First Read

ICE Moves
JLN Staff

The Intercontinental Exchange announced the hiring of Raymond Kahn, who will focus on ICE’s Interest Rates business. Prior to joining ICE, Kahn had his own firm, Archon Capital Advisors, with a focus on the use of blockchain technology in the post-trade and settlement space. (You can see our article here.)

Before that, Kahn managed Barclay’s OTC clearing platform from its inception, as well as the FCM.

This is a great hire for ICE. The exchange also re-hired Brookly McLaughlin as senior director, marketing and public affairs.

Some solid and interesting moves by ICE so far in 2017.

Editor’s note: Do you have a new hire you want the industry to know about? Send a note to us at jimkharouf@johnlothian.com, or to John Lothian at johnlothian@johnlothian.com.

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Davos Wonders If It’s Part of the Problem; Did the global elite’s devotion to borderless capitalism sow the seeds of a populist backlash?
Matthew Campbell and Simon Kennedy – Bloomberg
Kenneth Rogoff can pinpoint the moment he started to grow concerned Donald Trump would be the next U.S. president: It was when Rogoff’s fellow attendees at the World Economic Forum’s annual meeting last January said it could never happen. “A joke I’ve told 1,000 people in the months since leaving Davos is that the conventional wisdom of Davos is always wrong,” says the Harvard professor and former chief economist of the International Monetary Fund. “No matter how improbable, the event most likely to happen is the opposite of whatever the Davos consensus is.”
/goo.gl/3JozOB

***** If you have to ask, then yes.

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Exclusive: Citadel nears SEC settlement over customer orders – sources
Reuters
Citadel LLC has agreed to settle accusations by the U.S. Securities and Exchange Commission that its market-making arm misled customers about the routing of their stock orders, people familiar with the case told Reuters this week.
/goo.gl/J2SolT

****** Citadel should do some deep thinking about why this happened. And it should be public with its findings.

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LME Trading Starts Five Hours Late Due to Connectivity Issue
Bloomberg
The London Metal Exchange suffered its second major outage in less than six months as trading was delayed by five hours by what the exchange described as a connectivity issue.
Electronic trading on the LMEselect platform failed to start at the normal time of 1 a.m. in London on Thursday and finally resumed at 6 a.m. The issue didn’t affect telephone trading, and has been resolved, the LME said in an e-mailed statement, without giving any further explanation.
jlne.ws/2jbcNRk

***JB: This happened Thursday but came out after we had already published. It appears that the problem was a network outage, not a technical problem with the trading platform itself.

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ICE Endex Receives CFTC Authorisation As Foreign Board Of Trade
ICE
Intercontinental Exchange (NYSE:ICE), a leading operator of global exchanges and clearing houses and provider of data and listings services, today announced that the CFTC has issued an Order of Registration to ICE Endex giving it approval as an authorised Foreign Board of Trade.
/goo.gl/aeaZ0a

***** Is the front end to the exchange “Sendex?” Do you cancel and replace orders with “Amendex?” Just wondering.

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Working for an Algorithm Might Be an Improvement
Elaine Ou – Bloomberg
Bridgewater, the world’s largest hedge fund, has been portrayed as a bizarre, Moneyball-type machine in which employees’ every move is monitored and assessed, increasingly by computer algorithms. Awful as that may sound, what if it’s actually a step toward a happier and more prosperous world?
/goo.gl/T6NRd5

***** Working for an algorithm has to be better than working for a Packers fan.

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New series casts Bernie Madoff not only as a crook, but a product of a corrupt system
Ryan Vlastelica – MarketWatch
Bernie Madoff, who ran a nearly $65 billion Ponzi scheme, is one of the biggest criminals in human history. But he was also the product of a corrupt financial system, one where both clients and regulators looked the other way from cooked books in order to continue reaping the gains he so steadily delivered. That’s one of the sure-to-be-controversial conclusions of “Ponzi Supernova,” a new Audible audio series built around extensive interviews with the now-jailed Madoff, including hours of previously unheard testimony where he discusses his crimes in his own words.
/goo.gl/hkZlFw

