John Lothian Newsletter: Miami International Sees September Launch For Stock-Options Exchange; Swaps clearing likely mandated by year-end: CFTC; LME signs up for high speed push

May 3, 2012

Miami International Holdings plans to start its new venture, the MIAX Options Exchange (in New Jersey, not Miami), in September 2012. The CFTC hopes to get a clearing mandate for swaps by year’s end. The LME wades deeper into electronic trading with fast data from Fixnetix. One more big basket of volume reports awaits in the Exchanges section; more stories throughout from the ISDA conference; and the top box today contains a JLN Metals interview with Chris Gale of Latin Resources Limited.

Observations – Statistics – Commentary

Derivatives transparency sparks debate
By Telis Demos and Hal Weitzman in Chicago – Financial Times
The chief US futures regulator and the head of an industry group representing the world’s biggest banks have clashed over Washington’s desire to bring greater transparency to privately negotiated derivatives markets. Gary Gensler, chairman of the US Commodity Futures Trading Commission, said the $700tn market for over-the-counter derivatives was “the largest dark pool” among the world’s financial markets and needed to be opened up to public scrutiny.
http://jlne.ws/IIA43r

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CME Group’s Donohue Retires, To Receive Full 2012 Pay
By Jacob Bunge Of DOW JONES NEWSWIRES
The outgoing chief executive of CME Group Inc. (CME) formally retired from the exchange group he led for eight years on Tuesday, though he will collect salary for the rest of the year and remain eligible for a bonus.
http://jlne.ws/IIA6s6

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Five Minutes With Chris Gale, Latin Resources Limited
Chris Gale is the CEO of Latin Resources Limited, an iron ore and gold exploration company based in Perth, Western Australia. Latin Resources uses mineral sands technology to process iron ore and other materials at its Guadalupito project in the northern desert of Peru. Gale talked to editor/producer Nicole V. Rohr about the company’s reasons for using offshore mining and mineral sands production and about its plans in Latin America.

Q: What is the history of Latin Resources Limited?

A: We started the company back in March 2008 in Perth in Western Australia, and I’ve been investing in mining for some time in Australia. Australia is still at the point where mining exploration, and certainly mining itself, has become very expensive for a number of reasons. So, we wanted to look offshore and at the assets in Peru and South America. We went over and had a look at these assets, and really liked not only the assets, but the country itself with respect to mining, with respect to mining law and mining concessions, structure, infrastructure itself, highways and ports. And at the end of the day, [a significant percentage] of Peru’s GDP actually comes from mining, so they’re a mining country – the No. 2 silver producer in the world, No. 2 in copper, No. 2 in zinc and lead, and in gold they’re about No. 6.

One of the areas that we wanted to look at initially was exploration in iron. They [Peru] do have some very good iron ore… One of our key strategies was to ensure that these iron ore or these minerals were close to a port and close to infrastructure in regard to power, water and highways, for example. I see very often, in Australia incidentally, many assets, many good deposits, are discovered in places like Western Australia where they’re so stranded that someone has to spend $3 to $4 billion just to get those assets down to a port, and ultimately sold to market. So, we really focused on the coastal regions and our first area we looked at is right on the Chilean border, and we have a project down there. And the other area, around 2009 was presented to us, and was a project called Guadalupito which is a mineral sands project.

So, that’s how we started. We actually listed the company two years ago on the Australian Stock Exchange, in September 2010, and we have a number of substantial shareholders now on our books.

For the rest of the interview, visit the JLN Metals website at http://jlne.ws/IGOKAe

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Grain group questions 22-hour CME trading day
Reuters
Longer trading sessions at the benchmark Chicago grain futures markets will raise costs for U.S. grain merchants and could put some at a competitive disadvantage, the nation’s largest grain group said on Wednesday in response the CME Group’s plan for 22 hours of trading. The National Grain and Feed Association said there was “significant concern” about the market being open when the U.S. Agriculture Department releases its crop reports.
http://jlne.ws/IIA43y

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CME Chief Rebuffs Obama On Speculators
By Francesco Guerrera Of THE WALL STREET JOURNAL
The chief of the world’s largest futures exchange is coming to the defense of speculators. Two weeks after President Barack Obama blamed speculators, traders who wager on the future direction of commodity prices, for driving fuel prices higher and urged regulators to be tougher on them, Terry Duffy, the executive chairman of exchange operator CME Group Inc., hit back with a pointed explanation of investors’ role in financial markets.
http://jlne.ws/IIA6sf

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The fallacy of blaming oil ‘speculators’
Robert J. Samuelson – Washington Post
We should exorcise the politically convenient notion that high oil prices result from the market maneuvers of greedy “speculators.” It’s convenient because it suggests that a solution to high pump prices — or a partial solution — is to banish the offending speculators from the marketplace. That’s fantasy.
http://jlne.ws/IIA43z

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MARKET TALK: Fire In ISDA’s Fireside Chat With CFTC
Katy Burne – Dow Jones
Fireside chat between ISDA Chairman Stephen O’Connor and CFTC Chairman Gary Gensler gets heated at times. One awkward moment: when O’Connor pointed out that ISDA is not dealer controlled, since 40% of its members are customer “end users” of swaps compared to 25% for dealers, but Gensler asked whether dealers paid most of the fees. Another, O’Connor asked to “move on,” leading Gensler to quip, “There’s always the lawsuits” referring to an ISDA challenge in court against a CFTC rule.

