SGX expands clearing relationship with CME Group

Nov 9, 2020

First Read

$14,991/$300,000 (5%)
Myriam Herrera, Alexander D.Lamb and Anonymous

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Hits & Takes
John Lothian & JLN Staff

Former Vice President Joe Biden was declared the winner of the 2020 U.S. Presidential election by the major media networks and the Associated Press on Saturday, making him the President-Elect and Senator Kamala Harris the Vice President-Elect. The coronavirus is surging around the world, passing the 50 million case mark, and the U.S. went over the 10 million case mark over the weekend. Other than that, nothing happened.

While President Donald Trump has not conceded the election yet and has vowed to fight on with lawsuits and claims of election fraud, President-Elect Biden is proceeding with the transition. The tipoff that a decision was close over the weekend came when the Secret Service increased its protection of Biden, including an aircraft overhead.

So far the response from the markets and world leaders has been positive towards the news of Biden and Harris’s election. However, look for more turbulence in the coming weeks.

Did you miss LME Week? Well, just like your cable TV, LME Week is available on demand.
You can see the LME Metals Seminar HERE and the LME Focus Day – HERE.

Pamela Jones, executive director and co-founder of Genesis Consultancy, is the new chair of WILD London.

We had three more donations to the JLN MarketsWiki Education GoFundMe campaign since Thursday. The first was from industry veteran technologist Alex Lamb of The Technancial Company and the second was from Myriam Gilhuly, who in her professional world goes by Myriam Herrera. She is the development professional for the Pathway to Adventure Council of the Boy Scouts of American who so adroitly guides the LaSalle Street Boy Scout fundraiser, now called the LaSalle Street Trading Tech Awards. Myriam is a friend, and according to her, I am a mentor for her as I have guided her through revitalizing this event and our industry’s relationship with the Boy Scouts. Alex Lamb is a former London pit trader and an electronic trading pioneer whom I can’t wait to get on video to capture his story. He has some good ones. The last donation was made by the very famous “Anonymous.” Thank you Anonymous, Myrian and Alex and to all who have given and all who have yet to give. Support our efforts to preserve industry history by supporting our GoFundMe campaign.

We are going to place an order for another tranche of JLN hoodies that say, “The World Needs Journalists” followed by the JLN logo centered on the front of the hoodie. If you are interested in buying one, the cost is about $50, or $40 plus shipping.

Question: Iconic Canadian TV quiz show host who died over the weekend? Answer: Alex Trebek. The host of the long running Jeopardy quiz show died Sunday at the age of 80. He had been suffering from pancreatic cancer.

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

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Gary Gensler, the erstwhile Goldman Sachs banker who served as chairman of the CFTC from 2009 to 2014, is joining the President Biden transition team. He will work on financial regulation oversight, according to a Reuters report over the weekend. Under Gensler, the CFTC implemented a large number of swap reporting, clearing and trading regulations that were mandated by the 2010 Dodd-Frank Act. Gensler is currently a professor at the MIT Sloan School of Management, where he serves as a faculty advisor to the MIT Media Lab’s Digital Currency Initiatives. (You have to wonder if infatuation with cryptocurrencies isn’t an occupational hazard of the CFTC chairmanship: Gensler at MIT, Timothy Massad’s 69-page digital assets report for Brookings, Christopher Giancarlo’s Digital Dollar Project, and Heath Tarbert’s recent “Let me just basically say how impressed I am by Ethereum, full stop, period.”) ~Thom Thompson

This week offers an especially wide array of webinar options. One from Cboe’s Options Institute is “Harnessing Small-Cap Volatility with Russell 2000 Options” on Wednesday, November 11, at 12 p.m. ET/11 a.m. CT. Planned speakers include Catherine Yoshimoto, director of product management for FTSE Russell, Derek Devens, senior portfolio manager, Neuberger Berman, and Matt Moran, head of Index Insights, Cboe Options Institute. Although it’s advertised for financial professions, Moran said all JLN readers are welcome. You can register here. ~SC

Also on Wednesday, November 11, at 2 p.m. CT, Barchart is hosting a CPN Livestream Session with Julie Lerner, CEO of PanXchange, that is designed to take a deep dive into the hemp and franc sand data provided by PanXchange. Andrew Bish, CEO of Hemp Harvest Works, an equipment and consulting service provider for hemp producers, and Keith Petersen, Barchart’s head of strategy, also will join the discussion. Reserve your place here.

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Biden turns the page on a presidency of rancour; The next US leader could achieve much through tone and behaviour alone
The Editorial Board – FT
The trickling of power from the mightiest person on Earth seems unlikely to abate. Donald Trump will fight to stay in the White House, on spurious grounds, but much of the world is moving on from the US election. Foreign leaders are congratulating the man they refer to as “president-elect” Joe Biden. Most Americans themselves are resuming their lives: neither the street parties nor the pro-Trump rallies are typical.
/on.ft.com/3pcvzrl

*****I expect to hear more from Biden and less tweeting.~JJL

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Reality TV presidency cancelled after 4-year run; The Trump administration packed a lot of drama into 1 term
Demetri Sevastopulo – FT
As soon as US media called the election for Joe Biden, Democrats started promoting “Adiós Trump” T-shirts, in what was a fitting way to mark the end of a presidency that was launched with racist attacks on Mexicans. Following four years of chaos and tens of thousands of tweets from the president, the former reality TV star will depart the White House after a record number of Americans gave him a taste of his own medicine: you’re fired!
/on.ft.com/32tXw3Z

*****This wins the best headline of all the election stories.~JJL

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Biden taps Gensler to work on Wall Street oversight review – source
Trevor Hunnicutt, Michelle Price – Reuters
Democratic presidential candidate Joe Biden, who appeared to be closing in on an election victory, has tapped former derivatives market regulator Gary Gensler to work on a transition plan for financial industry oversight, according to a person with direct knowledge of the matter.
/reut.rs/3p97Acl

*****Welcome back Gary. We missed you.~JJL

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The stock market boost from having more women in management; European groups with higher numbers of female leaders benefit from stronger share prices
Sharon Bell – FT
Women used to be largely absent from the higher echelons of the corporate sector. As recently as 2005, fewer than 10 per cent of board members at Europe’s top 600 listed companies were women. Now that figure is more than 30 per cent. But has this made a difference?
/on.ft.com/3pdcuFq

****** There are some things you should do because they are the right thing to do, not because they will make your stock go up. But then, it is a nice benefit of doing the right thing.~JJL

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Friday’s Top Three
Our top story Friday was the NFA notice NFA orders Chicago, Ill. introducing broker Infinity Futures LLC to pay a $120,000 fine. Second was LSE and Refinitiv make commitments on trading to secure EU approval for deal, from the Financial Times. Third was the job listings page at the NFA.

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Lead Stories

SGX expands clearing relationship with CME Group, adding pan-Asia benchmark equity derivatives to Mutual Offset link
CME Group
SGX further broadens shelf of pan-Asia benchmark equity derivatives; SGX and CME Group will offer FTSE Emerging Market and FTSE China H50 futures on their Mutual Offset System
Singapore Exchange (SGX) is expanding the scope of its unique Mutual Offset System (MOS) with CME Group, offering global investors unmatched, round-the-clock access to trade and clear on the leading derivatives marketplaces in Asia and the United States.
/bit.ly/38pKf01

Oil-Rich Abu Dhabi to Start Trading Crude Futures From March
Anthony Di Paola – Bloomberg
ICE, Abu Dhabi, trading partners plan exchange start March 29; Abu Dhabi wants Murban futures to serve as regional benchmark
Oil-rich Abu Dhabi will open a commodities exchange in March to rival those of Middle Eastern neighbors, letting investors trade its crude using futures contracts for the first time. The ICE Futures Abu Dhabi exchange will open on March 29 and offer contracts based on the emirate’s flagship Murban crude grade, pending regulatory approvals, Intercontinental Exchange Inc. said in a statement Monday. The Atlanta-based operator of trading and clearing platforms is setting up the exchange with government producer Abu Dhabi National Oil Co. and other oil suppliers.
/bloom.bg/3p9fX7P

SoftBank posts $1.3bn loss on ‘Nasdaq whale’ bets; Signs of recovery for $100bn Vision Fund help Japanese group turn a $6bn quarterly net profit
Kana Inagaki – FT
SoftBank Group posted a loss of $1.3bn on its unexpected diversification into trading of listed technology stocks using a war chest amassed in a pandemic-driven flurry of asset sales. However, the Japanese conglomerate turned a $6bn net profit for the July to September quarter, helped by fresh signs of recovery at its $100bn Vision Fund since the WeWork debacle.
/on.ft.com/3pc8SUc

Watchdog warns banks on dangers of outsourcing technology; Risks of buying services from small group of external suppliers is high and rising
Matthew Vincent – FT
Financial regulators have warned of the dangers of banks relying on just a small group of third-party technology providers — just months after the collapse of payments group Wirecard left millions unable to access their cash.
/on.ft.com/2JMSIAd

