LME wins High Court ruling over cancelled nickel trades

Nov 29, 2023

First Read

Hits & Takes
John Lothian & JLN Staff

Yesterday we reported on The World Federation of Exchanges‘ “Ring the Bell” to mobilize for a climate initiative. JLN wants to applaud the individual exchanges that are participating in this important public display of support to address climate change and sustainability issues.

The exchanges participating in the “Ring the Bell” initiative are:

Abu Dhabi Securities Exchange (ADX), B3 – Brasil Bolsa Balcao, Bahrain Bourse, Baku Stock Exchange, Bolsa Mexicana de Valores, Bourse Regionale des Valeurs Mobilieres S.A., Bursa Malaysia, Cboe Global Markets, Chittagong Stock Exchange PLC, Colombo Stock Exchange, The Egyptian Exchange, FMDQ Group PLC, Ghana Stock Exchange, Johannesburg Stock Exchange, Latin American Stock Exchange – Latinex, Malta Stock Exchange plc, National Stock Exchange of India Limited, Nigerian Exchange Group, The Philippine Stock Exchange, Inc., Qatar Stock Exchange, The Stock Exchange of Thailand, Taipei Exchange, Taiwan Futures Exchange and the Toronto Stock Exchange

The forthcoming Winter 2023 issue of the CID (“Commodity Insights Digest”) includes Mark Shore’s review of Scott H. Irwin’s book “Back to the Futures.” The review is available HERE.

The CME Group issued a “Notice of Disciplinary Action” yesterday for Yueyu Bao regarding CBOT rule violations involving pre-arranged trading to move trades between accounts and failure to appear before the board, exchange staff or hearing committee. Bao was hit with a $50,000 fine and permanently suspended from access to any trading floor controlled by CME Group and from direct and indirect access to any designated contract market, derivatives clearing organization, or swap execution facility owned or controlled by CME Group.

Bloomberg has a story reporting “London Finance Workers to See Biggest AI Impact, UK Report Finds.” The story says, “Management consultants and City of London finance workers are among those most exposed to workplace changes ushered in by artificial intelligence, a new UK government report found, urging changes in schools and training programs to ease the impact.”

The Wall Street Journal is reporting that “U.S. Suicides Reached a Record High Last Year” and “Older men are at highest risk, while suicide rates among young people have declined.” According to the story, “Nearly 50,000 people in the U.S. lost their lives to suicide in 2022, according to a provisional tally from the National Center for Health Statistics.” Also, “Men 75 and older had the highest suicide rate last year at nearly 44 per 100,000 people, double that for people 15-24.”

I asked ChatGPT for some of the best quotes from Berkshire Hathaway Vice Chairman Charlie Munger, who died yesterday at the age of 99. Here are the top five:

1. “Spend each day trying to be a little wiser than you were when you woke up.”
2. “The big money is not in the buying and selling… but in the waiting.”
3. “In my whole life, I have known no wise people who didn’t read all the time – none, zero.”
4. “It’s not supposed to be easy. Anyone who finds it easy is stupid.”
5. “The best thing a human being can do is to help another human being know more.”

He left us a pretty good legacy of advice.

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

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COP 28 convenes Nov. 30 through December 12 in Dubai, UAE. The United Nations has announced its global focus this COP 28 as accelerating private sector climate action. The initiative, expressed through a series of events dubbed Forward Faster, calls on business leaders to take measurable, credible and ambitious action in five areas – gender equality, climate action, living wage, water resilience and finance and investment. Collectively these areas have the power to accelerate progress across all 17 Sustainable Development Goals (SDGs) where the private sector can make the biggest impact by 2030. Sign up to follow the sessions, many of them streamed, here. ~SAED

Our most read stories from our previous edition of JLN Options were:
Nasdaq’s Kevin Kennedy Discusses GEMX Launch on AWS Cloud, Highlights Latency Improvements and Future Cloud Migration Plans from John Lothian News.
Goldman Says Sharp Drop in Volatility Is Opportunity for Hedging from Bloomberg.
Hedge Fund Chief Marshall Demands Share of Treasure Found at Sea from Bloomberg. ~JB

Subscribe to the JLN Options Newsletter HERE (it’s free).

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A Deeper Dive into 0DTE Options trading: Jonathan Zaionz, Senior Derivatives Analyst at Cboe Global Markets and Author of “The Rise of SPX & 0DTE Options,” Discusses 0DTE and More in this Options Discovery Full Interview
JohnLothianNews.com

In this Options Discovery full interview, Asma Awass speaks with Jonthan Zaionz, a senior derivatives analyst at Cboe Global Markets who recently had his paper, “The Rise of SPX & 0DTE Options” published. Jonathan addresses a variety of topics from his career, including his passion for the derivatives space as well as the content published in his most recent article. Jonathan also gives more insight into 0DTE options trading such as the history, misconceptions, benefits and risks. You can download “The Rise of SPX & 0DTE Options” here: https://cottconsulting.com/services

Watch the video »

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The $7 Trillion ETF Boom Gets Blamed Again for Dumb Stock Moves
Emily Graffeo – Bloomberg
It’s the latest critique of the passive-investing boom: Fresh academic research claims that the relentless flood of index-chasing cash on Wall Street is distorting stock prices and causing extreme market moves. With assets in such exchange-traded funds now above $7.1 trillion in the US alone, a team from Goethe University in Frankfurt has published a paper arguing the frenzy is disrupting the natural investing order by spurring equity gyrations and blunting the role of company earnings on market prices, among other charges.
/jlne.ws/47TTQrx

***** My question is, what happens when there is little left to index?~JJL

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Singapore Central Banker Sees Private Crypto on Its Way Out
Claire Jiao and Anup Roy – Bloomberg
Private cryptocurrencies that failed the fundamental tests of financial services will eventually exit the monetary scene, according to Singapore’s central bank chief. That will leave a future monetary system made up of three key components: central bank digital currencies, tokenized bank liabilities and “well-regulated” stablecoins, Monetary Authority of Singapore’s Managing Director Ravi Menon said in Hong Kong on Tuesday.
/jlne.ws/47xbykX

****** I think I will let the market decide.~JJL

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Tuesday’s Top Three
Our top clicked item Tuesday was a tie between the web page for GivingTuesday and Fortune’s Gary Gensler has remade the SEC into a crypto nemesis and climate warrior. Now a backlash is brewing. Second was The Case That Could Destroy the Government, from The Atlantic. Third was our MarketsWiki page for John McPartland of Hidden Road Partners, who talked to Corties Draper about the function and purpose of clearinghouses in our latest episode of “Futures Discovery.”

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Lead Stories

LME wins High Court ruling over cancelled nickel trades; Judges dismiss claims against metal exchange by Elliott Management and Jane Street
Alistair Gray – Financial Times
The London Metal Exchange has won a landmark legal victory against traders who sued over its decision to cancel billions of dollars worth of nickel trades as England’s High Court dismissed claims it acted unlawfully. The world’s largest metal exchange was accused by hedge fund Elliott Management and market maker Jane Street Capital of making hasty and unlawful decisions during a crisis in the nickel market last year, when prices more than tripled in one day.
/jlne.ws/3RjcALK

Wall Street Banks Are Poaching Rival AI Talent; Wall Street giant has lost more than 100 AI staffers to rivals; That was partly offset by Goldman’s hiring from those peers
William Shaw – Bloomberg
For months, banks have been jockeying to lure the best AI talent to their ranks – and Goldman Sachs Group Inc. has been on the losing end of that fight. The Wall Street giant has seen a net outflow of 60 people to rivals such as Morgan Stanley and Citigroup Inc. in the 12 months through September, the most of any of its biggest rivals, according to data compiled by the consultancy Evident. Bank of America, which is down 55 staffers, suffered the second-biggest exodus, while Wells Fargo & Co. had the biggest net increase with 130 people.
/jlne.ws/47V5vGu

JPMorgan vs Citi: the Wall Street fight to bank New York’s top lawyers; As law firm partner pay has soared, so has their desirability as clients for private bankers
Roula Khalaf – Financial Times
JPMorgan Chase has stepped up efforts to lure New York’s top lawyers to its private bank, seeking to break rival Citigroup’s stranglehold on some of Wall Street’s wealthiest clients. JPMorgan this year poached one of Citi’s top private bankers in the field, Bola Oyesanya, in a bid to chip away at its rival’s dominance in New York. Oyesanya was previously running Citi’s law firm group focused on the New York region and joined JPMorgan in July to run its own law firm banking team.
/jlne.ws/3GruCoB

