Jorge Alegría returns to the Mexican Stock Exchange as CEO after the departure of Oriol Bosch; Washington’s Pivot on Bank Rules Could Free Up Tens of Billions

May 23, 2024

First Read

Hits & Takes
John Lothian & JLN Staff

Yesterday was Bitcoin Pizza Day, the annual celebration in the cryptocurrency community that commemorates the first real-world transaction involving bitcoin. On May 22, 2010, Laszlo Hanyecz, a programmer from Florida, paid 10,000 bitcoins (valued at around $41 at the time) for two Papa John’s pizzas.

Acuiti today released its Q2 2024 Proprietary Trading Management Insight report in collaboration with Avelacom. The report examines investment trends in front office software, headcount growth plans, strategies for trading in India, and hot topics like ETFs and the new BGC Group exchange, FMX. It explores whether proprietary firms are shifting to in-house software builds, their 2024 headcount plans, challenges in accessing India’s market, and opinions on the potential success of BGC’s new exchange and the competition for the EURSTR.

Simon Rostron, managing director at Rostron Parry Limited, reported on LinkedIn a new record gold price. He wrote, “The twice daily LBMA Gold Auction price, the longest-established and most respected benchmark, ended the week at an all time record high of $2402.60. (Previous record $2401.50 – p.m. 12th April).”

Gregory Meyer is starting a new position as US consumer editor at the Financial Times, he shared on LinkedIn. Meyer most recently served as deputy US news editor, but had spent a couple of years as a natural resources correspondent and nine and a half years as an energy and commodities markets reporter.

The Wall Street Journal reported that former President Donald Trump said in a post on his Truth Social platform on Thursday that Wall Street Journal reporter Evan Gershkovich would be released almost immediately from Russia after the presidential election, “but definitely before I assume office.” According to the Journal, “The Kremlin responded to the former president’s assertion saying ‘there is no contact between Putin and Trump on this matter.'”

I have two comments here. First, if Donald Trump can get Evan Gershkovich out of Russia, he should do it right now. Second, Donald Trump is no Jesse Jackson.

Also, OpenAI and News Corp have struck a major content-licensing deal valued at over $250 million in which OpenAI will use content from News Corp’s publications, including The Wall Street Journal and others, to enhance its technology, The Wall Street Journal reported.

Olivier Raevel has started his new position as chief strategy officer, executive program at INSEAD, he reported on LinkedIn. INSEAD bills itself as “The Business School for the World.” I met Olivier when he was head of commodities markets at Euronext. He participated in the JLN Open Outcry Traders History Project and was the first (and only so far) trader from the International Petroleum Exchange to participate.

Are you looking for a reason to go to Egypt next week? Look no further than the Malaysian Palm Oil Forum Egypt organized by Malaysian Palm Oil Council (MPOC) at the Triumph Luxury Hotel to be held on May 28.

Corties Draper is featured in a video produced by Roosevelt University and published on LinkedIn highlighting the program’s focus on integrating computer skills like R and coding essential for today’s workforce.

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


Our most read stories from our previous edition of JLN Options were:
The Market’s Fear Gauge Is Signaling Trouble. What to Expect. from Barron’s
The stock market has already chosen a winner in the 2024 presidential election from MarketWatch
Citi Trader Got 711 Warning Messages Before Sparking Flash Crash from Bloomberg ~JB

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Futures Hall of Famers Moore and Heinz Reflect on Trading Careers in JLN Interview

BOCA RATON, Fla. (JLN) – Robert Moore and James Heinz, two veteran traders recently inducted into the FIA Futures Hall of Fame, reflected on their decades-long partnership and the evolution of the industry in an interview with John Lothian News.

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Scarlett Johansson is right: AI companies must be more transparent; A new index shows that they have a long way to go, including on data access and model trustworthiness
John Thornhill – Financial Times
In the film Her, a lonely writer called Theodore Twombley falls in love with the disembodied voice of Samantha, a digital assistant played by the actor Scarlett Johansson. “I can’t believe I’m having this conversation with my computer,” Twombley tells Samantha. “You’re not. You’re having this conversation with me,” Samantha coos. The genius of Spike Jonze’s script is its exploration of the borderlands between the artificial and the real. But the science fiction film, released in 2013, has acquired ironic resonance today after OpenAI launched its latest GPT-4o multimodal artificial intelligence chatbot, seemingly mimicking Johansson’s voice.

****** Sometimes I wonder if there is any integrity to all the brains behind AI. And sometimes I realize there is not.~JJL


Wall Street’s Five-Day Office Rules Aren’t Our Fault, Watchdog Finra Says
Gillian Tan – Bloomberg
As Wall Street bosses warn employees that regulatory changes are about to end their days of working from home, the watchdog in charge has a blunt message: Stop blaming us. “There is no rule requiring registered persons to work from an office five days a week,” said Kayte Toczylowski, head of member relations and education at the Financial Industry Regulatory Authority. A slate of Finra rule changes set to take effect in coming weeks is meant to preserve workplace flexibility, Toczylowski said. She was responding to reports that more firms, such as Barclays Plc, are weighing full-time office mandates, with some bosses pointing to Finra in conversations with staff.

***** The FINRA rule is six days a week, not five, just for the record. FINRA allows you a day of rest, just like God.~JJL


A Brief History of Wall Street’s Fat Finger Problem
Jennifer Surane and Eric Lam – Bloomberg
A single Citigroup Inc. trader caused havoc in European stocks in 2022 after the simplest of blunders: The staffer entered the value of stocks they wanted to buy into the wrong field of the bank’s trading system. The mistake triggered a five-minute selloff in European stocks from France to Norway, with $1.4 billion worth of equities sold in error. Citing a litany of control failures, UK regulators handed down a £62 million ($79 million) fine on May 22 that, together with the trading losses from that day in 2022, mean the erroneous trade cost the desk nearly two years of revenue.

****** In the beginning, there was point and click and it was good. But then there was the double double click and it was not so good.~JJL


Wednesday’s Top Three
Our top clicked item Wednesday was the World Federation of Exchanges’ research report, The effect of DLT settlement latency on market liquidity. Second was the press release announcing the WFE report. Third was the CME Group’s announcement of its APAC Crude Oil Forum taking place on June 6, 2024.



Lead Stories

Jorge Alegria returns to the Mexican Stock Exchange as CEO after the departure of Oriol Bosch; The manager, who will replace Jose-Oriol Bosch, returns to the Mexican Stock Exchange after almost a decade
Michelle del Campo and Italia Lopez – Bloomberg
Grupo Bolsa Mexicana de Valores (BMV), the main stock exchange center in Mexico, announced the departure of its general director, Jose-Oriol Bosch, after nine years of leading the company. Jorge Alegría will assume general management, marking his return after his departure almost a decade ago, in May 2015. In a statement, the BMV reported that the appointment occurred in accordance with a succession plan and that Alegría will soon take office, while Jose-Oriol Bosch will remain at the institution during a transition period.

Washington’s Pivot on Bank Rules Could Free Up Tens of Billions; By reducing additional capital requirements, banks would be freer to reward shareholders and clients
Telis Demos – The Wall Street Journal
The biggest banks seem poised to win a reprieve in Washington, maybe even to the tune of tens of billions of dollars. The Wall Street Journal reported that regulators are considering making significant changes to a recent proposal that would require banks to have more capital. This comes after intense lobbying by the biggest banks, led by JPMorgan Chase’s Jamie Dimon. The upshot is that modifications to the proposal could on average cut the increase in requirements for big banks roughly in half from what was originally floated, the Journal reported-a development that will have some bank shareholders and customers cheering, even if critics say it leaves the financial system more vulnerable to shocks.

What Trump 2.0 Could Mean for the Federal Reserve; A second Trump administration could shake up personnel and financial regulation at America’s central bank, people close to his campaign said.
Jeanna Smialek – The New York Times
Former President Donald J. Trump relentlessly criticized the Federal Reserve and Jerome H. Powell, its chair, during his time in office. As he competes with President Biden for a second presidential term, that history has many on Wall Street wondering: What would a Trump victory mean for America’s central bank? The Trump campaign does not have detailed plans for the Fed yet, several people in its orbit said, but outside advisers have been more focused on the central bank and have been making suggestions – some minor, others extreme.

Wall Street braces for faster trade settlement
Laura Matthews and Carolina Mandl – Reuters
U.S. trading moves to a shorter settlement on Tuesday, which regulators hope will reduce risk and improve efficiency in the world’s largest markets, but is expected to temporarily increase transaction failure for investors. To comply with a rule change the U.S. Securities and Exchange Commission (SEC) adopted last February, investors in U.S. equities, corporate and municipal bonds and other securities must settle their transactions one business day after the trade instead of two as of May 28. Canada, Mexico and Argentina will speed up their market transactions a day earlier, on Monday. The UK is expected to follow in 2027, and Europe is considering the change.

China State Media Warns on Speculative Trading in Special Bonds; Newly issued note skyrocketed on exchanges on Wednesday; Most bond trading takes place in more liquid interbank market
Bloomberg News
China’s state media urged investors to refrain from engaging in speculative trades in the latest special sovereign bond, as an illiquid part of the market saw a retail buying scramble Wednesday. The Shanghai and Shenzhen exchanges had to halt trading in the security Wednesday on the bond’s debut as retail investors drove it as much as 25% higher. The 30-year security was just issued on Friday and its price was little changed in the separate interbank market where most bond trading takes place, largely between institutions.