Deutsche Bank rebuffed ECB over call for action on leveraged finance; Regulator requested suspension of key areas of business amid concern at ‘incomplete’ framework for monitoring risk
Olaf Storbeck and Stephen Morris – FT
Deutsche Bank rejected a request by the European Central Bank to suspend key parts of its leveraged finance operations over concerns that Germany’s largest lender was not properly monitoring risk in that area, according to people familiar with the matter.
/on.ft.com/36kIy1t

Federal Lawsuit Points to Payments’ Future; The Justice Department’s suit against Visa’s Plaid acquisition has implications for investors across the entire payments industry
Telis Demos – WSJ
The Justice Department’s lawsuit against Visa V 0.42% isn’t just relevant reading for Visa investors, but for investors across the payments sector. At the heart of the suit is the future of payments in the U.S. Among the government’s allegations is that Visa saw a potential pay-by-bank offering from Plaid as a competitive threat to debit cards, so it moved to eliminate this risk by acquiring the company. Visa in response said that its business “faces intense competition from a variety of players” but that “Plaid is not one of them,” and the lawsuit is “legally flawed and contradicted by the facts.”
/on.wsj.com/3kcf3Uj

Ant faces tortuous path back to market as Beijing tightens rules; China’s agile fintechs expected to be treated more like closely controlled banks
Hudson Lockett and Primrose Riordan and Yuan Yang – FT
If investors in Ant Group were hoping China’s biggest fintech would rapidly bounce back from the last-minute suspension of its $37bn listing last week, Beijing was quick to disappoint them.
/on.ft.com/36loyvp

Ant posed threat to China’s centralised control; IPO suspension may have lasting implications for fintech regulation
THE EDITORIAL BOARD – FT
Much of the coverage of China’s decision to suspend Ant Group’s $37bn share offering last week has focused on a personal clash between Jack Ma, Ant’s founder, and the Beijing authorities. That is understandable. Mr Ma is a Chinese celebrity entrepreneur who commands global recognition, and one of the world’s wealthiest people.
/on.ft.com/38kZjMC

Johnson Enters Brexit Endgame That Could Define His Tenure
Stuart Biggs – Bloomberg
Final push to overcome differences with EU on free trade deal; Brexit law going through Parliament risks clash with Biden
Boris Johnson faces a pivotal week for his leadership as the U.K. stands on the brink of completing its separation from the European Union. Over the course of the next seven days, the premier needs to deliver a trade deal with the EU or risk a chaotic and economically damaging rupture, and avoid a rift with U.S. President-elect Joe Biden over the U.K.’s controversial Brexit laws.
/bloom.bg/2JGAJvc

SoftBank Reveals Details of Controversial Derivatives Trading
Pavel Alpeyev – Bloomberg
Fair value of futures and options positions was $2.7 billion; Held $16.8 billion in stocks, including Amazon and Facebook
SoftBank Group Corp. provided new details about its stock and options trading program, a controversial effort that roiled markets and raised concerns about the Japanese company’s financial stability. SoftBank said the fair value of its futures and options positions came to $2.7 billion at the end of September, suggesting its positions are more conservative than originally feared. That included long call options on listed stocks worth $4.69 billion and short call options on listed stock with negative $1.26 billion of value, the company said in an earnings statement on Monday.
/bloom.bg/2ImolQT

On America’s Farms, Worries About Regulation, Hope for Trade Deals Under Biden; A Democratic administration raises concerns about potentially stricter environmental regulations; less-combative approach to trade expected
Jacob Bunge – WSJ
Joe Biden’s election as president raises new questions for a U.S. farm sector whipsawed by turbulent years under President Trump. Some farmers said they worry a Democratic White House will mean stricter environmental regulations and other restrictions are on the way after the Trump administration eased rules governing water quality, meatpacking-plant operations, genetically engineered crops and greenhouse-gas emissions.
/on.wsj.com/38rCRBh

What CEOs Expect From Biden Presidency: More Predictability; Corporate leaders foresee more traditional relationship with White House, with fewer surprises, and urge next administration to prioritize pandemic
Chip Cutter – WSJ
Chief executives say they expect that the biggest change with Joe Biden’s administration won’t be sweeping new policies but a more predictable relationship with the White House. Many corporate leaders view Mr. Biden as a centrist on business issues and foresee a quieter, less publicly turbulent relationship with the White House over the next four years—even if they don’t always agree with the administration’s policies.
/on.wsj.com/38nkkWY

Prospering in the Pandemic, Some Feel Financial Guilt and Gratitude; Lingering economic pain and increased awareness is changing how some spend on tips and charity
Veronica Dagher and Amber Burton – WSJ
Feelings of financial guilt have plagued many prospering in the uneven economic recovery. In some cases, those emotions along with gratitude are changing spending behavior. “Some of my clients have expressed feelings of survivor’s guilt, wondering why they are doing so well when others aren’t,” said Sue Peck, a financial planner in Madison, Wis.
/on.wsj.com/32rR0dU

The Digital Nomads Did Not Prepare for This; They moved to exotic locales to work through the pandemic in style. But now tax trouble, breakups and Covid guilt are setting in.
Erin Griffith – NY Times
For a certain kind of worker, the pandemic presented a rupture in the space-time-career continuum. Many Americans were stuck, tied down by children or lost income or obligations to take care of the sick. But for those who were unencumbered, with steady jobs that were doable from anywhere, it was a moment to grab destiny and bend employment to their favor.
/nyti.ms/32nzKqr

Many world leaders express hope, relief after Biden win
Avid Biller, John Leicester – Associated Press
World leaders congratulated U.S. President-elect Joe Biden on his victory, cheering it as an opportunity to fortify global democracy and celebrating the significance of Americans having their first female vice president.
/yhoo.it/3n25l8M

Coronavirus

Covid Cases Near 10 Million in U.S. With No Slowdown in Sight
Michelle Fay Cortez – Bloomberg
Colder weather, holidays seen contributing to the surge; ‘We have no respite this winter in large parts of the country’
Close to 10 million Americans have been diagnosed with Covid-19 in the past 10 months, and with the start of winter just a month away, and the public increasingly likely to spend more time cooped up inside, the virus shows few signs of slowing down.
/bloom.bg/3n8Is3w

Worldwide Cases Pass 50 Million With U.S. Surging: Virus Update
Bloomberg News
Worldwide cases of Covid-19 surpassed 50 million and the U.S. reported more than 126,000 new infections for the third consecutive day. Total U.S. cases neared 10 million with no slowdown in sight.
/bloom.bg/32sLpUZ

U.S. Cases Hit Fourth Straight Daily Record
WSJ
Daily coronavirus cases in the U.S. rose to another record Saturday as the country recorded 127,399 new infections.
/on.wsj.com/3k5lwAw

Covid-19 Is Whipping Up a Cold Russian Winter; Case numbers are rising in Russia, with hotspots emerging in distant regions. It’s straining a system that has hoarded resources at the center.
Clara Ferreira Marques – Bloomberg
Coronavirus infections are hitting records again in Russia, the world’s fifth hardest-hit nation in absolute terms. This time, the provinces are bearing the brunt, with nearly three-quarters of new cases registered outside of Moscow. Worrying reports suggest some areas are running out of beds, doctors and even oxygen.
/bloom.bg/38ndaSA

Pfizer’s Covid Vaccine Prevents 90% of Infections in Study
Robert Langreth, Naomi Kresge, and Riley Griffin – Bloomberg
Preliminary results could pave way for vaccine by year-end; Pfizer, BioNTech expect to get two-month safety data next week
The Covid-19 vaccine being developed by Pfizer Inc. and BioNTech SE prevented more than 90% of infections in a study of tens of thousands of volunteers, the most encouraging scientific advance so far in the battle against the coronavirus.
/bloom.bg/3p9Z2C4

German Covid Cases in ICU Hit Record as Pandemic Intensifies
Chris Reiter – Bloomberg
More severe cases than at any time in the coronavirus crisis; If ICUs get overloaded, then it’s ‘too late,’ minister warns
Germany has more severe Covid-19 patients than at any point since the pandemic began, underscoring the urgency facing authorities to contain the disease. Europe’s largest economy had 2,978 people being treated for the coronavirus in intensive care facilities on Monday, exceeding the previous peak of 2,933 on April 18, according to the DIVI register of German ICU capacity.
/bloom.bg/3n7BfB6

Philippines Seeks 50 Million Covid-19 Vaccine Shots in 2021
Ian C Sayson – Bloomberg
The Philippines aims to have at least 50 million coronavirus vaccine shots next year to inoculate about a fourth of the population, bulk of which will likely arrive by the end of 2021 or early 2022
/bloom.bg/32s4BSA

Schroders launches impact fund to aid Covid-hit emerging markets; Fund group’s BlueOrchard boutique will manage vehicle that is backed by development agencies
Siobhan Riding – FT
Schroders, the UK’s largest asset manager, is launching an impact investing fund designed to support emerging and frontier market companies battered by the coronavirus pandemic.
/on.ft.com/3mYXusO

