Putin Really May Break the Nuclear Taboo in Ukraine

Apr 29, 2022

First Read

Hits & Takes
John Lothian & JLN Staff

ADM Investor Services announced that Tom Kadlec will retire as president of the firm after nearly 32 years with ADM and named John Stott to replace him. Stott is currently the group vice president, finance, corporate treasurer and CFO of global technology of ADM and has been with the company for nearly 30 years.

Kadlec has earned his retirement, guiding ADMIS through the myriad of challenges the industry has faced in recent years, all while keeping his calm, professional demeanor. Congratulations to Tom on his retirement and welcome to John in his new role.

Tom Chlada shared on LInkedIn that today is his last day at RCM Alternatives and that he will be starting Monday as the COO of Prime Trading. Congratulations, Tom, on your new position.

Deutsche Börse held its first ever Discover Day at its headquarters in Eschborn where 30 children could experience their parents’ workplace for a day. The agenda included an interactive presentation about DB Group, a tour and rally through its headquarters, career talks, and a guided art tour through its latest Deutsche Börse Photography Foundation exhibition. I really like Deutsche Börse’ key message, which is that Deutsche Börse does not just have jobs for girls or boys, they have jobs for people who know what they can do and who want to share their skills with them. There is an Instagram report of the day.

The NFA plans to move in 2023 to BMO Tower, the 1.5 million-square-foot office building recently completed at 320 S. Canal St. NFA has been at its current Chicago location since 2007, and its lease expires in August 2023. The BMO Tower will be the NFA’s third home in 40 years since NFA was established. BMO Tower is a technology-smart building designed for collaboration.

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


The Security Traders Association (STA) has provided a replay of its March 30 Washington DC Spring Update, “FinTech & Digital Assets: State of Play” interview with Rep. Warren Davidson moderated by Josh Beck, KeyBanc Capital Markets Equity Research Group, as well as a fireside discussion on the state of play of digital assets with industry experts from Hudson River Trading, Grayscale Investments and the Association of Digital Assets Markets (ADAM). You can watch both videos here.~SR


Cboe Chairman, CEO and President Ed Tilly’s Boca Update Reflects on Growth of Exchange Group and Readiness for Integration

Ed Tilly was happy to be back at the FIA Boca International Derivatives Conference in March to see industry friends, clients and competitors he had not seen since the pandemic hit in 2020. He said he appreciates the conference as an opportunity to catch up with happenings in the industry and with regulators.

Watch the video »


Copper.co’s Betty Sharples Weighs in on Digital Asset Protection & Navigating the Regulatory Landscape

Copper.co’s Betty Sharples sat down with John Lothian News on the second day of FIA Boca 2022 to discuss industry growth, protecting digital assets, and her hope for regulatory solutions.

Betty Sharples is the business development director for the digital asset custodian Copper.co, which launched in 2018. Since its inception, Copper has provided custody, trading, and digital asset services across 450 crypto assets and over 40 different exchanges. Sharples said that Copper’s products and services all serve a purpose: to bring prime brokerage to the crypto space.

Watch the video »


IDX early bird rates end on 30 April!

FIA’s International Derivatives Expo is returning to The Brewery in London this coming 6-8 June. Standing still is not an option in today’s evolving cleared derivatives environment. Without adapting to new products, processes, technologies and regulations, your business won’t meet the needs of tomorrow’s industry. We’re bringing together industry leaders, vendors and policymakers to discuss what’s “now” in derivatives, and what lies ahead. Sign up by 30 April for the best rates!


Twitter-Musk Deal Spread Widens as Traders Fret Over a Collapse
Yiqin Shen – Bloomberg
The deal spread rose to $5.09 per share by the close on Thursday after touching as much as $6.24 in early trading. On Monday, the gap was $2.50, signaling that investors are increasingly nervous about the take-private deal. The market is pricing in a roughly 80% probability of it being completed, said Aaron Glick, a merger-arb specialist at Cowen & Co. The gross discount of Twitter’s stock price to the $54.20 all-cash offer, ending the day at roughly 10%, also moved with Twitter’s swings Thursday after the social media firm reported revenue below analysts’ expectations.

****** There is a chance Mr. Market does not like this deal and will continue to pressure Mr. Musk via his holdings of Tesla. It could get ugly.~JJL


Crypto Miners Threaten Frail Energy Grid at the End of the World
Patrick Gillespie and Ignacio Olivera Doll – Bloomberg
Crypto mining is expected to consume close to a quarter of all electricity supply in the Tierra del Fuego province, which includes the world’s southernmost city Ushuaia, in the next few months until October, according to a report by Argentina’s state-run electricity wholesaler Cammesa. Local officials warn that crypto mining, together with an already feeble energy infrastructure, is putting their energy grid at the risk of collapse. The province’s energy secretary, Moises Solorza, told Argentine newspaper Clarin that the province’s main cities including the capital Ushuaia “are at their limit.”

**** In Montana a crypto firm bought all of the electricity from a coal fired power plant that was slated to close. Now it is not closing and has caused CO2 levels to spike. ~JB


IEX is on a mission to reshape finance, and we need mission-driven people.
Bradley Katsuyama – LinkedIn
ICYMI, we recently announced plans to work with the incredible team at FTX to shape the trading technology and market structure for digital asset securities. The FTX partnership signifies our commitment and intention to have a meaningful impact on the future of digital finance, and we are building a team to fulfill this mission. Today, we’re excited to announce the appointment of Florian Seifferer as Chief Operating Officer (COO) of our Digital Assets group at IEX.

***** Why do I feel like the IEX people are a bunch of Trekkies? To explore strange new market structures, seek out new life and new civilizations of data and boldly go where no exchange has ever gone before!~JJL


Crypto Firms Poach U.K. Cops Into Top Jobs With Triple Pay; Coinbase, Chainalysis among firms employing ex-police; U.K. grapples with losing talent to crypto exchanges
Ellen Milligan – Bloomberg
Cryptocurrency firms, armed with cash and in need of regulatory experience, are poaching U.K. cybercrime cops with offers of double or triple pay. The National Police Chiefs’ Council, the representative body for all U.K. forces, says they are losing experienced cybercrime officers and staff at 3 to 4 times the rate of the rest of policing.

****** Pay off cops? I mean, pay cops to come work for you? Who would do that?~JJL


Thursday’s Top Three
We had a tie for No. 1 story Thursday between Why I’m still not taking crypto seriously, an opinion piece by Jemima Kelly in the Financial Times, and Robinhood’s Era of Fun and Games Comes to an End from Bloomberg. (The latter begins, “It’s the end of an era for Robinhood Markets Inc. — and perhaps financial markets broadly.”) Second was CFTC Announces Staff Roundtable Discussion on Non-intermediation from the CFTC (the round table will be May 25). Third was Mom and Pop Investors Took a Billion-Dollar Bath Trading Options During the Pandemic, from Bloomberg.


MarketsWiki Stats
26,826 pages; 238,360 edits
MarketsWiki Statistics


Lead Stories

Putin Really May Break the Nuclear Taboo in Ukraine; It seems unthinkable, but American leaders’ failure to think about it heightens the risk it will happen.
Peggy Noonan – WSJ
Sometimes a thing keeps nagging around your brain and though you’ve said it before you have to say it again. We factor in but do not sufficiently appreciate the real possibility of nuclear-weapon use by Russia in Ukraine. This is the key and crucial historic possibility in the drama, and it really could come to pass. And once it starts, it doesn’t stop. Once the taboo that has held since 1945 is broken, it’s broken. The door has been pushed open and we step through to the new age. We don’t want to step into that age.

Crypto Bill in U.S. House Would Limit SEC’s Reach Over Exchanges
Allyson Versprille – Bloomberg
The crypto industry’s push to wrest jurisdiction away from the U.S. Securities and Exchange Commission is gaining momentum in a proposal by a bipartisan group of House lawmakers. Republican Reps. Glenn Thompson of Pennsylvania and Tom Emmer of Minnesota joined Democratic Reps. Darren Soto of Florida and Ro Khanna of California to re-up a plan on Thursday that’d bring exchanges that offer digital assets like Bitcoin directly under the Commodity Futures Trading Commission’s purview. The CFTC’s jurisdiction is now largely limited to crypto futures, and the SEC has upset coin enthusiasts by asserting that its stricter investor-protection rules should apply.