Charlie Munger Wrote His Own Best Eulogy; Read and learn: It’s all in the commentary and the hard numbers that he posted decade after decade with Warren Buffett.
John Authers – Bloomberg
RIP Charlie Munger. Charles Munger, vice chairman of Berkshire Hathaway and Warren Buffett’s indispensable partner in the most remarkably sustained investment success in history, has passed away barely a month short of his 100th birthday. Possessed of an even sharper tongue than his business partner, he long ago assured an enduring place as one of the most influential investors ever to have lived.
/jlne.ws/3t593Ho

Berkshire Hathaway’s Charlie Munger dies aged 99; Warren Buffett’s longtime lieutenant and business partner was vice-chair of famed investment conglomerate
Eric Platt – Financial Times
Charlie Munger, the sharp-witted vice-chair of Berkshire Hathaway and investment partner of Warren Buffett, died at the age of 99 on Tuesday morning at a California hospital, the US investment conglomerate said in a statement. Munger, a trained lawyer whose name still sits atop of Los Angeles law firm Munger, Tolles & Olson, was instrumental in turning Berkshire into the investment powerhouse it is today.
/jlne.ws/47RLQaG

Charlie Munger, Who Helped Buffett Build Berkshire, Dies at 99; He became a billionaire from his stake in Berkshire Hathaway; Munger could say to Buffett: ‘You’re not thinking straight’
Noah Buhayar – Bloomberg
Charles Munger, the alter ego, sidekick and foil to Warren Buffett for almost 60 years as they transformed Berkshire Hathaway Inc. from a failing textile maker into an empire, has died. He was 99. He died on Tuesday at a California hospital, the company said in a statement. He was a longtime resident of Los Angeles. “Berkshire Hathaway could not have been built to its present status without Charlie’s inspiration, wisdom and participation,” Buffett said in the statement.
/jlne.ws/3RhgRz8

Hong Kong stock market ‘task force’ urges push to win Middle East IPOs; Group set up by territory’s government also recommends outreach in south-east Asia as listings from China dry up
Hudson Lockett and Chan Ho-him – Financial Times
A task force set up by Hong Kong’s government to boost stock market listings and trading activity has urged the territory to focus its efforts on companies and investors in the Middle East and south-east Asia, after outreach to the US and Europe was held back by China’s strict zero-Covid policies.
/jlne.ws/3sUDnVc

ICE Surgically Transfers CDS Positions from Europe
Shanny Basar – MarketsMedia
In June 2022 ICE said it would stop clearing credit default swaps in Europe and in October this year the exchange closed out the final open interest at ICE Clear Europe and re-established positions in the US at ICE Clear Credit. The process involved developing a new matching algorithm at ICE Link, a post-trade affirmation platform for buy-side and sell-side CDS market participants, in just three months.
/jlne.ws/46z4DXg

City minister tells UK regulators to allow more risk-taking; Speaking at FT Global Banking Summit, Bim Afolami says watchdogs should not aim to oversee ‘safest graveyard’
Michael O’Dwyer, Rafe Uddin and Stephen Morris – Financial Times
The new minister for the City of London has said UK regulators need to be more comfortable with risk-taking by companies. Bim Afolami, who was promoted in a ministerial reshuffle this month, said on Tuesday that regulators “need to realise that if you’re regulating a market, in any area, there’s no point having the safest graveyard”. “Animal spirits need to be there, we need to innovate, we need to drive growth and initiative,” he told the Financial Times Global Banking Summit, adding that this needed to be balanced with effective regulation.
/jlne.ws/3QYqlhw

Citibank employees called them ‘Armenian bad guys’ and canceled their accounts. Now they’re suing
Laurence Darmiento – LA Times
When Mary Smbatian started hearing rumors a few years ago that Citibank was closing the accounts of Armenian Americans in the San Fernando Valley, she thought it impossible the giant Wall Street bank would ever shutter hers. A residential loan broker who also runs an apartment management business, the Encino resident had been a Citibank client for more than a decade, with both company and personal accounts, as well as credit cards issued through the bank.
/jlne.ws/3sTCX1n

Citi Is Sued Over Sex Abuse. Before 2022, It Would Have Been a Secret; Ardith Lindsey, a managing director, is accusing the bank of tolerating a culture in which managers sexually harassed her.
Emily Flitter – The New York Times
A female employee of Citigroup recently sued the bank, accusing its leadership of tolerating a work culture in which she was sexually harassed and abused by male executives, in a high-profile application of a 2022 federal law that nullified forced arbitration for such cases. Ardith Lindsey, a managing director at Citi, alleged that her 15-year career at the bank had increasingly become a “traumatizing” experience, especially after she ended a relationship with a former supervisor. The supervisor, Mani Singh, then sent her dozens of threatening text messages, according to her lawsuit.
/jlne.ws/3N7Nltf

Treasury’s ‘Blunder’ Was No Mistake At All, Former Official Says; Amar Reganti says US can’t act like company when it issues; He was rebutting argument that US should have borrowed longer
Liz Capo McCormick – Bloomberg
If the US Treasury had tried to act tactically, like a company, to lock in low long-term borrowing costs during the pandemic, it would have damaged bond markets and the dollar, a former Treasury official wrote in a blog post. Rebutting a point of view put forth last month by billionaire investor Stan Druckenmiller, Amar Reganti wrote that unlike a company, the US needs to consider how its issuance will affect overall debt markets. Selling bonds predictably allows the US to keep its borrowing costs lower over time, wrote Reganti, now a fixed-income strategist at Wellington Management.
/jlne.ws/49YlyVV

UBS chair aims for ‘bloodless coup’ with Sergio Ermotti succession; Colm Kelleher sets target to compile shortlist for one of biggest roles in global banking
Owen Walker and Stephen Morris – Financial Times
UBS chair Colm Kelleher said he would like to line up a shortlist of three potential successors for chief executive Sergio Ermotti within the next “couple of years”, aiming to emulate the smooth succession process at his former employer Morgan Stanley. Speaking at the Financial Times Global Banking Summit on Tuesday, Kelleher said external hires would be considered to bolster competition for one of the biggest roles in global banking.
/jlne.ws/3sK0P7K

Barclays explores plan to drop thousands of investment banking clients; Project Minerva also examined more radical options including raising capital for an acquisition
Stephen Morris – Financial Times
Barclays is exploring a plan to drop thousands of clients at its investment bank as part of a strategic overhaul that is meant to boost profits and cut 1bn pounds of costs. Barclays executives have met several times this year to thrash out the restructuring, codenamed Minerva after the Roman goddess of wisdom, according to people briefed on the discussions.
/jlne.ws/3N0GFx5

Barclays Bankers on Edge as Town Hall Lays Out Overhaul Challenge; Paul Compton tells investment bank staff unit needs to grow; CEO Venkatakrishnan is expected to unveil overhaul in February
Jan-Henrik Foerster – Bloomberg
For traders and investment bankers inside Barclays Plc, the message came from on high: Their unit is sucking up too much capital relative to other parts of the bank. It was Paul Compton, head of the firm’s corporate and investment bank, who delivered the news to his staffers in a town hall at the firm’s headquarters in London’s Canary Wharf this week, according to people who were present and asked not to be named discussing a non-public event. The answer, Compton said, was finding more profitable ways to use the capital it’s been allocated.
/jlne.ws/3N6tDhH

Wall Street’s $300 Billion Middleman Rides Model-Portfolio Boom; Envestnet connects advisers to thousands of customized trades; Platform overseer Friederich says investors are trimming tech
Emily Graffeo and Vildana Hajric – Bloomberg
Brooks Friederich is a little-known figure in the world of investment advisory, even among the Wall Street cognoscenti. Yet every year, the 39-year old – and his Berwyn, Pennsylvania-based employer Envestnet – helps steer billions of dollars into tailor-made strategies for financial advisers, part of what’s known as the model-portfolio boom.
/jlne.ws/46GCLjQ

