Hits & Takes
By JLN Staff
Besides working for JLN, Suzanne Cosgrove is doing some freelance work for the Chicago Tribune. We missed a story she wrote that was published back on November 8 titled “National Futures Association fields a winning team.” The story tells how the NFA is “is ranked No. 33 among midsize employers in the Chicago Tribune’s 2019 list of Top Workplaces, as measured by consultancy Energage in Exton, Pa.”~JJL
An item yesterday noted that the Chinese commodity exchanges would be reporting volume on a single-count basis to match international standards, thus avoiding double counted volumes. We asked if that might impact the FIA volume numbers. It turns out that FIA has adjusted their data all along to avoid double counting. Thank you, Will Acworth.~JK
Derek Sammann of the CME Group is again growing facial hair for Movember. CME Group’s Executive Chairman and CEO, Terry Duffy, is the team captain or Capitaine Hairy. Donate to Derek HERE and support men’s health. ~JJL
Seed CX’s swap execution facility was declared dormant by the CFTC on September 1, 2019, having never operated. The SEF was licensed on August 23, 2016. Seed SEF originally intended to trade industrial hemp swaps but pivoted into cryptocurrencies two years ago. ~Thom Thompson
The top three winners in the CME Group University Trading Challenge were 1. Team Edge, University of Colorado Boulder 2. Team Aster, University of Illinois Urbana-Champaign and 3. Team The Fall from Simon Fraser University.~JJL
The Spread: MIAX and BSX; Robinhood Infinite Leverage; VIX
MIAX acquired a controlling interest in BSX, the Bermuda Stock Exchange; a trader named MoonYachts manipulated a programming error in Robinhood to turn $2,000 into $1 million; and the VIX had a quiet week.
EEX Group Acquires Commodities Business of Nasdaq Futures, Inc. (NFX)
EEX Group and U.S. based Nasdaq Futures, Inc. (NFX) have successfully reached an agreement to sell NFX’s futures and options exchange business to EEX Group. EEX Group will acquire the core assets of NFX, including the portfolio of open interest in NFX contracts. The transaction involves the transfer of existing open positions in U.S. Power, U.S. Natural Gas, Crude Oil, Ferrous Metals and Dry Bulk Freight futures and options contracts to EEX Group’s clearing houses Nodal Clear and European Commodity Clearing (ECC).
Roula Khalaf to succeed Lionel Barber as Financial Times editor; Change at top of news organisation to happen in January
Alex Barker – FT
Roula Khalaf has been appointed the next editor of the Financial Times, succeeding Lionel Barber, who is stepping down after a 14-year tenure that put the news organisation on a profitable footing even as its traditional print business was upended.
*****Lionel Barber had a great run as editor of the Financial Times. Congratulations and job well done. Looking forward to seeing Roula Khalaf in this role.~JJL
Police Warn City on Brink of ‘Total Breakdown’: Hong Kong Update
Dominic Lau, Natalie Lung, and Iain Marlow – Bloomberg
Hong Kong police fired tear gas in the city’s financial district on Tuesday afternoon for the second straight day after demonstrators blocked roads, disrupted the morning commute and clashed with police.
Monday’s Top Three
Our top story of the day on Monday was led by Gary DeWaal’s Bridging the Week, titled CFTC Settlement Undone; Aiding and Abetting Liability Potentially Broader; Spoofing = Wire Fraud. Second was the Hits & Takes item in JLN yesterday for the FIA Customer Funds page FCM Tracker, which shows $211.2 billion in US customer seg funds held at 55 US FCMs, as of September. And third was Thom Thompson’s JLN piece Back in Court with Bcause – Year End Report on the latest on the bankruptcy case.
|Trading Futures in a Retirement Account
As of mid-2017, 35% of US households owned IRAs with a mean asset value of more than $88,000 according to an Investment Company Institute study. IRA owners are looking to preserve their assets and improve their diversification in an unstable – and sometimes volatile – market.
Preserving assets over the long haul becomes easier when investors pursue options they know and understand. For many, those options lie outside the traditional stock and bond markets and fall into the category of alternatives – including futures trading.
