John Lothian Newsletter: NYSE, SEC Suspect Software Update Triggered Trading Halt; Brokerages battered by China market rout; Markets prepare for new Greek currency as Grexit prospect grows

Jul 9, 2015

First Read

Bits & Pieces
By John J. Lothian

It has been a week of market closures, some planned, others unplanned. First, we shut down the futures pits at the CME Group in Chicago and New York. Then the NYSE decides to take part of the day off when it discovers some issues with a software upgrade, according to reports.

I am signed up for market status texts reports from the NYSE and my phone started exploding with messages yesterday morning as NYSE started to discover its problems.

In other news, my friends at the Pathway to Adventure Council of the Boy Scouts of America report that Advantage Futures Trading Tech 300 kickoff merit badge fair day on July 15 has been sold out. We have 24 young men signed up for the chess and public speaking merit badges to be led by Advantage’s Terry Duffy. This is not the CME’s Terry Duffy, but still Terry Duffy.

The word is that GlenStar Properties, which owns the CBOT Building and is a MarketsWiki partner level sponsor, will be offering the engineering, electricity and search and rescue merit badges for the Trading Tech 300 program in August. Details and sign up to start soon.

I will be away at summer camp with my Boy Scout troop the week of July 18 to 24. With 9 new scouts in my troop, this will be quite the challenging week.

Finally, don’t forget to sign up your interns or yourself for our Summer Intern Education series in New York and Chicago. Details are available on www.marketswikieducation.com

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Don’t Panic! Market Fragmentation Will Save You!
By Matt Levine, Bloomberg
Okay here’s how you do stocks; A bunch of electronic trading firms post bids to buy shares, and offers to sell them, at the New York Stock Exchange, Nasdaq, the two BATS exchanges, seven other exchanges and like 40 dark pools.
jlne.ws/1eIFxv1

***** Too late for that Don’t Panic thing.

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Giuliani rips New York Stock Exchange for messaging
By Kevin Cirilli, The Hill
Former New York City Mayor Rudy Giuliani slammed New York Stock Exchange (NYSE) officials for their “atrocious” handling of a temporary shutdown of trading on Wednesday.
jlne.ws/1LYa5an

***** Shoot the messenger! There is a reason Giuliani is not president.

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Regulators on hook for China stock slide
Tom Mitchell in Beijing, FT
What began at the weekend as a behind-the-scenes effort by China’s undergunned markets regulator to reassure skittish investors has become an all-out push by the Communist party to safeguard its 25-year experiment with capital markets reform.
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****** The rule of law is one thing. Making up new rules on the fly, especially ones that restrict market participation, will have a chilling effect for a long time.

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Google shows top job ads to men, not to women
By Julia Carpenter, Chicago Tribune
Fresh off the revelation that Google image searches for “CEO” only turn up pictures of white men, there’s new evidence that algorithmic bias is, alas, at it again.
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****** Whatever happened to “Don’t be evil?” Or, how about “Don’t be stupid” for that matter?

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IBM Announces Computer Chips More Powerful Than Any in Existence
By JOHN MARKOFF, NY Times
IBM said on Thursday that it had made working versions of ultradense computer chips, with roughly four times the capacity of today’s most powerful chips.
jlne.ws/1J5YAHx

***** Computers just took another step closer to taking over the world.

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Pope Inspires Catholic Investors to Press Environmental Concerns; Institutions and religious orders reassess fossil-fuel exposure, push companies to address climate-change risks
By EMILY CHASAN And MAXWELL MURPHY, WSJ
The pope’s call to action on global warming is unleashing a new wave of shareholder activism by Roman Catholic investors.
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***** I told you, don’t mess with the Pope, especially one trying to save the world.

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’50-and-older crowd’ takes to the ring at Warehouse Gym & Boxing Club
Highland Park News – Chicago Tribune
Stu Unger of Deerfield won’t boast, so his buddies at the Warehouse Gym & Boxing Club in Highland Park do it for him.
“It’s good for older people to come in,” said Brandan Lawson of Gurnee, a trainer. “And Stu, he’s 68.”
The commodities broker will be the oldest athlete to box in the Warehouse Boxing Show, according to Pat Doljanin, Unger’s trainer. The event is open to the public and takes place Aug. 28 at the gym, 3570 Western Ave. in Highland Park.
jlne.ws/1ChduNY

***** Who said commodity brokers can’t take a punch? After all those elbows to the ribs in the trading pits, this should be a piece of cake.