The SEC Might Lose Its Courts; Also OpenAI valuation, client culling, coal IQ and profitable saunas.
Matt Levine – Bloomberg
Tomorrow the US Supreme Court will hear arguments in a case about whether the US Securities and Exchange Commission can fine people without a jury trial. The SEC can bring “administrative proceedings” in its own in-house courts, in front of SEC employees called administrative law judges, rather than bringing them in regular courts. A lot of people think that this is unfair, and in the political and legal climate of 2023, arguments like “this administrative agency has too much power to regulate” go a lot further than they used to.
/jlne.ws/3sV2My4

RIP BSBY: Bloomberg to shut down its lagging Libor replacement
Polo Rocha – American Banker
Bloomberg L.P. says it’s shutting down its BSBY interest rate benchmark, marking a quiet end to the data provider’s attempt to offer a successor to the defunct London Interbank Offered Rate.
/jlne.ws/3RkNZX1

Deutsche Bank chief says EU should consider scrapping bonus cap; But HSBC boss Noel Quinn warns against ‘unleashing inappropriate amounts of risk-taking’
Owen Walker, Stephen Morris and Joshua Franklin – Financial Times
Deutsche Bank’s chief executive has said that Europe should consider lifting a cap on banker bonuses, becoming the latest senior banker to call on Brussels to follow the UK’s lead. Christian Sewing said EU-based banks were suffering from an “unlevel playing field” in terms of attracting talent, after the UK scrapped the cap last month.
/jlne.ws/3T1nk2s

Big Oil Bets on Hot Air in Climate Talks; COP28 summit probably won’t change industry expectations of a slow energy transition, but nor will it clarify companies’ long-term future
Carol Ryan – The Wall Street Journal
Oil-and-gas companies are banking on a glacial pace of progress on cutting fossil-fuel use in this year’s round of climate negotiations-and they may well get it. The U.N. Climate Change Conference, COP28, begins Thursday with an oily twist. It is being hosted by the United Arab Emirates, which pumps more than 3 million barrels of oil a day. The Organization of the Petroleum Exporting Countries, of which the U.A.E. is a member, will have a pavilion at the climate summit for the first time.
/jlne.ws/417RV0n

Ukraine Invasion

Putin accuses the West of trying to ‘dismember and plunder’ Russia in a ranting speech
Associated Press
Russian President Vladimir Putin on Tuesday, in a ranting speech before a presidential election campaign, cast Moscow’s military action in Ukraine as an existential battle against purported attempts by the West to destroy Russia.Putin, who has been in power for more than two decades and is the longest-serving Russian leader since Soviet dictator Josef Stalin, is expected to soon declare his intention to seek another six-year term in a presidential election next March.
/jlne.ws/47UXwJO

‘Point of no return’: Why Kyiv won’t sit down with the Kremlin
Jonathan Brown, Victoria Lukovenko – AFP
When delegations from Moscow and Kyiv met in Belarus for secretive peace talks weeks after Russia invaded Ukraine, it took Ukraine’s lead negotiator less than an hour to lose hope. To end the war, Russia had dispatched a former culture minister — infamous for a PhD plagiarism scandal — and a firebrand nationalist who had recently faced down sexual harassment allegations.
/jlne.ws/49Y3ivJ

Zelenskiy Demands New Fortifications With War Risks Mounting
Aliaksandr Kudrytski – Bloomberg
Ukrainian President Volodymyr Zelenskiy called for a faster buildup of major defensive lines amid Kyiv’s stalled counteroffensive and concerns that Russia could attempt to take more territory. Zelenskiy urged greater speed and efficiency in building defenses in a video statement on Telegram after a meeting with key military and security officials Tuesday evening. He encouraged local communities to pitch in and pledged to make money available for the effort.
/jlne.ws/48doQmL

Kyiv’s Harsh Winter Deepens Gloom Over Battlefield Failures
Olesia Safronova, Kateryna Chursina and Volodymyr Verbianyi – Bloomberg
A sense of gloom is settling over Ukraine as the failure of a months-long counteroffensive gives way to the second winter since the Russian invasion. A fierce snowstorm cut power to thousands across southern Ukraine over the weekend, while temperatures in the east, where fighting is fierce, have plunged well below freezing. In the Ukrainian public, polls show cracks emerging and a softening in President Volodymyr Zelenskiy’s approval rating.
/jlne.ws/412nhWe

Greek Oil Tanker Owners Avoiding Russia After Treasury Letters
Julian Lee – Bloomberg
Oil tanker owners in Greece, the world’s most powerful shipowning nation, scaled back how much Russian crude they’re hauling, a decision that could ultimately disrupt the flow of Moscow’s petroleum. The number of Greek-owned tankers going to Russia will fall by a quarter this month compared with last, and is down 60% from June, ship tracking data compiled by Bloomberg show. That may well alarm officials in the Kremlin because the country still needs assistance from foreign vessel operators to get all its barrels to the global market.
/jlne.ws/46DELcL

Russia has stockpiled missiles for winter attack on Ukraine, says Nato; Jens Stoltenberg urges allies not to ‘underestimate’ Moscow and its war economy
Henry Foy, Christopher Mille, and Max Seddon – Financial Times
Russia has built up a large stockpile of missiles and intends to use them in a bid to destroy Ukraine’s power and heating infrastructure in the coming months, Nato’s secretary-general has warned. With the front line largely frozen after Ukraine’s autumn counteroffensive failed to make significant gains, Kyiv has stepped up calls for more air defence supplies from its western allies as it girds for another winter bombardment.
/jlne.ws/46RuUjL

Israel/Palestine Conflict

Saudi Arabia Offers Iran Investment to Limit Israel-Hamas War; Kingdom’s offer hinges on Iran reining in its regional proxies; Riyadh is also working with US and Arab allies to contain Iran
Sam Dagher – Bloomberg
Saudi Arabia has approached Iran with an offer to boost cooperation and invest in its sanctions-stricken economy if the Islamic Republic stops its regional proxies from turning the Israel-Hamas war into a wider conflict. The proposal has been delivered directly and through multiple means since Hamas’s attack on Israel last month and the ensuing war in Gaza, according to Arab and Western officials familiar with the matter.
/jlne.ws/3GsmlRj

The Gaza Cease-Fire Is a Major Military Victory for Hamas; From Vietnam to Libya to today, overmatched forces have taken advantage of humanitarian pauses to resupply, shift troops and improve logistics.
James Stavridis – Bloomberg
We should all rejoice to see Israeli hostages being released following the barbaric attacks by Hamas nearly two months ago. But under the short pause in fighting, the terrorists are exchanging kidnapped Israelis – in agonizingly slow fashion – to purchase time to rearm, refresh and reset their forces. There is not a shred of humanitarian impulse here. Hamas cynically measures the price of human lives and then doles them out 10 at a time for another day of military advantage.
/jlne.ws/3sWce4g

Exchanges, OTC and Clearing

LME Wins Nickel Crisis Case as UK Rules Against Elliott; Challenges by Elliott and Jane Street were dismissed; Elliott says it plans to appeal Wednesday’s High Court ruling
Mark Burton and Jonathan Browning – Bloomberg
The London Metal Exchange won a UK court challenge by Elliott Investment Management over its controversial decision to halt a runaway short squeeze in the nickel market last year, removing one of the biggest threats facing the LME as it seeks to move past the crisis. Challenges by both Elliott and trading firm Jane Street were dismissed, according to a ruling on Wednesday. The judges said the exchange’s executives should be granted wide discretion to make the urgent decisions that they did.
/jlne.ws/3T3s7jX

Investors Lose Legal Bid Against Exchange Over Nickel Market Blowup; Cases have been closely followed as test of whether exchanges have power to unwind trades to maintain orderly markets
Yusuf Khan and Joe Wallace – The Wall Street Journal
The London Metal Exchange chalked up a big victory over investors on Wednesday, when a court said it was within its rights to cancel trades during a high-profile blowup in the nickel market sparked by Russia’s full-scale invasion of Ukraine. The U.K. court rejected claims by activist fund Elliott Investment Management and market maker Jane Street Global Trading that the exchange had overstepped its powers by nixing $12 billion in trades in March last year. Had they won, Elliott and Jane Street planned to claim hundreds of millions of dollars in damages combined in a follow-on trial.
/jlne.ws/46zSZLK