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CME Raises Margins for Non-Hedged Accounts to Meet CFTC Rule
Bloomberg
CME Group Inc. (CME) , the world’s largest futures exchange, is raising futures margins for non-hedged positions to comply with new regulations. Members will be treated as speculators for outright positions, paying a higher margin, said the exchange, which trades everything from energy, agriculture and metals to interest rates and equity indexes.
http://jlne.ws/IIA6sm

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Redkite Generates World’s First ESMA Market Surveillance Alert
Press Release
Redkite Financial Markets, a specialist provider of market surveillance systems today announced that it generated the world’s first ever ESMA alert. The alert was generated at 9:05am this morning, on the first day of European trading, following the May 1 deadline for firms to comply with ESMA’s guidelines on systems and controls in an automated trading environment. The alert related to potential ‘quote stuffing’, a form of manipulative trading activity, that involves entering large numbers of orders and/or cancellations/updates to orders to camouflage a particular strategy, or to create uncertainty for other participants, slowing down their process.
http://jlne.ws/IIA43E

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At Milken, Feelings of Malaise
By KEVIN ROOSE – NY Times
If a single word captured the mood of the Wall Street contingent at this year’s Milken Institute Global Conference, “uncertain” would fit the bill.
http://jlne.ws/IIA43I

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Orc & Montreal Exchange Canadian Trading Webinar
Tuesday, May 15, 4:15pm ET / 3:15pm CT

Orc and Montreal Exchange discuss Canadian products and how to trade successfully.

Trading in Canada’s markets has become both more popular and more demanding in recent years. As market volumes increase, the need for a better understanding of the market and how to use high-performance trading solutions becomes more important.

In this webinar, Orc and Montreal Exchange will discuss what is currently happening in the Canadian trading market and how firms can use solutions like Orc Market Maker and Orc Spreader to stay competitive. Orc will also demonstrate how firms are leveraging our solutions to take advantage of market opportunities in Canada.

* Overview of the Montreal Exchange (M-X)
* M-X products and features highlight
* Orc overview
* Orc product highlights (Orc Market Maker and Orc Spreader)

Register through this link:
http://jlne.ws/IIA6ID

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MarketsWiki Page of the Day
Phupinder Gill
http://jlne.ws/Im4NAl

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MarketsWiki Recent Updates

People

Terrence A. Duffy; Phupinder Gill; Craig S. Donohue; Chris Gale

Miscellaneous

Upcoming Events

Statistics

22,827,646 pages viewed, 6,839 articles, 139,673 edits
MarketsWiki Statistics
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Lead Stories

Miami International Sees September Launch For Stock-Options Exchange
By Jacob Bunge Of DOW JONES NEWSWIRES
Miami International Holdings Inc. is targeting a late-September launch for a new U.S. stock-options market after filing legal documents with U.S. regulators last week. […] The planned MIAX Options Exchange, to be based in Princeton, N.J., has been under development for more than three years and has been supported by former executives and staff of the Philadelphia Stock Exchange, now owned by Nasdaq OMX Group Inc. (NDAQ).
http://jlne.ws/IIA43J

Swaps clearing likely mandated by year-end: CFTC
By Katy Burne – Dow Jones
A financial-market regulator said Wednesday at a derivatives industry conference that he would push to mandate clearing, a form of trade processing, for privately negotiated derivatives, or swaps, by the end of this year, leaving the door open for delays in the rule affecting the $300 trillion U.S. swaps market.
http://jlne.ws/IEHF6i

LME signs up for high speed push
Michelle Price – Financial News
The London Metal Exchange has chosen Fixnetix, the fast-growing trading technology firm, to provide super-fast data, as the long-established open outcry market moves towards an electronic trading model. The new agreement will allow firms wishing to trade on the metal exchange to receive LME trading data via Fixnetix’s super-fast – or low-latency – network, giving algorithmic trading firms the chance to enhance and diversify their strategies.
http://jlne.ws/IIA6Za