Futures trading has been allowed in IRAs since they were established in 1974 and there are real benefits to the investor and futures professionals. We’ll look at the benefits for both groups.
On the investor side, adding futures trading to a retirement plan can mean investing in something they have worked with for decades – allowing them to use their in-depth knowledge to benefit their retirement. Futures also adds a dimension of diversification and can help hedge against losses in other markets.
Traditional, Roth, SEP, SIMPLE and Solo 401(k) plans also allow individuals to save for retirement tax-free or tax deferred. Depending on eligibility and the type of IRA, the IRA owner may also receive a tax deduction for IRA contributions.
On the professional side, offering the IRA option to your clients can help you serve your clients because most investors don’t realize they can use IRAs to trade futures. Offering IRAs can also grow your business by doubling the number of accounts you establish per customer.
Futures trading accounts can be held in any type of IRA as long as it is self-directed and clients can choose to use managed futures, a self-directed futures account or systems trading.
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Support Swells for Developer in Spoofing Software Case; Petition for Chicago programmer Jitesh Thakkar nears its goal as industry worries about precedent CFTC enforcement case could set.
Joanna Wright – Waters Technology
A petition in support of Chicago software developer Jitesh Thakkar has passed its initial goal of 1,500 signatures. The petition can be seen on Change.org and is addressed to four US senators including House Financial Services chairwoman Maxine Waters. As of 11am ET on Monday, 1,557 people had added their signature, and the site updated the goal to 2,500.
****Thank you to Joanna Wright of Waters Technology for the initiative to write this story.
Libor is going away. CME rivals see an opening.
Crain’s Chicago Business
“Challenges loom large because of the potential splintering of the (new interest) rates,” says Matt Kluchenek, a lawyer at Mayer Brown in Chicago who specializes in derivative issues and works with trading firms. “Eurodollar futures and options was an entrenched product (group at CME), and a very successful one, so in a sense this resets the playing field.”
Ignoring Women Costs Finance Firms $700 Billion a Year
Emily Cadman – Bloomberg
Wealth products aren’t tailored to women, Oliver Wyman says; Men still dominate senior management roles, report says
The male-dominated finance industry is missing out on more than $700 billion a year in revenue by failing to listen to or tailor products for women, according to management consultancy Oliver Wyman.
Bakkt officially dives into crowded crypto custody market after NYDFS blessing
The Block Crypto
Bakkt, the cryptocurrency venture backed by Intercontinental Exchange, announced Monday the launch of its institutional custody business.
How the Algorithms Running Your Life Are Biased
Molly Schuetz – Bloomberg
Every minute, machines are deciding your future. Software programs don’t just recommend books and movies you might like: they also determine the interest rate you’ll pay on a loan, whether you land a dream job and even the chance you might commit a crime. The hope was that computers trained to find patterns in vast pools of data would make such decisions more objectively than humans do. Instead, researchers are finding that algorithms — the logic at the heart of software programs — can replicate and even amplify the prejudices of those who create them. Apple Inc. and Goldman Sachs Group Inc. got caught in the controversy as a Wall Street regulator opened a probe into whether the algorithm of their joint project Apple Card discriminates against women.
Academics accuse Morningstar of misclassifying bond funds; Trio alleges that funds report significantly safer portfolios than they actually hold
Brooke Fox – FT
A group of academic researchers has taken aim at Morningstar, the financial services giant, arguing the company is luring investors into unsuitable products by understating the riskiness of many of the funds it rates.
The Unsolved Mystery of the Medallion Fund’s Success; Renaissance Technologies’ famous but secretive in-house hedge fund doesn’t move in step with any market trend.
Richard Dewey and Ciamac Moallemi – Bloomberg
Most people on Wall Street have a tough time explaining the Medallion Fund, managed by the hedge fund company Renaissance Technologies. The most common answer is to just shrug and call it a money printing press. Currently open only to RenTech’s employees and a few other people connected to the firm, it’s generated average annual returns of close to 70% before fees since 1988 without ever suffering a yearly loss. After fees, it’s had one down year.