Eurex focused on harmonising onto one risk management framework; Risk management top of the agenda across Eurex business offerings on both the trading and clearing side, senior executives have affirmed.
Claudia Preece – The Trade
At a recent roundtable, Deutsche Börse Group derivatives exchange, Eurex, shared its plan to harmonise onto one risk management infrastructure over the next two years.
/jlne.ws/3RhgnJn

HKEX Welcomes Apac’s First Saudi Arabian ETF; First Saudi Arabian ETF listed in Hong Kong, offering global and regional investors unique Middle East exposure in Hong Kong; ADT of Hong Kong-listed ETPs reached $14 billion YTD 2023, up over 20% year-on-year
HKEX
Hong Kong Exchanges and Clearing Limited (HKEX) is pleased to welcome today (Wednesday) the listing of Asia Pacific’s first ETF to track Saudi Arabian equities – the CSOP Saudi Arabia ETF (Stock code: 2830 / 82830). This ETF, which tracks the FTSE Saudi Arabia Index, provides investors with a new opportunity to invest in Saudi Arabia’s capital markets through a Hong Kong-listed ETF, further enhancing the global connectivity of Hong Kong’s ETF market. The new ETF complements a huge array of thematic and country specific ETFs listed in Hong Kong and will be the world’s biggest Saudi-focused ETF.
/jlne.ws/417R7sn

Nasdaq Launches New Technology to Scale Global Carbon Markets
Nasdaq
Nasdaq (Nasdaq: NDAQ) today announced the launch of a pioneering new technology that securely digitizes the issuance, settlement, and custody of carbon credits. It will be provided to market infrastructures, registry platforms, and other service providers globally. The service will ultimately support the development and institutionalization of global carbon markets. Despite being a relatively young market the carbon credit operating model is characterized by bilateral trading and a heavy reliance on manual interaction, providing limited ability to scale as the market develops. This inflexibility has also led to an absence of standardization – where credit data can be categorized and integrated into existing systems – which is a major barrier to attracting significant capital flows.
/jlne.ws/411s6PB

Aquis Stock Exchange first to adopt cloud-based matching engine; All Aquis Stock Exchange trades are now being matched and executed while running on Amazon Web Services (AWS) as of 27 November.
Claudia Preece – The Trade
This week the Aquis Stock Exchange has become the first recognised investment exchange (RIE) to run a cloud-based matching engine, having achieved a full migration. Speaking to The TRADE, Adrian Ip, managing director at Aquis Technologies, said: “We are pleased to be the first regulated exchange in a major jurisdiction to adopt pure cloud for the matching engine, but we fully expect to see other exchanges follow suit.
/jlne.ws/4a1u0Uj

DTCC’S Alternative Investment Product Services Surpasses 10,000 Unique Funds; Alternative Investment Product Services has processed over 500 million transactions since inception.
DTCC
DTCC, the premier post-trade market infrastructure for the global financial services industry, today announced that its Alternative Investment Product Services (AIP) has reached a new milestone by surpassing over 10,000 unique funds on the service, an increase of 20% in the past year. At the same time, the number of clients leveraging the product rose to over 2,200, an increase of 28%.
/jlne.ws/47QX8fd

DTCC’s ALERT Surpasses 15 Million Standing Settlement Instructions; DTCC launches an ALERT API suite, providing new way for industry to request and receive SSI and market availability data
DTCC
DTCC, the premier post-trade market infrastructure for the global financial services industry, today announced that DTCC ALERT, the industry’s largest online global database for the maintenance and communication of account and standing settlement instructions (SSIs), has reached a key milestone with over 15 million SSIs, including three million cash SSIs, now included in the service- a 50% increase since 2021. This growth comes at a critical time, as the U.S. moves to a T+1 settlement cycle in May 2024. Accurate, automated SSIs are key to the facilitation of accelerated settlement, as leveraging golden copy data limits discrepancies that could potentially cause failed or delayed trades.
/jlne.ws/47flZt6

JPX Market Innovation & Research signs partnership with Bridgewise to disseminate information on the Japanese market
JPX
JPX Market Innovation & Research, Inc. (JPXI) has announced today that JPXI partnered with Bridgewise, a generative AI company for global stock analysis, for the dissemination of information on the Japanese market. Bridgewise uses proprietary generative AI technology to analyze all stocks world wide, including the one’s listed on the Tokyo Stock Exchange. It then analyzes their financial performance based on factors that predict future performance extracted from sources such as financial statements, securities reports, and based on Bridgewise unique AI model. Bridgewise also facilitates comparisons of stocks with their peers and assists investors in conducting investment analysis. Bridgewise analysis can be distributed in all languages, including Japanese.
/jlne.ws/3sUx43V

Minimum level of the Default Fund
LME
In accordance with LME Clear Default Procedure Part B:1.2(c), LME Clear has undertaken a review of the minimum level of the Default Fund and will change the minimum level of the Default Fund from $999,344,735 to $996,578,693 effective from Friday 1st December. Members are advised that LME Clear will take this into account for the December monthly re-sizing, due to take place on Friday 1st December.
/jlne.ws/3EEQs7p

Fintech

TNS Establishes Colocation Services at Brazil’s Largest Stock Exchange; The Partnership Provides Low Latency Connectivity, Managed Hosting and Market Data Solutions via the TNS network
Transaction Network Services
Today, Transaction Network Services (TNS) announced colocation services with B3 S.A. (Brasil, Bolsa, Balcão), Brazil’s largest stock exchange and the world’s third largest derivatives exchange, based in Sao Paulo. This collaboration strengthens TNS’ global solutions for financial markets, delivering seamless connectivity via the TNS ultra low latency trading network.
/jlne.ws/3GiXtvx

CUSIP Global Services and BeZero Carbon Create Unique Identifiers for Carbon Credits to improve transparency and efficiency in the Voluntary Carbon Market
CUSIP Global Services
Carbon ratings agency BeZero Carbon has partnered with international securities leader CUSIP Global Services (CGS), the global leader in securities identification to create unique identifiers for carbon credits. This is a crucial development to make trading credits in the rapidly growing VCM more efficient.
/jlne.ws/4a872v0

Symphony taps Google Cloud’s Generative AI for Voice Analytics in Financial Services; Symphony’s Cloud9 voice product for trading collaboration will be enhanced with Google Cloud’s speech-to-text fine-tuning gen AI capabilities for better efficiency and risk management
Symphony
Symphony, the leading markets infrastructure and technology platform, will combine its AI and domain expertise with Google Cloud’s transcription and generative artificial intelligence (gen AI) capabilities to offer built-for-purpose financial markets voice analytics. This announcement builds on Symphony’s strategic partnership with Google Cloud as its primary cloud provider.
/jlne.ws/3RkCOO0

PureStream: The disruptor venue determined to make waves in the institutional liquidity landscape; The TRADE checks in with the alternative trading system two years after its launch to explore its growth, backing from major institutions, use cases and how the platform is expected to evolve in the future.
Wesley Bray – The Trade
Alternative trading system (ATS) PureStream Trading Technologies launched in 2021 and was developed to re-engineer the price and liquidity discovery process for institutional traders using open-ended liquidity transfer rates, as with those found in data networks. The ATS claims to provider brokers and their institutional clients with improved bandwidth in order to access liquidity faster, more cost-effectively and with greater security.
/jlne.ws/3sV0krg

Amazon cloud boss takes swipe at Microsoft over OpenAI turmoil; Adam Selipsky says companies ‘don’t want a cloud provider that’s beholden primarily to one model provider’
Camilla Hodgson and Tim Bradshaw – Financial Times
The head of Amazon’s cloud division has used recent turmoil at OpenAI to launch a thinly veiled attack on Microsoft, the artificial intelligence company’s biggest investor. Adam Selipsky’s swipe at his biggest rival in cloud computing came as Amazon Web Services announced new custom chips for servers and AI – two weeks after Microsoft debuted its own bespoke processors – as well as a new workplace AI assistant that competes with Microsoft’s OpenAI-powered Copilot.
/jlne.ws/4a0vbmX