***** Madoff supposedly cornered the Swiss Miss hot chocolate market in prison.

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Markets must learn from pound flash crash, says BIS
Katie Martin and Caroline Binham – FT
Fragile market conditions, poorly controlled algorithms, and inexperienced staff all contributed to October’s flash crash in sterling, global policymakers have concluded, with the Bank for International Settlements urging banks and other market participants to learn from their mistakes.
/goo.gl/ss12d8

***** Markets and market participants learn. Every day.

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Thursday’s Top Three
Donald Trump’s market-moving press conference the other day featured a number of notable moments. Our top story from yesterday pertained to just one of those – Donald Trump’s colossal error on jobs during his press conference. Next up was Leo Murphy’s piece from Trading Technologies’ blog, Get Whatcha Need, about the disconnect between the skillsets employers look for and what students are taught. Coming in third place was The Trade’s JP Morgan slapped with $900k fine for overcharging clients.

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MarketsWiki Stats
92,246,137 pages viewed; 22,303 pages; 203,189 edits
MarketsWiki Statistics

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Lead Stories

Wall Street Gets Early Win as House Tries to Ease Swaps Rules
Bloomberg
Republican lawmakers who want to rein in Wall Street’s watchdogs aren’t waiting around for Donald Trump.
In a likely preview of things to come, the GOP-controlled House passed legislation 239-to-182 Thursday that would make it much harder for the top U.S. regulator of the $544 trillion derivatives market to justify new rules. The bill also could reduce the Commodity Futures Trading Commission’s authority over some swaps trades made overseas, even if the transactions involve U.S. banks. Wall Street and Republicans have sought such a change for years.
/goo.gl/8kPdPq

Sterling ‘Flash Crash’ Was Caused by Myriad Factors, BIS Says; Thin volumes, automated trading contributed to steep fall in pound in October
Mike Bird and Alistair Macdonald- WSJ
A “flash crash” in which the British pound plummeted 9% within seconds last October was likely caused by thin volumes and the sort of automated trading that has made such dramatic events more common, according to an investigation by the Bank for International Settlements.
/goo.gl/hjauyB

Formula for Trading on Trump Tweets Eludes Wall Street’s Best and Brightest; Traders face twin challenges of translating tweets into automated bets and big banks’ social-media restrictions
Chris Dieterich, Ben Eisen, Chelsey Dulaney and Telis Demos – WSJ
How do you trade a Donald Trump tweet? Investors are grappling with the president-elect’s highly visible but capricious social-media presence, which is upending well-worn Wall Street formulas for assessing the likelihood of certain developments and baking them into market prices.
/goo.gl/f0V0ae

Transparency lessons for Washington from Wall Street; Government officials tend to disclose their interests in long, baffling documents
Gillian Tett – FT
Donald Trump this week gave one of the most bizarre press conferences that Washington, or New York, has ever seen. It was not just because of the extraordinary allegations about Russian espionage, nor because the US president-elect attacked CNN as a purveyor of “fake news”. The other factor that made Wednesday’s events peculiar is what Mr Trump is (or is not) doing with his corporate interests.
/goo.gl/PyVXYd

ITG pays SEC $24m to settle ADR violations
Nicole Bullock – FT
ITG has agreed to pay $24.4m to settle charges with the Securities and Exchange Commission that it violated federal securities laws by improperly handling American Depository Receipts.
/goo.gl/EJYfMi

BNY Mellon Settles Charges Stemming From Miscalculations of Regulatory Capital Figures
SEC
The Securities and Exchange Commission today announced that BNY Mellon has agreed to pay a $6.6 million penalty to settle charges stemming from miscalculations of its risk-based capital ratios and risk-weighted assets reported to investors.
/goo.gl/SoeZsg

Eight US regulatory predictions for 2017; Davis Polk lawyers predict a new reform agenda in the US following the election
Annette L. Nazareth and Gabriel D. Rosenberg – FT
With the imminent change in administration in the US, we offer our eight regulatory predictions for 2017.
/goo.gl/cKLQDc

