John Lothian Newsletter: SEC Approves Plan To Expand Flash-Crash Safeguards; LME: Last 2 Bidders To Resubmit Sale Proposals June 7; Feds Eye MF’s False Promise

Jun 4, 2012

The SEC gives a thumbs-up on a plan to upgrade anti-flash-crash rules for next year. ICE and HKEx have been told by the London Metal Exchange to think over their purchase plans very carefully, and then resubmit them later this week. Federal investigators are paying more attention to statements made by MF Global employees that warnings of trouble and insufficient funds were ignored shortly before the company imploded.

First Read

HKEx turns to Noble for finance chief
By Jeremy Grant in Singapore – Financial Times
Hong Kong Exchanges & Clearing (HKEx) has hired Stephen Marzo as chief financial officer from the same job at Noble Group, one of Asia’s largest commodity and agribusiness companies. The move comes as HKEx recently signalled its ambition to push into commodities.
http://jlne.ws/L1eVC6
**JK – Push is a harsh word. HKEx is a  pusher of commodities.

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May Is Most-Active Trading Month All-Time At CBOE Futures Exchange
The CBOE Futures Exchange, LLC (CFE) today announced that May 2012 was the most-active trading month in CFE history as total volume exceeded two million contracts for the first time ever. New records were established in total monthly volume and monthly average daily volume (ADV) both exchange-wide and for futures on the CBOE Volatility Index (the VIX Index).
http://jlne.ws/L1eVCf
**JK – Trade in May and keep on going.

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IntercontinentalExchange Announces Upcoming Launch of New LNG Cleared Swap on the Japan Korea Marker
IntercontinentalExchange, a leading operator of global regulated futures exchanges, clearing houses and over-the-counter (OTC) markets, today announced it will launch a new liquefied natural gas (LNG) cleared swap contract based on the Platts daily assessment for the Japan/Korea Marker (JKM).
http://jlne.ws/L1eVCg

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BOX Options Exchange June 2012 InBOX
This is the June issue of InBOX, your news source from inside the BOX Options Exchange. This monthly publication will provide convenient summaries of recent developments at BOX.
http://jlne.ws/L1eTKt

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IPO doubts plague Nasdaq’s Grief-eld
By MARK DECAMBRE – NY Post
Companies in the early stages of going public are raising questions about whether they want to list with Nasdaq, The Post has learned. The questions, coming two weeks after Bob Greifeld’s exchange botched the largest, most anticipated initial public offering in a generation – Facebook’s $16 billion coming-out party – are the first indication that Nasdaq’s headaches over the snafu are likely to linger.
http://jlne.ws/L1eVSA

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Why People Are Going Nuts Over The New George Soros Speech On Europe
Joe Weisenthal | Business Insider
People are going crazy for the new George Soros speech on Europe, which is available on at his official website. We called it brilliant and a dynamo in our post on it yesterday.
http://jlne.ws/L1eTKE

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Bubbles Are Pathological Extrapolations That Prices Go Up Forever
Robert Lenzner – Forbes
Bubbles, whether in Japanese stocks in the 1990s, tech stocks in the US in 2000, or the price of residential real estate 2005-2008, are the result of “heightened expectations” in the economy, Prof. David Laibson explained at Harvard the other day.
http://jlne.ws/L1eTKJ

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Can a banking union save the euro?
by Gavyn Davies – Financial Times
A few weeks ago, after the Greek election on May 6, a consensus developed among many macro investors about the likely path for the eurozone crisis during the summer.
http://jlne.ws/L1eU10

A real banking union can save the eurozone
By Wolfgang Münchau – Financial Times
We have reached a rare moment in the eurozone crisis: I seem to be more optimistic than financial markets. I do not believe that Greece will leave the eurozone and I see a small chance that the June 28 meeting of the European Council will bring agreement on a banking union of sufficient strength.
http://jlne.ws/L1eVSP

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How technology is changing Futures & Crop Reports
National Corn Growers Association
As the world moves closer to trading around the clock, the future of crop report release times is being pondered. Some options being considered include changing the reports to the afternoon or running them on weekends to take them out of live trading time.
http://jlne.ws/L1eVST

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Annual Warren Buffett lunch auction begins Sunday
Associated Press via Yahoo! News
It’s true that Warren Buffett hired the hedge fund manager who won the last two private lunches with him that are part of an annual auction, but he doesn’t expect the event to become a recruiting tool for Berkshire Hathaway.
http://jlne.ws/L1eU19