CFTC Offers Dodd-Frank Fix
Jamila Trindle, Dow Jones Newswires
The Commodity Futures Trading Commission issued a proposal Tuesday to address complaints that certain parts of the Dodd-Frank financial regulation law could inhibit international data sharing among regulators from different countries.
http://jlne.ws/IoE0Uh

Sum of Swap Rules May Hurt Trading as Costs Rise, Executives Say
By Mary Childs and Matthew Leising
Proposed rules to increase transparency in the $708 trillion private derivatives market may combine for an amplified effect that boosts costs for users, according to industry executives.
http://jlne.ws/IIA6Zc

UK in furious rejection of EU bank plan
By Alex Barker in Brussels – Financial Times
Britain’s poisonous relations with Brussels erupted on Wednesday as George Osborne, the chancellor, refused to defend watered-down EU bank rules that would make him “look like an idiot”. The bad-tempered exchanges at a late-night meeting of European finance ministers risked scuppering agreement on a 600-page law to implement the Basel III international accord on bank capital.
http://jlne.ws/IIA6Zd

Britain Remains a Dissenter as Europeans Try to Set Capital Reserves for Banks
New York Times
Britain’s chancellor of the Exchequer was teased by his Czech counterpart as Europe’s finance ministers failed to reach an accord on the amount of capital reserves required for banks.
http://jlne.ws/IIA6Zh

S&P raises Greece’s long- and short-term credit ratings after completing debt swap
International Business Times
Standard and Poor’s said it raised Greece’s long-term local and foreign currency sovereign credit ratings to ‘CCC’ from ‘SD’ (selective default) with stable outlook and its short-term foreign and local currency sovereign credit ratings to ‘C’ from ‘SD.’
http://jlne.ws/IIA6IF

Remarks By U.S. Treasury Secretary Tim Geithner At The Opening Ceremony Of The 2012 Strategic And Economic Dialogue
http://jlne.ws/IIA6Zm

Growth vs austerity ignores the euro facts
Lorenzo Bini Smaghi – Financial Times
Amid the eurozone cacophony, the growth rhetoric sounds nicer than the austerity refrain. But the challenge is to translate rhetoric into facts, especially in countries where market conditions provide no room for deficit spending.
http://jlne.ws/IIA6IM

Independent Counsel for MF Global Is Sought
BY AARON LUCCHETTI – WSJ
A Republican member of the House Financial Services Committee is pushing for the Justice Department to turn over its investigation of the MF Global Holdings Ltd. collapse to an independent counsel, according to people familiar with the matter.
http://jlne.ws/IIA6IN

Environmental Trading News

South Korean Parliament Approves Carbon Trading System
Bloomberg
South Korea approved a cap-and-trade system to cut carbon emissions as President Lee Myung Bak seeks support from factories and power plants in the fastest-growing producer of greenhouse gases among industrialized democracies.
http://jlne.ws/Injc0p

**JK – So when will we have an EU, Aussie, California and South Korea linkage?

EEX launches Derivatives Market for EUAA and ERU – CF Partners new Liquidity Provider
Press Release
On 30 April 2012, the European Energy Exchange (EEX) launched the Derivatives Market for EU Aviation Allowances (EUAA). Thus, EEX expands its product range with emission allowances which can be used by airlines for compliance purposes.
http://jlne.ws/IHmWM3

Viewpoints: Mexico, California stand together on ‘green’ growth
The Sacramento Bee
http://jlne.ws/IGYXyz

**JK – Interesting Op/Ed on cooperation, including ideas for offsets in the California carbon market.

For more environmental trading news, subscribe to the Environmental Markets version of the John Lothian Newsletter edited by Jim Kharouf.
Visit http://www.jlnenvironmental.comto subscribe.

Exchange & ECN News

Deutsche Börse makes algo news feed available in new CME Co-Location Facility
Market Data & Analytics has made available its algorithmic news feed “AlphaFlash” in the CME Co-Location facility located in Chicago’s suburbs via its subsidiary Need to Know News. This is the second data center in the Chicago area that offers clients direct access to AlphaFlash. Two more access points in the U.S. are located in Secaucus (New Jersey) and Washington D.C.
http://jlne.ws/IIA6IT

Deutsche Börse increases security and efficiency in German government bond trading on Xetra
With effect from 2 May, Eurex Clearing will act as the central counterparty (CCP) for the settlement of trades in more than 60 German government bonds on Xetra. This means that counterparty risk will be reduced for all trading participants and efficiency further improved. As an incentive to all participants, Eurex Clearing will not be charging clearing fees for these bonds for the remainder of the year.
http://jlne.ws/IIA7fF

Energy contracts boost ICE income
By Arash Massoudi and Vivianne Rodrigues in New York – Financial Times
IntercontinentalExchange , said commissions from a growing number of over the counter energy contracts helped the US electronic futures exchange outperform its competitors and report record net income in the first quarter.
http://jlne.ws/IIA7fG

