval and David Sheppard – FT
Kingdom shifts message ahead of Opec meeting as investment collapses
Saudi Arabia’s veteran oil minister made clear late last year that the kingdom would no longer prop up the oil market, saying it was tired of cutting output to guarantee $100 a barrel for high-cost rivals.

Paris climate summit: the climate circus comes to town; The soap opera of global climate talks has been playing for 20 years. As it comes to Paris on Monday, Suzanne Goldenberg reviews the tears, the bloodshed and the unspeakable catering
Suzanne Goldenberg – The Guardian
On the evening of 18 December 2009, Barack Obama and a trail of White House and State Department officials swept through a cavernous exhibition centre in Copenhagen and barged, uninvited, into a private meeting between the leaders of four powerful developing countries – China, India, Brazil and South Africa.

US ethanol output tops 1m barrels a day
Gregory Meyer in New York – FT
US ethanol output has topped 1m barrels a day for the first time as refiners take advantage of low corn prices and a caravan of motorists returning to American highways.

Top scientists accuse House panel of harassing climate researchers; Eight key scientific bodies warn Republican congressman Lamar Smith that his committee’s investigation into Noaa could have a ‘chilling effect’ on science
Oliver Milman in New York – The Guardian
Leading scientists have accused a Republican-led committee of subjecting climate researchers to politically motivated “harassment” amid an increasingly fractious investigation into the activity of the National Oceanic and Atmospheric Administration (Noaa).

Palm Oil Facing `Powerful Cocktail’ of El Nino, Fuel Demand
Anuradha Raghu, Yoga Rusmana – Bloomberg
El Nino event ranks among three strongest since 1950, WMO says
LMC’s Fry says full-blown El Nino could push prices to $800
Palm oil will extend its rally next year as the worst El Nino in almost two decades curbs output in the world’s biggest producers and Indonesia uses more for fuel, according to delegates at a conference in Bali. Futures climbed to the highest in almost three weeks.

World artists call on climate negotiators to reach ‘ambitious’ deal in Paris; More than 300 musicians, actors and writers including David Bowie and Emma Adam Vaughn
and a host of musicians, actors, artists, novelists and leading figures in the creative industries have called on negotiators at next week’s climate summit in Paris to reach a deal that staves off dangerous global warming.

UN low-carbon investor coalition busts sign-up target
By Mark Cobley – Financial News
A group of investors promising to switch billions out of companies with the biggest carbon emissions has exceeded expectations, by gaining commitments for the decarbonisation of $230 billion, well above its target.


China Stock Bulls Hit Breaking Point as State Dials Back Support
Kyoungwha Kim, Kana Nishizawa – Bloomberg
Shanghai Composite sinks 5.5% in deepest selloff since August
Policy makers are rolling back measures to prop up equities
For three weeks, China’s stock investors have kept their cool as the government dialed back an unprecedented campaign to prop up share prices. On Friday, they suddenly decided to head for the exits.

New Rules for Chinese Finance
By Editorial Board – Bloomberg
China has set about taming its unruly financial sector with characteristic vigor. Its government is busy investigating dubious banks, detaining suspected insider traders, and proposing overhauls of its regulatory system. All of which would be fine, so long as the authorities were also focused on a deeper concern.

Stock market fallout from Murakami probe seen limited
BY YUKO TAKEO – Japan Times
Japan stock watchers say the fallout from an investigation of Yoshiaki Murakami for market manipulation will be limited. The Securities and Exchange Surveillance Commission started a probe into the famous investor this week, according to an official at the market watchdog. While companies that Murakami has stakes in have tumbled, Sompo Japan Nipponkoa Asset Management Co. and Daiwa SB Investments Ltd. say the scandal won’t affect other equities nor detract from the nation’s efforts to overhaul corporate governance.

China to Probe Largest Brokerage for Alleged Rule Violations
Bloomberg News
Citic Securities says will cooperate, all operations normal
Firm’s president among executives already under investigation
China’s securities regulator will probe Citic Securities Co. for alleged rule violations in the latest move against the country’s largest brokerage, where some top executives have already been placed under investigation.