ADM Names New President of ADMIS
ADM (NYSE: ADM) today announced that John Stott will serve as the new president for ADM Investor Services, Inc. (ADMIS), effective July 1, 2022. He replaces Tom Kadlec, who announced his retirement after nearly 32 years with ADM. Stott is currently Group Vice President, Finance, Corporate Treasurer, and CFO of Global Technology and 1ADM. He is also a long-term executive at ADM, having served in a variety of roles at the company over almost 30 years.

Europe Starts Splintering in Its Response to Russia’s Threat
Ewa Krukowska, Alberto Nardelli, Jonathan Tirone and Zoltan Simon – Bloomberg
Europe’s response to Russia’s threat to turn off the gas if companies don’t pay in rubles is starting to splinter. Poland and Bulgaria have already been cut off for failing to abide by Vladimir Putin’s new terms. But Austria is confident it can keep the gas flowing and Hungary says it has no choice but to agree to Moscow’s demands. Germany appears to be pursuing a compromise and says the ball is now firmly in Putin’s court. As payment deadlines come due governments and companies are wrestling with the dilemma of bending to Russia’s demands and strengthening Putin in his war against Ukraine or risk plunging their citizens into energy rationing. At stake is the European Union’s credibility.

New gas pipeline boosts Europe’s bid to ease Russian supply
Derek Gataopoulos – AP
Mountainous and remote, the Greek-Bulgaria border once formed the southern corner of the Iron Curtain. Today, it’s where the European Union is redrawing the region’s energy map to ease its heavy reliance on Russian natural gas. A new pipeline — built during the COVID-19 pandemic, tested and due to start commercial operation in June — would ensure that large volumes of gas flow between the two countries in both directions to generate electricity, fuel industry and heat homes.

China’s Sudden Currency Plunge Raises Risk of a 2015-Style Panic
Sofia Horta e Costa and Tania Chen – Bloomberg
When China’s tightly managed currency depreciates dramatically against the dollar, it can be hard to stop. More than six years after China’s shock 2015 devaluation roiled global markets and spurred an estimated $1 trillion in capital flight, the yuan is weakening at a similar pace. Onshore it’s lost nearly 4% in eight days, while the offshore rate is heading for its worst month relative to the greenback in history. Selling momentum is the strongest since the height of Donald Trump’s trade war in 2018.

Elon Musk’s Twitter Funding Puts More of His Tesla Holdings at Risk; Car company previously warned investors that its CEO might need to sell stock to cover loans; now he is borrowing more against his stake
Tim Higgins – WSJ
Tesla Inc. Chief Executive Elon Musk has for years intertwined his personal business ventures with his stake in the auto maker. Using those holdings to help finance his $44 billion purchase of Twitter Inc. brings that connection to a deeper level.

Twitter Isn’t Rid of Wall Street; Twitter’s revenue growth is slowing, and even after going private it won’t be free of the need to grow given its debt to Wall Street banks
Dan Gallagher and Laura Forman – WSJ
Elon Musk is taking Twitter “back from Wall Street” in the words of its co-founder. The irony is that the turbulent social network will be more indebted to the markets than ever.

Elon Musk will be the most indebted CEO in America if the Twitter deal goes through
Robert Frank – CNBC
The world’s richest person could soon add another title to his name – America’s most leveraged CEO. Two-thirds of Elon Musk’s financing for the $44 billion deal to take Twitter private will have to come out of his own pocket. That pocket is deep. He has a net worth of about $250 billion. Yet because his wealth is tied up in Tesla stock, along with equity in his SpaceX and The Boring Co., Musk will have to sell millions of his shares and pledge millions more to raise the necessary cash.

Elon Musk’s Twitter Is a Scary Place for Many Black Users
Kelsey Butler – Bloomberg
Black Twitter Is Very Nervous–Let me give you a sense of what it’s like being a Black woman on Twitter. One day, I opened my DMs to a one-word message saying “Niger.” The person didn’t mean the West African country, but the racial slur. That kind of experience isn’t uncommon. One in 10 tweets mentioning Black women is abusive and problematic, compared to one in 15 for White women, according to an Amnesty International analysis of millions of tweets.

War in Ukraine Brings Commodity Traders Uncomfortable Windfall
Archie Hunter and Tarso Veloso – Bloomberg
Glencore Plc expects its full-year trading profits will again exceed its targeted range following a bumper first-quarter performance, while crop giant Bunge Ltd. boosted its earnings estimates for the year by more than 20% after reporting its own stellar results.

FTX chief welcomes more regulation as CFTC weighs its crypto derivatives proposal
Lisa Pauline Mattackal – Reuters
Crypto exchange FTX’s move to seek regulatory approval for direct trading in cryptocurrency derivatives will leave the door open for more oversight of the business in the United States, the company’s chief executive officer said. The U.S. Commodity Futures Trading Commission (CFTC) is currently considering an application from FTX US to offer “non-intermediated” margin trades for cryptocurrency derivatives, meaning the exchange would bypass the financial companies that currently facilitate such trades.

SEC alleges Archegos’ Bill Hwang used $160 billion in leverage to own as much as 70% of a single company. These are the 7 biggest stakes he controlled.
Matthew Fox – Insider
At its peak, Archegos Capital allegedly utilized $160 billion in leverage to control the prices of various stocks without disclosing its ownership stake. That’s according to a formal complaint from the Securities and Exchange Commission that was released on the same day Archegos’ Bill Hwang and Patrick Halligan were arrested by the Department of Justice and charged with fraud and racketeering. Both have pleaded not guilty, and their lawyers have said they are innocent.

More of Europe’s crude supply is coming from deep in the heart of Texas
Arathy Somasekhar and Stephanie Kelly – Reuters
U.S. crude exports to Europe climbed in March and April as buyers across the Atlantic snapped up the country’s light sweet grades to offset the expected loss of Russian oil, according to shipping data, traders and analysts. As the European Union weighs an oil embargo on Russia over its invasion of Ukraine, U.S. exporters are ramping up shipments of U.S. light crude to Europe, helped by Washington’s decision to release 180 million barrels of oil from the U.S. Strategic Petroleum Reserve, which is flooding the domestic market.

Jack Bogle Was a Punk; The new book The Bogle Effect shows just how radical Vanguard’s founder was—and that his true legacy is the company’s mutual ownership, not its beloved index funds.
Eric Balchunas – Bloomberg
For the past decade, while cryptocurrencies, Fed policy, meme stocks, and Elon Musk have captured all the headlines, investors have been quietly funneling a billion dollars a day into the greatest money-transfer machine in the history of capitalism: Vanguard. Yet the company shouldn’t even exist. An asset manager owned by its investors? That invests in passive indexes? That charges only microscopic fees? That’s made millions of Americans fabulously wealthy and bankrolled countless retirements without succumbing to Wall Street?

Barclays suspends new sales and trading in its own debt after US error; Historical paperwork blunder continues to hit UK bank after £540mn first quarter charge
Stephen Morris and Robert Smith – FT
Barclays has suspended all new issuance of its own debt and halted market-making activities for its notes, following a US paperwork error in 2019 that has already delivered a £540mn hit to the bank. The trading suspension affects securities of the group holding company Barclays Plc as well as Barclays Bank, the internationally-focused unit that runs the investment bank, according to a statement on Friday.

Labor Department Criticizes Fidelity’s Plan to Put Bitcoin on 401(k) Menu; ‘We have grave concerns with what Fidelity has done,’ says acting assistant secretary Ali Khawar
Anne Tergesen – WSJ
Labor Department officials believe Fidelity Investments’s plan to allow investors to put bitcoin in their 401(k) accounts risks the retirement security of Americans, a senior administrator said. “We have grave concerns with what Fidelity has done,” Ali Khawar, acting assistant secretary of the Employee Benefits Security Administration, said in an interview with The Wall Street Journal.