ICE Reports 21% Increase in Futures Volume for April
IntercontinentalExchange, a leading operator of regulated global futures exchanges, clearing houses and over-the-counter (OTC) markets, reported futures volume for April 2012. Average daily volume (ADV) for ICE’s futures markets was 1,540,997 contracts, an increase of 21% from April 2011. Year-to-date through April 30, ADV across ICE’s futures exchanges was 1,551,967 contracts, up 2% compared to the first four months of 2011
http://jlne.ws/IIA7fP

CME Group Volume Averaged 10.7 Million Contracts per Day in April 2012
CME Group, the world’s leading and most diverse derivatives marketplace, today announced that April 2012 volume averaged 10.7 million contracts per day, down 12 percent from April 2011. Total volume for April was more than 225 million contracts, of which 85 percent was traded electronically.
http://jlne.ws/IIA7fQ

Average daily volume of 10.9 million contracts at Eurex Group in April
In April 2012, the international derivatives exchanges of Eurex Group recorded an average daily volume of 10.9 million contracts (April 2011: 10.5 million). Of those, 8.3 million were Eurex Exchange contracts (April 2011: 7.6 million), and 2.6 million contracts (April 2011: 2.9 million) were traded at the U.S.-based International Securities Exchange (ISE). In total, 156.9 million contracts were traded at Eurex Exchange and 52.0 million at ISE. This makes April the best month in terms of trading volumes in 2012.
http://jlne.ws/IIA9Er

95 billion euros turnover on Xetra in April
Order book turnover on Xetra and the Xetra Frankfurt specialist trading stood at E99.2 billion in April – a decrease by 8 percent year-on-year (April 2011: E108.3 billion). Of the E99.2 billion, E94.6 billion were attributable to Xetra – a decrease by 8 percent y-o-y (April 2011: E102.6 billion). E4.6 billion were attributable to the Xetra Frankfurt specialist trading, an 18 percent decrease y-o-y (April 2011: E5.6 billion). Order book turnover on Tradegate Exchange* totalled approximately E2.7 billion in April.
http://jlne.ws/IIA9Eu

Intercontinental Exchange Profit Rises on Record Commissions
By Matthew Leising – Bloomberg
Intercontinental Exchange Inc., the second-largest U.S. futures market, reported first-quarter profit rose 15 percent as higher revenue from clearing over-the- counter trades overcame a drop in futures trading.
http://jlne.ws/IIA9UM

April Trading Volumes At Boerse Stuttgart Reach More Than EUR 6.5 Billion – Investors Cautious – Market Mood Rather Negative On The Whole
Turnover at Boerse Stuttgart in April 2012 amounted to more than EUR 6.5 billion, according to its orderbook statistics. The mood among investors was considerably more restrained than in previous months. The largest share of the turnover was from trading in securitised derivatives, where total turnover was around EUR 3.3 billion. Investment products accounted for approximately EUR 1.8 billion of this, while leverage products contributed about EUR 1.5 billion.
http://jlne.ws/IIA7w8

BME Traded E65.76bn In April, Up 7.25% From The Previous MONTH – In April The Number Of Trades Came In At 4.6 Million, Up 31% From The Same Month In 2011
http://jlne.ws/IIA7we

Key figures SIX Swiss Exchange and Scoach Switzerland April 2012
Trading volume on SIX Swiss Exchange and Scoach Switzerland came to CHF 72.6 billion in April 2012 – 14.2% lower than the previous month. The number of trades fell by 9.3% to 2,633,386. The main reason for the month-on-month decline is that there were only 19 trading days during April, compared with 22 in March.
http://jlne.ws/IIA7wf

EEX launches Derivatives Market for EUAA and ERU – CF Partners new Liquidity Provider
On 30 April 2012, the European Energy Exchange (EEX) launched the Derivatives Market for EU Aviation Allowances (EUAA). Thus, EEX expands its product range with emission allowances which can be used by airlines for compliance purposes.
http://jlne.ws/IHmWM3

Bolsa De Valores, Mercadorias E Futuros 1Q12 Earnings Results Schedule
http://jlne.ws/IIA9V0

ASX Group Monthly Activity Report – April 2012
http://jlne.ws/IIA9V1

Irish Stock Exchange Statistics April 2012
http://jlne.ws/IIA9V5

NZX Monthly Shareholder Metrics – April 2012
http://jlne.ws/IIA7wl

CME Group Clearing Advisory
Changes to Performance Bond Requirements for Member Accounts – Effective May 7, 2012
http://jlne.ws/IIA7wo