Europe’s Biggest Fund Manager Says U.S. Stock Bulls Got It Wrong
Oliver Suess – Bloomberg
Market rally following Trump election ignores downside risks; U.S. equity markets could go further into ‘bubble territory’
Amundi SA, Europe’s largest money manager, says investors who have driven U.S. stock markets to record highs in expectation of fiscal stimulus from the Trump administration may be in for a surprise.
/goo.gl/65ZJs5

Fed Debt-Limit Contingency Plans Detailed in 2011 Transcripts
Craig Torres – Bloomberg
Federal Reserve officials assumed that the the U.S. Treasury would prioritize payments on government securities over other obligations in case the legal debt limit were breached, according to a transcript of a 2011 meeting of central bank policy makers.
U.S. central bankers were briefed in an Aug. 1, 2011, conference call on how the Treasury would handle principal and interest payments on government securities. The full details of that meeting were secret until Thursday, when the Fed released transcripts of the Federal Open Market Committee’s 2011 meetings under the customary five-year lag.
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Pound Flash Crash Had No Single Trigger, BIS Investigation Finds
Stefania Spezzati – Bloomberg
Time of day, stop-losses and expertise of staff played a role; Financial institutions didn’t face losses, according to BIS
The Bank for International Settlements found no single smoking gun in its investigation of the pound’s flash crash, instead suggesting factors ranging from the time of day to the lack of expertise of staff as the reasons behind the currency’s sudden plunge.
/goo.gl/QTeCr0

Yellen backs Dodd-Frank rules again, sounds upbeat on economy
By Victor Reklaitis – MarketWatch
Federal Reserve chief Janet Yellen said late Thursday that key parts of the 2010 Dodd-Frank law — including higher capital requirements and enhanced supervision for big banks XLF, -0.85% — should not be scrapped, according to a Wall Street Journal report. She has previously warned against rolling back Dodd-Frank rules, and it is something that President-elect Donald Trump has vowed to do. On Thursday, Yellen also said the U.S. economy faces no serious short-term obstacles, according to a Bloomberg report.
/goo.gl/HoAYWJ

Commentary: Making America’s risk of a financial crisis great again
Mark Thoma – CBS News
In the decades prior to the financial crisis, the U.S. underwent a period of financial deregulation under the assumption that market forces would prevent financial institutions from taking excessive risk. In particular, the shadow banking system — financial institutions that don’t operate as traditional banks — was lightly regulated.
/goo.gl/XK5wU7

House Votes to Require More Cost Analysis of SEC Rules; Bill is among first of several deregulatory measures congressional Republicans are expected to advance this year
By ANDREW ACKERMAN – WSJ
House lawmakers voted largely along party lines Thursday to approve a bill to require securities regulators to more extensively assess how much their rules cost the financial industry, part of a push to curtail what Republicans say is overly burdensome red tape.
/goo.gl/Bpw1N1

Brexit

Goodbye Passport, Hello Equivalence? Brexit Banks Lower Sights
Gavin Finch and John Glover – Bloomberg
British bankers are lowering their sights when it comes to securing a Brexit deal that will safeguard the U.K.’s biggest industry.
/goo.gl/qwoAVK

Preparing for Brexit Just Got Harder; The U.K. has just 11 weeks before the clock begins on formal talks.
Timothy Ross – Bloomberg
On Jan. 4, British Prime Minister Theresa May named Tim Barrow, a career diplomat, as the U.K.’s permanent representative to the European Union. It will be Barrow who must talk face to face in Brussels with diplomats from the EU’s 27 other member countries, building bridges with people who still feel bruised and angry at U.K. voters for supporting a referendum in June to quit the union. When his invisible work is done, politicians will step in, and formal negotiations will begin by the end of March. Barrow has just 11 weeks to prepare. His predecessor, Ivan Rogers, quit without warning on Jan. 3 after clashing with May’s office. He was apparently frustrated with the unrealistic attitudes of his pro-Brexit political bosses in London, who cheerfully insist that leaving the EU will be relatively trouble-free.
/goo.gl/X4jdpG