Broadridge’s LTX AI-Powered e-Trading Platform Launches New Buy-Side Advisory Group; Advisory Group will consist of senior credit traders from AllianceBernstein, American Century Investments, BlackRock, Invesco, MetLife Investment Management, PIMCO, and PineBridge Investments
To further develop corporate bond trading and advance market structure, global Fintech leader Broadridge Financial Solutions Inc. (NYSE: BR) has formed a new Buy-Side Advisory Group for LTX, Broadridge’s artificial intelligence (AI)-driven electronic trading platform. The Advisory Group will play a key role in evolving LTX and contributing to the development of solutions that drive greater efficiency and liquidity in the bond market.

Ukraine Invasion

Oil Middlemen Fueled Putin’s War Machine. Now They’re Getting Out.; Russia relies on exporters like discreet Swiss firm Trafigura to sell its crude supply, but Ukraine invasion tested even their legendary tolerance for risk
Joe Wallace and Eliot Brown – WSJ
Russia built a self-proclaimed fortress around its economy in the run-up to war—but there was a crack. Moscow depended on foreign middlemen to ferry its most strategic and lucrative export around the world: oil. Now the most-important middleman, Trafigura Group, is joining several competitors in cutting off Russian giant Rosneft Oil Co. from global oil markets. In a high-stakes move that goes farther than official Western sanctions, the Swiss commodities trader plans to stop exporting Rosneft’s crude altogether. It will cut its business with the state producer to a sliver of prewar levels, supplying only some refined products such as diesel into Europe, according to a spokeswoman.

After Criticizing Putin’s War, Russian Tycoon Tinkov Sells Bank He Built
Potanin’s Interros Capital is buying Tinkov’s 35% stake in TCS Group Holding Plc, better known as Tinkoff Bank, Interros said in a statement Thursday. The terms of the deal were not disclosed.

Ukrainian soldier says Elon Musk’s Starlink satellites ‘changed the war in Ukraine’s favor’ as they’re helping troops stay online amid Russian strikes
Sophia Ankel – Business Insider
A Ukrainian soldier said that Elon Musk’s Starlink satellites “changed the war in Ukraine’s favor” because they were helping troops stay online amid Russian strikes on Ukrainian infrastructure. The soldier’s comments were reported by the British freelance journalist David Patrikarakos, who was reporting from the Ukrainian city of Dnipro.

Russia warns West: Don’t test our patience
Guy Faulconbridge – Reuters
Russia on Thursday warned the West that there would be a tough military response to any further attack on Russian territory, accusing the United States and its key allies of undermining European security by openly inciting Ukraine to assault Russia. Russia’s Feb. 24 invasion of Ukraine has killed thousands of people, displaced millions more and raised fears of the most serious confrontation between Russia and the United States since the 1962 Cuban Missile Crisis.

Tankers of Russian oil a prime target for western sanctions; There is a potent measure available for leaders in the bid to squeeze Moscow financially
Gillian Tett – FT
Earlier this month Boris Johnson, the British prime minister, grabbed headlines by travelling to Kyiv to demonstrate his solidarity with Volodymyr Zelensky, the Ukrainian president. It was eye-catching, tub-thumping stuff. But if Johnson wants to support Ukraine against Russia’s invasion, he now should make a symbolic visit to a closer destination: the headquarters of Lloyd’s, the world’s largest insurance marketplace, in the City of London.

Russian gas payment demands in ‘breach’ of sanctions, EU warns; Completion of energy deals in roubles would fall foul of ban on central bank transactions
Valentina Pop and Andy Bounds – FT
The EU has warned European buyers of Russian gas that they will be in breach of sanctions against Moscow if they accept Kremlin demands for payment to be completed in roubles. The warning, which is clearer than previous guidance by Brussels, comes after several European companies indicated they would comply with a March 31 decree by President Vladimir Putin to introduce a two-tiered system for gas payments.

‘Divide and rule’: Russia’s rationale for halting gas flows to Poland and Bulgaria; The two EU nations have refused to implement a new payment mechanism imposed by Putin
Harry Dempsey and Neil Hume – FT
Russia has initiated its biggest counterattack against EU sanctions by cutting the flow of gas to Poland and Bulgaria because of their refusal to use a new payment mechanism that allows Moscow to access the cash it receives for its energy exports. The move by Gazprom, Russia’s state-backed gas supplier, has jolted global gas markets, pushing prices higher and providing a reminder of the Kremlin’s willingness to withhold energy exports from Europe.

US takes step closer to sending Russian oligarchs’ billions straight to Ukraine
Ben Werschkul – Yahoo Finance
On Thursday, President Joe Biden announced a proposal to get even more aggressive with the billions seized from Russian oligarchs who have close ties to Vladimir Putin. The White House released the outlines of what it calls a new comprehensive legislative package around Ukraine that includes provisions to “streamline the process for seizure of oligarch assets, expand the assets subject to seizure, and enable the proceeds to flow to Ukraine,” the White House said.

Exchanges, OTC and Clearing

WATCH: ‘This is a stock-picking market,’ says NYSE’s youngest-ever female trader. She explains why she doesn’t hold crypto, how young investors could get ahead, and how she’s diversifying.
Laila Maidan – Insider
In 2017, Lauren Simmons made history as the youngest-ever full-time female trader on the New York Stock Exchange when she took the floor at 22 years old. The experience of being an equity trader taught her key things about money. One of them was that it’s important to have transparent conversations about pay. Simmons was making $12,000 annually when she started her job as an equity trader — a number she soon realized was substantially lower than a colleague who made $120,000 working at a similar firm.

CME Group to Launch Canadian Wheat (Platts) Futures on June 13
CME Group
CME Group, the world’s leading derivatives marketplace, today announced it will launch Canadian Wheat (Platts) futures on June 13, pending regulatory review. This contract will offer market participants a new tool to directly manage exposure to the Canadian wheat market. “Canada is the world’s second largest producer of spring wheat and is one of the world’s top wheat exporters, making it an increasingly important region for our global clients,” said Tim Andriesen, Managing Director of Agricultural Products at CME Group. “Canadian Wheat futures are complementary to our existing suite of wheat products and will allow our clients to more effectively manage their exposure across the entire global wheat trade.”

BME launches 4 new indices that eliminate dividend risk
The new IBEX family indices replicates the performance of the IBEX 35® total return and discounts the dividends by a constant (decrement) on an annual basis; This type of indices is often used as underlying for various structured products.
The IBEX family is growing. BME has just launched the IBEX 35® TR Decrement 400 P, IBEX 35® TR Decrement 450 P, IBEX 35® TR Decrement 4.5% and IBEX 35® TR Decrement 5.0% indices. They all replicate the daily performance of the IBEX 35® total return but are discounted by a constant (known as decrement) on an annual basis, and therefore in terms of performance these indices should be compared with the IBEX 35® index.

BME admits a 11-year new sustainable bond from the Basque government for 500 million euros
This is the sixth issue linked to ESG principles launched by the Basque Country since its first one in May 2018; The volume of these transactions registered in the BME fixed income markets totals 100 billion euros
BME, through the Bilbao stock exchange, today admitted a 500 million euro, 11-year sustainable bond issue launched by the Basque Government. The bonds have a nominal value per unit of 1,000 euros. The transaction was three times oversubscribed, thus bringing a fixed annual coupon of 1.875%.

Cboe Global Markets Reports Results for First Quarter 2022
First Quarter Highlights*
Diluted EPS for the Quarter of $1.02, Down 20 percent; Adjusted Diluted EPS¹ for the Quarter of $1.73, Up 13 percent; Net Revenue for the Quarter of $418 million, Up 14 percent; Reaffirmed Organic Total Net Revenue Growth2 Target for 2022 of 5 to 7 percentage points; Increases Data and Access Solutions Organic Net Revenue Growth2 Target to 8 to 11 percentage points, from 7 to 10 percentage points; Reaffirmed 2022 Adjusted Operating Expense Guidance2 of $617 to $625 million
Cboe Global Markets, Inc. (Cboe: CBOE) today reported financial results for the first quarter of 2022.

Performance Bond Requirements – Agriculture, Equity, Energy Margin – Effective April 29, 2022
CME Group
As per the normal review of market volatility to ensure adequate collateral coverage, the Chicago Mercantile Exchange Inc., Clearing House Risk Management staff approved the performance bond requirements for the following products listed in the advisory at the link below. The rates will be effective after the close of business on April 29, 2022.