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Small Fish Burned in Facebook IPO Knew Better
By William D. Cohan – Bloomberg
You know that the hand-wringing over the almost 25 percent drop in the value of Facebook’s Inc.’s stock since its May 17 IPO has reached a new level of disproportion when ABC’s “Good Morning America” weighs in with the idea that maybe Mark Zuckerberg should abandon his honeymoon and return to Silicon Valley to somehow make things better for the gullible investors who got singed.
http://jlne.ws/L1eUhu

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Numerix To Host Upcoming Webinar: “The Impact of OIS Discounting – Valuation Approaches Re-examined”
Join Numerix on Friday, June 8th For A Webinar Discussion Examining Valuation Approaches & Best Practices In The New Multi-Curve Framework
Numerix (www.numerix.com), the leading provider of cross-asset analytics for derivatives valuations and risk management, will host a complimentary webinar on Friday, June 8 at 10:30 AM EDT where Ms. Anna Barbashova, Business Analyst for Numerix will examine the impact of OIS (Overnight Index Swaps) discounting on valuation approaches, and how valuation best practices have changed in the new multi-curve framework.

This webinar is complimentary, but registration is required as space is limited. For complete details and to register, visit
http://jlne.ws/L1eW9k

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InformationWeek Financial Services Webcast: High-Frequency Trading: The Good, The Bad and The Ugly
Date: Tuesday, June 5, 2012
Time: 9:00 AM PT / 12:00 PM ET
Duration: 60 minutes

There is no topic more controversial in today’s marketplace than high-frequency trading. Regulators are still wrestling with how to officially define the practice, let alone police it. And in the two years that have elapsed since the flash crash of 2010, market participants of all stripes remain divided on the issue. Firms with longer-term, low-turnover strategies remain suspicious of high-frequency traders, while others hold the view that if it weren’t for HFTs, there’d be no liquidity. Join this Advanced Trading Editorial webcast to hear experts from both sides of the issue debate whether HFT is good or bad for the market, and to hear a proposal on how to fix our market’s structure for the better.

For details and to register, visit http://jlne.ws/L1eUhx

MarketsWiki

MarketsWiki Page of the Day
Stanley Young
http://jlne.ws/JYghfq

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MarketsWiki Recent Updates

People

Stanley Young

Companies, Organizations and Groups

CBOE Futures Exchange; Penson Worldwide Inc.; PEAK6 Investments, L.P.; Knight Capital Group; Cortland

Products

CBOE NASDAQ Volatility Index; VIX; CBOE Volatility Index Futures; CBOE Weeklys; Euro-OAT Futures; CME Black Sea Wheat; ICE Corn futures; CME Corn futures

Miscellaneous

Dark pool; Corn futures

Statistics

24,597,258 pages viewed, 6,882 articles, 141,545 edits
MarketsWiki Statistics

Lead Stories

SEC Approves Plan To Expand Flash-Crash Safeguards
By Jacob Bunge Of DOW JONES NEWSWIRES
The Securities and Exchange Commission on Friday approved a long-awaited plan by U.S. stock exchanges to upgrade and broaden measures designed to guard markets against another “flash crash,” about two years after such an event occurred.
http://jlne.ws/L1eWpE

LME: Last 2 Bidders To Resubmit Sale Proposals June 7
Dow Jones
IntercontinentalExchange Inc. and Hong Kong Exchanges and Clearing Ltd. have been asked to resubmit their proposals to buy the London Metal Exchange on June 7, a senior LME executive told Dow Jones Newswires Friday.
http://jlne.ws/L1eWpM

Feds Eye MF’s False Promise
By JULIE STEINBERG, AARON LUCCHETTI and MIKE SPECTOR – WSJ
Federal investigators are scrutinizing a series of conversations among MF Global Holdings Ltd. employees shortly before the securities firm erroneously told regulators that its customer funds were safe, said people with knowledge of the probe.
http://jlne.ws/L1eWpS

Red Flags Were Raised on Client Cash, MF Global Inquiry Is Told
By BEN PROTESS and AZAM AHMED – NY Times
Federal investigators are conducting a final round of interviews with former MF Global employees, as they weigh whether to file criminal charges against some senior executives and grant another one immunity from prosecution.
http://jlne.ws/M43cV2