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Rival Systems Expands Leadership Team with Sales and Marketing
Rival Systems
Rival Systems (“Rival”), a provider of comprehensive technology solutions for professional derivatives traders, today announced the appointments of Natasha Solis as Director of Sales and Business Development and Sara Goodman as Director of Marketing. As Rival prepares for the official launch of its low-latency derivatives trading and risk management platform later this year, Solis and Goodman will develop and implement the sales and marketing strategy.
jlne.ws/1ILTVif

***** So are Solis and Goodman rivals then?

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Innovation Incubation: TriOptima’s Mireille Dyrberg Looks at the Latest FinTech Trends
JohnLothianNews.com

For the past several years, derivatives conferences have been all about regulation. But as Dodd-Frank, MiFID II and other global regulations move through the rulemaking phase to implementation and beyond, the focus has shifted from regulation to innovation.

The 2015 FIA Europe International Derivatives Expo was all about fintech, and the top-to-bottom technology overhaul of the world’s financial markets. Mireille Dyrberg, chief operating officer of post-trade services giant TriOptima, spoke with John Lothian News’ Doug Ashburn at IDX 2015 about the innovation cycle, which technologies to keep an eye on, and the role of fintech incubators such as ICAP’s Euclid Opportunities program.
Watch the video »
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Lead Stories

NYSE, SEC Suspect Software Update Triggered Trading Halt
by David Michaels, Bloomberg
A computer malfunction that knocked out trading at the New York Stock Exchange for more than three hours Wednesday probably stemmed from a software update that went awry, said two people briefed on a preliminary review.
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**JK – Jurassic World opens. NYSE shuts down. Coincidence? “Hold onto your butts.”

Brokerages battered by China market rout
Jennifer Hughes in Hong Kong, FT
China’s biggest brokers rushed to reassure investors of their financial strength as stock markets — and their own shares — continued to tumble.
Shares in the six Hong Kong-listed brokerage houses have each halved since China’s markets peaked on June 12, leaving investors in the group’s pre-crash equity-raising splurge including Tencent, Hillhouse and Sequoia Capital nursing brutal losses.
jlne.ws/1ILJ1cg

NYSE’s Farley Pulled Plug When He Realized Trade Data Was Off
by Sam Mamudi, Matthew Leising, Bloomberg
A morning that started with a computer glitch at the New York Stock Exchange ended with a trading halt when President Tom Farley realized investors couldn’t rely on the market to provide accurate data.
jlne.ws/1MhnoPY

This Chart Shows How Complex the U.S. Stock Market Has Become; Stock market fragmentation has a silver lining
by Tracy Alloway, Bloomberg
In recent years, the U.S. stock market has changed dramatically, thanks to an influx of regulatory, technological, and competitive pressures. The increasing complexity of the market has often been blamed for the technological glitches that appear to be occurring with some frequency on the country’s stock exchanges.
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Robots on Wall Street? Firms Try Out Automated Analyst Reports; Startups use artificial intelligence to write research; services gain traction at banks, fund firms
By STEPHANIE YANG, WSJ
Each day, Wall Street churns out millions of words encouraging investors to buy or sell stocks, bonds and mutual funds.
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I.R.S. Cracks Down on Hedge Fund Tax Strategy
By ALEXANDRA STEVENSON, NY Times
Hedge funds that used a strategy to claim billions of dollars in tax savings will face new scrutiny from the government, according to guidance issued by the Internal Revenue Service on Wednesday.
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Beijing’s barrage of support stems China rout
Josh Noble in Hong Kong, FT
Beijing’s barrage of measures to calm investor nerves scored a victory on Thursday, with the stock market rising strongly after a string of sharp declines.
jlne.ws/1fqeCoC