LEI Submission in CGM Files under Rule 980.G
CME Group
Pursuant to Rule 980. (Required Records and Reports) of the Exchange Rules of each of Chicago Mercantile Exchange Inc. (“CME”), Chicago Board of Trade, Inc., New York Mercantile Exchange, Inc. and Commodity Exchange, Inc. (collectively, the “Exchanges”), all clearing members are required to prepare, maintain and keep current those books and records required by the Exchanges, the Commodity Exchange Act and the regulations and to provide certain information to the Exchanges and/or to CME Clearing (the “Clearing House”) in accordance with the requirements of the rule.

New Product: Initial Listing of the Canadian Western Red Spring Wheat FOB Vancouver CME CME Group
Financially Settled (Platts) Futures – Effective June 13, 2022
Initial Listing of the Canadian Western Red Spring Wheat FOB Vancouver Financially Settled (Platts) Futures.

EBS Market Integration onto CME Globex
CME Group
Subject to applicable regulatory approvals, EBS Market’s Central Limit Order Book and eFix Matching Service will launch on CME Globex. You will receive subsequent notices with additional details and actions required to support the EBS Market integration onto CME Globex.

Dividend Derivatives: Introduction of further expirations for EURO STOXX® Banks Index Dividend Futures
The Management Board of Eurex Deutschland and the Executive Board of Eurex Frankfurt AG took the following decisions:
– EURO STOXX® Banks Index Dividend Futures (FEBD): Introduction of semi-annual maturities and additional December maturities with effect from 16 May 2022
– Amendment to the relevant Product Specific Supplements to the Liquidity Provider Agreement to reflect the introduction of additional expirations with effect from 1 June 2022.

Eurex extends incentive program to switch interest rates swap positions into the EU
To support banks and institutional investors in migrating OTC interest rate derivatives positions into the EU, Eurex Clearing has extended its incentive program until the end of 2022.

Changes of SSE-Listed China Connect Securities List
With effect from 5 May 2022, SHANGHAI WEAVER NETWORK (SSE Security code: 603039)
listed on Shanghai Stock Exchange will be removed from the list of China Connect Securities and will be added to the list of Special China Connect Securities which will be eligible for sell only in Northbound trading. The aforementioned change(s) is(are) also available on the “Eligible Stocks section of the Connect Scheme webpage.

Amendment – Revision of Northbound Transfer Fee in relation to Stock
With reference to the circular referenced CD/OES/CCASS/017/2022 dated 28 April 2022 regarding revision of Northbound Transfer Fee of Stock Connect, please note that the tariff code under which CCASS collects the revised transfer fee charged by ChinaClear (0.001%) mentioned in that circular should be “X5” instead of “X7” while that charged under the tariff code “X7” would remain unchanged.

Risk Management Arrangements in respect of the day following the Birthday of the
All markets operated by the Hong Kong Futures Exchange will be closed for business on 9 May
2022, except MSCI Futures and Options1. In order to assure that safeguards are in place against potential market risks that may arise during the aforesaid period when some of the major markets are open, Participants are kindly reminded to adopt the following risk management measures.

ICE’s Global Energy Markets Reach Record Open Interest
Intercontinental Exchange, Inc. (NYSE:ICE), a leading global provider of data, technology, and market infrastructure, today announced that it reached record open interest in its Total Energy futures and options markets of 46.7 million contracts on April 25, and is up 11% since the start of the year.

Moscow Exchange announces results for the first quarter of 2022
Unless otherwise indicated, all figures are for the first quarter of 2022, and the dynamics (percentage change) is compared to the first quarter of 2021 based on IFRS financial results.
Key Results of the First Quarter 2022
– Fee and commission income increased by 15.1% to RUB 10.6 billion.
– The increase in fee income is driven by higher trading volumes in January and February 2022. In the second quarter of 2022, there was a significant decrease in trading volumes, which may continue into subsequent quarters.
– EBITDA increased by 17.8% to RUB 11.1 billion, net profit increased by 18.5% to RUB 8.1 billion.

Hashdex Announces Launch of the Hashdex Nasdaq Crypto Index Europe ETP
Hashdex, a leading global crypto-focused asset manager, today announced the upcoming launch of the Hashdex Nasdaq Crypto Index Europe exchange-traded product (“ETP”) ISIN CH1184151731. The firm’s first European product will be available on the SIX Swiss Exchange under the ticker symbol SIX: HASH SW starting Monday, May 2, 2022.

Singapore International Ferrous Week returns with focus on sustainable steel
– SGX Commodities and Enterprise Singapore to hold second SIFW in-person from 17-20 May, with livestream and video-on-demand options
– Fastmarkets, S&P Global Platts and TradeWinds return as partners
SGX Commodities, Asia’s most liquid seaborne risk management venue for the ferrous value chain, and Enterprise Singapore (Enterprise SG), will jointly hold the Singapore International Ferrous Week (SIFW) for the second consecutive year following its successful inaugural launch last year.

TAIFEX to Launch Taiwan Semiconductor 30 Futures & Shipping and Transportation Sector Futures
Taiwan Futures Exchange (TAIFEX) will introduce Taiwan Semiconductor 30 Futures (SOF) and Shipping and Transportation Sector Futures (SHF) in late June to provide traders with more choices to manage their risks exposure in Taiwan’s Semiconductor sector or Shipping and Transportation sector. The SOF’s multiplier is NTD 50 and SHF’s is NTD 1,000, with contract value at around NTD 210,000 and NTD 270,000, respectively. Most of the specifications of these two contracts are as same as the specifications of TAIFEX’s domestic equity index futures. With regard to the trading hours, SOF is also available for night session in addition to regular session, fully covering the trading hours of the underlying stock markets (including ADRs in the U.S.). Please see below for contract specifications of SOF and SHF.


Twitter admits overstating audience figures for 3 years; Social media group targeted by Elon Musk reveals ‘error’ as it posts double-digit rise in users
Tim Bradshaw – FT
Twitter admitted to overstating its audience figures by almost 2mn users for about three years, as it reported its first quarterly results since the social media company agreed a $44bn buyout from Tesla chief Elon Musk. It is the second time that Twitter has miscalculated its user numbers, after discovering in 2017 that a similar error had gone unnoticed for three years.

Innovate London: Symphony launches its embedded collaboration platform and introduces a Microsoft Teams integration
Symphony – the leading markets’ infrastructure and technology platform – revealed financial firms will now be able to embed its technology in other platforms in order to successfully complete their workflows without context switching or adding friction. The company launched its embedded collaboration platform (ECP) on Tuesday as part of Symphony’s flagship conference Innovate, which took place in London.

TP ICAP announces new CEO of its Agency Execution division
TP ICAP, a leading electronic market infrastructure and information provider, announced today the appointment of Mark Govoni as Chief Executive Officer of its Agency Execution division. Govoni replaces John Ruskin, who has decided to step away from the business having successfully led the integration of Liquidnet into the TP ICAP Group. Ruskin will stay with the Group until the end of June to ensure an orderly transition.

Instinet’s president of US brokerage joins TP ICAP as CEO of its agency execution division; Incoming chief executive joins TP ICAP having previously served at Instinet, Nomura Securities International and Merrill Lynch.
Wesley Bray – The Trade
Interdealer broker TP ICAP has appointed Mark Govoni as chief executive officer of its agency execution division, replacing John Ruskin, who will be stepping away from the business. Following a successful integration of Liquidnet into the TP ICAP Group, Ruskin will remain at the Group until the end of June to ensure a seamless transition.

Data analysis most important skillset on the trading desk, finds report; Refinitiv report found as the equities, FX and fixed income markets have evolved, knowledge on how to handle data has become paramount to success.
Annabel Smith – The Trade
Despite their many differences, equities, fixed income and foreign exchange desks are united in their desire for traders with knowledge around data, a Refinitiv report has found. Data analysis and data science was the top ranked skill for the next one to three years by traders across asset classes, followed by market and market structure knowledge.