Confidencial Information: Jorge Alegría’s return to the BMV generates reactions from the stock market union
EL CEO (opinion)
Although during his time at the Derivatives Market (MexDer) he did not achieve the expected results, the Mexican Stock Exchange (BMV) appointed Jorge Alegría as its new general director, replacing Jose-Oriol Bosch Par. The announcement of Jorge Alegría’s return was not well received by the stock market industry. We are talking about brokerage house executives, bankers and even people within the BMV, who predict that this decision will reverse the limited achievements achieved by the group in the last nine years.

Swiss Parliament to Publish Credit Suisse Report in December
Bastian Benrath – Bloomberg
The Swiss parliament’s commission reviewing the collapse of Credit Suisse will publish its report in December, it said in a statement on Thursday. The commission has been investigating behind closed doors whether authorities acted properly during the crisis that led to the government-orchestrated takeover by UBS Group AG. It was the first such probe in almost 30 years.

General counsel seek clarity on rising geopolitical risks; Dealing with political, regulatory and technological matters is increasingly part of the job for in-house lawyers
Joe Miller – Financial Times
As Iran was firing dozens of long-range missiles into Israel, in April, Sean West’s phone would not stop ringing. The Los Angeles-based geopolitics analyst was fielding inquiries not from leaders on the global stage but from chief legal officers inside some of the world’s largest companies. They were worrying about what this latest escalation of the Middle East conflict would mean for their businesses’ supply chains, employees and customers.

Lion’s share of proprietary firms preparing to increase trading headcount in 2024; The expected additional headcount follows a period of strong performance for proprietary trading firms, according to Acuiti’s latest report.
Annabel Smith – The Trade
Almost 90% of proprietary trading firms are planning to increase their trading headcount throughout the remainder of this year, new research by Acuiti and Avelacom has found. According to the report, the expected boost in headcount follows a period of strong performance by prop firms and marks significant uptick from last year’s survey which found just 63% of firms preparing to expand their trading teams.

Ex-Citi banker says she was fired for refusing to give false data to regulator
Saeed Azhar – Reuters
A former managing director at Citigroup sued the bank and its chief operating officer on Wednesday, alleging she was fired for opposing what she said were attempts to give regulators false information. Kathleen Martin, a former managing director Citi hired in 2021 to help with data issues, said in a lawsuit filed in a New York district federal court that her supervisor COO Anand Selva wanted her to hide “critical information” from the Office of the Comptroller of the Currency (OCC) about the bank’s data governance metrics.

Hwang Defense Shows Cracks in Archegos’ Alleged ‘Corrupt Core’
Bob Van Voris and Chris Dolmetsch – Bloomberg
One of the prosecution’s star witnesses against Archegos Capital Management founder Bill Hwang acknowledged on cross-examination that he had something of a beef with the other key witness. Scott Becker, Archegos’ former risk management head, has been on the stand since Monday but faced his first questioning by defense lawyers on Wednesday. Hwang’s lawyer, Barry Berke, asked Becker if he believed former Archegos head trader William Tomita often took credit for his work. Wasn’t Becker so angry about it at one point that he “wished upon Mr. Tomita some nasty and unspeakable act?” Berke asked. That question drew an objection, but Becker answered a different version of it.

A Hot Button Issue for SEC Threatens to Erode Ether-ETF Demand; Prospective Ether ETF issuers have removed plans for staking; Lack of yield from staking may make the funds less attractive
Muyao Shen – Bloomberg
Many in the crypto market believe that a key change made to some applications for proposed spot-Ether exchange traded funds will be good for the Ethereum blockchain, while putting the prospective ETF products themselves at a disadvantage. Issuers including Fidelity Investments and Ark Investment Management have eliminated plans for “staking” the Ether they would purchase for the proposed funds if they’re approved. Staking is industry jargon for the mechanism that runs Ethereum and other so-called proof-of-stake blockchains. It involves locking up deposits of cryptocurrency in order to help validate transactions and secure the network in exchange for rewards paid for doing that work.

Citi Missed a Fat Finger; Also Revolut hostage selfies, backdated Damien Hirst NFTs and endless shrimp denials.
Matt Levine – Bloomberg
Oops. Sometimes banks get in trouble with regulators for misconduct, and the regulators fine the banks and issue an order describing the misconduct, and I read a description of the misconduct and am like “ah yes that sounds like misconduct.” Other times, I read the description and am like “hmm I guess but that’s kind of a gray area and I can understand why they thought it was allowed.” (Perhaps this is just me.) But sometimes, I read the description of the misconduct and am like “well that’s just using a computer, that’s just how computers work, anyone would mess that up, you can’t blame them for that.” Of course there the misconduct is in designing the computer system in such a way that people will inevitably mess it up.

China’s Buying of Key Russian Oil Could Be Lowest Since 2021; Teapots have bought about 12 million barrels of ESPO for June; Profits for making diesel in Shandong have halved this year
Bloomberg News
China’s independent oil processors are on track to take the lowest volume of Russian ESPO crude in over three years as refining profits shrink and other grades are offered at cheaper prices. Refiners have purchased about 12 million barrels of ESPO for June arrival so far this month, which is poised to be the lowest since May 2021, according to Kpler. While the trading cycle is still open for around another week in Asia, weaker Chinese buying has given India an opportunity to take more cargoes.

Jamie Dimon admits to ‘tough’ going for JPMorgan in China; Investment banking business has ‘fallen off a cliff’, chief executive tells bank’s flagship Shanghai conference
Thomas Hale – Financial Times
JPMorgan chief executive Jamie Dimon said on Thursday that parts of its business in China had “fallen off a cliff” in recent years, highlighting the challenges western institutions face in the country’s investment banking sector. In private comments, confirmed by the Financial Times, to attendees at the bank’s flagship conference in Shanghai, Dimon said that business had “grown” but it had been “tough” and that he remained optimistic on new areas of growth, after a wave of regulatory approvals.

Most of us have too much in bonds; Investors are going to be investing for so long that a fixed income-laden portfolio is far from optimal for them
Charley Ellis – Financial Times
It has long been shown that the returns on bonds are lower than those for equities for long-term investors. And most investors are going to be investing for so long that a bond-laden portfolio is far from optimal for them. A century ago there was a near monopoly of bonds in investor portfolios until economist Edgar Lawrence Smith proved that higher returns that could be earned by investing in equities. Gradually, over the following decades, a consensus developed that a 60/40 stock-to-bond ratio was “prudent” for both individuals and pensions and endowments.

Segantii to return capital amid Hong Kong insider dealing probe; Hedge fund tells investors firm will ‘return their capital in an orderly manner’
Arash Massoudi, Costas Mourselas, Ortenca Aliaj and Kaye Wiggins – Financial Times
Segantii Capital Management has told investors it will hand back their money, weeks after Hong Kong authorities announced a criminal insider dealing case against the hedge fund and its founder Simon Sadler. “We have always believed at Segantii that it is a great responsibility and privilege to professionally manage money and we have never taken that lightly,” a spokesperson for the firm said on Thursday. “We have decided, however, that at this time, it is in the best interests of our investors to return their capital in an orderly manner.” Segantii, which was founded by Blackpool Football Club owner Sadler, grew into a dominant player in block trading, a corner of finance in which banks offload chunks of shares privately.

Early bird catches the worm: A look at the race for first mover advantage in Europe’s emerging crossing network landscape
Annabel Smith – The Trade
In light of the US ATS’ looking to migrate to Europe and new offerings being proposed by European exchanges, Annabel Smith weighs up increased fragmentation against innovation, exploring the new competitive landscape, the prospect of private rooms, and who might be the provider to benefit most from first mover advantage. In the next year, Europe is set to play host to a plethora of new crossing platforms, aimed at equipping institutional investors with another tool to achieve their outcomes. Several European exchanges are well underway with plans to bring out offerings of this ilk in the next few months The TRADE understands, while a handful of US alternative trading systems (ATS) are also preparing to make the crossing over to the Bloc to replicate the progress they have achieved in the US.

BNY Mellon’s Rebecca Crowe talks outsourced trading
Claudia Preece – The Trade
The TRADE sits down with Rebecca Crowe, managing director and chief operating officer at BNY Mellon Markets, to analyse how firms are approaching the ongoing outsourcing discussion, including how structural decisions are being made and how future moves in the space could manifest. In terms of the decision to outsource, where are you seeing that decision come from? I would say that it is largely a c-suite level decision, however, there has been aâEUR¯taboo associated with the idea of outsourcing where people think it equates to eliminating your trading team completely, but I think now we’ve moved past that and it’s not so much an opinion we’re seeing.

FCC to consider rules for AI-generated political ads on TV and radio, but can’t touch streaming
Politics – PBS
The head of the Federal Communications Commission introduced on Wednesday a proposal to require political advertisers to disclose when they use content generated by artificial intelligence in broadcast television and radio ads. If adopted by the five-person commission, the proposal would add a layer of transparency that many lawmakers and AI experts have been calling for as rapidly advancing generative AI tools churn out lifelike images, videos and audio clips that threaten to mislead voters in the upcoming U.S. election.

Ukraine Invasion

Billions from Russia’s frozen assets will go to help Ukraine’s military, the EU says
Bill Chappell – NPR
The European Union plan to use as much as $3.25 billion in profits from Russian sovereign assets – frozen by sanctions due to Russia’s war on Ukraine – to fund Ukraine and its military. “Russia must pay for its war damages,” Czech Republic Minister of Foreign Affairs Jan Lipavský said as he shared the monetary amount on X.