China bans big shareholders from cutting stakes for next six months
BY SAMUEL SHEN AND BRENDA GOH, Reuters
China’s securities regulator took the drastic step of ordering shareholders with stakes of more than 5 percent from selling shares for the next six months in a bid to halt a plunge in stock prices that is starting to roil global financial markets.
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Trade halts add to China’s Potemkin market problem
By Quentin Webb, Reuters
Trading halts add to China’s Potemkin market problem. Boom, bust and bailout are already making it hard for outsiders to take Chinese stocks seriously. An extraordinary slew of trading halts, trapping investors in hundreds of stocks, makes things worse. Bosses and bourses are buying temporary respite at the cost of their own credibility.
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Who Blew Up China’s Stock Bubble?; Beijing urged people to buy stocks. Now it’s begging them to stop selling
by Brian BremnerEnda Curran, Bloomberg
In China, the invisible hand of the market sometimes needs help from the iron fist of the state. That’s certainly true after a meltdown vaporized $3.5 trillion in the value of shares traded on the Shanghai and Shenzhen exchanges.
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Hayes Said Traders Would Help Rig Libor for a Mars Bar
by Liam Vaughan, Gavin Finch, Bloomberg
Libor rigging was commonplace at UBS Group AG and was as easy as offering colleagues a bar of chocolate, Tom Hayes said in a nine-year-old Internet message shown to jurors at his criminal trial.
jlne.ws/1UA6WA7

Former trader Hayes ignored 2009 warning, Libor trial hears
BY KIRSTIN RIDLEY, Reuters
Tom Hayes, the former trader on trial on Libor interest rate rigging charges, told a London court on Wednesday he ignored a 2009 warning to stop trying to influence rates in part because he was pre-occupied with moving jobs.
jlne.ws/1MhnMy5

Markets prepare for new Greek currency as Grexit prospect grows
Roger Blitz and Philip Stafford in London, FT
For months “Grexit” has been a regular topic for speculation among foreign currency specialists. But the working assumption has been that all parties in Greece’s drawn-out saga would find a way of resolving their differences and keep the country in the eurozone.
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An Offline N.Y.S.E. Makes Barely a Ripple in a Day’s Trading
By MICHAEL J. de la MERCED, NY Times
Investors who wanted to buy and sell shares of companies listed on the New York Stock Exchange, such as I.B.M. or Target, were still able to do so with ease on Wednesday.
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Regulatory

Treasury Secretary Says ‘Wall Street Reform Is Working’; Lew says U.S. must ‘sustain and build on the progress we have made,’ calls on regulators to ‘finish important rules’
By RYAN TRACY, WSJ
U.S. Treasury Secretary Jacob Lew defended the Dodd-Frank financial overhaul Wednesday, nearly five years after it became law in July 2010.
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Statement on NYSE
Chair Mary Jo White, SEC
“We are in contact with NYSE and are closely monitoring the situation and trading in NYSE-listed stocks. While NYSE is working to resolve the situation, NYSE and NYSE MKT stocks continue to trade normally through other trading venues.”
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Stock crash sparks calls for super-regulator
BY LU JIANXIN AND PETE SWEENEY, Reuters
Chinese stock traders want Beijing to create a super-regulator to take over the investor relations and communication duties of existing regulators, which they say have co-ordinated poorly in their handling of the country’s stock market crash.
jlne.ws/1JRhQ1o

Xiao Gang: chairman of China’s embattled markets regulator
Tom Mitchell in Beijing, FT
Xiao Gang, the head of China’s embattled stock markets regulator, is a central bank veteran who has played a crucial role in the reform of the country’s banking sector.
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China public security ministry targets illegal market activity
Reuters
China’s public security ministry said it will crack down on illegal activity in equities and futures markets following what it called “abnormal volatility” on the country’s exchanges.
jlne.ws/1dO2Na8

Self-Regulatory Organization (SRO) Rulemaking and National Market System (NMS) Plans
SEC

  • CBOE: Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to Rule 6.49A (Release No. 34-75373; File No. SR-CBOE-2015-063; July 7, 2015)/li>
  • DTC: Notice of Withdrawal of Proposed Rule Change Regarding the Acknowledgment of End-of-Day Net-Net Settlement Balances by Settling Banks (Release No. 34-75380; File No. SR-DTC-2015-003; July 7, 2015)/li>
  • FINRA: Notice of Filing of a Proposed Rule Change to Amend FINRA Rule 2210 (Communications with the Public) (Release No. 34-75377; File No. SR-FINRA-2015-022; July 7, 2015); see also Exhibit 5/li>
  • NASDAQ: Notice of Filing and Immediate Effectiveness of Proposed Rule Change to Amend the Definition of Designated Retail Order in Nasdaq Rule 7018 (Release No. 34-75375; File No. SR-NASDAQ-2015-066; July 7, 2015); see also Exhibit 5