Investment Giants Raise Voices in Debate Over Their Impact on Competition; Vanguard, BlackRock aim to get in front of unresolved dispute on whether consumers are hurt by dominant investors’ holdings of competing firms
Dawn Lim – WSJ
The biggest U.S. money managers are working to convince Washington that they don’t harm competition among corporations as a debate about their sway has caught the attention of regulators.
Credit Traders Play War Games as Brexit Lobs Political Bombs
Tasos Vossos and Cecile Gutscher – Bloomberg
Bumper 2019 returns could be threatened by election volatility; Political risk premium on sterling bonds ‘looks fair’: UBS CIO
Gilts losing their protective buffer, the hard Brexit menace and even socialism with echoes of the 1970s. Debt investors are bracing for all of these scenarios — and more — as the U.K.’s second election in less than three years draws nearer.
The Madoff Victim Cash Recovery Quest May Be Coming to a Close; Having snagged more than $14 billion for investors, trustee Irving Picard has one more big target: $3.2 billion held overseas.
Joe Nocera – Bloomberg
HSBC Holdings Plc, et al., Petitioners v. Irving H. Picard, Case #19-277, The Origin
Remember when Bernard Madoff acknowledged operating the biggest Ponzi scheme ever, bilking investors out of $17.5 billion? That was 11 years ago. Since then, Irving Picard, the trustee in the Madoff bankruptcy, has filed hundreds of lawsuits to recover money for Madoff victims. He’s clawed back $14.2 billion so far. But there’s one bucket of money he hasn’t been able to get at: about $3.2 billion held by foreign banks.
Wall Street’s Very Own Unicorn Emerges in Private Credit Frenzy
Sridhar Natarajan, Davide Scigliuzzo, and Sonali Basak – Bloomberg
Dyal stake boosts Owl Rock Capital’s valuation to $2.5 billion; Investment will be used for new $3 billion to $5 billion BDC
It might sound like another techland unicorn: a 4-year-old startup suddenly worth $2.5 billion. But instead of Silicon Valley, this one emerged from Wall Street’s booming world of private credit. And it shows just how quickly fortunes are being minted by lending to companies too small or too risky to borrow from the traditional banking sector.
Dutch court orders Facebook to pull financial fraud adverts
Toby Sterling – Reuters
A Dutch court has ordered Facebook to remove advertisements that misuse the likeness of a local celebrity to promote fraudulent Bitcoin-related investments.
China’s digital currency not seeking ‘full control’ of individuals’ details: central bank official
China’s proposed digitized domestic currency is not a bid to gain full control of information belonging to the general public, a senior central bank official said on Tuesday, adding that the goal was to balance privacy concerns and the authorities’ need for information.
Exchanges, OTC and Clearing
Intercontinental Exchange to launch new platform in Abu Dhabi; Exchange to host first futures contract based on state oil company’s Murban oil
Simeon Kerr – FT
Intercontinental Exchange is to launch a new exchange in Abu Dhabi to host the first futures contract based on the state oil company’s Murban crude.
Giant Aramco listing a critical test for young Saudi exchange
Marwa Rashad, Davide Barbuscia- Reuters
The imminent listing of oil giant Aramco will be a pivotal moment for Saudi Arabia’s young and untested Tadawul stock exchange.
Nasdaq CFO Michael Ptasznik to Present at JP Morgan Ultimate Services Investor Conference 2019
Nasdaq (Nasdaq: NDAQ) is a global technology company serving the capital markets and other industries. Our diverse offering of data, analytics, software and services enables clients to optimize and execute their business vision with confidence. To learn more about the company, technology solutions and career opportunities, visit us on LinkedIn, on Twitter @Nasdaq, or at www.nasdaq.com.
DriveWealth Partners with Bamboo to Bring Nigerian Investors Easy Access To U.S Stock Market
DriveWealth, LLC, a U.S. based leader in global digital trading technology, today announced a partnership with Bamboo, a digital investment platform that gives Nigerians real-time access to invest in or trade over 3,500 stocks listed on the U.S. stock market or their local exchanges, directly from their mobile phones or computers.
Oppenheimer To Host Disruptive Innovation Summit: FinTech, Blockchain & AI
Oppenheimer & Co. Inc.