Stability AI Has Explored Sale as Investor Urges CEO to Resign; Move follows letter from investor Coatue calling for changes; Coatue concerned about Stability AI’s financial position
Mark Bergen and Rachel Metz – Bloomberg
Stability AI, the British artificial intelligence startup behind the Stable Diffusion image generator, has explored selling the company as management faces increased pressure from investors over its financial position. The London-based firm has presented itself as an acquisition target in recent weeks, and held early-stage conversations with multiple companies, according to several people familiar with the matter, who asked not to be identified because the discussions were private. A deal is not imminent and the company could cut the process short without selling, they said.
/jlne.ws/3SZ5ZHD

OpenAI Director Who Helped Oust Altman Now Key Player in Startup’s Future; Adam D’Angelo will continue to serve on the board despite previously agreeing to oust Altman as CEO and running a company that competes with ChatGPT.
Priya Anand and Sarah McBride – Bloomberg
/jlne.ws/3QZoGIy

What ChatGPT Means for Toddlers
Alex Webb – Bloomberg
/jlne.ws/3RkirjJ

Tokenbridge Launches Cutting-edge Tokenization Platform to Revolutionize Wealth and Fund Management
Tokenbridge via Portfolio Advisor
/jlne.ws/3uH4fIG

Cybersecurity

The crypto scam is on life support. Why are some lawmakers trying to give it CPR?
Michael Hiltzik – LA Times
For crypto, November has been the cruelest month. Things got started with a blast Nov. 2, when scam artist Sam Bankman-Fried was convicted on seven fraud and conspiracy counts related to his management of the once-upward scuttling crypto exchange FTX. Matters didn’t get any better after that. On Nov. 20, the Securities and Exchange Commission charged the crypto trading platform Kraken with a raft of legal violations.
/jlne.ws/410jmJl

Cybersecurity Firm BlueVoyant Buys Conquest Cyber, Discloses $140 Million Funding Round
Kim S. Nash – The Wall Street Journal
Cybersecurity company BlueVoyant has bought Conquest Cyber, a startup focused on the government and defense sectors, its fifth acquisition since 2020. BlueVoyant Chief Executive James Rosenthal said his company also closed a Series E funding round of more than $140 million, which facilitated the acquisition. Private-equity firm Liberty Strategic Capital and cybersecurity investor Istari led the round.
/jlne.ws/3sUrmz1

Cisco to buy cybersecurity firm Splunk for $28 billion
Milana Vinn, Yuvraj Malik and Aditya Soni – Reuters
Cisco Systems (CSCO.O) on Thursday agreed to buy cybersecurity firm Splunk (SPLK.O) for about $28 billion in its biggest-ever deal to strengthen its software business and capitalize on the boom in artificial intelligence. The deal, which is the biggest technology transaction of the year, will help reduce Cisco’s reliance on its massive networking equipment business, which has suffered in recent years from supply chain issues and a post-pandemic slowdown in demand.
/jlne.ws/4a9z21k

CrowdStrike forecasts strong Q4 revenue on resilient cybersecurity demand
Reuters
CrowdStrike Holdings (CRWD.O) on Tuesday forecast fourth-quarter revenue above Wall Street estimates, driven by resilient demand for its cybersecurity offerings in the wake of rising online threats.
/jlne.ws/47Sr22x

Shimano Was the Victim of a Ransomware Attack and Didn’t Pay the Ransom. Hackers Then Published a LOT of Data.
Micah Ling – Bicycling
Shimano, one of the world’s leading cycling component manufacturers, came under fire from hackers at the beginning of the month, when the company was the victim of a ransomware attack involving 4.5 terabytes of sensitive company data.
/jlne.ws/417y9SQ

Okta Says Hackers Stole Data For All Customer Support Users; Company also reported fiscal 3Q results that topped Wall Street analysts’ expectations
Will Feuer – The Wall Street Journal
Okta said hackers stole data for all of its customer support system users in a breach that the identity-verification company disclosed last month. Okta Chief Security Officer David Bradbury said all Okta Workforce Identity Cloud and Customer Identity Solution customers are affected by the hack, except for government customers that use a separate system. Earlier this month, Okta estimated that less than 1% of customers were affected by the breach.
/jlne.ws/412sE7Q

Cryptocurrencies

Binance Begins Again With U.S. Oversight. Will It Survive? Global crypto exchange’s new regime will force a significant shift in how the firm operates
Patricia Kowsmann, Caitlin Ostroff and Angus Berwick – The Wall Street Journal
Binance’s second act starts now. The largest global crypto exchange and its chief executive and co-founder, Changpeng Zhao, pleaded guilty last week to ignoring anti-money-laundering rules while serving U.S. customers. Binance agreed to pay over $4 billion in fines and consented to have a government-approved monitor oversee the firm’s activities. Zhao, who could face jail time, stepped down as CEO.
/jlne.ws/3QSP0DW

Coinbase Users’ Data Might be Shared With CFTC After Coinbase Served With a Subpoena
Hope C – CoinMarketCap
Coinbase, the US-based cryptocurrency exchange, has recently informed an undisclosed number of its users about a received subpoena. This legal order has the potential to result in the sharing of customer account information with the Commodities Futures Trading Commission (CFTC). Coinbase has chosen not to make any public statements about the matter, but it appears that the subpoena is connected to Bybit, a Dubai-based crypto exchange founded by Ben Zhou in 2018.
/jlne.ws/47xZ10p

SoFi Is Exiting Crypto With Banking Regulators Stepping Up Scrutiny; SoFi’s crypto customers can move to Blockchain.com service; Customers have to move by Dec. 19 or liquidate their coins
Olga Kharif – Bloomberg
SoFi Technologies Inc., the fast growing one-stop shop for financial-services products, is exiting crypto even with token prices surging because of increased scrutiny of the sector by banking regulators. The San Francisco-based company told crypto customers Wednesday they will need to liquidate their accounts in coming weeks, or move to crypto exchange and wallet provider Blockchain.com.
/jlne.ws/3uKortd

Ailing Crypto Firm Zipmex Makes Another Attempt at Restructuring; Zipmex exchange was given creditor protection over a year ago; Key creditors oppose debt recast plan, seek independent review
Suvashree Ghosh – Bloomberg
Ailing crypto exchange Zipmex has proposed to repay creditors about 3.35 cents per dollar of claims initially as part of its latest restructuring offer, according to people familiar with the matter. The payout could rise to as much as 29.35 cents contingent on recoveries under the revised plan to restructure Zipmex’s $97.1 million of debt, the people said, citing an Oct. 4 court document that’s also been seen by Bloomberg News.
/jlne.ws/3GlXIpz

Politics

Kremlin Sees Finland’s Border Measures as ‘Excessive,’ Tass Says
Bloomberg
Sending European military advisers to Finland’s border with Russia is an unnecessary security measure that may fuel tension, according to the Kremlin’s spokesman. Commenting on a report that Poland plans to send a group to help Finland protect its frontier with Russia, Dmitry Peskov said the concentration of additional forces on its border was “unprovoked and unjustified.”
/jlne.ws/3uCW0xq

Russian Demands Risk Making OSCE ‘Brain Dead’ Group, Lithuania Says
Natalia Drozdiak, Milda Seputyte and Selcan Hacaoglu – Bloomberg
Three Baltic countries and Ukraine said they won’t attend a meeting of the European security body OSCE after it invited Russian Foreign Minister Sergei Lavrov to take part. Lithuania, Estonia and Latvia said in a joint statement Tuesday they will stay away from the gathering of the 57-member Organization for Security and Cooperation in Europe. “It will only provide Russia with yet another propaganda opportunity,” the countries’ foreign ministers said ahead of the meeting due in Skopje, North Macedonia, on Thursday and Friday. Ukraine also announced it won’t take part.
/jlne.ws/47B3Whf

Russia Wants Foreign Visitors to Sign ‘Loyalty’ Pledge to Regime; Interior Ministry seeks law barring criticism, Tass reports; Kremlin has cracked down ahead of March presidential election
Bloomberg News
Russia wants foreigners entering the country to sign a “loyalty agreement” pledging not to challenge the Kremlin on issues like President Vladimir Putin’s war in Ukraine and a ban on promoting LGBT relationships, according to the Tass news service. Under a draft law prepared by the Interior Ministry, foreign entrants would sign a declaration agreeing to comply with prohibitions “established to protect the national interests of Russia,” the state-run news service reported Wednesday, citing the document. It was unclear if the measure would apply only to short-stay visitors or also to foreigners granted long-term visas to live and work in Russia.
/jlne.ws/3RksC7U