MSCI and MarketAxess enter into a strategic collaboration; The collaboration will focus on liquid fixed income indexes, portfolio construction solutions and ESG data.
Wesley Bray – The Trade
MSCI and MarketAxess have entered into a strategic collaboration to create portfolio analytics solutions and co-branded fixed income indexes, utilising MarketAxess’ liquidity data. MarketAxess’ AI-powered pricing and liquidity indicators, such as relative liquidity score and tradability , will be integrated into MSCI’s portfolio construction analytics tools and fixed income indexes.


Russian Cyberattacks Aimed To Destroy Critical Infrastructure — And Steal Data; The hacks, paired with prewar data theft, likely armed Russia with extensive details on much of Ukraine’s population.
Frank Bajak – AP
Russia’s relentless digital assaults on Ukraine may have caused less damage than many anticipated. But most of its hacking is focused on a different goal that gets less attention but has chilling potential consequences: data collection. Ukrainian agencies breached on the eve of the Feb. 24 invasion include the Ministry of Internal Affairs, which oversees the police, national guard and border patrol. A month earlier, a national database of automobile insurance policies was raided during a diversionary cyberattack that defaced Ukrainian websites.

An Urgent Need for Cybersecurity Stocks
James K. Glassman – Kiplinger
In June 2017, Russian hackers launched a malware attack on Ukraine called NotPetya. The attack, which locked users out of their own files unless they paid a ransom in bitcoin, was just one more tactic in the conflict between the two nations that had begun three years earlier. But viruses don’t respect borders, and this one spread far beyond Ukraine.

Four worries bank cybersecurity experts face
Carter Pape – American Banker
Few banks have a corporate leadership structure that puts cybersecurity executives close to the top of the organization, according to a recent survey of such executives at financial institutions.
The survey results, released by cloud computing and software company VMWare, show that 80% of chief information security officers report to chief information officers rather than the CEO. Experts disagree over whether that is the appropriate reporting structure, with some saying it creates a major governance issue and others saying CISO promotions are unnecessary.

SEC Cybersecurity Rule for Registered Funds, Investment Advisers
Ryan P. Blaney and Robert H. Sutton – National Law Review
Final comments were due last week to the Securities and Exchange Commission (SEC)’s proposed cybersecurity risk management rules for registered investment advisers, registered investment companies and business development companies (registered funds), as well as various amendments to existing rules governing investment adviser and registered fund disclosures. The main focus of the 200 plus page proposed rule is to strengthen existing requirements and foster upgrades to the cybersecurity risk management practices of registered funds and advisers. The vote was 3-1.[1] Cybersecurity has been front of mind for the SEC in recent years, having issued updated guidance on public company cybersecurity disclosures in 2018 and risk alerts in 2020 on credential stuffing and ransomware attacks.


Crypto: 80% of institutional investors expect digital assets to replace traditional investments
Akiko Fujita and Alexandra Semenova – Yahoo Finance
Yahoo Finance’s Alexandra Semenova joins the Live show to discuss crypto investment trends and how investors increasingly see digital assets replacing traditional assets.

Goldman Offers Its First Bitcoin-Backed Loan in Crypto Push; Secured lending facility lent cash collateralized by Bitcoin; Move comes as Wall Street warms up to digital assets
Yueqi Yang – Bloomberg
Goldman Sachs Group Inc. offered its first ever lending facility backed by Bitcoin, in a significant step for a major U.S. bank that accelerates Wall Street’s embrace of cryptocurrencies. The secured lending facility lent cash collateralized by Bitcoin owned by the borrower, a spokeswoman for the bank said. The deal was interesting to Goldman because of its structure and 24-hour risk management, she said in an email.

Crypto’s ‘Friends Forever’ Future Dies in a Day
Emily Nicolle – Bloomberg
At its heart, the crypto ethos is all about uniting everyone’s talents to foster a single goal: creating a decentralized, open-source and censorship-free future for all. To achieve this mission will take a lot of industry collaboration, particularly if you don’t have $44 billion lying around to buy the sector’s favorite social platform. The question is: Is it even possible?

Coinbase Cracks Down on Front-Running of New Crypto Listings; Biggest U.S. crypto exchange has ‘zero tolerance for this’; Allegations of front-running are common in crypto markets
Olga Kharif – Bloomberg
Coinbase Global Inc. outlined its most detailed plan yet to address concern about the possibility of front-running tokens being considered for listing on the biggest U.S. cryptocurrency exchange. In a blog post Thursday, Chief Executive Officer Brian Armstrong said Coinbase is implementing new procedures, so people wouldn’t be able to guess, by examining Coinbase’s blockchain activity or playing around with its software, if it’s considering listing new tokens.

Edward Snowden says he’s the mystery man involved in the creation of leading privacy cryptocurrency Zcash
Taylor Locke – Fortune
Back in 2016, six people played a key role in the creation of a cryptocurrency called Zcash. One of the six participants, who operated online under the pseudonym John Dobbertin, remained unknown—until now.

DBS CEO Casts Doubt on Retail Crypto Plan, Citing Regulators; Regulators not comfortable with retail crypto trading: Gupta; New survey says 4 in 10 Singaporeans on cryptocurrency
Faris Mokhtar and Joanna Ossinger – Bloomberg
DBS Group Holdings Ltd. Chief Executive Officer Piyush Gupta said Singapore’s biggest bank won’t offer crypto trading for retail investors this year, citing technological challenges and resistance from regulators. Gupta said during the bank’s results briefing on Friday that while he would have liked to start the service this year, it’s taking a “little bit longer than expected” to put the technology apparatus together. In addition, regulators aren’t comfortable with cryptocurrency trading for retail customers, he said. DBS currently offers crypto trading only for accredited investors.

Brazilian Firm Hashdex to List Its First Crypto ETP in Europe; Product linked to tokens including Bitcoin, Ether, Solana; Hashdex joins a slew of ETP launches in a weak crypto market
Tanzeel Akhtar – Bloomberg
Hashdex Gestora de Recursis Ltda. plans to list its first European crypto exchange-traded product, as the Brazilian cryptocurrency-focused asset management firm expands on the continent. The Hashdex Nasdaq Crypto Index Europe ETP will start trading on the SIX Swiss Exchange on May 2 under the ticker HASH SW, according to a statement from the company. It will be the firm’s first crypto product listed outside Latin America

How New York’s Potential Ban Could Cripple Crypto Miners
Joe Light – Barron’s
New York could be on the verge of severely limiting crypto miners in the Empire State. For investors, the real fear is whether the feds are close behind. It has been a bad month for Bitcoin. But even with it down 15% from its March high to about $40,000, most miners shouldn’t have trouble turning an operating profit with costs between $4,500 and $16,000 to mine a coin.


Biden Seeks New Aid for Ukraine as Russia Makes Slow Progress in Seizing East; Congress is asked to provide $33 billion to fund more weapons and provide longer-term economic assistance
James Marson – WSJ
President Biden sent Congress a $33 billion request to fund more weapons and provide longer-term economic assistance for Kyiv, as Russia’s military is gradually seizing more territory in Ukraine’s east, pushing south from the city of Izyum with the apparent aim of cutting off Ukrainian forces. Mr. Biden said Thursday that the $13.6 billion in funding that Congress had initially provided to Ukraine to help cover the first two months of the war was nearly depleted and that far more was needed, describing the conflict as being at a pivotal point.

US Lawmakers Reintroduce Bill to Give CFTC Crypto Spot Market Oversight; The Digital Commodity Exchange Act would give the regulator direct oversight of some types of crypto transactions and exchanges.
Nikhilesh De – CoinDesk
A bipartisan set of U.S. lawmakers are introducing a bill that would give the Commodity Futures Trading Commission (CFTC) a greater role in overseeing crypto spot markets. The Digital Commodity Exchange Act of 2022 (DCEA), introduced Thursday by representatives Glenn Thompson (R-Pa.), Ro Khanna (D-Calif.) Tom Emmer (R-Minn.) and Darren Soto (D-Fla.), would create a definition for “digital commodity” and allow the CFTC to oversee companies issuing or letting people trade these types of tokens, while having the Securities and Exchange Commission (SEC) continue to oversee tokens that fall under U.S. securities laws.