PLUS Markets Group Statement In Response To Press Release From Gulf Merchant Bank
The Board of PLUS Markets Group plc confirms that it yesterday received a letter through its advisers relating to the possible conditional acquisition by Gulf Merchant Bank or its affiliates of the Group’s subsidiary, PLUS Stock Exchange plc. The Board of PLUS Markets Group plc also notes the recent press release issued by GMB and related press comment and makes the following statement in response to these items and events.
http://jlne.ws/L1eWGc

Bank of America Withheld Loss Figures Ahead of Merrill Vote
By GRETCHEN MORGENSON – NY Times
Days before Bank of America shareholders approved the bank’s $50 billion purchase of Merrill Lynch in December 2008, top bank executives were advised that losses at the investment firm would most likely hammer the combined companies’ earnings in the years to come. But shareholders were not told about the looming losses, which would prompt a second taxpayer bailout of $20 billion, leaving them instead to rely on rosier projections from the bank that the deal would make money relatively soon after it was completed.
http://jlne.ws/L1eUy3

Gas prices are silver lining as economy weakens
Associated Press via Yahoo! News
There’s some good news behind the discouraging headlines on the economy: Gas is getting cheaper. At least two states had stations selling gas for $2.99 on Friday and it could fall below $3 in more areas over the weekend.
http://jlne.ws/L1eUy4

Matsushita Tapped to Tackle Insider Trades as New Japan FSA Head
Bloomberg
Tadahiro Matsushita, a Japanese Lower House lawmaker, is set to helm the country’s financial watchdog, replacing Shozaburo Jimi as the government intensifies probes into insider trading and accounting fraud.
http://jlne.ws/L1eUy7

JPMorgan So-Called Hedge Is Awkward for Fed Knowing Its Meaning
Bloomberg
When is a hedge not a hedge? That’s the question regulators from the Federal Reserve to the Office of the Comptroller of the Currency are confronting after JPMorgan Chase & Co. (JPM) reported a $2 billion trading loss from a credit-derivatives position Chief Executive Officer Jamie Dimon called a “hedge.”
http://jlne.ws/L1eWGp

In Economic Deluge, a World That Can’t Bail Together
By FLOYD NORRIS – NY Times
Less than four years ago, with the world’s financial system in danger of collapsing, major countries managed to come together on a coordinated course that averted a global depression.
http://jlne.ws/L1eWWG

Eurozone: Is Spain Going to Need a E300 Billion Bailout?
Tim Worstall – Forbes
That’s the supposition being made by the Daily Mail today, that Spain is going to require a E300 billion (near $400 billion) bailout to prevent complete economic meltdown.
http://jlne.ws/L1eWWJ

Euro Zone Is Lurching to a Crossroad
By LANDON THOMAS Jr. – NY Times
As Spain’s economic crisis deepens and uncertainty swirls over Greece’s future in the euro zone, the guardians of the increasingly fragile European monetary union are near a moment of truth: can they muster the will and resources to keep the euro zone from breaking apart?
http://jlne.ws/L1eUOw

Germany Signals Crisis Shift
By WILLIAM BOSTON – WSJ
Germany is sending strong signals that it would eventually be willing to lift its objections to ideas such as common euro-zone bonds or mutual support for European banks if other European governments were to agree to transfer further powers to Europe.
http://jlne.ws/L1eUOC

Exclusive: SEC investigator previously pushed to carry gun
Reuters via Yahoo! News
The lead internal investigator at the Securities and Exchange Commission, who is on leave after employees complained he wanted to carry a gun at work, previously tried to get a gun permit when he worked for another government agency, but the permit was denied.
http://jlne.ws/L1eWWW

MF Global trustee to report on payback efforts
Reuters via Yahoo! News
Former MF Global Holdings Ltd customers are hoping to get fresh information on Monday about where their money went and for an update on efforts to get it back.
http://jlne.ws/L1eUOJ

Regulatory

CFTC files creditor claim in MF Global bankruptcy
Reuters
The Commodity Futures Trading Commission (CFTC) staked a claim on Friday as a potential creditor of failed commodities brokerage MF Global Inc, in a sign it may charge the bankrupt firm and seek monetary sanctions.
http://jlne.ws/L1eXdf