Al Jaber Denies Using COP28 Presidency to Make Oil and Gas Deals
Jess Shankleman and John Ainger – Bloomberg
The head of global climate change talks starting in Dubai this week has strongly denied using his position to advance the United Arab Emirates’ commercial interests. COP28 President Sultan Al Jaber said reports that he is seeking to advance oil and gas deals during climate meetings with foreign governments ahead of COP28 were “false, not true, incorrect and not accurate.” He was speaking to journalists ahead of the start of the biggest-ever United Nations climate negotiations.
/jlne.ws/3RibcsC

The crackdown on Ukraine’s oligarchs; Volodymyr Zelenskyy’s government is taking action against politically influential business figures. But will a new generation take their place?
Ben Hall – Financial Times
When Igor Kolomoisky, one of Ukraine’s most powerful oligarchs, was arrested on suspicion of embezzlement this autumn, the news was covered in a brief report on 1+1, one of the country’s most popular and influential television channels. The coverage, which included pictures of him in court, was symbolic of the rapid collapse in Kolomoisky’s influence. After all, he is the owner of 1+1.
/jlne.ws/3N6zPWH

Regulation

India to roll out optional T+0 from March 2024 as part of roadmap to instantaneous settlement; Regulator Sebi outlines plan to move to instantaneous settlement by March 2025 on an optional basis using a parallel system to the current T+1 structure.
Jonathan Watkins – The Trade
The Securities and Exchange Board of India (Sebi) plans to roll out an optional same-day settlement system in March next year as part of plans to introduce instantaneous settlement in 2025. The regulator has been in consultation with market infrastructures and brokers to create a roadmap as it looks to lead to way in the global push to reduce settlement times.
/jlne.ws/3uud1d1

With Sam Bankman-Fried in the slammer, now the fugitive crypto ‘Lunatic’ behind 2022’s $40B crash is being extradited from his Montenegrin getaway
Rich Stanton – PC Gamer
Do Kwon, former crypto darling and now fugitive, was arrested in Montenegro this March while attempting to flee to Dubai. The High Court in Podgorica, the Montenegrin capital, has now given approval for Do Kwon’s extradition, though whether he’ll be off to South Korea or the US, both of which have open arrest warrants for him, remains to be decided.
/jlne.ws/3uDzfcM

Bank of America to Pay $12 Million Over Reporting of False Mortgage Data
Katherine Doherty and Paige Smith – Bloomberg
Bank of America Corp. agreed to pay $12 million in fines for submitting false mortgage-lending information to the US government, regulators said. From early 2016 through late 2020, some of the bank’s loan officers failed to ask mortgage applicants for their race, ethnicity and sex, as required under federal law, and then falsely recorded that the customers declined to provide the information, the Consumer Financial Protection Bureau said in a statement Tuesday. The fines will go into the bureau’s victim-relief fund, according to a consent order.
/jlne.ws/3N7HmEN

Chairman Behnam Announces CFTC Agricultural Advisory Committee to Meet December 14
CFTC
Chairman Rostin Behnam, sponsor of the Agricultural Advisory Committee (AAC), announced the AAC will hold a public meeting on December 14 from 9:00 a.m. to 12:00 p.m. (EST) at the CFTC’s Washington, D.C. headquarters. Members of the public will also have the option to attend virtually
/jlne.ws/3T4wgEi

The Market Risk Advisory Committee to Meet on December 11
CFTC
The Market Risk Advisory Committee (MRAC) will hold a public meeting on Monday, December 11 from 9:30 a.m. to 12:30 p.m. (EST) at the CFTC’s Washington, D.C. headquarters. Members of the public will also have the option of attending virtually. Commissioner Kristin N. Johnson is the sponsor of the MRAC.
/jlne.ws/46z0Adu

Commissioner Johnson to Deliver Remarks and Participate in Fireside Chat at the Inaugural DeFi Summit hosted by S&P Global
CFTC
Commissioner Kristin N. Johnson will deliver prepared remarks and participate in a fireside chat with Chief DeFi Officer of S&P Global Chuck Mounts, discussing decentralized finance and the CFTC’s role in regulating digital assets markets.
/jlne.ws/47yGQrH

Commissioner Goldsmith Romero to Participate in Fireside Chat at Sustainable Innovation Forum 2023 on Building Climate Resilient Markets and Supply Chains Through Derivatives
CFTC
Commissioner Christy Goldsmith Romero will participate in a fireside chat at the Sustainable Innovation Forum 2023 on Building Climate Resilient Markets and Supply Chains Through Derivatives during COP28 UAE.
/jlne.ws/49ZWOwo

Commissioner Johnson to Deliver Remarks and Participate in Fireside Chat at the Blockchain Association Policy Summit
CFTC
Commissioner Kristin N. Johnson will deliver prepared remarks and participate in a fireside chat moderated by Anchorage Digital General Counsel Georgia Quinn, discussing the CFTC’s recent enforcement actions in the decentralized finance and digital assets space.
/jlne.ws/3usVtxV

SEC Obtains Judgments Against Three Defendants for Insider Trading Prior to Pharmaceutical Merger
SEC
On November 27, 2023, the Honorable Vincent Marrero of the United States District Court for the Southern District of New York entered judgments by consent against defendants Joseph M. Dupont and Stanley Kaplan, who were each charged with insider trading in the securities of Portola Pharmaceuticals Inc. Previously, on August 9, 2023, Judge Marrero entered a consent judgment against defendant Jarett G. Mendoza, who was also charged with insider trading Portola securities.
/jlne.ws/3RlkG5t

India Probes Criminal-Terrorist Nexus to Protect Ties With US
Sudhi Ranjan Sen – Bloomberg
New Delhi is probing any role of Indian organized criminal groups in an alleged attempt to assassinate a US-based Sikh separatist leader, as the South Asian nation tries to protect its relationship with the US after being prompted by Washington. India has constituted a high-level committee to investigate inputs shared by the US over a nexus between organized criminals, gun runners, and terrorists, said Arindam Bagchi, spokesperson for India’s External Affairs Ministry. The South Asian country takes such inputs “seriously” and relevant departments are already examining the issue, he said.
/jlne.ws/40ZYPVj

UK regulator to force investment advisers to set aside buffer for redress claims; FCA says proposed rules would ensure ‘polluter pays’ when consumers are harmed
Sally Hickey and Laura Noonan – Financial Times
Investment advisers will be forced to set aside money to cover the cost of potential redress schemes under proposals by the UK’s top financial regulator that would ensure the “polluter pays” when consumers are harmed. The Financial Conduct Authority on Wednesday said it would consult on the proposals, which come months after the introduction of the Consumer Duty rules requiring companies to demonstrate fair value for clients.
/jlne.ws/412nhFR

Half of traders convinced FCA post-Brexit DVC decision will have little bearing on dark trading; Liquidity is continuing to shift away from continuous lit trading as traders increasing seek flexibility, SIX Swiss Exchange finds in new research.
Claudia Preece – The Trade
Almost half (49%) of traders claim that the Financial Conduct Authority’s (FCA) post-Brexit ESMA decision to remove double volume caps (DVCs) will have little impact on dark trading, according to recent survey findings by SIX Swiss Exchange. The FCA decision was aimed at controlling the amount of equity trading which takes place away from public exchanges, however, Tony Shaw, executive director and head of sales, UK & Ireland at SIX Swiss Exchange, explained: “Traders seem agnostic as to whether the double volume caps are in place or not, regardless of the political rhetoric.”
/jlne.ws/3sUq6fq

Investing and Trading

What’s a Spinoff? Why and How Companies Break Up
Bailey Lipschultz – Bloomberg
Household-name companies are breaking up, an effort to appeal to investors who want more streamlined businesses. A popular way to separate a company is through a spinoff, which creates two public companies with different areas of focus. The idea is to create value for investors in a tax-efficient way. Spinoffs historically have yielded mixed results for the new entity and the legacy business.
/jlne.ws/4a0wtyj