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Exchanges & Trading Facilities

Deutsche Börse and Shanghai Stock Exchange celebrate first successful year of market data cooperation; Eight clients from mainland China signed in total
Deutsche Börse
Deutsche Börse and Shanghai Stock Exchange (SSE) celebrate the anniversary of their successful market data cooperation. Three new clients signed today to get access to key Deutsche Börse market data via SSE. Now a total of eight clients use this connection.
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Exchanges and their customers have a history of halts
Robin Wigglesworth, FT
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United, NYSE technical troubles not caused by ‘nefarious’ actor -U.S. Homeland Security chief
Reuters
U.S. Homeland Security Secretary Jeh Johnson said technical problems reported on Wednesday by United Airlines and the New York Stock Exchange were apparently not related to “nefarious” activity.
jlne.ws/1HhGeoR

‘My Handheld’s Down!’: How the Big Board Went Dark
by Sam Mamudi, Leslie Picker, Ryan Hoerger, Bloomberg
The first sign of trouble on the New York Stock Exchange was a color — a sickly yellow. On the hand-held computers on the cavernous trading floor, that color meant one thing: the Big Board was down.
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HKFE Announces Revised Margins for Futures Contracts
HKEx
jlne.ws/1TnygQL

Latest Derivatives Market Research Reports for June 2015
HKEx
jlne.ws/1AK4xtn

No After-Hours Futures Trading Session Today Due to Issuance of Typhoon Signal No 8
HKEx
Hong Kong Exchanges and Clearing Limited (HKEx) has announced that there will be no After-Hours Futures Trading in its markets today due to the issuance of Typhoon Signal No 8.
jlne.ws/1Cr2duH

Dubai Mercantile Exchange And Abu Dhabi Securities Exchange Sign MoU To Drive Development Of UAE & Regional Capital Markets – Leading Regional Exchanges To Develop New Financial Products To Further Attract Investors
Mondovisione
The Dubai Mercantile Exchange (DME) and Abu Dhabi Securities Exchange (ADX) today signed a Memorandum of Understanding (MoU) in a move that will see two of the leading regional exchanges collaborate on several fronts to further drive the growth and development of capital markets in the UAE and the wider Middle East region.
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Greece Shuts Markets Through July 13 as Officials Debate Bailout
by John Detrixhe, Bloomberg
Greece extended the closure of its stock exchange and electronic bond market again as officials attempt to pull together a plan to unlock European bailout funds.
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Hedge Funds & Managed Futures

The Man Who Taught Mutual Funds How to Invest in Startups
by Leslie Picker, Bloomberg
By the age of 6, Henry Ellenbogen knew he wanted to be an investor. Not the kind he is today at T. Rowe Price Group Inc., where he manages $18.7 billion. He wanted to invest in an Atari game console.
jlne.ws/1HMzKSq

Top Brazil hedge fund Verde sees domestic assets still falling
Reuters
Verde Asset Management, Brazil’s largest hedge fund, reinforced larger-than-benchmark bets on a weaker real, rising global equities and higher domestic borrowing costs, underscoring expectations that local asset prices will keep trending down in dollar terms.
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Wealth Adviser: The Case Against Client-Account Minimums
By PATRICK GRAHAM, WSJ
Financial advisers who have client-account minimums are making a mistake, says Maryland-based adviser Mark Avallone. Why? “There is a huge need for financial advice for lower-net-worth individuals, usually people in their mid-20s to 40s,” he writes on Wealth Adviser at WSJ.com. He lists three simple reasons why advisers should eschew accounts minimums: 1. Such clients or prospects have family, friends and acquaintances who can be tapped. 2. Working with younger clients translates into long-term relationships in which their money will grow over time. 3. Having a younger client base can make the practice more attractive to potential buyers.
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INSIGHT-U.S investors not bailing on China stocks yet
By David Randall and Timothy Mclaughlin, Reuters
Some U.S. investors say China’s efforts to prop up its stock market had the opposite effect, though the sell-off now offers buying opportunities at what they say are panic-driven prices.
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Bad Math and a Coming Public Pension Crisis
By MARY WILLIAMS WALSH, NY Times
When Jim Palermo was serving as a trustee of the village of La Grange, Ill., he noticed something peculiar about the local police officers and firefighters. They were not going to live as long as might be expected, at least according to pension tables.
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Gross Didn’t Execute China Short Trade That He Suggested
by Mary Childs, Bloomberg
Bill Gross, who recommended shorting the Chinese stock market last month before it plunged, didn’t actually do the trade.
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China’s Stock Sale Ban Draws Scorn From Templeton, Wells Fargo
by Ye XieBelinda Cao, Bloomberg
Templeton Emerging Markets Group calls it an act of “desperation.” UBS Wealth Management labels it “extreme.” And Wells Fargo Funds Management says it just “postpones the inevitable.”
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Banks & Brokers