The FTX US Proposal That Shook Congress And The Crypto Derivatives World
Jason Brett – Forbes
Last month, the Commodity Futures Trading Commission (CFTC) has requested public comment on a proposal from FTX US to modify their Derivatives Clearing Organization (DCO) license to offer a new kind of margin trading to retail customers. This is what is known and described as a ‘non-intermediated’ model of crypto derivatives trading, meaning there is no intermediary in the form of a Futures Commission Merchant (FCM).

Crypto bill in House would limit SEC’s jurisdiction over exchanges; The measure sponsored by a bipartisan group of representatives would bring exchanges that offer digital assets like Bitcoin directly under the purview of the Commodity Futures Trading Commission.
The crypto industry’s push to wrest jurisdiction away from the Securities and Exchange Commission is gaining momentum in a proposal by a bipartisan group of House lawmakers. Republican Reps. Glenn Thompson of Pennsylvania and Tom Emmer of Minnesota joined Democratic Reps. Darren Soto of Florida and Ro Khanna of California to re-up a plan on Thursday that would bring exchanges that offer digital assets like Bitcoin directly under the Commodity Futures Trading Commission’s purview.

Congressman introduces Digital Commodity Exchange Act to set up CFTC regime for crypto exchanges
Kollen Post – The Block
A new bill looking to establish a reporting regime for cryptocurrency exchanges is now formally before Congress. On April 28, Glenn “GT” Thompson (R-PA) introduced Digital Commodity Exchange Act. The DCEA would set up a reporting regime for crypto exchanges with the Commodity Futures Trading Commission.

GOP Rep. Madison Cawthorn appears to have violated the STOCK Act by failing to disclose ‘let’s go brandon’ cryptocurrency purchase
Kimberly Leonard,Dave Levinthal – Insider
Republican Rep. Madison Cawthorn of North Carolina appears to have violated a federal conflict-of-interest law by failing to report his stake in a cryptocurrency named for the anti-Joe Biden slogan “Let’s Go Brandon.” By law, members of Congress must quickly and publicly report their crypto purchases in certified congressional documents, known as periodic transaction reports.

Our Fear of Escalation in Ukraine Has Only Made It More Likely; Joe Biden’s lend-lease plan for Ukraine provides critical weapons and supplies. But deterring and defeating Putin will also require a new strategic vision.
Therese Raphael – Bloomberg
The democracies opposed to Vladimir Putin’s war in Ukraine have been clear that, in Boris Johnson’s words, “Putin must fail.” But they haven’t defined failure. British Foreign Secretary Liz Truss took a stab at it on Wednesday night, and it’s worth a closer look at what she said. Her 2022 Mansion House speech, a set-piece event in the British political calendar, was headlined “the return of geopolitics.” She argued that winning the war in Ukraine is a “strategic imperative” that will require supplying the country with heavy weaponry, including tanks and airplanes, and ramping up arms production.

Alarmed by Russia’s Invasion, Europe Rethinks Its China Ties; German companies say they are adapting their China strategies
Beijing’s refusal to intervene with Putin is seen as a breach
lan Crawford, Colum Murphy, and Alberto Nardelli – Bloomberg
Russia’s war on Ukraine has triggered a profound reassessment in European capitals of their individual and collective relations with China. Confronted by the need to rapidly unwind a dependence on Russian energy built up over decades, government officials from Rome to Prague are re-evaluating the extent of their economic and political ties to China.

Putin’s Gas-for-Rubles Gambit Hits EU Fault Lines as Stakes Rise; Cutoffs to Poland and Bulgaria raised alarms throughout EU; Both sides face significant risks if standoff escalates
Bloomberg News
After suffering months of punishing sanctions, Vladimir Putin used a powerful tool to impose some economic pain on Europe — and to fracture the unity of his opponents — by shutting off natural gas this week to a pair of NATO members.

Putin’s Gas Strategy Gives Germany Only Bad and Worse Choices; Chancellor Olaf Scholz must either pay for Russian gas on Vladimir Putin’s terms or face the painful economic fallout of a cutoff.
Javier Blas – Bloomberg
In 2018, German government officials war-gamed a massive natural-gas shortage. With the real thing looming, the lessons are sobering. Some hospitals, nursing homes and jails were forced to close; companies shut; livestock was left to die; hundreds of thousands of jobs vanished; rationing for households was imposed, according to the official account of the crisis-management exercise.

Europe no longer trusts Moscow’s energy brand; The EU faces hard but necessary choices if it is to end its reliance on Russian gas imports
Daniel Yergin – FT
Among Vladimir Putin’s many miscalculations was his expectation, before the invasion of Ukraine, that Europe’s dependence on Russian energy was so great that its response would be muted, limited to little more than protests. That’s hardly proved to be the case as even Germany is now sending arms to Ukraine.


Progressing on Carbon Trading
Without access to carbon credits, companies all over the world will only get so far in their efforts to reduce emissions – credits allow them to offset those emissions that may be otherwise impossible or difficult to eliminate. But new analysis published by ISDA last week confirms our earlier findings that the conservatism of Basel III capital requirements for carbon credits could impair the ability of banks to support the transition to a sustainable economy…

Medley Management and Former Co-CEOs to Pay $10 Million Penalty for Misleading Investors and Clients; Settlement Structured to Expedite Payment to Bondholders Through Related Bankruptcy Proceeding
Washington D.C., April 28, 2022 — The Securities and Exchange Commission today charged publicly-traded asset manager Medley Management and its former co-CEOs, Brook B. Taube and Seth B. Taube, with making misrepresentations to investors and clients that created the illusion of Medley’s likely future growth. The respondents have agreed to settle the SEC’s charges and will collectively pay $10 million in civil penalties.

Elon Musk’s early Twitter stock buy under FTC scrutiny -The Information
Tesla Inc (TSLA.O) Chief Executive Elon Musk’s initial 9% stake purchase in Twitter Inc (TWTR.N) is being probed by the Federal Trade Commission (FTC), The Information reported on Thursday. The FTC is looking into whether Musk complied with an antitrust reporting requirement when he bought his stake in the social media company in early April, the report said, citing people with knowledge of the situation.

The FTC is looking at whether Elon Musk’s initial 9% stake in Twitter violated antitrust rules, report says
Phil Rosen – Insider
While Elon Musk has clinched a $44 billion takeover deal for Twitter, the Federal Trade Commission has opened up an inquiry into whether his initial stake in the social platform violated reporting requirements, sources told The Information Thursday.

Statement of Commissioner Caroline D. Pham Regarding Charges Against Archegos Capital Management
Commodity Futures Trading Commission Commissioner Caroline D. Pham today released the following statement regarding charges against Archegos Capital Management:

SEC Charges Brazilian Mining Company with Misleading Investors about Safety Prior to Deadly Dam Collapse; Since 2016, Vale manipulated safety audits and obtained fraudulent stability certificates
The Securities and Exchange Commission today charged Vale S.A., a publicly traded Brazilian mining company and one of the world’s largest iron ore producers, with making false and misleading claims about the safety of its dams prior to the January 2019 collapse of its Brumadinho dam. The collapse killed 270 people, caused immeasurable environmental and social harm, and led to a loss of more than $4 billion in Vale’s market capitalization.

Remarks at Virtual Roundtable on the Future of Going Public and Expanding Investor Opportunities: A Comparative Discussion on IPOs and the Rise of SPACs
Commissioner Caroline A. Crenshaw – SEC
Thank you Hal [Scott] for that kind introduction and for inviting me to speak today. I am honored to precede such an esteemed panel of practitioners and academics. As always, I must give my standard disclaimer that my remarks are my own and do not necessarily represent the views of the Commission or its staff.

Remarks before the Older Investor Roundtable
Commissioner Hester M. Peirce – SEC
Thank you to the organizers of today’s Older Investor Roundtable: NASAA, and, of course, Rick Fleming and Adam Anicich from the Commission’s Office of the Investor Advocate. And thank you to AARP for your participation.

Closing Remarks to the Older Investor Roundtable
Chair Gary Gensler – SEC
In 1937, in his first press conference as Chair of the Securities and Exchange Commission, William O. Douglas told members of the press that, in this country, “We have got brokers’ advocates; we have got Exchange advocates; we have got investment-banker advocates; and we are the investor’s advocate.”