SEC Approves Proposals to Address Extraordinary Volatility in Individual Stocks and Broader Stock Market
Press Release
The Securities and Exchange Commission has approved two proposals submitted by the national securities exchanges and the Financial Industry Regulatory Authority (FINRA) that are designed to address extraordinary volatility in individual securities and the broader U.S. stock market.
http://jlne.ws/L1eXdi

Ex-trader takes on insider dealing fight
By Brooke Masters, chief regulation correspondent – Financial Times
After three years of toiling in the regulatory shadows, Patrick Spens is ready to step into the limelight. A former Citigroup proprietary trader and hedge fund manager, Mr Spens decided to change sides after his fund’s leading investors were caught up in the collapse of Bear Stearns.
http://jlne.ws/L1eXdp

FSA to spot-check City firms
By Brooke Masters, chief regulation correspondent – Financial Times
The UK financial watchdog is to carry out spot checks on City firms’ reporting of suspicious trades, as part of its broader crackdown on market abuse, the Financial Times has learnt.
http://jlne.ws/L1eUOO

NFA Rule Submission Letters
Assessment Fee – Adoption of Interpretive Notice entitled: NFA Bylaw 1301(b): NFA’s Assessment Fee – Diminutive Notional Value Contracts and Security Futures Products
http://jlne.ws/L1eXKe

Downing Said to Resign From Justice Department Tax Post
Bloomberg
Kevin Downing, the Justice Department prosecutor who directed the U.S. crackdown on offshore tax evasion including UBS AG, agreed to join Miller & Chevalier, a Washington-based tax law firm.
http://jlne.ws/L1eXKg

IOSCO Extends The Deadline For Comments On Its Consultation Report On MMFS
The International Organization of Securities Commissions (IOSCO) has announced today that it has extended by one month the consultation period for its report on Money Market Fund Systemic Risk Analysis and Reform Options.
http://jlne.ws/L1eXKl

SIFMA Applauds SEC Approval Of Proposals To Address Extraordinary Market Volatility
http://jlne.ws/L1eXKs

AMF completes the incorporation of ESMA guidelines on risk measurement and the calculation of global exposure for certain types of structured UCITS
http://jlne.ws/L1eXKv

The Clean Energy Regulator and ASIC sign Memorandum of Understanding
http://jlne.ws/L1f0pp

Bankwest amends credit card advertising following ASIC action
http://jlne.ws/L1eY0N

Exchanges & Trading Facilities

LME Said to Get Bidders’ Assurances to Keep Trading Floor
Bloomberg
Intercontinental Exchange Inc. (ICE) and Hong Kong Exchanges & Clearing Ltd. pledged to keep the London Metal Exchange and its trading floor in the U.K. capital in their separate takeover proposals to the LME’s board, said two people with direct knowledge of the bids.
http://jlne.ws/L1f0pr

The Options Industry Council Announces May Options Trading Volume Up 5%
The Options Industry Council (OIC) announced today that 377,539,997 total options contracts changed hands in May, up 5.07 percent compared to the 359,310,820 contracts traded the previous May.
http://jlne.ws/L1f0pu

CME Group Volume Averaged 13.2 Million Contracts per Day in May 2012, up 24 Percent from April 2012
CME Group, the world’s leading and most diverse derivatives marketplace, today announced that May 2012 volume averaged 13.2 million contracts per day, down 2 percent from May 2011, but up 24 percent from April 2012.  Total volume for May was more than 291 million contracts, of which 85 percent was traded electronically.  
http://jlne.ws/K8NuVJ

ISE Reports Business Activity for May 2012
The International Securities Exchange (ISE) today reported average daily volume of 2.8 million contracts in May 2012. This represents a decrease of 3.1% compared to May 2011. Total options volume for the month was 61.5 million contracts. ISE was the second largest U.S. equity options exchange in May with market share of 18.3%*.
http://jlne.ws/L1eY0V

CBOE Holdings Reports May 2012 Trading Volume
CBOE Holdings, Inc. today reported that May trading volume for options on the Chicago Board Options Exchange (CBOE) and C2 Options Exchange (C2), combined, totaled 109.2 million contracts. May average daily volume (ADV) was just under five million contracts, an 18-percent increase from May 2011 ADV of 4.2 million contracts and a nine-percent increase from April 2012 ADV of 4.5 million contracts.
http://jlne.ws/L1eY11