Ejection of St Antony puts Barclays on the path to righteousness
Kate Burgess, FT
It was pretty clear months ago that St Antony of Barclays was not long for this corporate world but the speed of the bank chief executive’s departure was breathtaking.
jlne.ws/1G9f6ED

JPMorgan to Pay $136 Million to Settle Debt Collection Case
NY Times
WASHINGTON — JPMorgan Chase will pay $136 million to settle charges that it used illegal tactics to pursue delinquent credit card borrowers, the Consumer Financial Protection Bureau announced on Wednesday.
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Investors grumble as China leaders stay mum on stocks rout
BY BENJAMIN KANG LIM, Reuters
China’s wild stock market rout is a challenge not a crisis, say people close to the country’s leadership.
jlne.ws/1ILLfIE

U.S. bank earnings to be hit by bond trading slump -analysts
\BY LAUREN TARA LACAPRA, Reuters
Many Wall Street banks are expected to report underwhelming second-quarter results next week, after light bond market activity in the spring worsened into a downturn by June, analysts said.
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Clearing & Settlement

DTCC adds Turley to board
Global Investor Magazine
Jim Turley, co-head of group technology and operations (GTO) for Deutsche Bank has been elected to the Depository Trust & Clearing Corporation’s (DTCC) board of directors. Turley will replace former director John Parker, executive vice president at Wells Fargo Advisors and head of services and operations, who did not stand for re-election at the annual shareholders meeting and has left the board after five years of service.
jlne.ws/1JRgYJY

Automation could determine OTC swaps survivors
Automated Trader
Speed and certainty of execution, as well as clarity on cost of trade, are going to define which players stay in OTC derivatives markets in a MiFID II environment. The situation, said Christian Lee, partner and head of Clearing, Risk and Regulation at Catalyst, a consultancy, is a bit like what happened to the futures markets in the 90s, with open outcry pits now almost entirely gone.
jlne.ws/1JRh3NM

European Securities and Markets Authority final report on extension of scope of interoperability arrangements – Lexology
The July 2 recommends that the interoperability provisions in EMIR be extended to Exchange-Traded Derivatives, as one interoperability arrangement already exists (between LCH.Clearnet Ltd and Oslo Clearing), as is the general framework for assessing the risk involved as a result. This proposal will next be considered by the European Commission and may prove to be controversial.
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Indexes & Products

A Record Level Of 40 Billion US Dollars In Net New Assets Was Gathered By ETFs And ETPs Listed In Europe In The First Half Of 2015 According To ETFGI
Mondovisione
A record level of US$40 billion in net new assets (NNA) was gathered by ETFs and ETPs listed in Europe in the first half of 2015, surpassing the prior record of US$32 billion gathered in the first half of 2014, according to ETFGI’s preliminary ETF and ETP global insights report for the first half of 2015. At the end of June 2015, the European ETF/ETP industry had 2,118 ETFs/ETPs, with 6,502 listings, assets of US$499 Bn, from 50 providers listed on 25 exchanges in 21 countries.
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Commodity Indices Can Outsmart Another 45% Oil Drop
Indexology: S&P Dow Jones Indices
Many key factors are currently driving oil down and the bloodshed might not be over. As mentioned in a recent CNBC interview, from current levels, the S&P GSCI Crude Oil Total Return could drop another 45% before surpassing energy’s worst historical loss of 78.4% that happened in 2008-2009.
jlne.ws/1JRhoQx