Exchanges, OTC and Clearing

Chicago’s vast exchanges have got their eyes on retail FX customers: Massive M&A deals ahead
Finance Feeds
As CBOE’s $3.2 billion acquisition of BATS Global Markets draws nearer, it is clear to see an interest in massive mergers between firms that have an aligned interest in taking the retail trading sector by storm and placing it on exchange
During recent months, several draconian moves toward changing the method by which certain electronically traded retail financial instruments can be provided have drawn opinion from several senior executives within the FX and CFD industry that the large global listed derivatives and traditional execution venues are attempting to lobby the major regulators in order to force the OTC sector onto exchanges.
/goo.gl/x5dU7Z

The IBEX 35 Celebrates Its 25th Anniversary
BME
It has become the national and international benchmark of the Spanish Stock Exchange and it has become the underlying asset for a multitude of financial products; Since its creation in 1992, its return has reached 255% and its average yearly return 6.82% Tomorrow, Saturday January 14th, the IBEX 35© will celebrate its 25th anniversary, following its debut on the same date in January 1992 and coinciding with the birth in Spain of the Options and Futures market. This index is weighted by market capitalisation and is made up of the 35 most liquid companies listed on the Spanish Stock Exchange. During this period it has become the national and international benchmark of the Spanish stock market and has served as an underlying asset for a multitude of financial products.
/goo.gl/T92FhL

AIM REACHES £100 BILLION RAISED MARK
London Stock Exchange
AIM the world’s most successful growth market, reaches £100 billion raised through IPO and Secondary issues in it’s 22nd year; Since 1995, more than 3,500 UK and international companies have joined AIM to raise growth capital; New AIM companies in 2016 up 39 per cent post-IPO; raised record average of £30m; Market maturity demonstrated in development over the last ten years
London Stock Exchange today announces that AIM, the market for smaller growth companies, has helped companies from the UK and around the world to raise more than £100 billion, underlining its status as the world’s leading growth market.
/goo.gl/VdLjLV

NYSE LAUNCHES SMART BETA INDEX WITH ROGER IBBOTSON AND ZEBRA CAPITAL
ICE
The NYSE Zebra Edge Index applies renowned economist’s behavioral finance research aiming to capture higher returns with lower volatility
The New York Stock Exchange (NYSE), part of Intercontinental Exchange (NYSE:ICE), and Zebra Capital Management announce the recent launch of the NYSE Zebra Edge Index (NYSE: ZEDGENY), an index that incorporates behavioral finance research on high-turnover, or “popular” stocks, with the goal of capturing higher returns with lower volatility.
/goo.gl/gKhmmR

NYSE Extends Lead in U.S. ETF Listings, Trading and AUM in 2016; Market Quality and Liquidity Drove Continued Market Share Leadership
Intercontinental Exchange
In 2016, NYSE Arca, NYSE Group’s marketplace for exchange traded funds1 (ETFs), reaffirmed its position as the leading ETF listings exchange for the ninth consecutive year with greater than 92 percent of total ETF assets under management (AUM). NYSE Arca also maintained its position as the deepest pool of liquidity for the trading of ETF securities with nearly 2.5 times the trading of the next closest venue. 35 of the top 50 (70%) new ETF listings by assets under management listed on NYSE Arca in 2016.
jlne.ws/2jbUETJ

The Nasdaq Stock Market Led US Listing Exchanges with 38 Percent of U.S. ETP Listings and Switches in 2016
By GlobeNewswire
122 Products Listed on Nasdaq as Primary Venue
Nasdaq (Nasdaq:NDAQ), the single largest U.S. equity exchange by market share, announced 70 new exchange-traded products (ETP) listings and 52 switches in 2016, bringing Nasdaq’s total ETP new listings to 122. Closing out 2016, Nasdaq now has a total of 328 products listed, marking an increase of 50 percent compared to 2015. In the fourth quarter, nine ETPs listed and 27 products switched to Nasdaq from other U.S. exchanges. For the year, 38 percent of new ETP listings and switches across all U.S. exchanges listed on Nasdaq, and 56 of these new listings track a Nasdaq index.
/goo.gl/VtQrLX