Oppenheimer & Co. Inc. (“Oppenheimer”) – a leading investment bank, wealth manager, and a subsidiary of Oppenheimer Holdings (NYSE: OPY) – will host its Disruptive Innovation Summit: FinTech, Blockchain & AI at the Palace Hotel in San Francisco, CA on November 12, 2019. Held in partnership with sponsor Delphi Digital, the event will gather leading industry executives who will share informed and insightful commentary on new technology and explore investment opportunities in the space.
Tencent Should Be Split Up
Tim Culpan – Bloomberg Opinion
China’s most ubiquitous company is hiding one of its most valuable assets. That needs to change. Tencent Holdings Ltd., best known for the WeChat messenger that almost everyone in the country uses, has a growing fintech business. But it’s getting overshadowed by the games and social media divisions. By spinning it off into a new company, with a move to a separate listing, management could unlock as much as $230 billion in value. That would make the entity China’s fourth-largest listed company and the world’s sixth-biggest financial services firm.
The SIP Data Debate Heats Up, Again
Andy Nybo, David Tabaka – TABB Forum
Pressure from capital market participants and market data consumers seeking to get a better understanding of internal SIP operational characteristics continues to grow, especially as the equity market industry sees declining trading volumes and lower industry commission revenues
Financial Research: The Final Frontier for Fintech Innovation
Rowland Park – TABB Forum
Despite significant technical advancement across the financial markets, the way that financial research is distributed and consumed has remained largely unchanged for more than a decade. This is limiting the value that high-quality research generates both for its consumers and producers. But technology can help transform how financial research is handled by market participants, ushering in a new age of technological innovation in the space.
Ex-Cinnober Blockchain Lead Joins Nordic Crypto Fund to Bet Big on Bitcoin
Anna Baydakova – Coindesk
Since NASDAQ acquired Cinnober last year, blockchain lead Eric Wall has left the exchange business for a bitcoin investment fund, joining the Oslo, Norway-based Arcane Crypto, he told CoinDesk.
New Rules for the Hong Kong Crypto Exchanges Put Market in Limbo Status; New changes are coming to the Hong Kong crypto exchange market as the Securities and Futures Commission (SFC) issues new policies for trading platform’s operating licenses.
Silvia A – BitcoinExchangeGuide.com
The SFC (Securities and Futures Commission) in Hong Kong has launched new guidelines on October 6th, which completely changes the life of cryptocurrency exchange licenses operating in the city. Almost all of the Chinese crypto exchanges are separated from OKEx, which is already operating under the new guidelines.
Huge demand in Blockchain in Insurance Market Growth with top key vendors like Amazon Web Services, Inc.
Blockchain in insurance market is expected to grow at a CAGR of 65.9% over the forecast years (2019 – 2027), as Insurance Behemoths and InsurTech Companies are Venturing to Leverage Blockchain Technology to Prevent Insurance Fraud, Says Absolute Markets Insights.
HTC Will Support Binance Chain With Special Edition Smartphone
Nikhilesh De – CoinDesk
“The implications are profound and far-reaching. The most innovative smartphone makers are racing to adopt crypto. We are delighted to support and work with HTC EXODUS to make sure its users can access the Binance chain and DEX to help people access crypto and exchange anywhere.”
Former Circle Trade head forms a new crypto proprietary trading firm
Yogita Khatri – The Block
Daniel Matuszewski, former head of Circle Trade, an over-the-counter (OTC) trading desk of cryptocurrency firm Circle, has jointly set up a new proprietary trading firm called CMS Holdings. Matuszewski has partnered with Bobby Cho, former head of trading at brokerage firm DRW’s Cumberland crypto unit, and Julien Collard-Seguin, a former technology executive at Circle, for the new venture, CoinDesk reported Tuesday.
CoinMarketCap is set to adjust crypto ranking standards, release metric to weed out fake volumes
Frank Chaparro – The Block
CoinMarketCap is set to adjust a change it recently made to its cryptocurrency ranking mechanism, which resulted in “harsher-than-intended rank drops.”