Press Release: S&P Dow Jones Indices Statement on NYSE Floor Trading Halt Impact on Previously Announced Changes to the S&P 500
NASDAQ.com
S&P Dow Jones Indices (S&P DJI) has announced that it will not delay the implementation of the previously announced changes to the S&P 500, S&P MidCap 400 & S&P SmallCap 600 scheduled to take place after the close of trading July 8.
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Technology

NYSE Trading Glitch Reflects Persistent Problems With Financial IT
By STEVEN NORTON, WSJ
The computer glitch that led to a halt in trading at the New York Stock Exchange on Wednesday shows that even after years of investments in resilient and redundant networks, problems with financial technology are remarkably persistent.
jlne.ws/1HQc3qp

Cisco to invest $1bn in UK tech industry
Daniel Thomas and Murad Ahmed in London, FT
Cisco is promising to spend $1bn in the UK tech industry through a series of corporate acquisitions, venture capital investments and education programmes in the next five years.
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Microsoft’s Four Most Costly Blunders Besides Nokia; Remember the Red Ring of Death?
by Dina Bass, Bloomberg
Barely a year after Microsoft paid $9.5 billion for Nokia’s handset unit, the company says it has lost $7.6 billion of that value. That’s equal to about 95 percent of what Microsoft paid for the assets, excluding the cash that came with them. Along with a hefty writedown, Microsoft plans to cut as many as 7,800 jobs, many of them related to the purchase of the Finnish mobile phone maker.
jlne.ws/1dO1MyO

Boat Adds Russian Instruments To Its Trade Reporting Service
Mondovisione
Boat Services Ltd has confirmed they now support the post trade publication of Russian OTC trading, by including stocks listed on the Moscow Exchange (MOEX). Boat is the only exchange-independent trade data monitor (TDM), and the only one recognized by both the Financial Conduct Authority (FCA) and SIX Swiss Exchange.
jlne.ws/1D2I8G5

Software update may have triggered NYSE trading halt – Bloomberg
Reuters
A computer malfunction that forced the New York Stock Exchange to suspend trading for more than three hours on Wednesday probably stemmed from a software update that went awry, Bloomberg reported, citing two people briefed on a preliminary review.
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Enforcement

China Security Agency to Investigate ‘Malicious’ Short Sales
Bloomberg
China’s domestic security agency is teaming up with the securities regulator to probe short selling, as the government works to stem a stock plunge that has erased $3.9 trillion in market value, the state news agency said.
jlne.ws/1NVkykN

Environmental & Energy

The Tiny Islands at the Heart of Germany’s Offshore Wind Boom; Renewables industry revives remote North Sea archipelago known for birds and tax-free liquor
by Nicholas Brautlecht, Tino Andresen, Bloomberg
An industrial revolution is sweeping over Heligoland, a tiny German North Sea archipelago once annexed by the British, and a haven for bird watchers until the wind farmers moved in two years ago.
jlne.ws/1dO1U1c

A Colorado Coal Mining Town Struggles to Define Its Future
By JACK HEALY, NY Times
For more than a century, the economy and identity of this tiny community wedged into the mountains have been defined by the coal heaps, railroad tracks and deep underground mines that filled train cars with coal and miners’ pockets with money. “Welcome to Somerset,” says the blue sign at the entrance to town, “Coal mining town since 1896.”
jlne.ws/1LTzv86

Oman to Build Giant Solar Plant to Extract Oil; Facility is the latest measure in Oman’s fight to halt a decline in production capacity
By GEORGI KANTCHEV, WSJ
For years, the unforgiving desert of Oman has required special tools to extract some of the planet’s heaviest crude. The Persian Gulf sultanate’s repertoire now includes a technology not generally associated with oil pumping: solar-powered oil recovery.
jlne.ws/1D2H4lm

Oil Rout Seen Ending as Demand Trumps China’s Market Crash
by Grant Smith, Bloomberg
Oil’s biggest slump in four years will lose momentum because the plunge in Chinese equities and Greece’s economic crisis won’t dent global demand, according to Morgan Stanley, UBS Group AG and Societe Generale SA.
jlne.ws/1D2H0C8