Russian general who criticised leadership arrested in corruption purge; Detention of Maj Gen Ivan Popov, who complained of ‘mass deaths’ among his troops, sparks uproar among pro-war bloggers in Russia
Joe Barnes – The Telegraph
A Russian general who criticised military leaders over high casualty rates in Ukraine has been arrested on corruption charges, sparking uproar among pro-war bloggers. Maj Gen Ivan Popov, 49, was sacked in July last year after complaining about the “mass deaths and injuries” of Russian soldiers in Ukraine. He later accused military chiefs of “viciously beheading the army”.

Russia Hits Kharkiv With Missile Strikes, Killing at Least Six
Aliaksandr Kudrytski – Bloomberg
Russian forces hit Kharkiv and the nearby town of Lyubotyn with a barrage of at least 15 simultaneous missile strikes on Thursday, stepping up pressure against Ukraine’s second-largest city. The attack killed at least six civilians and wounded another 16, regional governor Oleh Synehubov said on Telegram. S-300 missiles damaged local transport infrastructure as well as a printing facility in Kharkiv, setting off a large fire, according to Telegram reports from Synehubov and city mayor Ihor Terekhov.

Russia’s military seeks new recruits: crime suspects; 61-year-old pop singer is among those brought to frontline in mobilisation drive
Polina Ivanova and Christopher Miller – Financial Times
Evgeny Zhurin, frontman of a small Russian pop band from the 1990s, had been in pre-trial custody facing 10 years in prison before he was spotted in khakis on the frontline in Ukraine. Although Zhurin had insisted on his innocence when charged with defrauding a pensioner, it appeared he had chosen not to take his chances in court but to serve on the battlefield instead.

Israel/Palestine Conflict

Norway Wealth Fund Ethics Board Looks at Middle East Arms Sales
Kari Lundgren – Bloomberg
The ethics adviser for Norway’s $1.7 trillion sovereign wealth fund said it is more closely monitoring whether companies potentially selling arms to Israel could be in breach of the fund’s guidelines. Companies marketing arms to Israel may violate the ethics rules forbidding the sale of weapons to states in armed conflict “where the weapons are used in ways that constitute breaches of the international rules on the conduct of hostilities,” a spokesperson for the Council on Ethics said by e-mail Wednesday.

Norway’s oil fund and its Israel-Palestine dilemma; Oslo is insistent that its fund is not a foreign policy tool but pressure is rising to take a stance on Middle East conflict
Richard Milne – Financial Times
The protesters outside Norway’s central bank last month were blunt: the world’s largest sovereign wealth fund should sell out of Israel. Norway’s $1.7tn oil fund was holding a conference with some of the world’s most prominent asset managers on how to be a better investor. “Stop investing in companies that contribute to genocide and occupation,” suggested one protester. Norway has the biggest sovereign wealth fund – and, unlike many other countries with similar investment vehicles, it is also a democracy. The debate on Israel is perhaps the most acute demonstration of the pressures this can bring.

Houthis Are Using Weapons That Can Reach the Mediterranean Sea, US Says; Iran-backed group has said it’ll expand range of ship attacks; No strikes in eastern Mediterranean detected, US official says
Ramsey Al-Rikabi – Bloomberg
The Houthi militants in Yemen have weapons that can reach as far as the Mediterranean Sea, according to a senior defense official, lending some credence to the group’s threats that it can expand its attacks on shipping beyond its immediate borders. The US government is concerned that the Iran-backed group has the capability to extend strikes on shipping beyond the Red Sea and Gulf of Aden to the Mediterranean, said the official, who asked for anonymity to discuss private talks.

Israel to Restart Gaza Talks After Hostage Video Sparks Outrage; Video showing Israeli women bloodied has shocked public; Talks stalled after Israel invaded Rafah in southern Gaza
Omar Tamo and Ethan Bronner – Bloomberg
Israel said it would revive stalled cease-fire talks with Hamas after social media video showing female Israeli soldiers being abducted by the militants on Oct. 7 sparked a public outcry. The 190-second clip, compiled from footage filmed by the militants on the day of the attack, shows five young women in civilian clothes, some bruised and bloodied, lined up against a wall before being pushed into a jeep. The women, who Israel confirmed are military personnel, were kidnapped when Hamas invaded Israel and killed 1,200 people. The attack triggered an Israeli military response that’s destroyed much of Gaza and killed more than 35,000 Palestinians.

Exchanges, OTC and Clearing

Intercontinental Exchange settles SEC charges after cyber breach disclosure lapse
Brian Croce – Pensions & Investments
The Intercontinental Exchange and nine of its subsidiaries agreed to settle Securities and Exchange Commission charges after failing to report a cyber breach in a timely manner, running afoul of agency regulations. ICE and its subsidiaries, which did not admit to or deny the SEC’s findings, consented that the subsidiaries violated the notification provisions of Regulation Systems Compliance and Integrity, or Reg SCI, and that ICE caused those violations. The subsidiaries agreed to a cease-and-desist order, and ICE agreed to pay a $10 million penalty, according to a May 22 SEC order.

ICE issued $10 million penalty by SEC while New York Stock Exchange and others are charged; Intercontinental Exchange (ICE) has received a $10 million dollar penalty while it and nine of its affiliates have been charged with failing to inform the US Securities and Exchange Commission (SEC) of a cyber intrusion.
Claudia Preece – The Trade
The SEC has confirmed that Intercontinental Exchange has agreed to pay a $10 million penalty related to a violation of its own internal cyber incident reporting procedure back in 2021. The commission has also charged nine other affiliates with failing to inform the US Securities and Exchange Commission (SEC) of a cyber intrusion, these are: Archipelago Trading Services, New York Stock Exchange, NYSE American, NYSE Arca, NYSE Chicago, NYSE National, the Securities Industry Automation Corporation, ICE Clear Credit, and ICE Clear Europe.

Cboe Publishes Amended Spot Ether ETF Filings as Industry Renews Approval Hopes; Cboe is the first exchange to publish its revised 19b-4 forms.
Helene Braun, Nikhilesh De – CoinDesk
Things appear to be moving ahead of the U.S. Securities and Exchange Commission’s (SEC) decision to potentially approve an important filing related to the launch of a spot ether (ETH) exchange-traded fund (ETF). Cboe, an exchange associated with five of the issuers of a potential spot ether exchange-traded fund (ETF), published its amended 19b-4 filings in response to feedback from regulators. The applicants include Fidelity, VanEck, Invesco/Galaxy, Ark/21Shares and Franklin Templeton.

NSE Listed Companies’ Market Capitalization Surpass USD 5 Trillion
National Stock Exchange of India
The market capitalization of Indian listed companies on NSE surpassed USD 5 Trillion (Rs 416.57 trillion) on May 23, 2024. On the same day, the Nifty 50 Index touched an all-time high of 22,993.60 The Nifty 500 index also touched an all-time high of 21,505.25 today indicating that growth in equity market is not restricted to only the large, capitalized stocks. The journey of market capitalization of Indian listed companies from to USD 2 trillion (July 2017) to USD 3 trillion (May 2021) took about 46 months, USD 3 trillion to USD 4 trillion (December 2023) took about 30 months and the latest USD 1 trillion addition took only about 6 months. The top 5 companies by market capitalization are Reliance Industries Limited, TATA Consultancy Services Limited, HDFC Bank Limited, ICICI Bank Limited and Bharti Airtel Limited.

BME Growth companies increase their turnover by 28% annualized over the last decade
Companies listed on the SME stock exchange have increased their annualized EBITDA by 20% annualized since 2013 and their workforce by 30%. Being listed on the financial markets helps companies grow faster and generate more jobs. This is attested to by the data relating to the variation in turnover, EBITDA and headcount of BME Growth companies over the last decade. Despite the fact that during this time the companies have faced a complicated context with a pandemic, a rise in the cost of financing following the change in central banks’ monetary policies and geopolitical conflicts, the companies on the SME Stock Exchange continue to grow, with data at the close of 2023.

Cboe Europe Derivatives Welcomes Interactive Brokers as New Trading Participant
Interactive Brokers joins Cboe Europe Derivatives (“CEDX”) and will provide its clients with access to the exchange’s suite of pan-European equity derivatives in the current quarter. The global electronic broker has become a direct trading participant of CEDX and clearing participant of Cboe Clear Europe N.V. CEDX recently expanded its range of equity options and now offers contracts on over 300 European companies. Cboe Europe Derivatives (CEDX), Cboe’s pan-European equity derivatives marketplace, today announces that Interactive Brokers has successfully joined the exchange as a participant and will provide its clients with access to CEDX’s range of equity index derivatives and equity options in the current quarter.

ICE Whitepaper Reveals Hidden Cost of Mortgage Fee Cures; Preventable expenses eroding lenders’ profit margins
Intercontinental Exchange
Intercontinental Exchange, Inc. (NYSE:ICE), a leading global provider of technology and data, released “The hidden cost of fee cures,” a whitepaper based on an analysis of preventable expenses eroding mortgage lender profits. The TILA-RESPA Integrated Disclosure (TRID) rule, also known as “know before you owe,” requires mortgage lenders to provide borrowers with a detailed accounting of costs and fees associated with purchasing or refinancing a home. Any errors made in the disclosure are the lender’s responsibility to detect and rectify. Depending on the specifics of the errors, lenders may be required to pay the difference between the disclosed and updated costs.