ASX Compliance Monthly Activity Report – April 2012
http://jlne.ws/IIA7MF

ASX Limited Earnings Update to 31 March 2012
http://jlne.ws/IIA7MH

Vexim lists on NYSE Alternext
http://jlne.ws/IIA7ML

TSX Block List Leaders – April 2012
http://jlne.ws/IIAabs

Banks, Brokers & Dark Pools

Marex circles prop trading firm
Tom Osborn – Financial News
Marex Spectron, the futures brokerage backed by several former Lehman brother executives, is finalising a deal to buy all or part of London proprietary trading firm Schneider Trading Associates, people familiar with the matter said, as the firm continues its aggressive growth by acquisition strategy.
http://jlne.ws/IIA7MN

BoE ‘could have done more’ to stop crisis: King
AFP via Yahoo! News
The Bank of England could have done more to avert financial crisis in Britain, its governor Mervyn King has admitted, saying the central bank should have “shouted from the rooftops” about its concerns.
http://jlne.ws/IIAabx

Guess Which Big Bank CEO Was Missing At Today’s Big Fed Meeting
Forbes
Wall Street’s top CEOs sat with Federal Reserve Governor Daniel Tarullo to discuss the central bank’s recent round of stress tests but a very big player was missing from today’s meeting.
http://jlne.ws/IIAabz

Bank CEOs Discuss New Rules With Fed’s Tarullo
CNBC
Fed Governor Dan Tarullo met with six bank CEOs at the Federal Reserve Bank of New York in downtown Manhattan today. The bankers used the opportunity to reinforce their views on various parts of the Dodd Frank law.
http://jlne.ws/IIA7MS

Well, That Was Awkward…
Bank Chiefs’ Regulatory Concerns Met With Official Silence
BY DAN FITZPATRICK, LIZ RAPPAPORT AND VICTORIA MCGRANE – WSJ
A meeting Wednesday between a top Federal Reserve official and six bank bosses was notable largely for long silences from the central bank’s side of the table.
http://jlne.ws/IIA7MV

IMF Managing Director Christine Lagarde Welcomes Progress Towards Using US$1.1 Billion Of Gold Profits As Part Of A Strategy To Boost Concessional Lending To Low-Income Countries And Calls On More Members To Join Effort
http://jlne.ws/IIA83a

SocGen first-quarter fixed-income surge offset by charges
Reuters
French bank Societe Generale reported a 20.1 percent drop in quarterly net profit, as the cost of selling assets in a weak economy and other one-off charges offset a surprise surge in bonds, currencies and commodities revenue.
http://jlne.ws/IIA83f

BNY Mellon Wins Five Custody Risk Americas Awards 2012
PR Newswire
BNY Mellon, the global leader in investment management and investment services, announced that it has been named winner of five awards by Custody Risk Magazine in its inaugural Custody Risk Americas Awards 2012.
http://jlne.ws/IIAas0

Goldman Sachs Finds More Unwanted Publicity in Gupta Case
David Glovin and Patricia Hurtado | Bloomberg
Goldman Sachs Group Inc. (GS), just months after being assailed by an ex-employee for harboring a “toxic” culture, faces a harsh spotlight this month in Manhattan federal court over how well a senior official guarded its secrets.
http://jlne.ws/IIAas2

UBS Is On Right Track In Implementing Strategy -CEO Ermotti
FOX Business
UBS AG (UBS) Chief Executive Sergio Ermotti said Thursday the bank is on the right track in implementing its strategy of building its asset gathering business.”In the future we will focus more on our leading global wealth management business and the business in our home market of Switzerland, where we want to grow successfully,” Ermotti said in a text prepared for delivery at UBS’s annual …
http://jlne.ws/IIAas4

ECB May Soften Stance as Draghi’s Tentative Recovery Withers
Bloomberg
Since the European Central Bank President predicted an economic recovery at the start of the year, data have increasingly pointed to a deepening recession.
http://jlne.ws/IIAaIl

Citi Hires Freddie Mac Executive as Mortgage COO
Wall Street Journal Blogs
Citigroup Inc. has snatched Freddie Mac executive Anthony Renzi to become the chief operating officer of its North American mortgage business, according to people familiar with the matter.
http://jlne.ws/IIA83t

High turnover among HSBC’s top cops
Reuters via Yahoo! News
Since 2007, as HSBC Holdings Plc’s U.S. business has faced multiple investigations for alleged failures in its anti-money laundering (AML) efforts, at least half a dozen executives involved in them have cycled through the bank.
http://jlne.ws/IIAaIq

850 former HSBC Salinas workers to be laid off
KSBW Salinas
The day after HSBC in Salinas became Capital One, hundreds of its employees were alerted that they will be laid off, and the entire facility will close by summer 2013. Employees at the Salinas facility said 850 workers will be laid off beginning in December.
http://jlne.ws/IIA8jT