Why US Banks Are Hemorrhaging Deposits to Money Funds
Alex Harris – Bloomberg
For well over a decade, “interest-earning savings account” was almost an oxymoron – interest rates offered to depositors were near zero almost everywhere. Then the US Federal Reserve started rapidly increasing rates in early 2022 to fight inflation. US banks raised their deposit rates a little; money market funds (MMFs) raised theirs by much more. What followed was a wave of more than $1 trillion in bank deposit withdrawals, perhaps the biggest, fastest outflow ever, while MMF assets surged by $1.3 trillion. Consumers and businesses who switched saw their interest earnings grow but faced new risks. And bank loans to businesses shrank after the deposit flight hit its peak, raising worries about the impact on the economy.
/jlne.ws/46z7v6j

Risky Bonds Decimated By Credit Suisse Implosion Are Booming Again
Tasos Vossos, Abhinav Ramnarayan and Cecile Gutscher – Bloomberg
A day that started with a blunt call to investors ended with incredulous fund managers at Algebris Investments facing double-digit losses. It was March 20, and the Swiss government had just taken the unprecedented decision to wipe out $17.3 billion of junior debt as part of a forced merger between Credit Suisse Group AG and UBS Group AG.The move set off a global slump in the price of additional tier 1 bonds, as the riskiest banking debt is known, with some forecasting that it would serve as a death knell for the entire asset class. As one of the world’s top buyers of AT1s, Algebris needed to talk to its investors.
/jlne.ws/3N54js8

US Home Prices Hit Record With Eight Straight Months of Gains
Alicia Clanton – Bloomberg
Home prices in the US extended their climb, reaching a fresh record high. A national gauge of prices rose 0.7% in September from August, according to seasonally adjusted data from S&P CoreLogic Case-Shiller. It was the eighth straight month of gains for the index, which doesn’t provide a specific dollar figure for homes.
/jlne.ws/3QXvFBL

A Master of One-Liners: Munger on Politics, Life and Crypto; Berkshire Hathaway Vice Chairman Charlie Munger dies at age 99; Bank of America CEO Moynihan calls Munger a ‘legendary’ figure
Katherine Chiglinsky – Bloomberg
The thing many Berkshire Hathaway Inc. investors may have enjoyed almost as much as the 3,800,000% return Charlie Munger helped engineer were his quips along the way. His label for a derivatives trading desk: “casino in drag.” Alan Greenspan was smart but “totally overdosed on Ayn Rand.” And Bitcoin was “noxious poison.”
/jlne.ws/47CUdHs

A $30 Billion Rout Shows Toll of Fed Hikes on Biden Energy Goals; America’s path to net-zero carbon emissions is getting narrower.
David R Baker, Saijel Kishan, and Jennifer A Dlouhy – Bloomberg
/jlne.ws/4a16yGM

Environmental, Social and Corporate Governance

Biggest Climate Talks Ever Confront Global Chaos and Record Heat; More than 70,000 people are expected in Dubai for COP28, but what can they actually get done?
Jess Shankleman, Laura Millan, and Jennifer A Dlouhy – Bloomberg
More than 70,000 politicians, diplomats, campaigners, financiers and business leaders will fly to Dubai to talk about arresting the world’s slide toward environmental catastrophe. The need for progress has never been more urgent: 2023 will almost certainly be the hottest year on record, greenhouse gas emissions are still rising and promises to cut pollution remain insufficient to take the risk of unmanageable warming off the table. At the same time, rapid inflation and global instability – including wars in Ukraine and Gaza – have scrambled the politics and economics of the energy transition.
/jlne.ws/3SYM1fV

Making Sense of the Oil Kingdom’s Climate Summit; Catch up on the latest episodes of Bloomberg Green’s Zero podcast.
Oscar Boyd and Christine Driscoll – Bloomberg Zero (podcast)
COP28 begins in Dubai on Thursday, with around 70,000 people expected to attend the behemoth climate conference. The Zero podcast team will be on the ground, meeting leaders and experts helping shape the outcome of the summit. Catch up on recent episodes of the podcast that look at what might be achieved at the summit, and the key technologies and policies being discussed. New episodes of Zero will be published twice a week at COP28.
/jlne.ws/47PjtJW

Six Numbers Illustrating Why COP28 Could Be a Heavy Lift for World Leaders; This year’s U.N. climate summit could be an especially important one as carbon emissions continue to reach historic highs, bringing the planet closer to critical tipping points.
Kristoffer Tigue – Inside Climate News
More than 70,000 diplomats, politicians, business leaders and environmental advocates from all around the world are expected in Dubai on Thursday for COP28, the United Nations’ flagship climate change summit. Each year, delegates from nearly 200 nations gather at the conference to discuss how they can limit rising global temperatures through the end of the century in hopes of avoiding the most dire consequences of climate change, including upwards of three-quarters of Earth’s species disappearing for good.
/jlne.ws/3Gms3o0

Al Jaber Denies Using COP28 Presidency to Make Oil and Gas Deals
Jess Shankleman and John Ainger – Bloomberg
The head of global climate change talks starting in Dubai this week has strongly denied using his position to advance the United Arab Emirates’ commercial interests. COP28 President Sultan Al Jaber said reports that he is seeking to advance oil and gas deals during climate meetings with foreign governments ahead of COP28 were “false, not true, incorrect and not accurate.” He was speaking to journalists ahead of the start of the biggest-ever United Nations climate negotiations.
/jlne.ws/3uzWdSa

First transatlantic flight powered by cooking and animal fats lands in New York; Aviation industry hails milestone but green campaigners question whether alternative fuels are sustainable
Philip Georgiadis – Financial Times
A Virgin Atlantic plane powered by a blend of waste cooking oil, animal fats and other unorthodox fuels landed in New York on Tuesday, after a flight from London Heathrow that the aviation industry hailed as a milestone in its complex and controversial push to decarbonise. The journey is the first time a commercial airline has operated a long-haul flight entirely powered by so-called sustainable aviation fuels (SAF), which emit less carbon over their lifecycle than traditional jet fuel.
/jlne.ws/3uwkmsy

ExxonMobil makes U-turn on monitoring its methane emissions; US oil major joins UN’s flagship reporting programme after years of resisting external scrutiny
Myles McCormick and Jamie Smyth – Financial Times
ExxonMobil has agreed to join the UN’s flagship methane emissions reporting programme as it seeks to present a more transparent image after years of resisting external monitoring of its approach to climate change. The biggest western oil producer told the Financial Times that advances in technology meant it was now in a position to join the Oil and Gas Methane Partnership, a standardised reporting framework to monitor industry emissions of the potent greenhouse gas, led by the UN Environment Programme.
/jlne.ws/47B9KHt

UK bans vague ‘sustainability’ fund labels in greenwashing crackdown; Financial Conduct Authority moves to outlaw ‘misleading’ marketing in $250bn sector
Kenza Bryan – Financial Times
/jlne.ws/3T4tHlE

Europe Is Guzzling Diesel From India, a Key Buyer of Russian Oil
Prejula Prem – Bloomberg
/jlne.ws/47uHSou

How AI Can Help Clean Up the Biggest Climate Messes; From steel to cement, AI could provide rapid solutions to cut carbon emissions, according to a forthcoming report.
Michelle Ma – Bloomberg
/jlne.ws/47UqJ7r

HSBC, SocGen Drop Bids to Get CO2 Goals Approved by UN Body; ABN Amro and StanChart have also withdrawn their bids; Banks still plan to comply with other industry CO2 standards
Alastair Marsh and Frances Schwartzkopff – Bloomberg
/jlne.ws/46C5Tsk

Institutions

Morale at Goldman Sachs ‘is pretty good’: CEO David Solomon
David Hollerith – Yahoo Finance
Goldman Sachs (GS) CEO David Solomon is finishing 2023 talking about the same subject that was front and center for him as the year began – the “noise” surrounding one of Wall Street’s most storied banks. “Broadly speaking, morale at the firm is pretty good,” Solomon said Tuesday morning during the FT Global Banking Summit in London. “Is there noise sometimes from certain people? Absolutely … It goes with the territory,” he added.
/jlne.ws/47wuPTB