Performance Bond Requirements: Agriculture, Metals and Energy – Effective May 23, 2024
CME Group
As per the normal review of market volatility to ensure adequate collateral coverage, the Chicago Mercantile Exchange Inc., Clearing House Risk Management staff approved the performance bond requirements for the following products listed in the advisory at the link below. The rates will be effective after the close of business on May 23, 2024.

New Product Summary: Initial Listing of the Soybean Oil – NY Harbor ULSD Spread Financial Futures Contract – Effective June 17, 2024
CME Group
Initial Listing of the Soybean Oil – NY Harbor ULSD Spread Financial Futures Contract.

HKEX Establishes FIC Advisory Panel And Appoints New Consultative Panels Member
Hong Kong Exchanges and Clearing Limited
Hong Kong Exchanges and Clearing Limited (HKEX) is pleased to announce today (Thursday) the establishment of an FIC Advisory Panel, an advisory body to support the Group’s further development in the fixed-income and currency (FIC) business. The FIC Advisory Panel, chaired by HKEX Co-Head of Markets Glenda So, will advise the Group on its FIC strategy and facilitate the introduction of new FIC products and services, further developing the FIC market and supporting Hong Kong’s position as an international financial centre. Commencing on 1 June 2024, the FIC Advisory Panel Advisory Panel will consist of HKEX representatives and external FIC market leaders as members.

Moscow Exchange, OZK Group and Demetra-Holding agreed to cooperate
On May 23, 2024, the Moscow Exchange, OZK Group and Demetra-Holding signed a cooperation agreement on the development of organized trading, price indicators and derivative financial instruments of the grain market. The official ceremony of signing the agreement took place within the framework of the forum “Exchange market of Russian agricultural products: main directions and development prospects” at the “Russia” exhibition site. The ceremony was attended by Chairman of the Board of the Moscow Exchange Yuri Denisov, General Director of OZK JSC Dmitry Sergeev and General Director of Demetra-Holding LLC Alexey Gribanov.


Nvidia Keeps Its Old Chips Selling Hot; Worries about a slowdown in sales ahead of major chip upgrade look misplaced
Dan Gallagher – The Wall Street Journal
Patience might be the one thing Nvidia can’t afford these days. Luckily for the chip maker, it doesn’t look like it will need to. Ahead of Nvidia’s fiscal first-quarter results Wednesday afternoon, there was a growing fear among investors that major customers such as Google, and Microsoft would curb their orders for the latest generation of the company’s artificial-intelligence systems to await the launch of a new line later this year.

The TRADE launches EMS Survey for 2024; Buy-side users of Execution Management Systems (EMS) are invited to rate their vendors in the 2024 edition of The TRADE’s annual Survey.
Karen Delahoy – The Trade
The TRADE’s annual Execution Management Systems (EMS) Survey, allowing buy-side users to assess and rate their vendors, is now open for submissions. Buy-side clients are invited to rate their EMS providers across 13 functional categories, alongside the chance to detail what additional capabilities they would like to see from vendors in the future.

Nvidia CEO Says Dell Partnership Is Key in Its Push to Expand AI; Wider range of customers will be able to make ‘AI factories’; Nvidia looks to decrease its reliance on data center giants
Edward Ludlow and Ian King – Bloomberg
Nvidia Corp. Chief Executive Officer Jensen Huang said its partnership with Dell Technologies Inc. will spread artificial intelligence to a wider range of customers, helping businesses and organizations create their own “AI factories.” “We want to bring this generative AI capability to every company in the world,” he said in a Bloomberg Television interview in Las Vegas, where Dell is holding a conference. “It’s not about just delivering a box – it’s about delivering an entire infrastructure. It’s an infrastructure that’s insanely complicated.”

OpenAI Just Gave Away the Entire Game; The Scarlett Johansson debacle is a microcosm of AI’s raw deal: It’s happening, and you can’t stop it.
Charlie Warzel – The Atlantic
If you’re looking to understand the philosophy that underpins Silicon Valley’s latest gold rush, look no further than OpenAI’s Scarlett Johansson debacle. The story, according to Johansson’s lawyers, goes like this: Nine months ago, OpenAI CEO Sam Altman approached the actor with a request to license her voice for a new digital assistant; Johansson declined. She alleges that just two days before the company’s keynote event last week, in which that assistant was revealed as part of a new system called GPT-4o, Altman reached out to Johansson’s team, urging the actor to reconsider. Johansson and Altman allegedly never spoke, and Johansson allegedly never granted OpenAI permission to use her voice. Nevertheless, the company debuted Sky two days later-a program with a voice many believed was alarmingly similar to Johansson’s.

Nvidia Delivers on AI Hype, Igniting $140 Billion Stock Rally; ‘We are poised for our next wave of growth,’ CEO says; Outlook for second-quarter revenue exceeds estimates
Ian King – Bloomberg
Nvidia Corp., the chipmaker at the center of an artificial intelligence boom, gained in late trading after a bullish sales forecast showed that AI computing spending remains strong. Second-quarter revenue will be about $28 billion, the company said Wednesday, topping the $26.8 billion predicted by analysts. Results in the fiscal first quarter, which ended April 28, also beat projections – lifted by growth in Nvidia’s data-center division. The big question heading into the earnings report was whether Nvidia’s latest numbers could justify the dizzying run-up in its stock. The shares had gained 92% this year through Wednesday’s close, fueled by investor hopes that the company would continue to shatter expectations.

Meta’s Zuckerberg Creates Council to Advise on AI Products; Stripe’s Collison, Shopify’s Lutke among new advisers; Group to guide Meta on tech, strategic growth opportunities
Kurt Wagner – Bloomberg
Meta Platforms Inc. Chief Executive Officer Mark Zuckerberg has created a new product advisory council – a group that will meet periodically with Meta’s management team and offer guidance on the company’s artificial intelligence and technology advancements. The Meta Advisory Group, as it will be called, will be made up of four executives: Stripe Inc. CEO and co-founder Patrick Collison; former GitHub CEO Nat Friedman; Shopify Inc. CEO Tobi Lütke; and Charlie Songhurst, an investor and former Microsoft Corp. executive. None of the men will be paid, a Meta spokesperson confirmed.

OpenAI Inks Deal With Wall Street Journal Publisher News Corp.; ChatGPT maker gets access to content from a dozen-plus outlets; Startup also has deals with Financial Times, Dotdash Meredith
Shirin Ghaffary – Bloomberg
News Corp. announced an agreement with OpenAI to let the company use content from more than a dozen of its publications in the ChatGPT-maker’s products. As part of the deal, OpenAI’s services will be able to display news from the Wall Street Journal, Barron’s, MarketWatch and other News Corp. publications. The agreement comes as OpenAI has been striking several deals with high-profile media companies in the US and Europe in recent weeks, including The Financial Times, Dotdash Meredith and social media firm Reddit, to display and license content.

Darpa-Backed Startup Seeks $70 Million to Join AI Chip Goldrush; Silicon Valley is racing to build a better chip for AI.
Lizette Chapman – Bloomberg
A Silicon Valley startup backed by the US Defense Advanced Research Projects Agency is seeking at least $70 million more from investors in its quest to to develop an ultra-efficient chip for artificial intelligence technology, according to documents reviewed by Bloomberg. The company, EnCharge AI Inc., joins the growing technological race to build better chips to power the current wave of AI technology. Computing power has become a scarce and precious resource in the AI world, helping send chipmaker Nvidia Corp.’s market cap soaring past $2 trillion and spurring OpenAI boss Sam Altman to seek billions for chipmaking endeavors.

AI-Translation Startup DeepL Announces $300 Million Investment at $2 Billion Valuation; The round, led by Index Ventures, reflects businesses’ increasing interest in function-specific AI models
Isabelle Bousquette – The Wall Street Journal
DeepL, a German startup focused on AI-powered translation services, announced Wednesday $300 million of investment at a $2 billion valuation in a round led by Index Ventures. The company’s success reflects businesses’ increasing interest in function-specific AI models, in this case translation, beyond the general purpose models popularized by OpenAI’s ChatGPT.


Researchers Warn of Chinese-Aligned Hackers Targeting South China Sea Countries
The Hacker News
Cybersecurity researchers have disclosed details of a previously undocumented threat group called Unfading Sea Haze that’s believed to have been active since 2018. The intrusion singled out high-level organizations in South China Sea countries, particularly military and government targets, Bitdefender said in a report shared with The Hacker News.

Remote Work, Aging Tech Targeted by Canada Cybersecurity Plan
Bloomberg via Mint
The Canadian government released its first-ever cybersecurity strategy on Wednesday, with the aim of addressing challenges posed by remote work, cloud computing, aging infrastructure and recruitment.

Persistent Burnout Is Still a Crisis in Cybersecurity; Burnout has been an oft-reported problem among security professionals for years. Are there any new ideas for supporting mental health in the industry?
Joan Goodchild – Dark Reading
Dr. Ryan Louie, a psychiatrist focused on the intersection of cybersecurity and mental health, recalls a valuable lesson from his medical student days that cybersecurity practitioners may find relevant: “During one of my clinical clerkships at the hospital, our team’s attending physician on the first day of the rotation highlighted that ‘We are a team, and that everyone should feel free to say whenever they feel they have too much on their plate or if they need any help.’ And that medical students and residents on the team should not worry about impacts to their evaluation. There was genuine psychological safety,” he says.