Average daily volume of 11.2 million contracts at Eurex Group in May
In May 2012, the international derivatives exchanges of Eurex Group achieved an average daily volume of 11.2 million contracts (May 2011: 12.9 million). Of those, almost 8.45 million were Eurex Exchange contracts (May 2011: 10.0 million), and 2.8 million contracts (May 2011: 2.9 million) were traded at the U.S.-based International Securities Exchange (ISE). In total, 185.9 million contracts were traded at Eurex Exchange and 61.5 million at ISE. This makes May the best month in terms of trading volumes in 2012.
http://jlne.ws/L1f0pD

94 billion euros turnover on Xetra in May
Order book turnover on Xetra and the Xetra Frankfurt specialist trading stood at E99.0 billion in May – a decrease by 27 percent year-on-year (May 2011: E136.5 billion). Of the E99.0 billion, E94.1 billion were attributable to Xetra – a decrease by 28 percent y-o-y (May 2011: E130.8 billion). E4.8 billion were attributable to the Xetra Frankfurt specialist trading, an 15 percent decrease y-o-y (May 2011: E5.6 billion). Order book turnover on Tradegate Exchange* totalled approximately E2.3 billion in May.
http://jlne.ws/L1eYho

BOX Options Exchange Price Improvement Activity For May
In the month of May, price improved contracts on BOX Options Exchange (“BOX”) averaged 269,556 per day. Price improvement versus the prevailing NBBO for contracts submitted via BOX’s price improvement auction (“PIP”) averaged $176,747 per day, while total savings to investors this month were $3.9 MM.
http://jlne.ws/L1eYhv

May Statistics Report From The NASDAQ OMX Nordic Exchanges
The value of average daily share trading amounted to EUR 2.2 billion, as compared to EUR 2.4 billion during the past 12-month period. The average number of trades per business day was 366,869 as compared to 391,372 during the past 12-month period. The total market cap of listed companies at NASDAQ OMX Nordic Exchange amounted to EUR 659 billion, compared to EUR 809 billion in May 2011.
http://jlne.ws/L1eYxL

MGEX Reports May Volume; Impressive Gains in Options Volume
MGEX, a Designated Contract Market and Derivatives Clearing Organization, today announced May futures and options volume for its flagship Hard Red Spring Wheat (HRSW) contract, including a dramatic increase in options volume. When compared to the previous month, options volume increased by a staggering 228 percent and marked a year-over-year increase of 36 percent. A total of 87,882 futures and options contracts traded on the Exchange in May with futures trades accounting for 85,536 contracts.
http://jlne.ws/L1eYxQ

KCBT HRW Wheat Futures & Options Open Interest Increases Over Last Month
The Kansas City Board of Trade during the month of May saw increases in open interest in both the HRW wheat futures and wheat options contracts compared to last month.
http://jlne.ws/L1eYy1

OneChicago Announces Trading Volumes for May 2012
OneChicago, LLC (OCX), an equity finance exchange, today announced that a total of 259,382 security futures contracts were traded in the month of May 2012.
http://jlne.ws/L1eYOi

Key figures SIX Swiss Exchange and Scoach Switzerland:
A total of 2,947,101 transactions were conducted on SIX Swiss Exchange and Scoach Switzerland in May 2012. This represents an increase of 11.9% compared with April. All of the segments contributed to this result. As a result, May showed the highest number of trades of any month for the year to date. Trading volume increased by an aggregated 4.0% to CHF 75.5 billion.
http://jlne.ws/L1eYOk

SIX Swiss Exchange launches SMI Risk Control indices
SIX Swiss Exchange today announced the launch of SMI Risk Control indices, which replicate a hypothetical portfolio that diversifies the risk contained within the SMI. This portfolio consists of an investment in the SMI and a money market allocation, measured by the SARON overnight interest rate. The asset allocation of the new indices will be reviewed on a daily basis to maintain the target level of risk.
http://jlne.ws/L1f0WC

The Spanish Stock Exchange Traded E70.38 Billion In May, Up 7% From The Previous Month
The equity trading volume on the Spanish Stock Exchange in May was E70.38 billion, up 7% from the previous month but 15% down on the same period last year. The trading volume for the first five months totaled E313.08 billion, down 23.9% from the same period in 2011.
http://jlne.ws/L1f0WG