Huobi’s ‘Regulator-Friendly’ Blockchain Goes Open Source
David Pan – Coindesk
Huobi Chain, the regulator-facing public blockchain of exchange Huobi Group, is now open source and publicly available to all developers on GitHub, the firm said Tuesday.
Swiss crypto bank SEBA goes live after FINMA greenlight
Yogita Khatri – The Block
Switzerland-based cryptocurrency bank SEBA is now fully operational. In a statement shared with The Block on Tuesday, SEBA Bank AG (formerly SEBA Crypto AG) said that Swiss clients, including corporates, asset managers and professional private investors, can now open an account with it. The bank has plans to onboard clients from selected foreign jurisdictions in December.
China’s digital currency will provide required anonymity in transactions, says official
Yogita Khatri – The Block
China’s upcoming digital yuan will not fully control people’s information and will provide them with required anonymity in their transactions, according to an official.
Canada’s biggest bank exploring to launch cryptocurrency trading platform
Yogita Khatri – The Block
The Royal Bank of Canada (RBC), the country’s largest bank with over $965 billion in total assets, could launch a cryptocurrency trading platform.
Trump impeachment: About time for Wall Street to get nervous
John Crudele – NY Post
Wall Street should start getting nervous. It’s getting close to the time when the Democrats’ impeachment effort will crash head-on with the various investigations of — let’s put it mildly by calling them “indiscretions” — during the last presidential election.
The wealth tax plan worrying US billionaires; Bill Gates is not the only sceptic of Elizabeth Warren’s progressive policy
Brendan Greeley – FT
The debate over whether the US should impose a federal tax on wealth has gripped US politics after Democratic candidate for president Elizabeth Warren tabled the plan as one of the pillars of her campaign.
Fed Likely to Defy History With Rates Steady Through Elections
Rich Miller and Christopher Condon – Bloomberg
That would be surprisingly rare in a presidential polling year; Powell likely to tell lawmakers policy is in a good place
Federal Reserve Chairman Jerome Powell is likely to signal again this week that monetary policy is on hold, buttressing the belief that he may steer clear of action through 2020.
How Trump’s Stock Market Record Stacks Up; He’s no Harry Truman, but there’s no doubt the S&P 500 has done well since the 2016 election.
Justin Fox – Bloomberg
It’s been three years now since Donald Trump was elected president, which means it’s been three years of listening to Donald Trump bragging about how great the stock market is doing. Contrary to one now-infamous pre-election prediction, it has done quite well.
Trump Stumbles in Fight to Keep N.Y. Taxes From U.S. House
Erik Larson – Bloomberg
President had sought federal court ruling to block state law; Judge says Trump can renew fight over disclosure in N.Y. court
President Donald Trump suffered a setback in his lawsuit to block New York from giving a copy of his state taxes to Congressional committees after a federal judge in Washington determined he doesn’t have jurisdiction.
Testimony reveals Trump’s view on Ukraine was driven by Russia and Hungary’s leaders
NYT’s Peter Baker, former chief of staff for the CIA and Dept of Defense Jeremy Bash, former congresswoman Donna Edwards, former deputy assistant attorney general Harry Litman, and NBC News’ Heidi Przybyla on the revelation in George Kent’s testimony about Russia and Hungary’s influence on Trump when it came to Ukraine
Bloomberg, Buttigieg and the Rise of Mayors; With the federal government at a standstill, leading a city actually may be a better proving ground for showing you can get things done
Gerald F. Seib – WSJ
The hottest Democratic presidential candidate right now is Pete Buttigieg, and the newest one, at least potentially, is Michael Bloomberg.
Warren’s ‘2 Cents’ Come at Your Expense; Her levy on wealth would sink stocks, raise interest rates, and confiscate far more than she admits.
Andy Puzder – WSJ
Sen. Elizabeth Warren is campaigning for a 2% surtax on anyone’s net worth over $50 million and 6% on more than $1 billion. Most discussion of the wealth tax has focused on whether it could generate sufficient revenue to fund Ms. Warren’s various spending plans, and the revenue likely would be far less than she projects. But that focus overlooks the ways the massive new tax would harm all Americans.