Why the Crypto Market Is Betting on Spot-Ether ETFs
Isabelle Lee – Bloomberg
Cryptocurrency markets have grown more optimistic that US securities regulators might approve exchange-traded funds that invest directly in Ether, the second-biggest token behind Bitcoin. The signals, including a Bloomberg News report on May 21 saying that the US Securities and Exchange Commission had recently contacted the exchanges with spot Ether ETF filings, marked a reversal of expectations. A flurry of document filings followed, including for ETFs from ARK 21Shares, Fidelity Investments, Invesco Ltd., Franklin Resources Inc. and VanEck.

Happy Bitcoin Pizza Day; Laszlo Hanyecz is famous for spending 10,000 bitcoin on two pizzas. But his involvement with Bitcoin development goes much deeper than food purchases.
Daniel Kuhn – CoinDesk
On May 22, 2010, Florida-resident Laszlo Hanyecz paid 10,000 bitcoin (BTC) for two Papa Johns pizzas in what is largely considered to be the first purchase ever made with the then experiential digital currency. The value of those coins would be worth just under $700 million today.

Why the Crypto Market Is Betting on Spot-Ether ETFs
Isabelle Lee – Bloomberg
Cryptocurrency markets have grown more optimistic that US securities regulators might approve exchange-traded funds that invest directly in Ether, the second-biggest token behind Bitcoin. The signals, including a Bloomberg News report on May 21 saying that the US Securities and Exchange Commission had recently contacted the exchanges with spot Ether ETF filings, marked a reversal of expectations. A flurry of document filings followed, including for ETFs from ARK 21Shares, Fidelity Investments, Invesco Ltd., Franklin Resources Inc. and VanEck.

B2C2 and Swissquote partner to enhance liquidity on SQX; The collaboration seeks to help create an attractive marketplace for digital assets to increase trading activity and improve operational efficiency.
Wesley Bray – The Trade
Digital assets market maker B2C2 has partnered with Swiss online banking and financial services provider Swissquote to deepen liquidity on the latter’s exchange. Swissquote Exchange (SQX) is a central limit order book (CLOB) which offers liquidity alongside an environment to trade cryptocurrencies to a wide range of market participants.

Nasdaq files updated 19b-4 form for BlackRock’s spot Ethereum ETF
Sarah Wynn – The Block
Exchange Nasdaq Stock Market LLC has filed an updated 19b-4 form for BlackRock’s spot Ethereum exchange-traded fund as other amended filings have begun to flood in. Nasdaq filed the amended form for the world’s largest asset manager on Wednesday. Exchange CboeBZX filed revamped 19b-4 forms late Tuesday for five spot ETF proposals. The amended filings come as exchanges were reportedly asked by the SEC to amend their 19b-4s earlier this week. Form 19b-4s are filed to let the SEC know about a proposed rule change and are among the documents that need the agency’s greenlight before spot ether ETFs can become effective. S-1 registration statements would still need to go effective before the funds can begin trading.

Meet BlackRock’s Bitcoin Believer; On this episode of Trillions, we sit down with a key player behind the most successful exchange-traded fund launch in history.
Eric Balchunas and Joel Weber – Bloomberg (podcast)
The iShares Bitcoin Trust was the most successful exchange-traded fund launch in history by nearly all metrics. For most ETFs it takes years to hit $10 billion in assets, but IBIT did it in less than two months. Now it’s closing in on $20 billion. How much bigger will it get? And who is buying it? And how did BlackRock end up being one of the firms leading the charge on ETF-izing crypto?


US House passes crypto bill despite warnings from SEC
The U.S. House of Representatives on Wednesday passed a bill that aims to create a new legal framework for digital currencies, despite an unusual warning from the U.S. securities regulator it could create new financial risks. The Republican-sponsored Financial Innovation and Technology for the 21st Century Act passed in a bipartisan 279-136 vote. It is not clear if the Senate will take up the measure.

Crypto’s ‘huge moment’ scrambling US politics; Recent votes surfaced household names like Chuck Schumer and Nancy Pelosi as unexpected allies.
Jasper Goodman And Eleanor Mueller – Politico
Cryptocurrency is used by a fraction of the American electorate. But it’s starting to have an outsize impact on U.S. politics and policy. The crypto industry won several eye-catching victories this month that showcased its growing influence on the levers of power in Washington – something that’s poised to expand as it prepares to spend more than $80 million on the 2024 elections. The wins come as the Federal Reserve said this week that only 7 percent of adults held or used crypto last year, a decline of 5 percentage points from 2021.

Donald Trump taps Texas oil tycoons in bid to close cash gap with Joe Biden; Harold Hamm and Occidental Petroleum boss among backers as ex-president vows to scrap Democrat’s climate agenda
Myles McCormick, Alex Rogers and Sam Learner – Financial Times
Donald Trump swept through Texas on Wednesday seeking to bolster his campaign war chest with donations from oil barons and moguls controlling vast fortunes spanning sectors from sports to automotive. The former president, whose in-person campaigning has been restricted by his “hush money” criminal trial in New York, attended lunchtime fundraisers in Houston before dashing to a dinner in Dallas.

Trump Says His Relationship With Putin Will Help Free Jailed WSJ Reporter Evan Gershkovich; The Kremlin responded by saying the Russian leader isn’t in contact with the former U.S. president about the journalist
Ann M. Simmons and Joanna Sugden – The Wall Street Journal
Former President Donald Trump said his relationship with Russian leader Vladimir Putin would help secure the release of Evan Gershkovich, the Wall Street Journal reporter detained in a Moscow jail for more than a year. In a post on his Truth Social platform on Thursday, Trump said that Gershkovich, whom the U.S. State Department deems wrongfully held, would be released almost immediately after the presidential election “but definitely before I assume office.”

SEC’s Gensler hits back at crypto bill ahead of House’s landmark vote; Gensler’s new warning shot escalates what is already a full-out fight over crypto’s regulatory status in the U.S. and the proposed legislation.
Declan Harty – Politico
SEC Chair Gary Gensler is taking the unusual step of publicly rebuking House legislation that lays out how to regulate cryptocurrency trading, just hours before lawmakers vote on the bill. In a statement, Gensler on Wednesday sharply criticized the bill as a loophole-ridden plan that risks undercutting decades-old investor protection in the name of creating a new regulatory structure for the $2 trillion crypto market that he says is already largely subject to U.S. securities laws.

Why Donald Trump Is Betting on Crypto
Andrew R. Showman – TIME Magazine
Donald Trump used to rail against cryptocurrencies, calling them a “disaster waiting to happen” and saying that bitcoin seemed “like a scam.” Now, he’s vowing to build a “crypto army.” On Tuesday, the Trump campaign announced that it would accept donations in crypto, including bitcoin, ether, and dogecoin. Many crypto fans embraced the announcement on social media, arguing that it was proof that crypto will be a key issue in the coming election. Others, however, said that it simply reeked of opportunism.

Democrats refer Big Oil probe findings to the Justice Department
Rachel Frazin – The Hill
House and Senate Democrats are referring the results of their probe into alleged climate disinformation by the oil industry to the Justice Department. “We are making a formal referral to Attorney General [Merrick] Garland to commence a proper inquiry into whether charges should be brought and what charges should be brought,” Sen. Sheldon Whitehouse (D-R.I.) told reporters.

Rishi Sunak announces July 4 general election; Prime minister has ended months of speculation over the general election date as the country
David Maddox – Independent
Rishi Sunak has dramatically announced that the general election will be held on July 4 after months of intense speculation. Mr Sunak took Westminster by surprise by revealing the date following a year and a half of scutiny and questions over his leadership.

Will ‘Finland’s Achilles Heel’ Become a Problem for Europe? The Aland Islands are variously described as the lock to Finland, a pistol pointed at Sweden, and a beacon of peace.
Danielle Bochove and Leo Laikola – Bloomberg
On a boat weaving through the Aland Islands in late April, coastguard officer Kim Westman was on the lookout for anything out of the ordinary. And like nearly every patrol since Russia’s invasion of Ukraine some two years ago, Westman found nothing of serious concern to report. But the serenity belies growing concerns over a crucial maritime gateway and shipping routes worth $160 billion a year.

Cash-Filled Suitcases Fuel India’s $16 Billion Election; Authorities seize large sums of money, goods during elections; Parties have traded accusations about ties to big businesses
Anto Antony and Swati Gupta – Bloomberg
As the Nellai Express Train stopped at Tambaram railway station in southern India at 8:30 p.m. on April 6, six government officials waiting in the shadows behind the steel pillars on the platform rushed into the coach marked A1. Within minutes, they had arrested three young men lugging five trolley bags filled with neat bundles of 500 rupee notes, according to an official who was part of the operation. In total, they were carrying about $500,000 to allegedly pull in votes for a candidate up for election to the lower house of parliament, the officials later said without naming the politician. A code of conduct bans any transactions – monetary or otherwise – which could be used to sway voters.


Analysts: SEC Could Begin Approval Process for Spot Ethereum ETFs Tomorrow
Kevin Helms –
Bloomberg’s ETF analysts have explained that the U.S. Securities and Exchange Commission (SEC) could start the approval process for spot ethereum exchange-traded funds (ETFs) tomorrow. They noted that the securities regulator has requested revised Form 19b-4s from issuers to be submitted by Tuesday morning, indicating “likely approval” as soon as Wednesday. This submission is a necessary step in the ETF approval process.