Covid Infections in Animals Prompt Scientific Concern; Mink in Denmark are not the only animals that could become reservoirs for the coronavirus to spread new mutations to people.
James Gorman – NY Times
The decision this week by the Danish government to kill millions of mink because of coronavirus concerns, effectively wiping out a major national industry, has put the spotlight on simmering worries among scientists and conservationists about the vulnerability of animals to the pandemic virus, and what infections among animals could mean for humans.
/nyti.ms/36l77ey

Denmark Covid-19 Virus Mutation Leads to New Restrictions
Morten Buttler – Bloomberg
Denmark to cull up to 17 million mink to fight Covid outbreak; Scientists fear the new strain could undermine vaccine efforts
A new Covid-19 mutation that started in Denmark’s mink population has spread beyond the region in which it was first discovered to the eastern part of the country.
/bloom.bg/38lfhX4

Restaurants Defend Dining Rooms as Covid-19 Spreads; McDonald’s, Starbucks say new protocols keep people safe in their stores; health experts say takeaway and outdoor dining remain safer
Heather Haddon – WSJ
Restaurant chains are setting long-term plans to keep dining rooms open whenever and wherever possible as the coronavirus pandemic shows no sign of relenting. McDonald’s Corp. MCD 0.12% , Starbucks Corp. SBUX 0.03% and other chains are serving customers inside, in line with safety standards they say they have honed during roughly nine months of grappling with the virus. Some executives say they see an immediate boost in sales when dining rooms reopen.
/on.wsj.com/2IiDd2E

Coronavirus Relief Surges for Japan’s Small Businesses; Banks have extended the equivalent of more than $250 billion in loans in less than six months
Megumi Fujikawa – WSJ
It isn’t a great time to be running a hotel in Japan, since virtually all foreign tourists are barred from visiting the country. But the owner of a traditional Kobe hot-springs inn had no problem getting a loan for renovations.
/on.wsj.com/3p96OMt

Exchanges, OTC and Clearing

Intercontinental Exchange to Launch ICE Futures Abu Dhabi and the World’s First Murban Crude Futures Contracts on March 29, 2021
Intercontinental Exchange, Inc.
Intercontinental Exchange, Inc. (NYSE:ICE), a leading operator of global exchanges and clearing houses and provider of mortgage technology, data and listings services, today announced that it plans to launch ICE Futures Abu Dhabi (IFAD) and the world’s first futures contracts based on Murban crude oil on March 29, 2021, subject to the completion of regulatory approvals.
/bit.ly/32rHmrI

Intercontinental Exchange Launches Clearing for CDS Index Options
Extends Monte Carlo Portfolio Framework to Higher Order CDS Derivatives
BusinessWire
Intercontinental Exchange, Inc. (NYSE:ICE), a leading operator of global exchanges and clearing houses and provider of mortgage technology, data and listings services, today announced it has launched clearing for Credit Default Swap (CDS) Index Options, bringing greater capital efficiencies, price discovery and risk management to the CDS market. Beginning today, ICE Clear Credit now offers clearing of Index Options on the CDX North American Investment Grade and High Yield indices. Index Options on the iTraxx Europe indices are expected to be added in 2021.
/bit.ly/2U5G7u1

This Is the NYSE’s Plan to Win More Direct Listings
Joe Weisenthal and Tracy Alloway – Bloomberg
This year’s stock market boom has coincided with a boom in new listings. There have been plenty of IPOs, numerous SPACs, and an uptick in companies doing direct listings on the exchange. That third category has gotten relatively less attention, but it potentially represents a powerful offering from the NYSE, which unlike many other financial companies, has performed quite well. On this episode, we speak with John Tuttle, Vice Chairman and Chief Commercial Officer at NYSE about how direct listings work, and why the NYSE sees them becoming a much bigger vehicle for going public in the future.
/bloom.bg/325dC2S

SGX pioneers SingPass use for transaction signing of Central Depository services
SGX
Singapore Exchange (SGX) is pioneering the use of SingPass to authorise, or sign, transactions that require a high level of security. SGX’s Central Depository (CDP) began offering SingPass access including transaction signing from 26 October 2020 for its CDP Internet online services. The introduction of SingPass is part of a larger plan to bring all CDP customers on-board CDP Internet in 2021. A total of 1.2 million CDP account holders will then be able to view their securities portfolio in real time. They will also have free access to 24 months of past account statements and 60 days of CDP notifications.
/bit.ly/3palmvt

TP ICAP cautions on flat revenue growth as trading dries up; Statement comes as UK interdealer broker seeks to convince investors to back $425m rights issue
Philip Stafford – FT
TP ICAP, the interdealer broker, has cautioned that revenue growth will be flat this year after trading in swaps, bonds and energy dried up following the turbulent period in global markets at the onset of the pandemic. The UK group said on Monday that full-year turnover was likely to be in line with last year’s £1.8bn, on a constant currency basis, as activity in its core markets slowed markedly after a bumper spring.
/on.ft.com/3pjvWAv

TP ICAP launches electronic trading system for reducing risk in fixed income portfolios; MATCHBOOK?ReBalance?is?the latest post-trade risk management?tool from TP ICAP?that can be?used across emerging market, investment grade, high yield, financial, and corporate bonds.
Annabel Smith – The Trade
Interdealer broker TP ICAP has?extended its post-trade risk management business with the launch of an?electronic trading system that allows clients to reduce residual risk in fixed income portfolios.?? ?
/bit.ly/38qmZPN

Indonesia Stock Exchange goes live with electronic trading platform?from AxeTrading; The Indonesia Stock Exchange (IDX) has teamed up with AxeTrading to deploy an electronic platform for bond trading on the secondary market.?
Annabel Smith – The Trade
Fixed income trading software provider AxeTrading has launched an electronic trading platform with the Indonesia Stock Exchange (IDX) using its AxeChange technology.? AxeTrading confirmed in September last year that it had been chosen by IDX as its technology partner to deploy a new electronic trading platform for the Indonesian bond market.
/bit.ly/3pfkFBc

Foreign Exchange (FX) derivatives: Delisting of FX Options and introduction of options on FX Futures; Eurex Circular 085/20 Foreign Exchange (FX) derivatives: Delisting of FX Options and introduction of options on FX Futures
Eurex
1. Introduction – The Management Board of Eurex Deutschland and the Executive Board of Eurex Frankfurt AG took the following decisions with effect from 14 December 2020:
/bit.ly/3n5atJt

Notice of Summary Action
CME Group
MEMBER FIRM: MAREX NORTH AMERICA LLC
RULE VIOLATION: Rule 576. IDENTIFICATION OF GLOBEX TERMINAL OPERATORS
Each Globex terminal operator shall be identified to the Exchange, in the manner prescribed by the Exchange, and shall be subject to Exchange rules. If user IDs are required to be registered with the Exchange, it is the duty of the clearing member to ensure that registration is current and accurate at all times. Each individual must use a unique user ID to access Globex. In no event may a person enter an order or permit the entry of an order by an individual using a user ID other than the individual’s own unique user ID.
PENALTY: On October 21, 2020, pursuant to Rule 512 (“Reporting Infractions”), Marex North America LLC was issued a $1,000 fine for its violation of Rule 576.
/bit.ly/2I9Kvpv

Client Name and LEI required in CGM submissions effective January 27, 2021
CME Group
Effective January 27, 2021, the CFTC will adopt revised Regulation § 39.19(c)(1)(i) to require DCOs to report additional customer level information including legal entity identifiers to the extent the information is available. In order to comport its practices and the obligations of clearing members with the revised CFTC regulations, CME Clearing has recently adopted rule changes which similarly take effect on January 27, 2021. This advisory describes two changes to requirements for the nightly submission of Customer Gross Margin (CGM) position files to CME Clearing in order to comply with the revised CFTC regulations and CME rules.
/bit.ly/38l73ya

Notice of Summary Action
CME Group
MEMBER FIRM: ICAP Energy LLC
NYMEX RULE VIOLATION: 526.F. BLOCK TRADES
Unless otherwise agreed to by the principal counterparties to the block trade, the seller, or, in the case of a brokered transaction, the broker handling the block trade, must ensure that each block trade is reported to the Exchange within the time period and in the manner specified by the Exchange. The report must include the contract, contract month, price, quantity of the transaction, the respective clearing members, the time of execution, and, for options, strike price, put or call and expiration month. The Exchange shall promptly publish such information separately from the reports of transactions in the regular market.
PENALTY: On October 21, 2020, pursuant to Rule 512, a fine in the amount of $1,000 was assessed against ICAP Energy LLC for its violation of NYMEX Rule 526, and NYMEX Rule 526.F.
/bit.ly/2JRzaLa

Constituent Change in J-Stock Index
JPX
Tokyo Stock Exchange, Inc. (TSE) will make changes to the constituents of J-Stock Index on November 30, 2020 (after the close of trading on November 27, 2020) as follows. Component stocks of the index are reviewed annually in November.
/bit.ly/3n5cC7Z