“MAS’ Approach to the Crypto Ecosystem”
There are three distinguishing features that make up the crypto ecosystem.
– First, the blockchain. It is a distributed ledger where ownership of assets is recorded and verified, and transactions take place peer-to-peer and are irrevocable.
– Second, the concept of tokenisation. This enables all manner of assets or items of value to be represented digitally through a smart contract on a blockchain Third, cryptography. This is a secure way for transactions to be performed.
Taken together, these features make the crypto ecosystem a potentially transformative technology. It enables high value assets to be fractionalised and this can unlock new economic value, enhance financial inclusion, and enable more seamless and efficient financial services. This is the greater vision that MAS is focused on, much beyond cryptocurrencies.

Bill Hwang case puts prosecutors’ market manipulation claim to the test; Experts say US government may struggle to show Archegos Capital chief intended to artificially boost share prices
Stefania Palma – FT
US authorities have dedicated months to amassing evidence to support their claims that Bill Hwang, founder of collapsed family office Archegos Capital Management, used his firm to feed a market manipulation scheme that sent shockwaves across the US securities markets.

Investing and Trading

Soy Oil Jumps to Another All-Time High on Global Shortage Fears
Kim Chipman and Megan Durisin – Bloomberg
Soybean oil once again reached the loftiest price ever while corn approached a decade high as war in Ukraine chokes global supplies of grains and vegetable oils. Russia’s invasion of its neighbor is upending trade of key agriculture crops from a major exporting region, driving up commodity prices and causing nations to go into hoarding mode to avert massive food shortages and potential civil unrest.

Mining Giant Glencore Is Losing Support for Its Climate Plan
Thomas Biesheuvel – Bloomberg
Shareholder support for Glencore Plc’s climate change strategy has weakened and the world’s top coal shipper will now have to consult with investors as it looks to defend one of its most profitable businesses.

The Real Enemy; Managing both volatility and risk in uncertain times.
Christine Benz – Morningstar
Volatility has surfaced with a vengeance so far in 2022. On Tuesday, U.S. stocks logged their biggest one-day loss since 2020 as investors fretted about inflation and whether technology company earnings growth would help justify their still fairly lofty valuations. Owing to a crazy quilt of these and other issues, including rising interest rates and supply chain concerns, the Morningstar U.S. Equity Index has dropped about 13% for the year to date, and the technology-stock-heavy Nasdaq Composite index has logged losses of nearly 20%.

Environmental, Social and Corporate Governance

Investors Crank Up Pressure on Companies With Record Climate, Race Proxy Proposals
McDonald’s and Meta are being pressed on societal concerns, while banks face growing criticisms about their funding of fossil-fuel companies.
Saijel Kishan, Mathieu Benhamou and Jeff Green – Bloomberg
McDonald’s Corp. is facing questions about animal welfare. Meta Platforms Inc. is being confronted by concerns that its metaverse is causing psychological damage. And the biggest U.S. banks are being held to account for their contributions to climate change.

Exxon Subpoenaed in California’s Probe of Plastics Makers; State attorney general is investigating petrochemical companies, accusing them over overstating the role of recycling in reducing plastic pollution
Christopher M. Matthews – WSJ
California’s attorney general is investigating Exxon Mobil Corp. and other fossil-fuel and petrochemical companies, accusing them of misleading the public about the impact of plastic pollution. Attorney General Rob Bonta announced the investigation Thursday. He said his office has issued a subpoena to Exxon seeking information about what he called an “an aggressive campaign to deceive the public, perpetuating a myth that recycling can solve the plastics crisis.” Mr. Bonta, a Democrat, didn’t specify what other companies his office is investigating.

Natural-Gas Producers: In Thin Air; Geopolitical risks are pushing natural-gas prices, and producer stocks, to the stratosphere
Jinjoo Lee – WSJ
U.S. natural-gas prices are floating up, and so are hopes for companies in the business of extracting it. EQT Corp., the largest natural-gas-focused producer in the U.S., said Thursday that it generated $580 million in free cash flow in its first quarter, higher than Wall Street expectations and more than double what it saw a year earlier. That follows another bullish earnings report from natural-gas producer Range Resources, which said Wednesday that it saw the highest quarterly free cash flow in company history.

The Case for Taking the ‘G’ Out of ESG; Why governance isn’t a good way to measure a company’s commitment to stakeholders
David F. Larcker and Brian Tayan – WSJ
Investors often use ESG criteria to measure a company’s commitment to values beyond shareholder returns—in particular to environmental and social priorities. A perplexing question is why governance—the “G” in ESG—is included as a third factor.

Shareholders Push an Array of ESG Proposals; Proxy battles include efforts to get companies to give all employees sick leave, and to provide more transparency on carbon emissions
Suzanne McGee – WSJ
Some shareholders want banks to stop financing new fossil-fuel projects. Others are asking companies to extend paid sick leave to cover part-time employees. And many are pressing businesses to go beyond lofty-sounding commitments to environmental, social and governance issues and explain how their business practices are delivering on carbon emissions, racial justice and more. Welcome to what appears likely to be one of the most significant years ever for ESG shareholder proposals.

HSBC faces greenwashing accusations from UK advertising watchdog; Draft conclusions find two of bank’s adverts misled customers by selectively promoting its green initiatives
Stephen Morris – FT
The UK advertising watchdog is preparing to warn HSBC about using adverts to greenwash its reputation and order it to be more transparent about its contribution to climate change, in a ruling that could have wide implications for financial sector marketing.

ESG demand drops among European ETF investors; But first quarter data show strong performance for cyber security, gold and broader commodity funds
Dave Baxter – FT
Flows into exchange traded funds that are focused on better environmental, social and governance (ESG) outcomes amounted to EUR13bn in the first quarter, less than half of the EUR27bn that went into them in Q4 2021, Morningstar data for Europe show.


Citigroup Sees Muni Revival With Investors Poised to Get Cash Bonanza
Martin Z. Braun – Bloomberg
Citigroup Inc. strategist Jack Muller estimates that the amount of cash state and local government bondholders will receive from principal and interest payments in May will exceed the volume of new debt sales by about $9.5 billion. Since investors typically reinvest those payments, that will likely lift demand for bonds.

Robinhood Investors Brace for More Losses After Firm Cuts Jobs
Annie Massa – Bloomberg
Robinhood Markets Inc. dazzled investors with a vision for growth: Entice millions of traders to buy stocks for free, and then sell them on other financial products to be introduced down the line. So far, that story is eluding the Menlo Park, California-based startup. User adoption has stalled, new offerings aren’t yet taking off, and investors are bracing for more losses when Robinhood reports first-quarter results late Thursday.

Robinhood’s net revenues are down, but crypto is becoming a bigger piece of the pie
Aislinn Keely – The Block
Transaction-based revenues are down, but trading platform Robinhood’s crypto business is still a major driver of its revenue. The company announced in its Q1 2022 earnings today, disclosing total net revenues were down 43% compared to last year, from $522 million to $299 million. Transaction-based revenues were down 48% from $420 million to $218 million. This is in line with the firm’s earlier predictions that total net revenues would be less than $340 million.

Robinhood Stock Plumbs New Depths After Revenue Tumbles 43%
Annie Massa – Bloomberg
First-quarter revenue tumbled 43% and the stock cratered anew in late trading Thursday, the latest signs that shareholders looking for a turnaround may be hard-pressed to find one. Two days after announcing that it’s cutting 9% of full-time staff, the brokerage posted a first-quarter adjusted loss of $392 million, or 45 cents a share, that was wider than the 38 cents that Wall Street analysts expected. Revenue of $299 million missed the average estimate of $352.9 million, according to a statement Thursday.

A Goldman analyst foresaw Robinhood’s growth woes weeks ago and downgraded the stock. Here are the 3 lingering issues he pinpointed.
Carla Mozée – Insider
Robinhood’s plan to let go of about 9% of its workforce underscored a slowdown at the retail investing platform that Goldman Sachs noted earlier this month in a note downgrading the stock. The issues Goldman raised weeks ago have gained more salience as Robinhood is due to release first-quarter financial results late Thursday, on the heels of its plan to cut more than 300 workers. The announcement from CEO Vlad Tenev spurred a stock selloff Wednesday that ended with the lowest closing price since the company went public in July 2021.