WSE Launches UTP Education And Information Campaign
In November 2012, the Polish capital market will undergo a major technological and qualitative break-through: the implementation of the new trading system on the Warsaw Stock Exchange. The Universal Trading Platform (UTP) acquired by the WSE from NYSE Euronext is a trading system which integrates the highest global technology standards and is now used by the stock exchanges in New York, Paris, Lisbon, Amsterdam, and Brussels. This November, the Warsaw Stock Exchange joins the group and gets access to the global technology infrastructure which has for years served investors around the world.
http://jlne.ws/L1eYOw

NASDAQ OMX Nordic to offer trading in all Norwegian shares
NASDAQ OMX Nordic today announced the plan to broaden its Norwegian shares trading and routing offering, by enabling its members to trade all shares listed on Oslo Børs on NASDAQ OMX Stockholm AB.
http://jlne.ws/L1f1d3

Reminder: Direct Edge Trading Notice #12-19: Requirement For Members To Identify Orders As Principal, Agency, Or Riskless Principal, Effective June 4, 2012
http://jlne.ws/L1eZ51

[CBOE] Trader E-News
http://jlne.ws/L1eZ55

NASDAQ OMX member firms’ trading activity 05/2012
http://jlne.ws/L1f1tt

Program Trading Averaged 29.8 Percent of NYSE Volume during May 21-25
http://jlne.ws/L1f1tz

TOM MTF Statistics Week 22 2012
http://jlne.ws/L1eZlv

Hedge Funds & Managed Futures

The Curtain Opens on 401(k) Fees
By GRETCHEN MORGENSON – NY Times
IF recent stock market gyrations have taken a bite out of your 401(k), get ready for more discomfort. You’re about to learn how much you’re paying just to maintain that account. New Labor Department rules will require fuller disclosure about the fees charged on 401(k)’s.
http://jlne.ws/L1eZly

Hedge Funds in Longest Rout Since Global Recession: Commodities
Bloomberg
Hedge funds curbed bullish bets on commodities for a third consecutive month, the longest retreat since the global recession, as Europe’s worsening debt crisis and slowing U.S. job growth sent prices tumbling.
http://jlne.ws/L1eZlA

DEUTSCHE BANK: We Are Witnessing The ‘Maximal Breakdown Of Historical Correlations’ Across The Financial Markets
Matthew Boesler | Business Insider
There’s a “new protocol” on how stocks, bonds, and currencies trade, writes analyst Aleksandar Kocic at Deutsche Bank. In a note to clients this morning, Kocic points to the apparent dichotomy between reality (record low yields with the 10-year US Treasury below 1.5 percent) and economists’ forecasts:
http://jlne.ws/L1eZC0

Ross Hikida, Veteran of BlackRock Japan and Barclays Global Investors, Joins AARM Corp.’s Board of Directors
Alternative Asset Risk Management Corp. today announced that Ross Hikida, former president of BlackRock Japan Co., Ltd. and CEO of Barclays Global Investors Japan Limited (BGI), has joined the company’s Board of Directors.
http://jlne.ws/L1f1Kd

Banks & Brokers

Analysis: How Morgan Stanley sank to junk pricing
Reuters via Yahoo! News
The bond markets are treating Morgan Stanley like a junk-rated company, and the investment bank’s higher borrowing costs could already be putting it at a disadvantage even before an expected ratings downgrade this month. Bond rating agency Moody’s Investors Service has said it may cut Morgan Stanley by at least two notches in June, to just two or three steps above junk status.
http://jlne.ws/L1f20s

Morgan Stanley wants to hike stakes
Omaha World-Herald
Morgan Stanley’s chief executive, James Gorman, has made it clear he wants to get his hands on the brokerage business it owns with Citigroup. Now, he will spend the next few months figuring just how much the business, Morgan Stanley Smith Barney, is worth to his bank.
http://jlne.ws/L1f20B

JPMorgan Still Top Wall Street Fixed Income Trader: Analyst
TheStreet.com
JPMorgan Chase is likely to remain a leader in global fixed income trading, along with Deutsche Bank and Barclays PLC, according to Citigroup’s 141 page analysis this week of the likely impact of new regulations in the space.
http://jlne.ws/L1f20J

J.P. Morgan Makes More Risk Management Changes
Wall Street Journal Blogs
The risk management changes continue at J.P. Morgan as it battles the fallout from its trading blunder.
http://jlne.ws/L1eZSw