Periodic Review of “JPX-Nikkei Index 400” and “JPX-Nikkei Mid and Small Cap Index”
JPX
The periodic review of the JPX-Nikkei Index 400 and the JPX-Nikkei Mid and Small Cap Index, jointly calculated by Tokyo Stock Exchange, Inc. and Nikkei Inc., has been conducted as follows.
/bit.ly/36fSVUk

Trading Volumes Drop While CME Open Interest Climbs 28.6% – CryptoCompare Analysis
Mondovsione
Despite Bitcoin’s rally to $14k towards the end of the month, October saw spot trading volumes drop by 17.6% across the board. CME had an impressive month with open interest climbing 28.6%, signalling growing demand for Bitcoin from institutional traders. However, overall derivatives volumes declined slightly, experiencing a 2.4% drop since September.
/bit.ly/36maO3w

Warsaw Stock Exchange Monthly Statistics For October 2020
Mondovisione
Warsaw Stock Exchange Monthly Statistics for October 2020 is now available:
/bit.ly/3pcd9XC

TAIFEX Expands Offshore Index Futures Suite With The Launch Of FTSE 100 Futures
Mondovisione
The Taiwan Futures Exchange (TAIFEX) will launch a new offshore futures contract tracking the FTSE 100 Index, the leading stock market indicator of the UK and one of the world’s most recognized indices, on November 23, 2020. The listing of the new product expands TAIFEX’s popular suite of international equity index futures – tracking the major US and Japan markets – and extends its reach to Europe for the first time. The new product also intensifies the cooperation between TAIFEX and FTSE Russell following the launch of Asia’s first ESG futures earlier this year.
/bit.ly/38oqiqr

AxeTrading Expands Exchange Business With Launch Of IDX ETP
Mondovisione
Today, the Indonesia Stock Exchange (IDX) launched their Electronic Trading Platform (ETP) for secondary market trading of bonds and sukuk using AxeTrading’s AxeChange technology. The ETP is named Alternative Market Operator System (SPPA).
/bit.ly/3pe07ZN

FTSE Mondo Visione Exchanges Index Down By 6.7 % In October, Aquis Exchange Top Performer In October, HKEX Largest Exchange By Market Capitalisation http://
Mondovisione
Shares in the world’s largest exchange operating groups fell by 6.7% in October, with all but 5 of the 32 constituents of the FTSE Mondo Visione Exchanges Index being in negative territory. with the Index closing at the end of the month at 62,119.09 points, down from 66,604.18 on 30 September 2020.
/bit.ly/3ndfH69

EGX Signs An MoU With GAFI To Facilitate Procedures For Listing & Capital Increases
Mondovisone
The Egyptian Exchange (EGX) signed a memorandum of Understanding (MOU) with the General Authority for Investment and Free Zones (GAFI) to facilitate the procedures for capital increases for listed companies, and to enhance cooperation simplifying procedures mechanism and improving the business environment in Egypt.
/bit.ly/3n538cS

Fintech

Deutsche Bank to Sell IT Business to Tata Consultancy Services
Steven Arons and Saritha Rai – Bloomberg
Move will help CEO Christian Sewing pursue job-cutting targets; Buyer to take on 1,500 Postbank Systems workers in Germany
Deutsche Bank AG agreed to sell a technology services unit to Tata Consultancy Services Ltd., helping the bank chip away at Chief Executive Officer Christian Sewing’s ambitious job-cutting target.
/bloom.bg/3pdbIIk

JP Morgan adds ESG metrics to data platform across trading business with RepRisk; RepRisk, which combines machine learning and AI technologies, has worked with JP Morgan to expand its DataQuery analytics platform with ESG data.
Annabel Smith – The Trade
US investment bank JP Morgan?has partnered with environmental, social, and corporate governance (ESG)?data science specialist RepRisk to?incorporate ESG risk metrics within its data platform.?The data will be available via JP Morgan’s DataQuery platform,??providing clients across its trading and securities services businesses with access to ESG risk data from over 150,000 companies.?
/bit.ly/32tql0y

CloudMargin Wins Fifth Award for Best Buy-Side Collateral Management Tool at WatersTechnology’s Buy-Side Technology Awards
CloudMargin
CloudMargin, creator of the world’s first and only collateral and margin management solution native to the cloud, has once again won the award for Best Buy-Side Collateral Management Tool at the 14th annual Buy-Side Technology Awards, hosted by WatersTechnology in a virtual ceremony on Friday. This marked the company’s fifth win in the category.
/prn.to/32ufkw1

DOJ files suit to stop Visa’s $5.3 billion acquisition of fintech firm Plaid
Michael McSweeney – The Block
A civil antitrust lawsuit has been filed by the U.S. government as it tries to stop the acquisition of fintech firm Plaid by Visa. The lawsuit, filed Thursday, describes Visa as a “monopolist” that is trying to buy Plaid in order to “eliminate a nascent competitive threat that would likely result in substantial savings and more innovative online debit services for merchants and consumers.” According to the civil complaint, DOJ lawyers are asking the court to stop the acquisition transaction from taking place.
/bit.ly/3lczoKw

Federal Lawsuit Points to Payments’ Future; The Justice Department’s suit against Visa’s Plaid acquisition has implications for investors across the entire payments industry
Telis Demos – WSJ
The Justice Department’s lawsuit against Visa V 0.42% isn’t just relevant reading for Visa investors, but for investors across the payments sector. At the heart of the suit is the future of payments in the U.S. Among the government’s allegations is that Visa saw a potential pay-by-bank offering from Plaid as a competitive threat to debit cards, so it moved to eliminate this risk by acquiring the company. Visa in response said that its business “faces intense competition from a variety of players” but that “Plaid is not one of them,” and the lawsuit is “legally flawed and contradicted by the facts.”
/on.wsj.com/3kcf3Uj

Cryptocurrencies

BloCKcHaiN 2020 Election ConSpiRACY *Alert*; In which crypto bros bearing the power of immutable truth sort the whole mess out.
Izabella Kaminska – FT
FT Alphaville has spent some of this week marvelling at the audacity of the White House Gift Shop (a privately owned entity that’s entirely unaffiliated with the actual White House) to be pre-selling a commemorative series of coins dubbed: “PRESIDENT DONALD J. TRUMP DEFEATS COVID WITH ICONS OF HIS ENTIRE FIRST TERM!”
/on.ft.com/3lcOqA2

Bitmain Releases Rack-Style New Miner, Bringing Next Level Computing Power
PR Newswire
Bitmain is officially announcing a new rack-style mining equipment – AntRack. Featuring a hot-swappable modularized configuration, it is easy to deploy and upgrade with no need to turn off, and the rack-style design is an excellent option for customers of large-scale operations.
/prn.to/3lfBg59

Winklevoss Twins Ride Bitcoin Surge to Become Billionaires Again
Simon Hunt and Olga Kharif – Bloomberg
Tyler and Cameron Winklevoss, whose fortunes have been on a roller coaster since they jostled with fellow student Mark Zuckerberg at Harvard University more than a decade ago, are once again billionaires thanks to a surge in the price of Bitcoin. The twins bought $11 million worth of Bitcoins in 2013, according to the New York Times, and soon became evangelists, creating crypto exchange Gemini Trust Co. The 39-year-old brothers, who gained widespread fame following the release of the 2010 movie “The Social Network,” briefly became billionaires in 2017 when Bitcoin soared to a record before the volatile currency plummeted.
/bloom.bg/3mZ9iv8

Norway Central Bank Official Says ‘No Acute Need’ to Introduce a Digital Currency
Sebastian Sinclair – Coindesk
The deputy governor of the Norway’s central bank said there’s no urgent need for the nation to launch a digital krone in a speech at the country’s Finance Payments Conference on Thursday.
/bit.ly/3n4YhbE

Family Offices May Now See Bitcoin as Alternative to Gold: JPMorgan Report
Nathan DiCamillo – Coindesk
The Grayscale Bitcoin Trust is outperforming gold exchange-traded funds (ETFs), a trend perhaps driven by institutional investors like family offices, according to a report by JPMorgan analysts that CoinDesk has obtained. “This contract lends support to the idea that some investors that previously invested in gold ETFs such as family offices, may be looking at bitcoin as an alternative to gold,” the analysts wrote in the Nov. 6 report.
/bit.ly/3k6XgOs

Blockchain lending startup Figure seeks national bank charter: report
Michael McSweeney – The Block
Figure Technologies, the blockchain lending startup founded by former SoFi CEO Mark Cagney, has applied for a national bank charter, according to a report by Bloomberg. “It will drive down the cost of delivering our product to those underserved by the financial sector,” Cagney told the outlet. “It will allow the consumer to build a credit history and become a mainstream prime borrower.”
/bit.ly/2GHKM22