‘Volcker rule’ looms over exchange IPOs
Ashley Coutinho – Business Standard News
An American law could limit the universe of institutional investors that may invest in the coming Initial Public Offers (IPOs) of India’s two major bourses, the BSE and National Stock Exchange (NSE).
jlne.ws/2jcxxbC

MGEX Sets Top 20 Daily Volume Record
Press Release
MGEX, a Designated Contract Market (DCM) and Derivatives Clearing Organization (DCO), has recorded a total volume of 18,611 from Wednesday, making it the 20th-best day in MGEX’s history.
jlne.ws/2jcEj0L

“The tipping point”
Drew Nicol – Securities Lending Times via Eurex
The latest issue of Securities Lending Times features a spotlight article on Deutsche Börse’s breakfast seminar, which provided a unique opportunity for securities lending participants to meet and share their experiences of traversing the various stages of connecting with Eurex’s Lending CCP.
/goo.gl/oN5nCh

LSE-backed Libor replacement faces data wrangle
Chris Davis – Risk.net
Three replacements for the Libor rate have been proposed so far
Proposed secured rate based on data from NEX, which has a competing offering
One of the candidates to become the new sterling risk-free rate could be facing an uncertain future after doubts surfaced around its access to trade data belonging to the sponsors of a rival benchmark offering.
jlne.ws/2jcoUxw

NSE introduces e-ETF facility through e-IPO platform; NSE would conduct a mock session of it on January 13, 16 and 17
Business Standard
With an objective to facilitate acceptance of subscriptions for Further Fund Offer (FFO) of a central public sector enterprise (CPSE) exchange-traded fund (ETF), the National Stock Exchange (NSE) has introduced an online facility for the investment and subscription of ETF on its e-IPO (initial public offering) platform.
/goo.gl/cAyuuQ

Politics

Anthony Scaramucci is hired for a top job in Trump’s White House
Robert Costa and Philip Rucker – The Washington Post
Anthony Scaramucci, a prominent New York financier and confidant to President-elect Donald Trump, has accepted a top position on the incoming White House staff, where he will coordinate the administration’s engagement with the U.S. business and political community, according to two transition officials familiar with the decision.
jlne.ws/2jcVkrY

Trump’s New Border Conflict of Interest; His backer Kelcy Warren and billionaire Carlos Slim support a pipeline taking Texas natural gas to Mexico.
Lauren Etter and Andrea Navarro – Bloomberg
As President-elect Donald Trump promises to push ahead with a border wall and threatens to penalize companies that move production to Mexico, the final touches are being put on two pipelines that snake from Texas shale fields across the southern U.S. border. The projects, which have a combined value of $1.4 billion, will supply the Comisión Federal de Electricidad, Mexico’s state-owned electric utility, with U.S. natural gas that will lower power costs in Mexico—including those at factories churning out everything from car parts to flatscreen TVs for American consumers. The utility contracted in 2015 with a transnational consortium that includes Mexican-based Carso Energy, to develop and operate the Comanche Trail Pipeline and the Trans-Pecos Pipeline.
/goo.gl/tkTuqL

Will Putin and Trump Bond Over Oil?; There’s room for cooperation, but also competition.
Matthew Philips – Bloomberg
In the early 2000s, the Russian and U.S. presidents, Vladimir Putin and George W. Bush, decided it was time their two countries had a closer relationship. The obvious place to start was the oil industry. The U.S. was importing almost twice as much crude as it produced and wanted to diversify away from Middle Eastern suppliers. Russia’s vast, untapped reserves of oil needed two things U.S. companies had plenty of: money and technology.
/goo.gl/mV4uDE

Goldman Sachs Completes Return From Wilderness to the White House
James B. Stewart – NY Times
“Government Sachs” is back. After eight years in the political wilderness, its name synonymous with the supposedly undue and self-serving influence in Washington that brought us the financial crisis and the Wall Street bailout, Goldman Sachs is again making its presence felt. In the Trump administration, to an unprecedented degree, economic policy making is largely being handed over to people with Goldman ties.
/goo.gl/vvOR19