Trader in Société Générale Debacle: Bank Shares Blame
BY NOÉMIE BISSERBE – WSJ
Jérôme Kerviel, the former Société Générale SA trader whose bets led to one of the largest trading losses ever, still won’t say why he did it. Asked the question during a brief meeting at his lawyer’s office recently, he lit a cigarette and checked for messages on his cell phone.
http://jlne.ws/L1eZSx

Lazard hires former Brazilian central banker
By Tom Braithwaite in New York – Financial Times
Lazard is hiring the former president of the Brazilian central bank and integrating its Brazilian joint venture as the independent investment bank looks to expand in the country.
http://jlne.ws/L1eZSz

With old rules gone, bankers make risky bets
KEN BENSINGER, Los Angeles Times
The nation’s biggest banks like to tout their low-cost checking accounts, extensive ATM networks and loans to home buyers and Main Street merchants. Somehow those folksy messages never seem to get around to mentioning another part of the banking business: high-pressure trading rooms where a company’s best and brightest bet hundreds of millions of dollars on arcane financial instruments such as over-the-counter synthetic derivatives and credit default swaps.
http://jlne.ws/L1f2hb

D.A. Davidson & Co. Receives Most Productive Broker Award for 2nd Year from Thomson Reuters / Financial Times
Business Wire via Yahoo! Finance
D.A. Davidson & Co. has received the Most Productive Broker Thomson Reuters / Financial Times Award for the second year in a row.
http://jlne.ws/L1f2xv

Knight Capital Group Completes Acquisition of the Futures Division of Penson Financial Services, Inc.
http://jlne.ws/L1f090

Clearing & Settlement

Over $1 trillion notional of buy-side interest rate swaps cleared on SwapClear
LCH.Clearnet Limited’s interest rate swap (IRS) clearing service, SwapClear, announced that more than one trillion dollars in buy-side client notional volumes have been cleared on its market-leading platform. Activity has intensified in the run-up to regulatory reform, as clients capitalize on the benefits of counterparty risk reduction, and operational and capital efficiencies.
http://jlne.ws/L1f2xH

Indexes & Products

New Hedge Fund Replication ETF
ETF Trends via Yahoo! Finance
The exchange traded fund industry has offered products that try to incorporate hedge fund-like strategies. On Thursday, a new player on the block, AlphaClone, launched the first ETF to specifically track disclosed positions of hedge fund managers.
http://jlne.ws/L1f2xL

STOXX Monthly Index Report – May 2012 In Review
As of May 31, 2012 stock market indices in Europe, Asia, the U.S. and globally were down in May, according to global index provider STOXX Limited. For the month of May, the Europe, Asia, global markets and U.S. markets were down -6.82%, -3.08%, -2.87% and -0.55%, respectively.
http://jlne.ws/L1f099

Semi-Annual Review of the OMX Stockholm 30 Index
http://jlne.ws/L1f34C

Semi-Annual Review Of OMX Copenhagen 20 Index
http://jlne.ws/L1f2O4

Component Change Made In Euro STOXX 50, STOXX EUROPE 50 And STOXX North America 50 Indices – Changes Are Due To Fast Entry And Fast Exit Rules
http://jlne.ws/L1f2Oa

Technology

Scottrade Recognized as one of the World’s Most Innovative IT Companies
Business Wire via Yahoo! Finance
Investing services company, Scottrade, Inc., today received the 2012 CIO 100 Award from IDG’s CIO magazine. The annual award program recognizes organizations around the world that exemplify the highest level of operational and strategic excellence in information technology (IT).
http://jlne.ws/L1f2Oe

Enforcement

JPMorgan fined for wash trades in oil, gasoline
Reuters
JPMorgan Chase & Co executed wash trades on 10 separate occasions in U.S. crude oil and gasoline futures in the first half of 2011, the operator of the New York Mercantile Exchange (NYMEX) said in a disciplinary notice on Friday.
http://jlne.ws/L1f5JK

ASIC accepts enforceable undertaking from former Commonwealth Financial Planning adviser
http://jlne.ws/L1f5JP

Environmental & Energy

Fourteen Programs Show CO2 Trade Taking Off: World Bank
Bloomberg
New carbon programs in at least 14 emerging nations from China to Costa Rica show emissions trading may take off even as U.S. lawmakers focus on non-market-based regulations for climate protection, a World Bank official said.
http://jlne.ws/KpqHcL