Debate Rages on Whether a Digital Dollar Will Unleash Inflation
Omkar Godbole – Coindesk
With record U.S. money printing failing to achieve much-needed economic stimulus, some observers now expect creation of a “digital dollar” central bank digital currency (CBDC) will not only speed payments to consumers but also spur inflation. The Federal Reserve has consistently undershot its 2% inflation target since the Great Recession of 2008, and the situation has only worsened this year due to the coronavirus pandemic. This is leading some to speculate that, should the central bank implement a digital dollar – which it’s not close to doing at present – soaring inflation will soon follow.
/bit.ly/32tRVKZ

The FDIC wants to hire a legal counsel with fintech and blockchain expertise
Michael McSweeney – The Block
The Federal Deposit Insurance Corporation — a U.S. government agency that provides insurance to banks — is looking to hire a legal counsel with expertise in the area of financial technology and blockchain, per a job ad. The “FinTech Counsel” role, as outlined in the post, would provide the agency with “support in the areas of providing advice and assistance in connection with legal issues arising from new digital and other forms of technology.” The position exists within the FDIC Legal Division’s Financial Technology and Innovation Group, Fin Tech Innovation Team.
/bit.ly/3n82Ce4

Privacy Coin GRIN Is Victim of 51% Attack
Kevin Reynolds – Coindesk
Privacy-centric blockchain network Grin (GRIN) is undergoing a 51% attack, an event in which a miner (or miners) acquires more than 50% of the network’s mining hash power and takes control, according to a notice at the bottom of the Grin protocol’s website.
/bit.ly/36ni3IA

Legitimate volume on spot crypto exchanges fell to $125.8 billion in October
Michael McSweeney – The Block
Cryptocurrency trading volumes decreased by 25.8% in October, according to The Block’s volume index for spot exchanges. October’s legitimate volume figure came in at $125.8 billion compared to $169.5 billion for the month of September.
/bit.ly/32uC66R

Canadian tax officials are seeking info on crypto exchange Coinsquare’s customer base: report
Michael McSweeney – The Block
Canadian news outlet National Post reports that the country’s tax authority has gone to court in an effort to press crypto exchange Coinsquare to divulge information about its clients. The November 6 report cites court documents from September, stating that “Canada’s tax agency is asking a judge to force Toronto-based crypto trading platform Coinsquare to hand over information and certain documents about all its clients since the beginning of 2013.”
/bit.ly/2JUsITP

New Jersey Moves Closer to Crypto License With Introduction of Senate Bill
Sebastian Sinclair – Coindesk
New Jersey has inched closer to implementing a cryptocurrency license similar to the “BitLicense” mandated in neighboring New York since 2015. Sponsored by Senator Nellie Pou (D.-35), a bill known as the “Digital Asset and Blockchain Technology Act” was introduced to the Senate last Thursday. Senate bill 3132 seeks to regulate cryptocurrency service providers under the oversight of the N.J. Department of Banking and Insurance.
/bit.ly/2IjcPWq

FinTech Ripple Chooses DIFC For Regional Headquarters
Mondovisione
Dubai International Financial Centre (DIFC), the leading global financial centre in the Middle East, Africa and South Asia (MEASA) region, announced that Ripple, the enterprise blockchain solution for global payments, has established its regional headquarters in the Centre.
/bit.ly/3n761tQ

Politics

Wall Street Wants to Be Sure Biden Can Keep Warren’s Army at Bay
Robert Schmidt, Jesse Hamilton, and Yalman Onaran – Bloomberg
His victory sets up internal Democratic fight over regulation; Progressives want new constraints on pay, tough watchdogs
Wall Street has made its peace with a Joe Biden victory, taking comfort in his decades-long political career in which moderation is a prevailing trait. But it’s nervous about his more liberal allies. Finance executives will be closely watching how Biden handles the coming internal Democratic fight between centrists and progressives that threatens to increase regulation and dent profits.
/bloom.bg/38pX7Uc

Saudi King, Crown Prince Congratulate Biden, Harris on Victory
Zaid Sabah – Bloomberg
Saudi Arabia’s King Salman bin Abdulaziz and his son, Crown Prince Mohammed, issued a brief statement of congratulations to President-elect Joe Biden and Vice President-elect Kamala Harris on Sunday night via the official Saudi Press Agency.
/bloom.bg/32sLisx

Traders Look for Post-Election Reset
Justin Carrigan and Benjamin Purvis – Bloomberg
Euro and Aussie extend gains as currency trading gets underway; Biden seen as a positive for trade, lifting risk appetite
After a week in which markets barely had time to draw breath as Joe Biden inched toward victory in the U.S. presidential election, traders have begun to dive right back in with the euro and Australian dollar among currencies climbing versus the greenback.
/bloom.bg/38jEZLA

Biden Stocks Will Have History and Fed on Side, Not Much Else
Sarah Ponczek – Bloomberg
Assessing the next 4 years for stocks under a Biden presidency; Fragile economy, high valuations pose possible headwinds
First the good news for Joe Biden in the stock market. Going by history, buoyant markets tend to stay that way after a presidential election, at least for a while.
/bloom.bg/38n6Yd8

Biden pledges to ‘restore soul of America’ in bipartisan victory speech; President-elect calls on Democrats and Republicans to control pandemic and build prosperity
Demetri Sevastopulo and Lauren Fedor – FT
Joe Biden said he intended to “restore the soul of America” as the president-elect delivered a victory speech in which he urged the country to come together following one of the most divisive periods in US history.
/on.ft.com/3nifkr1

Joe Biden constrained: how Wall Street positioned for divided US government; Shock, patience and a rethink in a tense week for fund managers
Katie Martin, Robin Wigglesworth and Colby Smith – FT
Investors approached the US presidential election with confidence that Democratic challenger Joe Biden would win, and win big. By the end of the week, they were cheering at the prospect of a more circumscribed Biden presidency shackled by a Republican Senate.
/on.ft.com/2JHD216

What Wall Street would make of a Biden presidency; Divided government might shield banks from higher taxes and tighter regulation
Robert Armstrong – FT
Donald Trump, the great regulation-cutter, has done almost nothing to cut regulation on banks. There was some mild softening of capital and liquidity rules for small and midsized banks; that’s it. Politically, it is clear that the Trump Republican party decided that making life easier for big banks, a short 10 years after the great financial crisis, was not a political winner.
/on.ft.com/2JHDdcM

What a Joe Biden Presidency Will Mean for Markets; A wild week across financial markets shows investors pricing in more of the status quo
Akane Otani – WSJ
The U.S. presidency is set to change in January—but the two powerful forces that have driven financial markets this year will likely remain the same: the Federal Reserve and the pandemic. Many money managers have coalesced around the idea that what happens now isn’t dependent quite so much on what Democrat Joe Biden will do once he takes control of the White House—especially since it appears Congress might be divided.
/on.wsj.com/35cfcTw

Biden’s DOJ Must Determine Whether Trump Should Be Prosecuted
David Yaffe-Bellany and Billy House – Bloomberg
The president-elect previously said he wouldn’t interfere; Manhattan inquiry could lessen pressure on Justice Department
Joe Biden won the presidency promising to bring Americans together. But now his administration is sure to come under pressure from some Democrats to risk exacerbating divisions by investigating and prosecuting Donald Trump. It would be a turnabout of the “Lock him up!” chants regularly directed at Biden by Trump’s supporters at campaign rallies.
/bloom.bg/32prNkk

Germany Considers Delaying a $4 Billion Tariff Strike on the U.S.
Birgit Jennen and Bryce Baschuk – Bloomberg
EU trade ministers will discuss Boeing sanctions on Monday; Foreign Minister Heiko Maas wants a ‘new deal’ with the U.S.
Supply Lines is a daily newsletter that tracks Covid-19’s impact on trade. Sign up here, and subscribe to our Covid-19 podcast for the latest news and analysis on the pandemic. Germany is seeking to mend transatlantic trade relations and is mulling a more conciliatory approach that would see the European Union delay tariffs set to hit $4 billion of American products as soon as Tuesday, according to a senior official familiar with the government’s thinking.
/bloom.bg/36jwmxL

Trump Advisers View Legal Challenges to Biden Win as Futile
Jennifer Jacobs and Jordan Fabian – Bloomberg
Some aides urging Trump to continue court battles over count; Kushner recommended legal action to ensure transparency
Recognition is growing in Donald Trump’s inner circle that efforts to overturn Joe Biden’s victory will be futile, though some advisers have urged the president to pursue focused legal challenges, according to people familiar with the matter. Trump has given no indication he’s preparing to concede. His closest aide, son-in-law and senior adviser Jared Kushner, has recommended the president ask courts to ensure transparency around ongoing counts of ballots in several contested states, the people said.
/bloom.bg/32sOpk7

Biden Gets Muted Reaction in China With Trump-Era Rift to Endure
Bloomberg News
Foreign Ministry sidesteps questions on election, trade; Shift on China policy likely to be more style over substance
Unlike Donald Trump, whom Chinese officials had little knowledge of before he took office, Joe Biden is well known in Beijing. But that history is unlikely to quickly repair a relationship between the global powers that has fundamentally changed over the past four years.
/bloom.bg/3n3Ad99