Europe’s Once Crisis-Torn Periphery Turns Bond Market Darling; JPMorgan, Neuberger are loading up on bonds from Spain
Alice Atkins – Bloomberg
A remarkable role reversal is underway across the euro area just over a decade since a series of fiscal crises almost broke the single currency. Back then it was the so-called periphery countries of Portugal, Italy, Ireland, Greece and Spain drawing the ire of investors after running up massive debts. Now it’s the core nations of Germany and France which are having to increasingly explain themselves amid budget crises and fiscal plans that are running up against European Union limits.
/jlne.ws/3N4tpHJ

DWS follows BlackRock with launch of fixed maturity bond ETFs; The four Xtrackers euro-denominated investment grade corporate bond funds aim at four different maturities
Sandra Heistruvers – Financial Times
DWS has launched four fixed-maturity bond exchange traded funds, after rival BlackRock rolled out similar products in Europe earlier this year. The Luxembourg-domiciled Xtrackers II Target Maturity Ucits ETFs, which aim to make regular quarterly payouts to investors and are liquidated at the end of their term, are available with fixed durations until September 2027, 2029, 2031 and 2033. They charge investors a total expense ratio of 0.12 per cent.
/jlne.ws/47QUFBq

Morgan Stanley Fights Over $1.5 Million Bonuses for Paris Banker Who Quit; Bank seeks to topple earlier court defeat over deferred awards; Case could have repercussions for top banks in France
Gaspard Sebag – Bloomberg
Morgan Stanley is fighting to overturn a French court ruling ordering it to pay EUR1.4 million ($1.5 million) in bonuses to a banker who quit the firm, in a case that could affect how investment banks try to prevent their best performers from leaving. At the heart of the dispute at the Paris court of appeals is the question of whether the bank could withhold deferred bonuses once the employee had resigned. Morgan Stanley argues that sums claimed by Bernard Mourad were a reward for loyalty only collectible if he’d stayed on.
/jlne.ws/3QY32Ev

Thematic fund investors miss two-thirds of potential returns, research shows; Buying high and selling low meant investors earned 2.4% a year while total returns were 7.3% a year
Emma Boyde – Financial Times
Investors in funds that follow a narrow theme have lost out on more than two-thirds of their potential total returns over the past five years due to buying high and selling low, research from Morningstar reveals. Thematic funds that existed for the entire five-year period ending June 30 enjoyed annualised returns of 7.3 per cent, but the typical investor received only 2.4 per cent a year as many bought in after the bulk of returns had been made.
/jlne.ws/46Rv62t

Kingdom Holding Buys $450 Million Citigroup Stake From Alwaleed
Nicolas Parasie – Bloomberg
Kingdom Holding Co., the investment company of Prince Alwaleed Bin Talal, has raised its stake in Citigroup Inc. to 2.2% after buying a $450 million stake from the Saudi billionaire.
/jlne.ws/3Rh8Yd3

A Hard Rain’s A-Gonna Fall on Hedge Funds; Tighter trading rules will make life harder for the shadow-banking community.
Marcus Ashworth – Bloomberg
/jlne.ws/3T51jA4

HSBC CEO Says Bonuses Should Remain ‘Sensible’ Even Without Cap; Quinn worries bigger pay packages encourage riskier behavior; UK regulator announced it would abandon the cap last month
Harry Wilson – Bloomberg
/jlne.ws/412knRt

Deutsche Bank Chief Says Investors Want Proof of Progress
Leonard Kehnscherper – Bloomberg
/jlne.ws/3R21gCh

Work & Management

London Finance Workers to See Biggest AI Impact, UK Report Finds
Irina Anghel – Bloomberg
Management consultants and City of London finance workers are among those most exposed to workplace changes ushered in by artificial intelligence, a new UK government report found, urging changes in schools and training programs to ease the impact.
/jlne.ws/410B6o4

An American model who moved to Spain says she initially thought the relaxed work culture was strange but now she loves it
Mikhaila Friel – Business Insider
Princess Keisha Omilana and her family left their home in London, UK, for the Spanish city of Valencia in March 2022. Keisha is an American model, entrepreneur, and owner of SAXS Mag, a travel, fashion, and entertainment publication that she launched in September. She is married to Prince Kunle, crown prince of the Arugbabuwo ruling house in Nigeria. The couple and their two children have lived in cities across the world, including New York City, Dubai, and most recently, London, where they lived for seven years before relocating to Valencia for work.
/jlne.ws/3uE7G37

Wellness Exchange

Hypnosis Could Work Wonders on IBS; As far-fetched as it may seem, research suggests that hypnotherapy can help patients find relief from all sorts of gut disorders.
Kate Wheeling – The Atlantic
The change in Zack Rogers was sudden. In the middle of his 12th birthday party, his stomach started hurting. He went to bed early that night, missing much of his own slumber party, and then stayed home from school the whole next week. The stomach pain was excruciating, and he couldn’t keep any food down. He lost 40 pounds in just a few weeks.
/jlne.ws/3QZlYTo

A year after launching, ChatGPT is already changing medicine
Tina Reed – Axios
It’s passed medical licensing exams. It’s advanced how researchers develop new medicines and cut down on doctors’ hefty paperwork. And it’s nudged health care closer to a world where AI can offer diagnoses. Why it matters: One year after OpenAI’s ChatGPT exploded onto the scene, the generative AI model is already upending health care – an industry not exactly known for its speedy adoption of tech – while accelerating questions about AI’s promises and limitations.
/jlne.ws/49ZiJ71

Regions

Fidelity and Abrdn agree £1.2bn China trust merger; Investment companies seal tie up as investors shun sector
Sally Hickey – Financial Times
Two investment trusts have agreed to merge their portfolios in an attempt to cut costs and increase liquidity, as the sector struggles with deep share price discounts. The FTSE 250 £1bn Fidelity China Special Situations trust will absorb the assets of Abrdn’s China Investment Company. The deal will create a £1.2bn trust that will continue to be managed by Fidelity and portfolio manager Dale Nicholls, the companies said in a statement on Tuesday.
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India Allots $142 Billion for Free Grains to 800 Million People
Ruchi Bhatia and Santosh Kumar – Bloomberg
Sign up for the India Edition newsletter by Menaka Doshi – an insider’s guide to the emerging economic powerhouse, and the billionaires and businesses behind its rise, delivered weekly. India’s cabinet on Wednesday approved a proposal to spend 11.8 trillion rupees ($142 billion) to extend a free food program for about 800 million beneficiaries for five years.
/jlne.ws/40YLo8i

Norway’s $1.5 Trillion Wealth Fund Recommends Adding Private Equity
Kari Lundgren – Bloomberg
Norway’s $1.5 trillion wealth fund recommended that private equity be added to its investment portfolio, reflecting a broader shift among large pension and sovereign funds to diversify beyond public assets.
/jlne.ws/46ygcxS

The Panama Canal Is So Backed Up, Ships Are Rerouting Through the Suez
Peter Millard – Bloomberg
The Panama Canal has become so backlogged that the world’s largest operator of chemical tankers has decided to reroute its fleet to the Suez Canal. London-based Stolt-Nielsen, which has a tanker division with 166 ships, is charging customers additional costs for the longer route, it said in an email. A bottleneck at the Panama Canal due to low water levels has prompted shippers to divert to Suez, the Cape of Good Hope, or even through the Strait of Magellan off the tip of South America.
/jlne.ws/3sW9PGM

Miscellaneous

US Pro Sailing Team Acquired in the Sport’s Biggest-Ever Deal; SailGP is selling off many squads to independent investors; Sale tops $40 million valuation for British sailing team
Kim Bhasin – Bloomberg
The US team of international sailing competition SailGP has been acquired by investors in the sport’s biggest team deal to date. The deal significantly surpasses the $40 million valuation for the UK’s Emirates GBR sail team earlier this year, according to a person familiar with the matter, who asked not to be identified discussing private information.The international championship, in which competitors race F50 foiling catamarans, is attracting more independent owners. The group acquiring the US team was led by former Uber Technologies Inc. executive Ryan McKillen and world champion sailor Mike Buckley. They’re joined by former Milwaukee Bucks co-owner Marc Lasry’s Avenue Sports Fund.
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