CO2 market wants tougher EU 2020 climate goal
Reuters
The European Union needs to aim for a deeper emissions cut soon, to rescue a record low carbon price and spur long-term investment in low-carbon technology, leading carbon market players said at an industry gathering.
http://jlne.ws/K7lRMH

Australian Law Allows UN CO2 Use Through 2020: Negotiator
Bloomberg
Australia can accept United Nations emission offsets in its planned carbon market through 2020 and potentially beyond because it’s already signed up to the 1997 Kyoto Protocol, said one of the nation’s climate negotiators.
http://jlne.ws/JFDmT1

Amendments To The Definitions And Exclusion Of Liability Clauses In Contract Specifications For Certain GreenX European Union Allowance And Certified Emission Reduction Futures Contracts
http://jlne.ws/L1f3ld

Asia-Pacific

Japan probe highlights culture of insider trading
AFP via Yahoo! News
A probe into insider trading has thrust the spotlight on the cosy world of Japanese share dealing, with US investment banking giant JPMorgan now ensnared in the snowballing investigation.
http://jlne.ws/L1f3li

Asian banks to have tough time meeting liquidity rules: KPMG
Reuters via Yahoo! Finance
Asian banks will have a tough time meeting new global liquidity rules because of a shortage of assets such as top-rated government debt that can be converted into cash quickly, according to KPMG.
http://jlne.ws/L1f60h

China May Relax Property Curbs to Aid Growth, Deutsche Bank Says
Bloomberg
China may relax its property curbs to encourage end users to buy homes as the government seeks to support economic growth, according to Deutsche Bank AG.
http://jlne.ws/L1f60n

HKEx: Appointment Of Cash Market Consultative Panel Members
The Board of Directors of Hong Kong Exchanges and Clearing Limited (HKEx) is pleased to announce the appointment of Choy Sze Chung, Jojo and David Rabinowitz as Cash Market Consultative Panel members effective 1 June 2012 to fill the casual vacancies arising from the resignation of Cham Yau Nam and Hon Sau Yee, Kenneth.
http://jlne.ws/L1f60q

China ‘Not Hijacked by Markets’ Into Over Stimulating: Pro
CNBC
By maintaining a moderate rate of growth and not promising a huge stimulus the Chinese government has shown that it is not being “hijacked by the markets,” Steven Sun, HSBC’s Head of China Equity Strategy said Monday.
http://jlne.ws/L1f6gI

[OSE] Trading Overview in May 2012
http://jlne.ws/L1f6gM

[TFX] Trading Volume in May 2012
http://jlne.ws/JRc5mn

Tokyo Grain Exchange: Notice Of Market Consolidation
http://jlne.ws/L1f6gQ

Frontier Markets

Egypt’s EFG rebuffs buy-out offer
Reuters via Yahoo! News
Egypt’s EFG Hermes poured cold water on an offer by a group of investors to buy its shares at a premium to the market price, saying they should have filed the bid with the regulator and given shareholders better assurances.
http://jlne.ws/L1f3BL

Frontier Strategy Group Partners With Syngenta on Food Security in Emerging Markets
Frontier Strategy Group (“FSG”), a leading provider of decision-critical information to senior executives responsible for emerging markets, has recently developed a food security index in partnership with Syngenta Asia Pacific called the Rice Bowl Index.
http://jlne.ws/L1f6gZ

Developing Islamic Hedging And Liquidity Management – Welcome Remarks By Mr Tai Boon Leong, Executive Director, Monetary Authority Of Singapore At IIFM Industry Briefing On Islamic Hedging & Liquidity Management Instruments
http://jlne.ws/L1f3S7

Bursa Malaysia Introduces Referral Agent Activities
Securities and futures brokers are now able to refer their respective clients to one another following amendments made to the Securities Commission’s Licensing Handbook allowing for Referral Agent activities.
http://jlne.ws/L1f6h1

HSBC gets formal approval for Oman merger, names board, CEO
Reuters via Yahoo! News
HSBC Holdings has received formal regulatory approval to merge its business in Oman with local lender Oman International Bank, it said in a statement to the Muscat stock exchange on Sunday. The combined entity, named HSBC Bank Oman, begins operations today after gaining assent from the sultanate’s Ministry of Commerce & Industry
http://jlne.ws/L1f3Sh

MCX Weekly Market Report May 25, 2012 – May 31, 2012
http://jlne.ws/L1f3Sk

Malawi Stock Exchange Weekly Trading Report
http://jlne.ws/L1f6xk

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