How Biden’s Win Affects Commodities Hit by Trade Wars, Tariffs
Joe Deaux – Bloomberg
It’s been a tumultuous four years for U.S. commodity industries that found themselves a key focus of the White House through its aggressive trade policy agenda. From steel and aluminum tariffs to grain subsidies to boosting exports of liquefied natural gas, very few corners of the global commodities market eluded Donald Trump’s attention. There was at least one memo, executive order, pronouncement or tweet bringing some sort of attention to uranium, soybeans, and rare earths, the kinds of materials that haven’t received attention from American presidents in years.
/bloom.bg/3p5YD3H

For a Strong Start, Biden Needs a Smooth Transition; The president-elect faces a mountain of challenges and risks wasting precious time without cooperation from the current administration.
Mohamed A. El-Erian – Bloomberg
President-elect Joe Biden is preparing to lead the U.S. at an increasingly troubling time. Americans face a host of challenges, from surging Covid-19 infections and slowing economic growth to worsening inequality and deep political and social divisions. The Biden administration will be under pressure from Day One and would have a better chance at getting off to a strong start if it were afforded a smooth transition. Biden and his team will need to be able to take quick actions, and it would greatly help if they were taken with as full an information set as possible.
/bloom.bg/3pcq9N2

Regulation

Evidence of PPP Fraud Mounts, Officials Say; Reports of waste and abuse in the Paycheck Protection Program inundate government watchdogs and federal prosecutors
Ryan Tracy – WSJ
The federal government is swamped with reports of potential fraud in the Paycheck Protection Program, according to government officials and public data, casting a shadow on one of Washington’s signature responses to the coronavirus pandemic. Congress and the Trump administration designed the PPP to give small businesses fast and easy access to taxpayer funds, and it worked: About $525 billion in loans were distributed to 5.2 million companies between April 3 and Aug. 8. Many business owners say it was a lifeline in turbulent times.
/on.wsj.com/2IhAoOW

ESMA updates Q&As for prospectus and transparency rules linked to Brexit
ESMA
The European Securities and Markets Authority (ESMA), the EU’s securities markets regulator, has today issued Questions and Answers (Q&As) concerning the Prospectus Regulation (PR) and the Transparency Directive (TD) in the context of the Brexit transition period. ESMA has also updated prospectus Q&As as part of an ongoing Q&A revision exercise.
/bit.ly/2ImA027

Proposed Rule Change to Adopt Temporary Supplementary Material .17 (Temporary Relief to Allow Remote Inspections for Calendar Year 2020 and Calendar Year 2021) under FINRA Rule 3110 (Supervision).
FINRA
Financial Industry Regulatory Authority, Inc. (“FINRA”) is filing with the Securities and Exchange Commission (“SEC” or “Commission”) a proposed rule change to adopt temporary Supplementary Material .17 (Temporary Relief to Allow Remote Inspections for Calendar Year 2020 and Calendar Year 2021) under FINRA Rule 3110 (Supervision) to provide member firms the option, subject to specified requirements under the proposed supplementary material, to complete remotely their calendar year 2020 and calendar year 2021 inspection obligations under FINRA Rule 3110(c) (Internal Inspections), without an on-site visit to the office or location. The temporary rule change is necessitated by the compelling health and safety concerns and the operational challenges member firms are facing due to the sustained COVID-19 pandemic.
/bit.ly/32rJIqy

CFTC Issues Order of Registration to ICE Futures Abu Dhabi Limited to Permit Trading by Direct Access from the U.S.
CFTC
The Commodity Futures Trading Commission today announced that it has issued an Order of Registration to ICE Futures Abu Dhabi Limited (IFAD), a Foreign Board of Trade (FBOT) incorporated in the Abu Dhabi Global Market and located in Abu Dhabi, United Arab Emirates.
/bit.ly/32rWvcW

Green Horizon Summit: Rising to the Climate Challenge
UK FCA
Speech by Nikhil Rathi, CEO, at an online conference hosted by the City of London.
/bit.ly/36icX0r

Monetary Authority Of Singapore: $35 Million Grant To Help Small Financial Institutions Adopt Digital Solutions For Data Reporting
Mondovisione
The Monetary Authority of Singapore (MAS) announced today the launch of a S$35 million [1] Productivity Solutions Grant (PSG) for the financial services sector to help smaller financial institutions [2] adopt digital solutions for more streamlined data reporting to MAS. The grant is currently applicable to banks and will be subsequently expanded to include insurers and capital market intermediaries.
/bit.ly/3mZccQy

Securities Commission Malaysia Warns Public Against Fake Donation Letter Using Sc Chairman’s Name
Mondovisione
The Securities Commission Malaysia (SC) would like to caution members of the public of a fake donation letter purportedly from “Badan Kebajikan Thalassaemia Malaysia (944520K)” seeking donation and falsely naming the SC Chairman as its advisor.
/bit.ly/2IjZdtZ

Biden Set to Tap Gary Gensler as Adviser on Wall Street Oversight
Andrew Ackerman – WSJ
Joe Biden is expected to tap Gary Gensler to advise on plans for Wall Street oversight in a prospective administration, according to people familiar with the matter, a move that likely would please Democrats who cheered the former regulator’s tough approach to rulemaking during the Obama administration. Under President Obama, Mr. Gensler spearheaded the overhaul of derivatives markets mandated by the 2010 Dodd-Frank Act and the prosecution of big investment banks for manipulating the London Interbank Offered Rate, the benchmark for trillions of dollars in lending worldwide.
/on.wsj.com/35dlfYc

Investing and Trading

Berkshire Scoops Up Its Own Stock While Pandemic Hits Earnings
Katherine Chiglinsky – Bloomberg
Berkshire has repurchased a record $16 billion so far in 2020; Every operating unit except energy business had profit drop
Warren Buffett might have just found his next elephant-sized deal: Buying back his own stock. Berkshire Hathaway Inc. spent $16 billion buying back its stock in the first nine months of 2020, more than triple its previous annual record. The repurchases even surpass many of Berkshire’s biggest investments in recent years, including 2019’s Occidental Petroleum Corp. financing deal, and total more than Berkshire has ever spent in one year buying Apple Inc. stock.
/bloom.bg/32mxqzS

From Tech to Pot, Stocks Get $2.6 Trillion Election Boost
Felice Maranz – Bloomberg
Split Congress potential offers ‘sigh of relief’: strategist; More spending likely, yet concerns about higher taxes abating
It’s an outcome that would meet some of Wall Street’s best-case scenarios: U.S. stocks posted their best week in eight months with a $2.6 trillion boost in value as sectors from tech to cannabis got a lift ahead of Joe Biden’s victory and a potential Republican Senate.
/bloom.bg/38pLH2s

U.S. Corporate Bond Sellers Are Preparing an Onslaught of Deals
David Caleb Mutua – Bloomberg
About $30 billion of high-grade debt sales expected this week; Revlon’s final tender deadline for bond exchange due Tuesday
U.S. corporate bond markets are primed for an avalanche of sales as companies report earnings after the presidential election dampened issuance last week.
/bloom.bg/2JHC0SM

Gold Hasn’t Behaved Like a Haven Recently; A weaker dollar after Election Day has seen stocks, gold and bitcoin all rally this week
Will Horner – WSJ
Gold’s gains this week have highlighted something unusual about its rally this year: Rather than moving in the opposite direction to stocks, the haven metal and riskier equities recently have rallied and tumbled together.
/on.wsj.com/2U7wzi2

Emerging-Market Bulls Take Heart as Election Outcome Rouses Risk
Netty Idayu Ismail, Lilian Karunungan, and Sydney Maki – Bloomberg
Biden presidency, a Republican Senate to boost EM: Eaton Vance; Erdogan’s ouster of central bank governor may rattle traders
The emerging-market bargain-buyers are in celebration mode. And the party’s not over yet. The prospect of a Joe Biden presidency checked by a divided Congress has gotten everyone from Eaton Vance Corp. to Medley Global Advisors predicting a fresh boost for risk assets, just a week after the stocks, currencies and bonds of developing nations hit the buffers as the U.S. election approached. BlackRock Inc. says developing-nation assets, which look more appealing in this low-rate world, could benefit from a more moderate leader in the White House. The Biden administration’s policy approach will probably reduce uncertainty, according to UBS Global Wealth Management.
/bloom.bg/2ImVrQq

Negative yields may be coming to U.S.: Guggenheim CIO Minerd
Julie Hyman – Yahoo Finance
It’s tough enough for fixed-income investors — retirees, life-insurance companies, pension funds — to find high-yielding assets, with the Federal Reserve holding rates so low. It’ll get even tougher when negative yields comes to the U.S., according to one prominent investor.
/yhoo.it/32tzIxg