Mnuchin Might Have to Wait Until February for His Final Confirmation Vote
by Saleha Mohsin – Bloomberg
Senate panel to provide seven-day notice for Mnuchin hearing; Analyst says any delay is political, not institutional issue
President-elect Donald Trump may take power with the top post at the Treasury Department temporarily vacant.
/goo.gl/MYaSQN

Investing and Trading

Go Skew Yourself With Managed Futures
ValueWalk
Skewness is a statistical measure of how returns behave in the tails of a probability distribution. Wikipedia has a more robust definition of skewness with some good visuals here. If an investment (e.g., stocks) has negative skewness this means that the extreme returns are more likely to be negative than positive (it has a tendency to crash). However, if its return has a positive skewness (e.g., buying call option on stocks) then its large returns are more likely to be positive than negative.
jlne.ws/2jcgNkC

Index IDEA: US stock indexes continue post election march, but cap & style leaders trade places in first week of 2017
FTSE Russell
US small-cap stocks, as reflected by the Russell 2000 Index, have continued their upward march since the US presidential election, with a 15.5% rise from November 8 through January 11. This compares to a 7.5% increase for US large-cap stocks as reflected by the Russell 1000 Index for this same period. And across small- and large-cap US stocks, value-oriented US stocks have recorded higher values than growth-oriented US stocks in this period.
jlne.ws/2jcFdKR

Investors show bond fund appetite as Trumpflation trade cools; Municipal and emerging market debt register strong inflows as stocks show fatigue
Eric Platt in New York – Financial Times
Investors have returned to the world of debt in a cooling of the Trumpflation trade that pummelled bond markets and propelled equities to record highs after the US election.
/goo.gl/y1m5BS

Why ‘Teflon-Like’ Global Markets Are Resisting the Bears
Sid Verma – Bloomberg
Markets betting U.S. growth, earnings will offset yield gains; ECB, Bank of Japan replace Fed as global liquidity providers
The rise of Donald Trump. Looming European elections. A jump in inflation. A less accommodative Federal Reserve.
/goo.gl/iF2zVN

‘Massive Inflow’ Feeds Currency Surplus Gnawing at Denmark’s Peg
Peter Levring – Bloomberg
Danish current account surplus is now approaching 10% of GDP; Government says it won’t intervene to address imbalance
It’s not easy maintaining a fixed currency regime when you have one of the biggest current account surpluses in the rich world.
/goo.gl/agivl8

Moneymen With $50 Billion Heading Where Banks Fear to Tread
Edith Fishta and Luca Casiraghi – Bloomberg
Direct lenders off ECB radar have more leeway to take risks; Italy is candidate for alternative loans as bank crisis rages
As lenders watch Italy lurch through a banking crisis with dismay, Symon Drake-Brockman at Pemberton Capital Advisors LLP is readying his checkbook.
/goo.gl/p3dgOL

Repealing Obamacare: Just what the doctor ordered for wealthy investors
John Harwood – CNBC.com
The race to repeal Obamacare by President-elect Donald Trump and the Republican Congress will have one immediate side effect beyond any doctor’s office: a large tax cut for the wealthiest Americans.
/goo.gl/LEuqfw

The Market Has Already Started to Dump Trump; Stocks once regarded as out of favor with the incoming president outperformed following his news conference, confirmation of a move under way in the market for more than a month
James Mackintosh – WSJ
Markets responded to Donald Trump’s rambling news conference on Wednesday by dumping Trump. The dollar and pharmaceutical and biotechnology stocks were sold, bonds were bought and stocks once regarded as out of favor with the president-elect outperformed.
/goo.gl/FTXQtg

The gold market in 2017
World Gold Council
In 2016, investors around the world returned in large numbers to the gold market, as a combination of macroeconomic drivers and pent up demand kept interest in gold high. As we start the new year, there are some concerns that US dollar strength may limit gold’s appeal. We believe that, on the contrary, not only will gold remain highly relevant as a strategic portfolio component, but also six major trends will support demand for gold throughout 2017.
/goo.gl/kyH3qC