Former FTX Executive Deserves 5 to 7 Years in Jail, US Says; Ryan Salame pleaded guilty to two charges in September; Salame was the CEO of FTX Digital Markets in the Bahamas
Ava Benny-Morrison and Robert Burnson – Bloomberg
Former FTX executive Ryan Salame should serve five to seven years in prison, prosecutors say, for criminal charges stemming from the multibillion-dollar collapse of the cryptocurrency empire. In a sentencing memo filed in federal court in Manhattan on Tuesday, federal prosecutors said the 30-year-old pleaded guilty to “serious crimes, and a substantial sentence is required to ensure that Salame receives just punishment.” Salame’s lawyers have argued he should serve no more than 18 months.

Segantii Hedge Fund to Return Cash Amid Insider Trading Case; Sadler and firm charged with insider trading in Hong Kong; The ‘block-trade king’ built one of Asia’s largest hedge funds
Bei Hu, Nishant Kumar, and Gillian Tan – Bloomberg
Simon Sadler’s hedge fund is returning capital to investors, marking an abrupt end for one of Asia’s largest funds after regulators in Hong Kong accused it of insider trading. “It is in the best interests of our investors to return their capital in an orderly manner,” a spokesperson for Segantii Capital Management Ltd. said in a statement Thursday. “We have always believed at Segantii that it is a great responsibility and privilege to professionally manage money and we have never taken that lightly.”

Bill Hwang’s ‘Margin Bot’ Explains How He Got Nickname; Archegos risk chief Becker is pressed on cross-examination; Becker is a star prosecution witness in Bill Hwang’s fraud trial; On cross, defense suggests Hwang didn’t know about lies to banks; Earlier, prosecutor took Becker through FBI raid and cooperation deal
Thank you for joining us. We’re going to wrap our coverage of the Archegos trial today. Here are the key takeaways from today’s testimony. Former Archegos risk management head Scott Becker took the stand for his third day as one of the prosecution’s star cooperating witnesses, and the defense got its first shot at cross-examining him.

Citi Trader Got 711 Warning Messages Before Sparking Flash Crash; Wall Street giant fined $78 million in UK for 2022 trades; London staffer’s fat-finger blunder triggered Europe selloff
Jennifer Surane and Jonathan Browning – Bloomberg
For one Citigroup Inc. trader in London, the morning of May 2, 2022 went from bad to worse. It was a public holiday in the UK, so it should have been a quiet day in the markets. A little before 9 a.m., the staffer on Citigroup’s Delta One trading desk – who was working from home – began putting together a trade that would hedge the bank’s exposure to the MSCI World Index.

Hopes of ether ETF revived after flurry of SEC filings
Isabelle Lee, Sidhartha Shukla and Emily Graffeo – AFR
Crypto markets are becoming increasingly optimistic about regulatory approval for US exchange-traded funds investing directly in ether amid a flurry of activity at potential issuers, exchanges and the securities regulator. That’s after the US Securities and Exchange Commission requested that the New York Stock Exchange and Cboe Global Markets update so-called 19b-4 filings that propose rule changes to allow the planned funds to trade, said people familiar with the matter who asked not to be identified.

Star witness testifies at Archegos trial: ‘Do whatever it takes to get the cash’; Former chief risk officer at Bill Hwang’s family office tells of pressure and lies during testimony
Joshua Franklin – Financial Times
A star witness in Bill Hwang’s criminal trial testified that employees would do whatever it took to support their boss’s aggressive trading strategy, including lying to lenders in the run-up to the collapse in 2021 of his family office, Archegos Capital. Over more than two days of testimony for the prosecution in Manhattan federal court, Archegos’s former chief risk officer Scott Becker said he repeatedly lied to banks in the hope they would facilitate more trades for the fund.

Investec Sets Aside £30 Million for UK’s Motor Finance Probe; UK regulators have been reviewing past auto loan commissions; Investec said it’s planning to pay its highest dividend ever
Adelaide Changole – Bloomberg
Investec Plc set aside £30 million ($38 million) to pay for possible compensation and other costs linked to UK regulators’ ongoing probe of its auto lending business. The provision, tied to the Financial Conduct Authority review into historical motor finance commission arrangements and sales, boosted the South African lender’s overall costs in the year ending in March, according to a statement.

FINRA Statement to Correct Misinformation About the New Residential Supervisory Location Rule
FINRA’s new rules for evolving work models – hybrid and remote -provide member firms greater flexibility for their registered persons to work from home. Our new Residential Supervisory Location (RSL) Rule and Remote Inspections Pilot Program Rule are intended to provide member firms greater flexibility – not less – to allow eligible registered persons to work from home, following the expiration of temporary COVID-19 relief from existing requirements. The new rules provide a practical and balanced way for firms to meet their regulatory obligations, while protecting investors, and acknowledging the need for greater workplace flexibility.

ASIC’s priorities in a changing regulatory environment
Speech by ASIC Commissioner Alan Kirkland at the Australian Finance Industry Association (AFIA) Risk Summit 2024, 22 May 2024.
Good morning everyone – and thanks to Diane and AFIA for the invitation to speak at the 2024 Risk Summit. I would like to begin by acknowledging the Wurundjeri people of the Kulin nation as the traditional owners of the land on which we meet. I pay my respects to their elders, past and present – and extend that respect to Aboriginal and Torres Strait Islander people here today.

ASIC restricts Energy World Corporation Ltd from issuing a reduced-content prospectus
ASIC has restricted Energy World Corporation Limited (EWC) from issuing a reduced-content prospectus for listed entities for the next 12 months. ASIC was satisfied that EWC contravened its financial reporting obligations to comply with accounting standards. EWC has a number of liquefied natural gas projects under construction as well as overseas oil and gas exploration and evaluation assets. In each of EWC’s 30 June 2023 (FY23) and 31 December 2023 (HY24) financial reports, EWC’s auditor had qualified their audit report in respect of USD $921 million of these assets as they were unable to obtain sufficient appropriate audit evidence to support assumptions used by EWC in its impairment models.

ASIC issues DDO stop orders against Trademax Australia
ASIC has made two interim stop orders preventing Trademax Australia Limited from opening trading accounts or dealing in contracts for difference (CFDs) or margin foreign exchange contracts (margin FX) to retail investors. ASIC acted following concerns that Trademax failed to take reasonable steps likely to result in its retail product distribution conduct being consistent with two target market determinations (TMDs).

ESMA consults on commodity derivatives under MiFID review
The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, is launching today a public consultation on proposed changes to the rules for position management controls and position reporting. The changes come in the context of the review of the Market in Financial Instruments Directive (MiFID II) and aim to minimise the burden on reporting entities. ESMA is consulting on changes to the technical standards (RTS) on position management controls, the Implementing Technical Standards (ITS) on position reporting, and on position reporting in Commission Delegated Regulation (EU).

MiFIR review: ESMA consults on Consolidated Tape Providers and their selection
The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, is inviting comments on draft technical standards related to Consolidated Tape Providers (CTPs), other data reporting service providers (DRSPs) and the assessment criteria for the CTP selection procedure under the Markets in Financial Instruments Regulation (MiFIR).

Consultation: Class exemption renewal for disclosure of relevant interests by directors and senior managers, and NZCDC Settlement System
FMA – New Zealand
We are reviewing whether to renew two existing class exemption notices for a further five years: The Financial Markets Conduct (Disclosure of Relevant Interests by Directors and Senior Managers) Exemption Notice 2019 – this provides conditional relief for directors and senior managers of listed issuers from the requirements of the Financial Markets Conduct Act 2013 (FMC Act) to disclose relevant interests in quoted financial products of the listed issuer or a related body corporate where: the financial product is an interest in a passive fund; or financial products of the listed issuer are approved for trading on a financial product market authorised to operate in Australia or the United Kingdom, and a valid disclosure has been made under the listing rules of that other market.

FCA fines HSBC £6.2 million over treatment of customers in financial difficulty
The FCA has fined HSBC UK Bank plc, HSBC Bank plc and Marks and Spencer Financial Services plc (HSBC) £6,280,100 for failures in its treatment of customers who were in arrears or experiencing financial difficulty.âEUR¯ Between June 2017 and October 2018, HSBC failed to properly consider people’s circumstances when they had missed payments. This meant it did not always do the right affordability assessments when entering arrangements with people to reduce or clear their arrears. Sometimes it took disproportionate action when people fell behind with payments, which risked people getting into greater financial difficulty.

FCA fines CGML £27,766,200 for failures in its trading systems and controls
The FCA has fined Citigroup Global Markets Limited (CGML) £27,766,200. Failures in the firm’s systems and controls led to US$1.4bn of equities being sold in European markets when they should not have been. On 2 May 2022, a CGML trader had intended to sell a basket of equities to the value of US$58m. The trader made an inputting error while entering the basket in an order management system. This resulted in a basket to the value of US$444bn being created.

FSA Weekly Review No.587 May 23, 2024 NEW
FSA Japan
Week of May 10, 2024 – May 16, 2024
This page contains the latest in events, developments, and updates to the FSA website.

11th Asian Monetary Policy Forum to Discuss Monetary Policy Challenges Amid Uncertainty and Structural Shifts in the Global Economy
Monetary Authority of Singapore
The 11th Asian Monetary Policy Forum (AMPF) will take place in Singapore today and tomorrow. This year’s AMPF once again brings together leading policymakers and academics to focus on the challenges confronting monetary policy against the current macroeconomic and financial landscape. The joint dinner for AMPF and the Asian Bureau of Finance and Economic Research (ABFER), taking place in the evening of 23 May, will be addressed by Professor David Autor of the Massachusetts Institute of Technology. In his keynote speech, Professor Autor will discuss the long-term implications of recent technologies, including generative Artificial Intelligence, on the labour market.