Trade War’s Forgotten Farmers Get Crushed in U.S. Cotton Country
Marvin G Perez – WSJ
High U.S. stockpiles to cap gains even if China boosts imports; Farmers face poor yields after summer heat damages Texas crops
American cotton farmers are having such a difficult year that even a potential trade deal between the U.S. and China is likely to offer them little comfort.
Bloomberg’s Company Weighs Implications of Possible Presidential Run; Bloomberg News would cover co-founder’s campaign, as it did during his 12-year tenure as New York City mayor
Lukas I. Alpert – WSJ
As Michael Bloomberg weighs another bid for political office, the financial-data and media company he co-founded is grappling with the implications of having to cover his campaign.
ESMA advises EC on the supervisory regime for third-country CCPs
The European Securities and Markets Authority (ESMA), the EU’s securities markets regulator, has published three sets of technical advice to the European Commission (EC) regarding third-country central counterparties (TC-CCPs) under the revised European Market Infrastructure Regulation (EMIR 2.2).
Central banks’ mandates allow them to tackle climate change; There is now a settled consensus that global warming is a financial stability threat
Isabelle Mateos y Lago – FT
Move over, negative rates. There is a new issue baffling and dividing those running the world’s central banks: should they be helping to fight climate change? The answer has to be yes — within their mandates. For most central banks, that means taking significantly more action. But governments have their own part to play in spurring on indispensable market development.
A week of spoofing by newbie trader results in $500,000 fine
Brad Rosen, J.D. – Jim Hamilton’s World of Securities Regulation
The CFTC issued an order filing and settling charges against Mitsubishi Corporation RtM Japan Ltd., a company incorporated under the laws of Japan, with its main office in Tokyo, for engaging in multiple acts of spoofing contracts on the New York Mercantile Exchange for platinum and palladium futures. The order found that RtM Japan engaged in this spoofing activity through an inexperienced trader who utilized a trading platform located in RtM Japan’s Tokyo office. The order requires RtM Japan to cease and desist and imposes a civil monetary penalty of $500,000. The order also notes that company promptly suspended the trader from trading upon learning of the spoofing activities (In the Matter of Mitsubishi Corporation RtM Japan Ltd., November 7, 2019).
Investing and Trading
OSTC Appoints UCL Professor Rose Luckin As Non-Executive Director
OSTC, a leading global derivatives trading and education business, announces the appointment of Professor Rose Luckin as an independent non-executive Board member.
Frackers Prepare to Pull Back, Exacerbating a Slowdown in U.S. Oil Growth; Shale companies change course as financial pressure mounts; “I don’t think OPEC has to worry that much more about U.S. shale growth”
Rebecca Elliott and Christopher M. Matthews – WSJ
After pushing U.S. oil and natural-gas production to record levels, some shale companies plan to pump less.
Millionaire investors hoard larger cash piles; Nearly two-thirds want to increase cash exposure through fear of volatile markets
Stefan Wagstyl – FT
Wealthy investors are hoarding ever-larger cash piles in a sign of widespread concern about global political and economic uncertainty, according to a survey published on Tuesday by UBS, the Swiss bank.
World’s Rich Readying for Major Stock Sell-Off, UBS Wealth Says
Joanna Ossinger – Bloomberg
Wealthy people around the globe are hunkering down for a potentially turbulent 2020, according to UBS Global Wealth Management.
Selloff in Complex Investments Flashes Warning for Junk Bonds; Losses in October virtually wiped out returns in some CLO bonds
Matt Wirz – WSJ
Stocks rose to records in October. One corner of the debt market had a rougher time.
Lloyd’s of London sees rush of ‘syndicate-in-a-box’ applications: CEO
Lloyd’s of London SOLYD.UL has received 80 applications from firms seeking to set up cost-efficient remote syndicates, its Chief Executive John Neal told a conference on Tuesday.
Citi global securities services sales head departs with plans to purchase Premier League football club; Citi’s former global head of securities services sales left the bank last month to focus on his new investment firm ALK Capital.