80 HSBC Credit Card Jobs Cut by Capital One
WGRZ-TV Buffalo
The impact of HSBC exiting North American operations continues to be felt by Western New Yorkers. Capital One confirms to 2 On Your Side that it is shutting down the Buffalo credit card operations that it bought from HSBC last summer.
http://jlne.ws/IIA8jW

Morgan Stanley’s Fleming Is Said to Lure Heaton for Wealth Unit
Bloomberg
Morgan Stanley (MS) hired Eric Heaton, Deutsche Bank AG (DBK) ‘s head of investment banking for financial services companies in the Americas, according to a person familiar with the matter.
http://jlne.ws/IIAaIw

Italian banks fall ahead of Moody’s review
By Alexandra Stevenson – Financial Times
Banks across Europe were hit hard after manufacturing data for April highlighted the continuing stresses in the eurozone’s periphery. Italian banks suffered the biggest losses as investors anticipated downgrades across the sector from Moody’s.The rating agency recently said it would review its ratings for Italian banks in early May.
http://jlne.ws/IIA8jY

Regulatory News

The SEC News Digest
The SEC News Digest provides daily information on recent Commission actions, including enforcement proceedings, rule filings, policy statements, and upcoming Commission meetings.
http://www.sec.gov/news/digest.shtml

Remarks By CFTC Chairman Gary Gensler Before The International Swaps And Derivatives Association’s 27 Annual General Meeting
http://jlne.ws/IIAaIx

SEC Charges Florida Stock Scheme Mastermind and 10 Cohorts
The Securities and Exchange Commission today charged a Florida man and 10 cohorts involved in two separate schemes to illegally sell stock, including one that sought to capitalize on circumstances in Haiti following the earthquake that destroyed much of the country’s infrastructure in January 2010.
http://jlne.ws/Im0AwI

U.S. SEC fraud lawsuit vs Morgan Keegan revived
Reuters via Yahoo! News
A federal appeals court on Wednesday revived a U.S. Securities and Exchange Commission lawsuit accusing Morgan Keegan & Co of fraudulently misleading investors about the safety of auction-rate securities it sold.
http://jlne.ws/IIA8Ae

NFA fines Chicago futures firm Olympus Futures and its owner Howard Malman
National Futures Association (NFA) announced today that it has levied a $100,000 fine against Olympus Futures, Inc. (OFI), an introducing broker located in Chicago, Illinois, and Howard K. Malman (Malman), the sole owner and a principal of the firm. A panel of NFA’s Hearing Committee issued the Decision, based upon a Complaint issued by NFA’s Business Conduct Committee in December 2011 and a settlement offer submitted by OFI, Malman and OFI’s Chief Compliance Officer Michelle Bodenshok.
http://jlne.ws/IIAaYW

Former FINRA Enforcement Director Daniel Nathan Joins Morrison & Foerster in Washington, D.C.
Morrison & Foerster is pleased to announce that Daniel A. Nathan, the former Vice President and Regional Enforcement Director for the Financial Industry Regulatory Authority (FINRA), has joined the Firm’s Washington, D.C. office as a partner, adding further scope to Morrison & Foerster’s enforcement capabilities in Washington, D.C., nationally and internationally.
http://jlne.ws/IIA8Af

Feds sue Utah hedge fund owner
The Salt Lake Tribune
Federal regulators are suing a Utah hedge fund owner over allegations he artificially inflated assets and charged excessive fees. Russell K. Cannon, 38, of North Salt Lake, is one of three Utahns who have been named in recent actions by the Securities and Exchange Commission.
http://jlne.ws/IIA8Ah

Decision in ASIC’s appeals in James Hardie matter
http://jlne.ws/IIA8Ai

New York Attorney General Schneiderman Secures Prison Sentence For Stockbroker Who Defrauded 800 Victims Out Of $6.2 M
http://jlne.ws/IIAaZ6

Norwegian day traders cleared of wrongdoing
By Michael Stothard in Helsinki – Financial Times
Two Norwegian day traders who outwitted the automated trading system of a big US broker have been cleared of all wrongdoing by the country’s highest court.
http://jlne.ws/IIAaZ7

Investments – Indexes – Managed Futures – Managed Funds

Chesapeake CEO ran $200 mln hedge fund: report
Market Watch
NEW YORK (MarketWatch) — Chesapeake Energy Corp. Chief Executive Aubrey McClendon ran a private $200 million hedge fund while heading up the energy company, according to a report by Reuters on Wednesday. Heritage Management Company LLC was launched by McClendon and Chesapeake co-founder Tom Ward, Reuters reported.
http://jlne.ws/IIA8An

McClendon’s Secret Hedge Fund Appears To Violate His Fiduciary Duty To Chesapeake
Forbes
How will McClendon ever regain the trust of shareholders?
http://jlne.ws/IIA8Ar