Clean energy investment set to surge as oil left ‘in limbo’, Chatham House finds
By James Phillips – BusinessGreen
“Strong” climate change policies will cause investments in energy efficiency, renewable energy, and biofuels to climb while fossil fuel supply will dwindle, according to new research from Chatham House.
jlne.ws/1HdlRHt

Technical solutions alone can’t fix climate change: scientists
By Laurie Goering – Thomson Reuters Foundation
Dealing with climate change and its risks will require not only technical responses like drought-resilient crops and higher sea walls but also reshaping economic and political incentives that are driving global warming, scientists said on Wednesday.
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Asia-Pacific

China’s Market Rescue Makes Matters Worse
by Kyoungwha Kim, Kana , Takeo, Bloomberg
That’s always been a difficult question in a country where individual investors drive more than 80 percent of trades on local stock exchanges. Now, though, finding the answer has become harder than ever.
jlne.ws/1HfTpn9

China Market Rout Spreads From Stocks to Price of Pig Food
Bloomberg
China’s stock rout spread to the country’s commodities markets as investors rushed to raise cash.
jlne.ws/1Cp9n2K

This Is Why So Many Chinese Companies Are Suspended; China’s corporations have been big fans of stock-based loans, too
by Tracy Alloway, Bloomberg
At least 1,331 companies have halted trading on China’s mainland exchanges, freezing $2.6 trillion of shares, or about 40 percent of the country’s market value, Bloomberg reported on Wednesday.
jlne.ws/1TnzjA6

Iron ore tumbles amid China contagion
Neil Hume, Commodities Editor, FT
Iron ore, the key ingredient in steelmaking, suffered its biggest one-day fall since records began, dropping by more than 11 per cent to a seven-year low as worries about the Chinese economy continued to mount.
jlne.ws/1Mhm8wq

Is that what China’s “whatever it takes” looks like?
David Keohane, FT
A mangled, half-frozen, market up 6 per cent? With one eye on our now abused ‘rule’, here’s the Shanghai Comp at pixel (click through the chart for the updated price from Google Finance):
jlne.ws/1Hklp9q

China stems stocks rout, but market faces lengthy hangover
BY KOH GUI QING AND KAZUNORI TAKADA, Reuters
Beijing’s increasingly frantic attempts to stem a stock market rout were finally rewarded as Chinese shares bounced around 6 percent on Thursday, but the costs of heavy-handed state intervention are likely to weigh on the market for a long time.
jlne.ws/1RlYwxd

Unraveling the China Puzzle; As investors grapple with fallout from the Chinese selloff, they attempt to position for what may come next
WSJ
The rout of the Chinese stock market has become a litmus test for investors world-wide. Does the decline presage darker times ahead for the Chinese—and potentially global—economy? Or is it a short-term occurrence that may soon be forgotten?
jlne.ws/1JR9KFL

Hong Kong IPO Bankers Face Long Summer as Stock Rout Widens
by Vinicy Chan, Bloomberg
It’s looking like a dry summer for Hong Kong bankers, as a widening Chinese market rout threatens a revival in the city’s new listings.
jlne.ws/1JVWOf9

Frontier Markets

NYSE halt: Sebi, exchanges review risk management systems; They expressed satisfaction about the systems after this ‘urgent review’ and said nothing was found amiss
Business Standard
With a major ‘glitch’ causing nearly four-hour trading halt at the New York Stock Exchange (NYSE) last night, regulator Sebi and stock exchanges here have initiated an urgent review of the overall risks management and disaster recovery systems of the Indian markets.
jlne.ws/1Cr6VZn

BSE proposes delisting over 1,000 stocks suspended for 7 yrs; Says shares of these companies can be suspended after giving their shareholders sufficient opportunity to exit
Business Standard
In a major clean-up exercise, top exchange BSE has proposed delisting more than 1,000 companies from its platform as trading in their shares have remained suspended for more than seven years for various penal reasons.
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NSEL scam: Bombay HC reserves order on MPID Act applicability
MPID Act says ‘deposit’ accepted by a financial establishment should be retained, processed and returned by it with or without interest on maturity
Dilip Kumar Jha, Business Standard
The Bombay High Court on Tuesday reserved the order in the case filed by National Spot Exchange (NSEL) challenging applicability of the Maharashtra Protection of Interest of Depositors (MPID) Act in the Rs 5,600 crore payment crisis at the exchange.
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