John Collett – Hills News
Investors who invest ethically are helping their hip-pocket as well as the planet.
/goo.gl/kC2Dtr

Institutions

Top Morgan Stanley execs netted $17m in post-election share sales
Alistair Gray in New York – Financial Times
Seven Morgan Stanley executives have netted about $17m selling their shares in the bank since Donald Trump’s election, capitalising on a jump in financial stocks driven by his victory. James Gorman, chairman and chief executive, has taken home $7.1m, president Colm Kelleher $3.3m and investment head Daniel Simkowitz $3.7m, company filings show.
jlne.ws/2jcFtJH

Exclusive: Morgan Stanley cuts bankers, bonuses as deals, IPOs stall – sources
Liana B. Baker and Olivia Oran – Reuters
Morgan Stanley (MS.N) laid off a number of senior investment bankers last week and cut bonuses by roughly 15 percent because of a decline in revenue from dealmaking and capital raising across Wall Street, people with knowledge of the matter told Reuters.
jlne.ws/2jcCiBO

Bank of America Q4 profits up 48% on Trump trading; Bank to buy back more shares after shock election result fuels strong results
Laura Noonan – FT
Bank of America is buying back an extra $1.8bn of its shares after high trading volumes and cost cutting drove a higher-than-expected 48 per cent rise in the bank’s fourth-quarter profits.
/goo.gl/6vva0S

Instinet continues to build its U.S. Equity Research boutique with three senior hires
PRNewswire
Instinet, LLC announced today that it is continuing to strategically grow its U.S. Equity Research and U.S. Equity Research Sales offering with three senior hires. Mike Wood joins as a senior equity research analyst covering the Building Products sector. David Gingeleskie and Eric Goldstein have joined as senior equity research salespeople.
jlne.ws/2jcD8hR

Billionaire George Soros Lost Nearly $1 Billion in Weeks After Trump Election
Gregory Zuckerman and Juliet Chung- WSJ
Billionaire hedge-fund manager George Soros lost nearly $1 billion as a result of the stock-market rally spurred by Donald Trump’s surprise presidential election. But Stanley Druckenmiller, Mr. Soros’s former deputy who helped Mr. Soros score $1 billion of profits betting against the British pound in 1992, anticipated the market’s recent climb and racked up sizable gains, according to people close to the matter.
jlne.ws/2jcAE3d

IG Group renames binary options products to Digital 100s – SMN Weekly
SMN Weekly
Forex brokerage IG Group (LON:IGG) has given a new name to its binary options instruments – Digital 100s, data from its website indicates. The broker has not published an official press release regarding the change. It seems the broker has removed the term ‘binary options’ altogether from its dictionary, probably in an attempt to distinguish itself from the recent bad reputation of such instruments.
jlne.ws/2jcIKZs

Fintech

NEX Data and Tradition agree global data distribution partnership
NEX
NEX Data, a NEX Group business which delivers global pricing data and information solutions, and Tradition, one of the world’s largest interdealer brokers in over-the-counter commodity and financial products, announce today that they have agreed a distribution partnership.
jlne.ws/2ikdT9p

Deloitte Opens Second Blockchain Lab
Emilia David – WatersTechnology
Consulting and advisory firm Deloitte opened a blockchain lab focused on developing proofs of concept into functioning prototypes in New York’s financial district. The solutions cultivated in the lab will be designed as “ready-to-integrate” for Deloitte’s financial services clients. The blockchain lab, its second so far, has a dedicated team of more than 20 blockchain developers who will work with teams from within Deloitte’s network of preferred technology companies.
jlne.ws/2jcDe9d

Covering Your Assets: Blockchain and Security
Jean-Philippe Ausmasson and Philipp Jovanovic – EnterpriseTech
The combined market value of blockchain-based technologies, such as cryptocurrencies, is measured in the billions of US dollars. With cryptocurrency gaining legitimacy, it’s worth knowing what security measures are used to “cover your assets” — as well as what the issues are — before you join in the gold rush.
jlne.ws/2jcLLJE