Citigroup Freed From Decade-Old Regulatory Sanction in Win for Fraser
Jennifer Surane and Hannah Levitt – Bloomberg
The U.S. Office of the Comptroller of the Currency lifted a 10-year-old consent order with Citigroup Inc. in a victory for Chief Executive Officer Jane Fraser, who’s dedicated thousands of employees to improving her bank’s risk and controls systems.

Credit Suisse Holders Revolt on Archegos, Reject Greensill Audit
Myriam Balezou and Marion Halftermeyer – Bloomberg
Credit Suisse Group AG shareholders voted not to absolve the bank’s board of directors from legal liability for mistakes made in the run-up to the Archegos Capital Management debacle, while rejecting an attempt to force a special audit of the Greensill Capital losses. About 60% of shareholders represented at the Zurich-based bank’s virtual annual general meeting voted against the usual step of discharging liability for the 2020 results, according to a webcast of the meeting Friday. That leaves open the possibility of further lawsuits over the more-than $5 billion Archegos loss.

Deutsche Bank Searched in Potential Money Laundering Case; Federal police, regulator BaFin search firm’s offices; Deutsche Bank says it had flagged suspected money laundering
Nicholas Comfort and Steven Arons – Bloomberg
Deutsche Bank AG’s offices in Frankfurt are being searched by law enforcement authorities after the lender flagged potential money laundering. Police were at the bank’s headquarters Friday following a decision by a Frankfurt court. Officials from the prosecutors office, regulator BaFin and Germany’s BKA federal police are involved in the raid, according to a spokeswoman for the prosecutors.

Wellness Exchange

Shareholder Proposals to Broaden Access to Covid-19 Vaccines Rejected; Investors in Pfizer, Moderna and Johnson & Johnson voted down shareholder proposals aimed at boosting supplies to poorer countries
Peter Loftus – WSJ
Investors in three Covid-19 vaccine makers on Thursday rejected shareholder proposals aimed at broadening global access to the shots. Pfizer Inc., Moderna Inc., and Johnson & Johnson JNJ had opposed the proposals, saying they already had taken steps to expand access to their vaccines in poorer countries. Shareholders at Pfizer and Moderna voted against similar resolutions, which asked each company to study the feasibility of transferring technical know-how and patents to allow other manufacturers to produce Covid-19 vaccine doses for low- and middle-income countries.

Study suggests climate change could fuel more pandemics; The harm we inflict on the environment could result in ecological changes that increase animal-to-human virus transmission.
Ja’han Jones – MSNBC
Climate change will increase the likelihood of pandemics caused by animal-to-human transmission, according to a study published Thursday in the science journal Nature. The study highlights the worrying connection between climate change and infectious diseases — two deadly phenomena that often inspire misinformation and government apathy.

Are We in the Middle of an Invisible COVID Wave? No one’s actually sure.
Yasmin Tayag – The Atlantic
Over the past month, the number of new COVID cases in my social circle has become impossible to ignore. I brushed off the first few—guests at a wedding I attended in early April—as outliers during the post-Omicron lull. But then came frantic texts from two former colleagues. The next week, a friend at the local café was complaining that she’d lost her sense of smell. My Instagram feed is now surfacing selfies of people in isolation, some for the second or third time.


China’s Sudden Currency Plunge Raises Risk of a 2015-Style Panic; Strong dollar triggers worst month on record for offshore yuan; History shows sharp declines can intensify capital outflows
Sofia Horta e Costa and Tania Chen – Bloomberg
When China’s tightly managed currency depreciates dramatically against the dollar, it can be hard to stop. More than six years after China’s shock 2015 devaluation roiled global markets and spurred an estimated $1 trillion in capital flight, the yuan is weakening at a similar pace. Onshore it’s lost nearly 4% in eight days, while the offshore rate is heading for its worst month relative to the greenback in history. Selling momentum is the strongest since the height of Donald Trump’s trade war in 2018.

China in ‘deep crisis’, says Hong Kong private equity chief; PAG founder Weijian Shan decries Beijing’s zero-Covid policies as country’s growth slows
Tabby Kinder and Hudson Lockett – FT
The founder and chair of one of Asia’s biggest private equity investors has criticised the Chinese government for policies that he says have resulted in a “deep economic crisis” comparable to the global financial crash. Weijian Shan, whose group PAG manages more than $50bn, said his fund had diversified away from China and was being “extremely careful” about its portfolio in the country.

China decries pursuit of glory, short-term gains in revamp of US$4 trillion fund industry amid steep market losses
South China Morning Post
China is taking steps to revamp its US$4 trillion mutual fund industry amid stunning losses, decrying the pursuit of short-term results and celebrity status after the local stock market suffered the biggest blow in the region last quarter. Mutual funds must prioritise investors’ long-term interests, prevent obsession with size and rankings and seek greater participation from the financial sector, the China Securities Regulatory Commission (CSRC) said in a statement on its website late on Tuesday. The regulator also encouraged banks, insurers and brokerages to enhance participation in the sector.

After Russian Retreat, Ukraine’s Farmers Discover Fields Full of Mines; Damage to farmland threatens long-lasting disruption to food supplies from the region
Alistair MacDonald – WSJ
Russian forces have riddled Ukrainian fields with mines and destroyed equipment in areas they once occupied, in what returning farmers and the Kyiv government allege is a campaign by Moscow to hobble the country’s agricultural industry. Russia’s invasion already has decimated shipments of corn, wheat and sunflower oil from what was until recently one of the world’s biggest food exporters. Prices have soared, adding to global food-price inflation and heaping misery on developing countries that had been dependent on imports from the region.

On the hunt for oligarchs in the ‘wild west’ of corporate intelligence; When the blow is finally delivered, it comes quick, polished and polite
Lou Stoppard – FT
The afternoon of October 4 2014 was peculiarly bright in London and too fine to be stood for hours sweating with nerves in a navy wool suit, but Paul Austin likes to look smart when he delivers the blow. Serving someone legal papers likely means “you are ruining that person’s day, quite badly”, he tells me. A certain formality, looking more like a business associate than “a heavy”, can make the whole thing more genteel and help the medicine — a bitter thing to swallow for the oligarchs and wayward globe-trotters Austin deals with — go down easier.

Colombia Utility Bonds Fall Toward Record as Dam Gets Delayed; Empresas Publicas de Medellin notes fall for 16th straight day; First unit was set to start in July; now pushed to August
Andrea Jaramillo – Bloomberg
Bonds from the electric utility in Medellin, Colombia, have tumbled toward a record low after officials pushed back the start date for a massive new dam that will eventually supply almost a fifth of the country’s power needs.

Brazil Eyes Wheat in the Heat to Tackle Ukraine Grain Shortage; With dozens of countries hungry for the grain, Brazilian scientists bank on tropical wheat expansion; “what’s more important than bread?”
Samantha Pearson – WSJ
Deep in the sweltering savanna of central Brazil, a quiet farming revolution is under way, promising relief as Russia’s war in Ukraine sparks food shortages. Here in the tropics, growing wheat—a crop best suited to mild temperatures—was once considered a crazy idea. Now, new varieties of protein-rich “tropical wheat” created by state agronomists are already starting to reap record harvests and profits.

Megadrought Threatens California Power Blackouts This Summer
David R Baker, Mark Chediak and Naureen Malik – Bloomberg
The historic drought that’s choked off rivers and reservoirs from the Rocky Mountains to the California coast is threatening to strain power grids this summer, raising the specter of blackouts and forcing the region to rely on more fossil fuels.

Fracking Boom Turns Texas Into the Earthquake Capital of the U.S.; A state not known for earthquakes has been hit so hard, it’s even poised to overtake California and Alaska.
Sergio Chapa and David Wethe – Bloomberg
Earthquakes were never anything people in West Texas thought much about. Years would pass in between tremors that anybody felt. Even after the shale revolution arrived in force a decade ago and oil crews started drilling frantically in the region’s vast Permian Basin, there seemed to be no impact on the land.

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