Chesapeake faces heat from top investor
By Ed Crooks in New York – Financial Times
The largest investor in Chesapeake Energy, the US gas producer, plans to take a more active role in the company to “discuss all options” for increasing shareholder value, including possible “proposed corporate transactions of a significant nature”.
http://jlne.ws/IIAbfn

Carlyle IPO raises unimpressive $671 million
By Greg Roumeliotis and Olivia Oran – Reuters
Private equity firm Carlyle Group LP proved a tough sell with investors on Wednesday, raising $671 million in an IPO that was slightly below a pricing range already seen as modest.
http://jlne.ws/IIAbfp

Omgeo turns to ETD processing
By Philip Stafford – Financial Times
Omgeo has expanded its electronic trade processing service into the fast-growing market for exchange-traded derivatives, as tight regulation and growing demand force change in the industry.
http://jlne.ws/IIAbfr

DTCC TO BEGIN PUBLISHING PUBLIC DATA ON INTEREST RATES DERIVATIVES
The Depository Trust & Clearing Corporation (DTCC) announced today that it had begun publishing public information on over-the-counter (OTC) interest rates trades. The data were first posted yesterday at 5 p.m. (2200 GMT).
http://jlne.ws/IIA8QM

ISDA Elects 13 Board Members
http://jlne.ws/IIA8QU

John Arnold Closes Centaurus Hedge Fund After 10 Years
Bloomberg
John Arnold, the hedge-fund manager who became a billionaire betting on natural gas prices, said he’s closing his Centaurus Energy Master Fund “to pursue other interests.”
http://jlne.ws/IIA8QX

Hedge Fund Plan Put Off After Co-Founder Has Stroke
Bloomberg
Dublin Hill Capital, the investment firm co-founded by Richard Ruzika, former chief of Goldman Sachs Group Inc. (GS) ‘s special situations group, suspended plans to start a hedge fund after Ruzika suffered a stroke.
http://jlne.ws/IIAbfC

Och-Ziff Capital Management Group LLC Reports 2012 First Quarter Results
http://jlne.ws/IIA8QY

EDHEC-Risk Study Highlights The Need To Reform Retirement Systems And Corporate Pension Funds
http://jlne.ws/IIA97f

United States ETF/ETP Industry As At End Of April 2012 – Preliminary findings
http://jlne.ws/IIAbvV

Global ETF/ETP Industry As At End Of April 2012 – Preliminary findings
http://jlne.ws/IIAbvW

European ETF/ETP Industry As At End Of April 2012 – Preliminary Findings
http://jlne.ws/IIA97s

Numerix CrossAsset Introduces Innovative Model Coverage to Support VIX Futures Instruments
Numerix (www.numerix.com), the leading provider of cross-asset analytics for derivatives valuations and risk management, released in its latest version of Numerix CrossAsset innovative model coverage for VIX futures instruments to more accurately price volatility linked derivatives.
http://jlne.ws/IIAbvZ

db x-trackers bond index ETFs on euro zone and German government bonds launched on Xetra
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The Asia Dow Finished April Down 1.09% According To Dow Jones Indexes
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The Europe Dow Closes April Down 4.14% According To Dow Jones Indexes – Novo Nordisk Topped All 30 Europe Dow Components With 6.66% Gain For The Month
http://jlne.ws/IIAbw1

Dow Jones-UBS Commodity Indexes April 2012 Performance Report
http://jlne.ws/IIA9nS

Technology News

Arbitrage Trading of Soft Commodity and Agricultural Futures
Join NYSE Liffe, Complete Commodity Solutions Ltd and RTS Realtime Systems for an interactive webinar on the opportunities of arbitrage trading in soft and agricultural commodities. Our experts will look at a variety of contracts, analyze price relationshops and discuss the impact of the currency exposure of commodities such as coffee, cocoa, wheat and sugar. Using popular wheat contracts as an example, our experts will demonstrate how to successfully capture opportunities using low latency trading solutions.
http://jlne.ws/IIAbw9

Fixnetix Announces Connectivity to London Metal Exchange (LME) Expanding to 85 Markets Worldwide
Fixnetix announced today connectivity to the LME (London Metal Exchange,) is now available as part of the Fixnetix 85 markets ultra-low latency global infrastructure for market data, trading and risk control. The relationship indicates algorithmic trading and electronic trading are on the rise whilst exchanges are recognising the positive impact on volumes.
http://jlne.ws/IIA9o1

Eze Castle Integration’s Eze Private Cloud Passes 2,000 Hedge Fund User Milestone
PRWeb via Yahoo! News
Eze Castle Integration, Inc., a leading provider of strategic IT solutions and private cloud services to hedge funds, today announced it has surpassed 2,000 users and more than a petabyte of data in its Eze Private Cloud. These latest milestones make the Eze Private Cloud the most widely used hedge fund cloud spanning two continents and delivering the broadest range of managed services.
http://jlne.ws/IIAbwb