Pre-trial review fixed for false trading in shares of China All Access (Holdings) Limited
SFC – Hong Kong
The Eastern Magistrates’ Court today set down 5 September 2024 for a pre-trial review of the prosecution brought by the Securities and Futures Commission (SFC) against Ms Wong Yuk Lan, an administration controller of China All Access (Holdings) Limited (China All Access) at the material time, for alleged false trading (Notes 1 to 3). At today’s hearing, Wong pleaded not guilty to a charge of creating false or misleading appearance with respect to the market for, or the share price of, China All Access between 29 and 31 December 2014.

Investing and Trading

Coinbase to launch gold and oil futures trading
RT Watson – The Block
U.S.-based cryptocurrency exchange Coinbase announced it will launch retail-sized futures contracts for oil and gold. The new product will launch as of June 3rd, Coinbase Derivatives said on Tuesday. “While crypto derivatives remain at the core of our business, we’re excited to announce the launch of new futures contracts for oil and gold,” the company said in a statement.

Losses Pile Up in Top-Rated Bonds Backed by Commercial Real Estate Debt
Carmen Arroyo and Natalie Wong – Bloomberg)
For the first time since the financial crisis, investors in top-rated bonds backed by commercial real estate debt are getting hit with losses. Buyers of the AAA portion of a $308 million note backed by the mortgage on the 1740 Broadway building in midtown Manhattan got less than three-quarters of their original investment back earlier this month after the loan was sold at a steep discount. It’s the first such loss of the post-crisis era, according to Barclays Plc. All five groups of lower ranking creditors were wiped out.

Bank of Japan Faces Shortage of Sellers in Bond-Buying Operation
Yumi Teso and Masaki Kondo – Bloomberg
For the first time in at least a decade, there was a shortage of sellers on Thursday when the Bank of Japan offered to snap up regular government bonds in one its buying operations. The unexpected outcome looks set to fuel speculation that the central bank will reduce debt purchases more broadly as it winds back monetary stimulus and allows borrowing costs to rise in Japan.

Activist investor calls for Rio Tinto to abandon primary London listing; Palliser Capital says miner should unify corporate structure in Australia to boost share price
Ivan Levingston and Harry Dempsey and Robin Harding – Financial Times
Rio Tinto should abandon its primary London listing and unify its corporate structure in Australia, echoing a move by rival BHP, according to an activist investor that has taken a stake in the dual-listed miner. Palliser Capital, a UK-based fund, said on Thursday that Rio’s current dual corporate structure was a barrier to its strategic plans, which made it difficult to do major acquisitions and meant the London-listed company was trading at a $27bn discount to its Australian entity.

Environmental, Social and Corporate Governance

Tornado Pummels Wind Turbines in Iowa; The damage was unusual, experts say, because turbines are built to withstand extreme weather. Iowa is a wind powerhouse, with thousands of turbines.
Christopher Flavelle – Financial Times
The footage from southwest Iowa is shocking: In the trail of a tornado, a wind turbine is bent in half like a cheap straw, its hub engulfed in flames and thick black smoke, its blades on the ground. “You’re seeing multiple of these big wind turbine towers that have been destroyed,” Zane Satre, a meteorologist for KCCI 8 News in Des Moines, told viewers. “These are big tall ones – I think they’re what, like 250 feet tall? Well that tornado took them out.”

Why insurance is key to speeding up the energy transition; Firms that develop expertise in emerging clean tech will reap financial rewards
Cara Eckholm – Financial Times (opinion)
As natural catastrophes such as wildfires and hurricanes have proliferated, insurers have begun to cancel coverage for property owners in vulnerable cities. The root cause of the uptick in weather-induced property damage is, of course, global warming – and to stop tragedy from spreading, we need to move rapidly to alternative energy sources. While charred homes have become the face of the climate insurance crisis, there is another invisible problem looming: many insurers have been slow to offer coverage for the very types of ambitious clean energy projects that will keep us away from the climate cliff. And that coverage gap risks stymying investment in the energy transition. Without insurance, it’s hard to secure financing to get clean energy projects built.

UK’s National Grid Plans Huge Capital Raise in Net Zero Push; Network company is seeking to raise £6.8 billion in capital; The energy transition requires massive investment in the grid
Eamon Farhat and Rachel Morison – Bloomberg
National Grid Plc plans to raise £6.8 billion ($8.7 billion) of capital to help fund a massive investment program as the shift to net zero requires a sweeping overhaul of Britain’s power network. As well as issuing new shares, the company intends to sell its Grain liquefied natural gas terminal and its US onshore-wind business, according to a statement Thursday. The firm will use the proceeds to expand and strengthen the grid so that it can connect renewable-energy projects and vehicle-charging networks, and shoulder an expected doubling of electricity demand in the push to decarbonize.

Young Alaskans sue state over fossil fuel project they claim violates their rights; Plaintiffs claim $38.7bn gas export project, which would triple state’s greenhouse gas emissions, infringes constitutional rights
Dharna Noor – The Guardian
Eight young people are suing the government of Alaska – the nation’s fastest-warming state – claiming a major new fossil fuel project violates their state constitutional rights. The state-owned Alaska Gasline Development Corporation has proposed a $38.7bn gas export project that would roughly triple the state’s greenhouse gas emissions for decades, the lawsuit says. Scientists have long warned that fossil fuel extraction must be swiftly curbed to secure a livable future.

Hydrogen-Powered Private Jets Can Cut Emissions – If They Can Get Off the Ground
Private jet travel is the most carbon-intensive form of flying. Startups are promising a future of emissions-free hydrogen power.
Coco Liu – Bloomberg

Exxon case against activist shareholder can proceed, US judge rules
Sabrina Valle – Reuters
A U.S. judge on Wednesday allowed a lawsuit filed by Exxon Mobil against two activist groups seeking to bar their climate resolution to go ahead against one of the groups. The oil company’s lawsuit raised alarm among activists and proxy advisers who argued it would muzzle debate among shareholders and public companies. Exxon sued climate activist groups Arjuna Capital and Follow This in January and told the court it would not drop the matter after they agreed to withdraw their petition, citing “the likelihood” the pair could file similar resolutions in the future.

New NASA Mission Tracks Microscopic Organisms in the Ocean and Tiny Particles in the Air to Monitor Climate Change; The spectrum of colors viewed by the PACE satellite can identify different phytoplankton species in the ocean and a variety of aerosols in the atmosphere, helping researchers identify threats to the health of people and the planet.
Teresa Tomassoni – Inside Climate News

ESG Ratings Get Regulated: Why That’s A Good Thing For Businesses
Mary Foley – Forbes (contributor)


If You’re Banking at a Non-Bank, Read the Fine Print; The supply chain of financial services is only as strong as its weakest link.
Marc Rubinstein – Bloomberg
SoLo Funds markets itself as a new type of financial institution. “Banking* is better in a community,” the Los Angeles-based business trumpets on its website. The asterisk is important because SoLo isn’t a bank. Rather, it’s a financial-technology venture that connects consumers to an insured depository institution via another financial-technology company.

Charles Schwab to Roll Out Alternatives Platform For Qualified Investors
Paige Smith – Bloomberg
Charles Schwab Corp. is planning to roll out an alternative investments platform in phases for individual investors this year. The platform will offer investors access to private equity, venture capital, private credit and long-short exchange funds to start, with one or two offerings in each of those categories, executives said at the Westlake, Texas-based firm’s institutional investor day.

JPMorgan Hunts for Private Credit Firm to Bulk Up in Hot Sector
Hannah Levitt and Paula Seligson – Bloomberg
JPMorgan Chase & Co. is on the hunt to buy a private credit firm to augment its $3.6 trillion asset management arm, as the biggest US bank makes more inroads into Wall Street’s buzziest sector. The JPMorgan unit is seeking a private credit shop that could bolster its private capital business, according to people familiar with the matter. As part of the effort, the company held talks to buy Chicago-based Monroe Capital this year, but the two firms ultimately decided not to pursue a deal, the people said, asking not to be named describing private discussions.

Santander Tests Demand for SRTs Tied to Over $6 Billion in Loans; Processes are at an early stage with no firm decisions made; Discussions linked to Santander loans in Mexico and Brazil
Esteban Duarte and Jorge Zuloaga – Bloomberg
Banco Santander SA is sounding out interest for potential synthetic-risk-transfer transactions linked to more than $6 billion in loans, which are tied to carmakers and other borrowers in Mexico and Brazil. Santander Mexico, which has auto financing agreements with carmakers including Tesla Inc. and Suzuki Motor Corp., is gauging investor interest for a potential synthetic risk transfer linked to about $1.8 billion of vehicle loans, according to people familiar with the matter.

Goldman Becomes First Wall Street Bank to Get Saudi HQ License; Goldman recently got a license to set up regional HQ in Saudi; Firms not based in Saudi Arabia risk losing out on business
Archana Narayanan, Matthew Martin, and Nicolas Parasie – Bloomberg
Goldman Sachs Group Inc. has become the first Wall Street bank to take a step toward complying with Saudi Arabia’s ultimatum for foreign firms to set up their Middle Eastern base there. The investment bank received a license recently from the kingdom’s Ministry of Investment to set up its regional headquarters in Riyadh, according to people familiar with the matter. It wasn’t immediately clear how many staffers will move to Saudi Arabia and how much of Goldman’s regional operations will ultimately be based in the kingdom.