Why 2020 Was the Perfect Year for Tax-Loss Harvesting; In an up-and-down market, selling losing funds creates losses that help offset capital gains
Neal Templin – WSJ
This is the kind of year that was made for tax-loss harvesting. The tactic, used to legally reduce or avoid altogether capital-gains taxes, is especially useful in years when a jarring market slide is followed by a strong rebound. That’s why this year, with the market’s plunge in March and subsequent recovery to record highs, was ideal for this strategy.
/on.wsj.com/3pblISy

Value Stocks May Have Done a Lot Better Than You Think; New research says that a flawed definition has led value investing to be such a poor performer over the past 15 years
Mark Hulbert – WSJ
Value’s drought isn’t nearly as bad as many have made it out to be. I am referring to the disappointing performance of value stocks relative to growth stocks. Using the traditional academic definition to differentiate the two types of stock—value stocks have low price-to-book-value ratios, growth stocks have high ones—value has lagged behind growth for nearly 14 years. Over the previous 80 years, in contrast, value far outperformed growth.
/on.wsj.com/3n52yvI

Environmental, Social and Corporate Governance

Scottish Widows to dump £440m of company holdings that fail ESG tests; Exclusions policy is one of the most aggressive adopted by a leading UK pensions provider
Chris Flood – FT
Scottish Widows plans to dump company investments worth at least £440m that fail to meet its environmental, social and governance (ESG) standards, one of the most far-reaching exclusions policy adopted by a major UK pensions provider.
/on.ft.com/3n5xE6y

Companies defy investor demands on climate change; Analysis of 6,000 listed groups shows few businesses are close to meeting targets set by Paris accord
Attracta Mooney – FT
Companies are failing to respond to investor demands on climate change, according to a new analysis that examines how prepared businesses are for the transition to a low-carbon economy.
/on.ft.com/2IfJ34r

Japan Eyes Replacing Oil With Hydrogen Amid Carbon Neutral Push
Aya Takada and Stephen Stapczynski – Bloomberg
Clean-burning fuel may represent 40% of Japan’s energy by 2050; Japan needs to build infrastructure, ships to import hydrogen
Tucked into a port in western Japan sits a spherical tank that may soon hold the country’s energy future. The import terminal in the city of Kobe, is slated to get its debut hydrogen shipment in March. Over the next 30 years deliveries of the zero-emission fuel are expected to ramp up exponentially as the world’s fifth-biggest polluter seeks ways to replace its heavy fossil fuel use and meet a pledge to become greenhouse gas neutral by 2050.
/bloom.bg/2IkeYkv

BLM movement adds pressure on start-ups to diversify; Progress is slowed by coronavirus but is marked by a change in VC funding conditions
Jennifer Williams-Alvarez – FT
Just as the killing of George Floyd and other Black Americans at the hands of police officers has pushed large, established companies to take diversity and inclusion more seriously, start-ups are also feeling the pressure for change.
/on.ft.com/3pa3DEk

Founders’ tips for funding during Covid-19; Despite the pandemic, there is plenty of capital around for entrepreneurs — take your time to find the right partner
Maren Bannon and June Angelides – FT
While raising capital for a new start-up has never been easy, this coronavirus-affected year has added to the challenges facing entrepreneurs who have been forced to go online to build investor connections and pitch for funding.
/on.ft.com/36lqtjB

Asian ESG wave gathers pace as consumers and start-ups buy in; South Korea example shows ‘patient capital’ is needed as coronavirus stimulus funnels cash into eco-friendly businesses
Edward White – FT
Mouthfuls of succulent Korean barbecued beef doused in deep red ssamjang hot sauce — a dish served everywhere from Michelin-starred restaurants to street-side stalls — does not usually invoke thoughts of sustainability. Zikooin wants to change that.
/on.ft.com/3n8hIjW

Big Oil must make seismic changes to survive; The industry needs a reset in order to maintain its social licence to operate
Muqsit Ashraf – FT
In meteorology, the “Fujiwhara effect” is a phenomenon that occurs when two cyclones come together to form a larger storm. In April 2020, a Fujiwhara effect of sorts hit the global oil industry when an oil price war and a global pandemic combined and sent oil prices plummeting, and the industry itself into crisis.
/on.ft.com/38poTjv

Carney Calls Net-Zero Greenhouse Ambition ‘Greatest Commercial Opportunity’
Alastair Marsh and Benjamin Robertson – Bloomberg
Firms under increasing pressure to devise climate strategies; Ex-BOE governor lays out plans for firms ahead of UN forum
Mark Carney is calling on banks, insurers and fund managers to play their part in “re-engineering” the global economy towards net-zero greenhouse gas emissions and says there’ll be great rewards from doing so.
/bloom.bg/3pbGCkt

China Solar Manufacturers Jump as Biden Win Seen Boosting Demand
Dan Murtaugh – Bloomberg
Change in administration should support solar sector: analyst; Longi, GCL-Poly among companies seen poised to benefit
Shares in the Chinese companies that dominate production of solar panels rose after Joe Biden’s victory increased the likelihood that the world’s top economy will accelerate its move toward clean energy.
/bloom.bg/36ejvgq

What Is Greenwashing? Here Is What Investors Need to Know; As interest in sustainable investing grows, more companies are making misleading claims about their ESG practices
Simon Constable – WSJ
Wall Street professionals increasingly are investing in companies considered to be “green” in that they follow ESG (environmental, social and governance) principles. But as the importance of sustainability grows in the investing world, a trend has emerged: greenwashing. It’s a term investors may start hearing more often.
/on.wsj.com/3pchLNq

South Africa Sees Eskom at Zero Carbon Emissions Only by 2050
Felix Njini – Bloomberg
Eskom Holdings SOC Ltd., South Africa’s debt-ridden utility, may eliminate carbon emissions at its power plants only by 2050, according to a government task force.
/bloom.bg/36jCFl1

Institutions

Deutsche Bank Rejected ECB Request to Halt Leveraged Ops: FT
Sebastian Tong – Bloomberg
Deutsche Bank AG rejected a request to suspend key parts of its leveraged finance operations after the European Cen­tral Bank expressed concern that the lender was not properly monitoring risk in that area, the Financial Times reported, citing people familiar with the matter.
/bloom.bg/2JHBnIU

Societe Generale Plans to Cut 650 Jobs, Les Echos Reports
William Horobin and Alexandre Rajbhandari – Bloomberg
Cuts will focus on investment bank, Paris region: Les Echos; Around 100 Societe Generale traders could lose jobs under plan
Societe Generale SA will announce 650 job cuts on Monday, mainly at its investment-banking operations, newspaper Les Echos reported, without saying where it obtained the information.
/bloom.bg/2I7WR1p

Vanguard admits investors were sent incorrect information; Latest technical gaffe related to estimated yields and income across most of its money market fund range
Chris Flood – FT
Vanguard provided investors with inaccurate data for almost a year about the income that clients could expect to earn on money market funds in an embarrassing blunder for the world’s second-largest asset manager.
/on.ft.com/3eD86KZ

The Battle to Keep America’s Black Banks Alive; There are 18 Black-owned banks in the U.S., half that existed a decade and a half ago. A new movement is under way to help those that are left to survive—and even thrive.
Amber Burton, Justin Scheck and John West – WSJ
A half-century ago, the federal government set out to attack the racial wealth gap by supporting Black-owned banks. Policy makers hoped the banks would lend to Black communities sidelined by the mainstream financial system. But five decades of federal financial and regulatory support have failed to boost America’s Black-owned banks. The majority have disappeared under the burden of soured loans, bigger competitors created by mergers and financial downturns that hit small lenders hard. Fifteen years ago America had 36 Black-owned banks, government data show. Now there are 18.
/on.wsj.com/2U6LIA9

Mizuho to Become First Japan Bank to Start Selling Consumer Data
Taiga Uranaka and Yuki Hagiwara – Bloomberg
Will offer the service to companies, banking unit CEO says; Lender will provide aggregated data, not personal information
Mizuho Financial Group Inc. will start selling information on consumers’ spending habits and other aggregated data in a bid to expand beyond the traditional lending business. “We are going to offer a data service for corporate clients,” Koji Fujiwara, chief executive officer of Mizuho’s main banking unit, said in an interview. The move would be the first of its kind by a Japanese bank, he said.
/bloom.bg/3n4lNWg

As Smart-Beta Funds Struggle, Here’s What to Do Now; Recent results suggest that these funds have a hard time in turbulent markets
Bailey McCann – NY Times
Smart-beta funds, a popular $1 trillion-plus force in the investing world, were supposed to provide investors with a way to consistently beat the broader market by a small amount.
/on.wsj.com/36jOpUx

Goldman Sachs to move $60bn in assets from UK to Germany
Lucy Burton – Yahoo Finance
Goldman Sachs is planning to move up to $60bn (£46bn) worth of assets out of the UK and into Germany due to Brexit as it becomes the latest banking giant to make such a move. With less than two months to go before the transition period ends, big banks are ramping up their plans to move assets out of the UK and onto the continent.
/yhoo.it/32siUX