Reports

Briefing.com Economic Calendar
http://www.briefing.com/Investor/Public/MarketAnalysis/Calendars/EconomicCalendar.htm

USDA Today
http://www.nass.usda.gov/Publications/index.asp

CBOE Events Calendar
http://www.cboe.com/AboutCBOE/EventCalendar.aspx

Economic Release Calendar
The Economic Release Calendar (PDF) is a schedule of government, academic and industry economic releases, provided as a service to CME customers.
http://www.cmegroup.com/tools-information/calendars/

Asia-Pacific News

Lone Star Sues Korea Exchange Bank Over $49 Million Bill
Bloomberg
Five units of Lone Star are asking Singapore’s High Court to rule that the South Korean bank should compensate them for payments made to Olympus Capital, according to court papers filed in the Southeast Asian city.
http://jlne.ws/IIAcjs

China Curbs on Currency Still an Issue
By ANNIE LOWREY – NY Times
The pace of appreciation of the Chinese currency against the dollar has slowed in the last year, ensuring that China’s manipulation of its exchange rate remains a central topic as Treasury Secretary Timothy F. Geithner arrives in Beijing for the annual dialogue between the nations.
http://jlne.ws/IIAcjt

Japanese banks
Lex – Financial Times
If Nomura is Japan’s financial harelike cautionary tale of overseas expansion, might Bank of Tokyo-Mitsubishi be the tortoise? Japan’s largest bank by assets wants to increase its global presence. It has the best chance in a long while to break the familiar pattern of expansion and retreat.
http://jlne.ws/IIAbMt

SGX Welcomes Concord Futures As New Member
http://jlne.ws/IIAbMC

HKEx Welcomes The Enactment Of The Securities And Futures (Amendment) Ordinance 2012
http://jlne.ws/IIAbMH

Overview Of Annual Reports Of 2011, 1Q Reports Of 2012 Of Shanghai Stock Exchange-lLsted Companies
http://jlne.ws/IIAc2U

Notice of Shanghai Stock Exchange’s Adjustment To Some Charging Standards (2012-04-30)
http://jlne.ws/IIAc2W

Frontier Markets

DFSA Board Announces Appointment of the Next Chief Executive
The Board of Directors (“Board”) of the Dubai Financial Services Authority (“DFSA”) today announces the appointment of Ian Johnston as the next Chief Executive of the DFSA. Ian Johnston will succeed Paul M Koster, with effect from 15 June 2012, after Paul Koster completes three and a half years with the DFSA.
http://jlne.ws/IIAc30

Bloomberg and Qatar Central Bank Launch Interbank Rate
Business Wire
Qatar Central Bank (QCB) and Bloomberg LP are partnering to launch the first ever Qatar Interbank Offer Rate (QIBOR) fixings in a move aimed at encouraging a more active interbank market in Qatar
http://jlne.ws/IIAczX

ICAP in Middle East derivatives push
By Philip Stafford – Financial Times
ICAP, the world’s largest interdealer broker, is beefing up its global derivatives business by hiring a team to trade from a new Dubai-based office and poaching Michael Drennan, the former head of Asia sales at MF Global.
http://jlne.ws/IIAc34

Bright Spot In Merger Landscape
BY DANA CIMILLUCA – WSJ
In a bleak mergers-and-acquisitions landscape, there’s at least one bright spot: China, Brazil and other emerging markets.
http://jlne.ws/IIAc3a

MSCI Emerging Markets And MSCI EAFE Indices Form Basis Of New NASDAQ OMX PHLX Equity Options
http://jlne.ws/IIAcA9

Dow Jones Islamic Market Titans 100 Index Closed Down 0.83% In April
http://jlne.ws/JVMIP1

Tel Aviv Stock Exchange & NASDAQ Biomed Industry Investor Conference -May 17, 2012
http://jlne.ws/K1GESb

Dubai Financial Market PJSC Board Of Directors’ Meeting
http://jlne.ws/JF0l3q

ZuluTrade’s Social Trading Network Now Available to ADS Securities Customers
Business Wire
Forex autotrading platform ZuluTrade, leader in social forex trading, teams up with Abu Dhabi based ADS Securities to better serve users in the Middle East region where forex investing is booming.
http://jlne.ws/IIAtmA

Miscellaneous News

Value-Added Tax Would Raise Tons for U.S. Coffers
Josh Barro – Bloomberg
With the exception of the U.S., every country in the Organization for Economic Cooperation and Development has a value-added tax — one on business sales that functions much like a retail sales tax. It’s time for the U.S. to join that club.
http://jlne.ws/KVRnk4

John Lothian Newsletter

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