Ex-Goldman Sachs VP rips bank’s ‘man’s world’ culture: ‘I played golf, talked football, and cried in bathroom’
Ariel Zilber – NY Post
A former vice president at Goldman Sachs said she left a six-figure job at the Wall Street giant two years ago to become a novelist because of its “man’s world” culture that left female employees “not feeling valued.” Lindsay MacMillan, who worked at the bank’s marketing department where she rose to become a VP, wrote that she cut short a promising career after six years at Goldman because she felt the need to “keep my feminine side tucked away” being one of the few women in her division.

Eurazeo eyes 750 mln euros for new planetary boundaries fund
Simon Jessop – Reuters
French private equity investor Eurazeo (EURA.PA) plans to raise at least 750 million euros ($813.08 million) for an impact-focused buyout fund targeting companies helping the world operate within its ecological limits, an executive told Reuters. The Eurazeo Planetary Boundaries Fund is based on the scientific concept of ‘planetary boundaries’, which define thresholds on everything from pollution to biodiversity loss within which the world must remain to be habitable.

Calpers Veteran Who Oversees Private Debt Bets to Leave in July; Jean Hsu leaving largest US pension fund after almost 25 years; Fund had $12.8 billion in private debt exposure as of April 30
Gillian Tan – Bloomberg
Jean Hsu, the global head of private debt at California Public Employees’ Retirement System, resigned after almost a quarter-century at the largest US pension fund. “My time at Calpers has been the opportunity of a lifetime – and after 25 rewarding years, it is time to start a new chapter,” Hsu wrote in an email to investment firms seen by Bloomberg News. She’ll remain at Calpers until July.

Work & Management

Wall Street’s Five-Day Office Rules Aren’t Our Fault, Watchdog Finra Says; Regulatory changes give firms more flexibility, official says; Yet some bosses are warning staff to prepare for daily commute
Gillian Tan – Bloomberg
As Wall Street bosses warn employees that regulatory changes are about to end their days of working from home, the watchdog in charge has a blunt message: Stop blaming us. “There is no rule requiring registered persons to work from an office five days a week,” said Kayte Toczylowski, head of member relations and education at the Financial Industry Regulatory Authority.

JPMorgan and Goldman Sachs want bankers back in the office 5 days a week, but one bank CEO says he only took his $4.2 million job on the condition he could work from home
Eleanor Pringle – Fortune
The finance industry-on average-isn’t a massive fan of hybrid work. However, one bank CEO said the condition for him to take the top job-and a $4.2 million salary-was to work from home a few days a week. Mike Regnier is the CEO of Santander UK, the fifth-largest bank in the country with 19,000 staff on its payroll. And unlike JPMorgan’s Jamie Dimon-who said workers who want to be remote will have to find another role-and Goldman Sachs David Solomon-who has called his staff back to their desks five days a week-Regnier allows his staff to come to the office just twice a week.

Wellness Exchange

A Michigan farmworker is diagnosed with bird flu in 2nd U.S. case tied to dairy cows
The Associated Press
A Michigan dairy worker has been diagnosed with bird flu – the second human case associated with an outbreak in U.S. dairy cows. The worker had been in contact with cows presumed to be infected, experienced mild eye symptoms and has recovered, U.S. and Michigan health officials said in announcing the case Wednesday. A nasal swab from the person tested negative for the virus, but an eye swab tested positive, “indicating an eye infection,” the U.S. Centers for Disease Control and Prevention said in a statement.

Gas stoves may contribute to early deaths and childhood asthma, new Stanford study finds
Tony Briscoe – Los Angeles Times
Lung-irritating pollution created by cooking with gas stoves may be contributing to tens of thousands of premature deaths and cases of childhood asthma in the United States, according to a new study published in the journal Science Advances. For decades, scientists have known the flames from a gas stovetop produce nitrogen dioxide, a pungent gas that can inflame a person’s lungs when inhaled. But for the first time, a team of researchers from Stanford University and Oakland-based research institute PSE Healthy Energy published a nationwide estimate of the long-term health consequences associated with cooking with natural gas and propane stoves.

ADHD diagnoses are rising. 1 in 9 U.S. kids have gotten one, new study finds
Maria Godoy – NPR
About 1 in 9 children in the U.S., between the ages of 3 and 17, have been diagnosed with ADHD. That’s according to a new report from the Centers for Disease Control and Prevention that calls attention-deficit/hyperactivity disorder an “expanding public health concern.” Researchers found that in 2022, 7.1 million kids and adolescents in the U.S. had received an ADHD diagnosis – a million more children than in 2016. That jump in diagnoses was not surprising, given that the data was collected during the pandemic, says Melissa Danielson, a statistician with the CDC’s National Center on Birth Defects and Developmental Disabilities and the study’s lead author.


Fruit Picker Who Said Her Hands Bled From Work Sues UK Employer; Discrimination case is first of its kind, advocate says; UK relies on migrant workers to keep its farms running
Aine Quinn – Bloomberg
A Nepalese farm worker who came to the UK to pick berries is suing her ex-employer for unpaid wages and discrimination in what campaigners say is the first case of its kind. Sapana Pangeni, 31, said in a witness statement given Wednesday that her hands bled because she was not given gloves and was forced to live in an unheated caravan in winter 2022 with five men at a farm near Reading in Southern England.

Japan’s ‘wall of money’ is too big a temptation to resist; Private equity funds see the country’s financial institutions and wealthy individuals as an untapped opportunity for capital
Leo Lewis – Financial Times
Earlier this month Carmelo Anthony, the 10-time National Basketball Association All-star, three-time Team USA Olympic gold medallist and two-time Male Basketball Athlete of the Year, barrelled through Tokyo on a week-long tour. His hosts were life insurers, asset managers and mega banks. A few of them managed to get the New York Knicks legend to sign shirts and caps but Anthony was there on business: the punishing, end-to-end schmooze-slog required to raise private equity funding in increasingly testy global markets.

India Needs ‘Balancing Act’ to Manage Bond Index Flows, S&P Says
Ruchi Bhatia – Bloomberg
Indian policymakers will face a “balancing act” in managing anticipated foreign capital inflows from its bonds’ inclusion in key global indexes while trying to retain the rupee’s general stability, according to an S&P Global Ratings economist. Tapping the country’s $644 billion reserves to tame volatility is an option, but that can be “fairly costly,” senior economist Vishrut Rana said in an interview Wednesday. Letting currency volatility play out may lead to an increase in bond yields and raise the government’s funding costs, he said.

Options Traders Pile Into Big Short on India Volatility
Ishika Mookerjee and Chiranjivi Chakraborty – Bloomberg
In a market that’s captured the attention of global finance for allegedly making $1 billion for Jane Street Group, many trading firms are employing a relatively simple strategy: short volatility. The trade, or variations of it, revolves around a bet that Indian stock indices will move within relatively small ranges, according to five participants familiar with the strategy, who asked not to be identified discussing private information. Significant amounts of capital are deployed to scale the derivatives bets in the world’s largest market by number of options contracts traded, the people said.

IMF Calls Zimbabwe Switch to Gold-Backed ZiG an ‘Important’ Step
Ray Ndlovu – Bloomberg
The International Monetary Fund welcomed Zimbabwe’s introduction of a new gold-backed currency as a positive step, in its first substantive comment on the ZiG since it was introduced last month. “The introduction of ZiG represents an important policy action accompanied by several complementary policy changes – including monetary, exchange rate, and fiscal policy measures,” a spokesperson for the Washington-based lender said in an emailed response to Bloomberg questions.

US Calls for Coordinated Action by Lenders to Indebted Nations; Goal is to aid countries owing billions to bilateral creditors; US has sought to cast lending from China as unsustainable
Eric Martin – Bloomberg
The US plans to announce a broad outline for helping developing nations ease mounting debt burdens, particularly owed to China, which it says have stifled investments in critical sectors like climate adaptation. The so-called Nairobi-Washington Vision, to be unveiled Thursday during Kenyan President William Ruto’s state visit to the White House, will call on creditor countries to provide more forms of debt relief and for international financial institutions to coordinate support packages, according to senior Biden administration officials. It will also urge creditors to provide more transparent lending, and encourage more private-sector investments.


Oreo-Maker Mondelez Fined $366 Million for Carving Up EU
Samuel Stolton – Bloomberg
Mondelez International Inc. was fined EUR337.5 million ($366 million) after European Union antitrust watchdogs said the US company illegally thwarted cross-border sales of its chocolate, cookies and coffee. The EU said the maker of Côte d’Or chocolate, Ritz crackers and Oreo cookies reached anticompetitive agreements with distributors to carve up markets and bump up prices.

How the Boy Scouts rolled out their rebrand and weathered name-change controversy; Scouting America will take the place for the century-old name.
Allison Carter – PR Daily
After 114 years, the Boy Scouts of America are changing their name – but little else about the organization. The “boy” is dropping out of the name, which will become simply Scouting America. “Certainly, Boy Scouts of America’s got to be one of the most highly recognizable names out there in terms of youth service, but you’ve got to do something to retain that, but also make sure that everyone feels welcome,” Michael Ramsey, chief marketing officer of the organization, told PR Daily.

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The Stock Market Has Rarely Been This Sleepy

Lead Stories The Stock Market Has Rarely Been This Sleepy Gunjan Banerji - The Wall Street Journal It's eerily calm out there in the stock market. The Cboe Volatility Index, or VIX, dropped below 12 last week, a nearly five-year low. The gauge, based on options prices...

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