Regions

Lira Traders Brace as Central Banker Fired, Minister Quits
Farah Elbahrawy – Bloomberg
Traders in Turkey’s lira, the worst-performing emerging-market currency this year, are preparing to cast their verdict on two potentially huge upheavals to the country’s finances — the second change of central-bank chief in 16 months and the sudden resignation of the treasury minister.
/bloom.bg/36cKHMy

Turkey’s Finance Minister Resigns Amid Pressures of Sliding Economy; President Recep Tayyip Erdogan’s son-in-law, who is known for his ties to the Trump White House, said he was quitting as Turkey’s lira tumbles and its economy worsens.
Carlotta Gall – NY Times
Turkey’s finance minister, Berat Albayrak, the son-in-law of President Recep Tayyip Erdogan, announced his resignation Sunday evening amid escalating fallout over the country’s collapsing economy and plunging currency.
/nyti.ms/3n6JcWZ

Shock change in Turkey’s economic leadership raises stakes for lira; Currency is stuck at all-time lows, building pressure for a rate rise
Laura Pitel – FT
President Recep Tayyip Erdogan’s son-in-law has resigned as Turkey’s finance minister as part of a surprise weekend shake-up in the country’s economic management after a period of intense pressure on the lira.
/on.ft.com/36is5uv

China Has a Clever Plan to Keep Its Citizens Spending at Home; Why let consumer cash escape to other nations?
Shuli Ren – Bloomberg
China has become almost free of Covid-19. Its success results partly from draconian quarantines. And it isn’t letting its guard down. The capital city of Beijing, for instance, added restrictions just six weeks after resuming international flights in early September. Travelers from overseas must now be tested three times, instead of twice. They also have to spend two weeks isolated in a hotel chosen by the government. Some rooms can be quite dingy.
/bloom.bg/2ImVlbz

China Inks First Term Deal for U.S. LNG Since Trade War Erupted
Bloomberg News
Foran Energy says it signed framework agreement with Cheniere; Deal involves purchase of 26 cargoes between 2021 and 2025
China inked its first term deal to buy liquefied natural gas from an American exporter since the trade war disrupted deliveries, a sign of confidence that relations with the U.S. could be normalizing.
/bloom.bg/36ypyNd

Brexit

Johnson Enters Brexit Endgame That Could Define His Premiership
Stuart Biggs – Bloomberg
Final push to overcome differences with EU on free trade deal; Brexit law going through Parliament risks clash with Biden
Boris Johnson faces a pivotal week: deliver a trade deal with the European Union or risk a major rupture, and avoid a rift with U.S. President-elect Joe Biden over the U.K.’s controversial Brexit legislation.
/bloom.bg/2JGAJvc

Lords defeat of Brexit bill will put government on track for Biden clash; Controversial internal market bill could cross US president-elect’s ‘red lines’ on Northern Ireland
Sebastian Payne – FT
Boris Johnson is facing a heavy defeat in the House of Lords this week on controversial Brexit legislation that will break international law, setting him on course for a clash with US president-elect Joe Biden.
/on.ft.com/32mzh7O

Ireland’s trading future lies beyond the UK after Brexit; Exporters will ship through, over and around the UK as they diversify to Asia and the EU
Neale Richmond – FT
Whether there is a Brexit deal, or no deal, the economic impact on Ireland of the UK leaving the EU will be stark. This has always been the case and it is why Ireland’s first preparatory meeting for Brexit was held in December 2014, two years before the referendum took place.
/on.ft.com/38o3Xtb

Brexit: EU and UK negotiators resume trade talks in London
BBC News
EU and UK officials have resumed trade talks in London at the start of another key week for the negotiations. They are trying to bridge what the two sides have said are still significant differences on fishing quotas and competition issues. Boris Johnson said on Sunday that the “outlines” of an agreement were clear and a deal was “there to be done”. But he has insisted the UK is prepared to leave the single market and customs union on 31 December without agreement.
/bbc.in/3eHnOVj

Deal or no deal, Northern Ireland faces Brexit trade disruption
Kate Holton – Reuters
Northern Ireland will not be ready on Jan. 1 to implement the systems needed to keep trade moving with the rest of the United Kingdom as required by the Brexit divorce deal, the National Audit Office (NAO) said on Friday. The audit office, which reviews government spending, said that all UK borders would face widespread disruption when Britain finally leaves the European Union’s orbit, whether or not it strikes a trade deal with the bloc.
/reut.rs/32uezD1

Sunak to Lay Out Post-Brexit Financial Services Plan
Alex Morales – Bloomberg
Rishi Sunak will set out plans Monday to boost the U.K.’s status as global financial center in his first major statement on financial services since becoming Chancellor of the Exchequer in February. In an address to Parliament, Sunak will spell out his ambitions for the sector, including the country’s approach to the equivalence process governing cross-border financial cooperation with the European Union once it exits the Brexit transition period at the end of the year, the Treasury said.
/bloom.bg/35cZnfu

UK sees goodwill for Brexit trade deal, open to ‘sensible’ fishing compromise
Guy Faulconbridge, Kate Holton – Reuters
Britain said on Monday it was open to a “sensible” compromise on fishing and that there was goodwill on both sides to progress towards a Brexit trade deal, with the European Union saying it was redoubling its efforts for an accord.
The United Kingdom left the EU in January but the sides are trying to clinch a deal that would govern nearly 1 trillion dollars in annual trade before transitional arrangements end on Dec. 31. “There are still differences, there are still some obstacles to overcome,” British Environment Secretary George Eustice told Sky News. “But I think there is now some goodwill on both sides to progress things.”
/reut.rs/38pSGbH

Miscellaneous

EU debates hitting Airbnb with tougher regulation; Officials are considering rules that would class the online accommodation platform as a ‘gatekeeper’
Javier Espinoza and Alice Hancock – FT
The EU is debating guidelines that would classify the accommodation booking company Airbnb as a “gatekeeper” platform, paving the way for much stricter regulation under its new Digital Markets Act.
/on.ft.com/3pabaDb

Charity sector faces £10bn funding shortfall and 60,000 job losses; Grant giving foundations and endowments increase their exposure to riskier assets to find better yields
Chris Flood – FT
Restrictions on Remembrance Sunday services due to lockdown measures have disrupted one of the UK’s most sacred traditions, preventing many ex-servicemen and women from gathering to mark the sacrifice of fallen comrades in times of war. Many volunteers have also been unable to help at this year’s Poppy Appeal, the Royal British Legion’s largest fundraising event. The charity is only one of the 166,000 charities and voluntary organisations across Britain that have seen vital income streams shrink at a time when demand for their services has surged due to the pandemic.
/on.ft.com/3eGHRmT

Bloomberg’s Streaming News Channel Deepens Push in Consumer Media; QuickTake service will cover general interest and lifestyle news, starting with 10-and-a-half hours of daily programming
Lukas I. Alpert – WSJ
Bloomberg LP built its multibillion-dollar business selling high-priced data terminals to institutional customers such as financial-services companies. These days, it is focusing much of its energy on reaching media consumers.
/on.wsj.com/2U9YJsN

Publishers of Wall Street Journal, New York Times Ride Subscription Growth to Higher Profits; ‘The news cycle certainly played a role,’ New York Times CEO says of fast-growing subscriber base
Jeffrey A. Trachtenberg and David Marcelis – WSJ
The publishers of The Wall Street Journal and New York Times posted higher earnings for the September quarter, as subscription-revenue growth was offset by sharp declines in advertising partly caused by the coronavirus pandemic.
/on.wsj.com/2GEWmee

How to Study Abroad When You Can’t Leave Home; Virtual programs salvage international experiences for students with Zoom pop-ins from actors and a former president
Maya Goldman – WSJ
Yulissa Garcia-Serrato and her classmates were supposed to meet the former Croatian president during their study abroad trip to the Balkan country this summer. But after the Covid-19 pandemic caused the program to switch from in-person to an online learning environment, the University of Oregon senior feared her virtual travels wouldn’t amount to much of a trip.
/on.wsj.com/3peq1ML

Anti-Murdoch petition in Australia gets record public support; Campaign backed by 2 former prime ministers challenges media mogul’s dominance
Jamie Smyth – FT
A petition with 500,000 signatures calling for a public inquiry into Rupert Murdoch’s media empire was presented to Australia’s parliament on Monday, amid concerns the nation was slipping into deeper political polarisation and division.
/on.ft.com/38Dps9J

The Trump Presidency Is Ending. So Is Maggie Haberman’s Wild Ride; For the last four years, the Times reporter has been the human incarnation of a nation riveted, like it or not, by Donald Trump.
Ben Smith – NY Times
Maggie Haberman lives rent-free in Donald Trump’s head, all over the front page of The New York Times and also in a brick house in an unglamorous Brooklyn neighborhood out beyond the Citi Bikes and stately brownstones. On election night, as the votes started coming in, she was seated at her dining room table with her husband and one of her three children, drinking from a liter bottle of Foodtown raspberry seltzer, eating leftover Kit Kats from Halloween, typing and texting, and, still, still, working her sources.
/nyti.ms/2ImUbwG

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