Regulation

SEC Announces 2017 Examination Priorities
SEC
The Securities and Exchange Commission today announced its Office of Compliance Inspections and Examinations’ (OCIE) 2017 priorities. Areas of focus include electronic investment advice, money market funds, and financial exploitation of senior investors. The priorities also reflect a continuing focus on protecting retail investors, including individuals investing for their retirement, and assessing market-wide risks.
jlne.ws/2jcLRRf

ESMA says EU regulators show improvement in MiFID execution
SMN Weekly
European financial regulators’ supervision of execution requirements under the Markets in Financial Instruments Directive (MiFID), the European Securities and Markets Authority (ESMA) said in its latest report on the matter. The regulatory bodies are giving greater attention to best execution requirements under the MiFID and have successfully taken steps to address shortcommings addressed in last year’s review.
jlne.ws/2jcwtEu

Ex-Visium hedge fund manager cheated investors, U.S. jury hears
Nate Raymond – Reuters
An ex-portfolio manager at Visium Asset Management LP corruptly sought to boost the value of one of its hedge fund’s holdings, defrauding investors while enabling the investment firm to earn millions of dollars, a U.S. prosecutor told jurors on Wednesday.
jlne.ws/2jcBQDE

ITG Paying $24 Million for Improper Handling of ADRs
SEC
The Securities and Exchange Commission today announced that broker ITG agreed to pay more than $24.4 million to settle charges that it violated federal securities laws when it prompted the issuance of American Depository Receipts (ADRs) without possessing the underlying foreign shares.
jlne.ws/2jcOOS7

SEC Backs “Virtual-Only” Annual Meeting Option
By TATYANA SHUMSKY – WSJ
The growing popularity of virtual-only shareholder meetings isn’t sitting well with shareholders.
/goo.gl/iUQtVT

OCC fines Usher and Ramchandani $5m each in FX ‘Cartel’ probe
Mikael Latreille – Risk.net
The Office of the Comptroller of the Currency (OCC) has issued notices of $5 million fines against former foreign exchange traders Richard Usher, ex-head of G10 spot trading at JP Morgan, and Rohan Ramchandani, ex-head of European spot trading at Citibank, for violating the Sherman Antitrust Act and engaging in unsound practices.
jlne.ws/2jcL96v

Biomet Charged With Repeating FCPA Violations
SEC.gov
The Securities and Exchange Commission today announced that a Warsaw, Ind.-based medical device manufacturer has agreed to pay more than $30 million to resolve parallel SEC and Department of Justice investigations into the company’s repeat violations of the Foreign Corrupt Practices Act (FCPA).
jlne.ws/2jctGLu

Regions

Some Peso Traders Want Mexico to Buy Twitter and Shut It Down
Brendan Walsh and Isabella Cota – Bloomberg
There’s a strange idea circulating among Mexican currency traders. Well, more of a joke really. But there’s a certain logic to it.
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U.S. Seizes $25 Million Worth of Aluminum Linked to Chinese Billionaire; The move is the most potent action yet by federal authorities investigating aluminum shipments to the U.S.
Scott Patterson – WSJ
U.S. customs officials have seized $25 million worth of aluminum linked to a Chinese billionaire accused of stockpiling the metal across the world, according to people familiar with the matter.
/goo.gl/mpr17z

Modi’s Setback on Black Money
Bloomberg
India’s controversial decision to ban 500- and 1,000-rupee notes has backfired. The idea was to root out “black money” — the profits of political corruption, tax evasion and ordinary crime. But efforts to get around the ban have been so effective that those problems may now be harder to solve than before.
/goo.gl/XLSL5P

How a China Crackdown Caused Bitcoin’s Price to Plunge
Geoffrey Smith – Fortune
The value of the cryptocurrency bitcoin is melting down Thursday, having dropped 20% against the dollar by midday Eastern Time in only two hours of frantic trading.
/goo.gl/BiLQuq

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