In Land of 3,500% Stock Gains, Crashes Are Quickly Forgotten
Bloomberg News
Despite 2015 rout, China shares have surged over the long run
Shanghai Stock Exchange celebrates 25th anniversary on Nov. 26
Fang Zhengdao set up shop on a rainy day in mid-November, a yellow umbrella in his hand and a handwritten sign by his side. Two months had passed since the great Chinese stock-market crash of 2015, and Fang figured it was time to start peddling equities again.

China Announces Military Overhaul to Make Army More Combat Ready
Bloomberg News
Moves better prepare country to project force beyond borders
Biggest overhaul of Chinese armed forces in six decades
President Xi Jinping announced a major overhaul of China’s military to make the world’s largest army more combat ready and better equipped to project force beyond the country’s borders.

25 Years of Stock Market Milestones for China
Bloomberg News
This year has been a wild ride for Chinese stocks, something that long-time investors have come to expect from a country that’s seen 55 bull and bear markets since the ruling Communist Party first allowed equity trading in 1990. As the Shanghai Stock Exchange celebrates its 25th anniversary on Thursday, here’s a look at some of the key milestones on China’s path from equity-market upstart to $7 trillion behemoth.

Frontier Markets

Brazil’s BM&FBovespa says arrest of board member won’t impact operations
BM&FBovespa SA, Brazil’s sole financial exchange, said that Wednesday’s arrest of billionaire financier and board member André Esteves is unlikely to impact operations.

Sebi may seek relief for commodity exchange warehouses
By Ram Sahgal, ET Bureau
There could soon be a glimmer of hope for hedgers and traders in farm futures such as pulses and oilseeds. Sebi is planning to write to the government to exempt exchange warehouses from stock limits under the Essential Commodities Act once prices of these commodities stabilise.

Structured commodities markets can help unlock Africa’s agricultural potential
Paul Boateng – Quartz
With agriculture making up approximately 65% of Africa’s labour force and 35% of the continent’s GDP, the sector’s capacity to help realise major continental development priorities is beyond doubt. Yet, as the IIED argues, the agricultural industry in many African countries has been unable to “meet its full potential as an employer, fair distributor of income, and national revenue earner”.

HSBC Said to Close Down Private Banking Operations in India
George Smith, Alexander Anto Antony – Bloomberg
HSBC Holdings Plc will close down its private banking business in India and transfer about 70 staff following a strategic review of the operations, people familiar with the matter said.

Buhari Bounce Becomes Bust as Nigeria Policies Irk Investors
Paul Wallace, Michael Cohen – Bloomberg
Growth rate set to slow to 16-year low of 3.3% as oil falls
Naira policy is biggest concern, Citigroup analyst Howell says
When Muhammadu Buhari clinched victory in Nigeria’s presidential elections in March, stocks soared as investors looked to the former military ruler to reverse decades of economic mismanagement and policy inertia. Now hopes have fizzled in his ability to turn around Africa’s largest economy and oil producer.

Piketty Says Russia Robbed of Bigger Reserves by Capital Flight
Olga Tanas, Paul Abelsky – Bloomberg
Inequality, lack of transparency sap reserves, economist says
Russia struggling to rebuild holdings after currency crisis
Count Russian reserves as another casualty of income inequality that Thomas Piketty believes is reshaping the world’s biggest economies.


DraftKings, FanDuel Argue Against New York Ban; Judge says he’ll make a ruling ‘very soon’ on whether to grant injunction request
The two largest daily fantasy sports operators appeared in court Wednesday to argue vigorously against the New York attorney general’s plan to shut them down in the state.

Fattest-Ever U.S. Cattle Herd Signals End to Record Beef Prices
Linly Lin – Bloomberg
Steers stuffed with cheap corn to limit losses as prices drop
Weight gain at slaughter plants biggest in more than a decade
Cattle in the U.S. are now the fattest they’ve ever been, signaling an end to the seven-year run of record beef prices just as losses begin to mount for American feedlot owners.

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