Joe Parsons – The Trade
Citi’s global head of securities services sales, Alan Pace, has left the US bank after 11 years, and is reportedly setting his sights on purchasing a UK Premier League football club.
BTIG establishes fixed income credit trading team in Europe; BTIG has made several new hires from Jefferies, Societe Generale and Blantyre Capital to bolster the fixed income credit team in Europe.
Hayley McDowell – The Trade
US-based agency broker BTIG has formed a new fixed income credit division in London, as it seeks to expands its services and client base across Europe.
Ex-Edoma trader homes in on ESG sector with hedge fund launch; Quentin Dumortier sets up Atlas Global Investors to focus on responsible investments
Laurence Fletcher – FT
A former trader at hedge fund Edoma Partners is launching a new fund focusing on responsible investments, the latest sign that a sector known for its single-minded focus on making money is turning its attention to the world of ethical investing.
Goldman Sachs keeps losing top traders to hedge funds
Sarah Butcher – eFinancialCareers.com
As managing director promotions approach at Goldman Sachs, some people at the firm aren’t waiting around to see who’s on the list. Especially, it seems, if they work on a rates desk.
Saudis Are Urged Not to ‘Miss the Train’ on Aramco IPO; Among Saudi Arabia’s middle class, anticipation is mounting for oil giant’s stock-market debut
Donna Abdulaziz and Rory Jones – WSJ
Saudi Arabia’s middle class is preparing to invest billions of dollars in Aramco shares, as ownership of the kingdom’s prized asset—the world’s most profitable company—transfers to the populace for the first time.
China’s $1tn scramble for convertible bonds reflects hot market; Bidding for new deals including Shanghai Pudong Development Bank stuns investors
Hudson Lockett – FT
New debt and equity offerings often draw a crowd. But when investors last month placed more than $1tn worth of orders for a convertible bond issued by Shanghai Pudong Development Bank, about 140 times the $7bn raised, it was enough to shock even the most seasoned China investor.
Why foreign companies are ditching their Japan listings; Number of overseas businesses listed in Tokyo is down to just four, from more than 120
Leo Lewis – FT
The number of foreign companies listed in Tokyo is an illuminating index of the city’s status as an international financial centre. For years, that indicator has been flashing red. Now the group is down to just four, and threatens to vanish completely.
Could SBI be the saviour of Japan’s struggling regional banks? Financial-services group has outlined plan to invest in network of regional lenders
Leo Lewis – FT
In the past, a $10m investment in a dismal-looking Japanese lender would barely have been noticed. But in 2019, with the countryside emptying and the nation approaching its fifth year under the central bank’s negative interest rate policy, it triggers a 27 per cent share price surge and talk of radical realignment in regional banking.
Chile’s stock market drops after proposal to rewrite constitution; Investors fear that the move by Sebastián Piñera would undermine the economy
Benedict Mander – FT
President Sebastián Piñera’s unexpected proposal to rewrite Chile’s constitution triggered a fall in the local stock market on Monday while opponents criticised the government’s plan as inadequate.
Deadly Pig Disease Sparks Fear of a Heart Drug Shortage
Jason Gale – Bloomberg
With African swine fever wiping out a quarter of the world’s pigs, primarily in China, doctors and drugmakers around the world are sounding the alarm about a possible prolonged shortage of heparin, a critically important blood thinner. The drug, derived from pig intestines, is widely used to treat heart attacks and prevent deadly blood clots. China has been the primary source of the medicine, and the crisis there highlights a need to develop alternate supplies.
Clandestine Pig Vaccines Create ‘Chaos’ in China, Caixin Reports
Unauthorized experimental vaccines against African swine fever are being used on pig farms in China, creating “chaos” because of their varying levels of efficacy, Caixin reported.
China’s Shifting Approach to Bank Bailouts
China’s legions of regional banks are under strain. The country’s two-year crackdown on risky financing and the trade war with the U.S. have slowed economic growth, triggering debt defaults that are exposing them as the weakest link in the credit chain. Several lenders have fallen into deep trouble this year, with others — perhaps many — expected to follow. What’s different is that China seems to have thrown out the old playbook of injecting state funds into struggling lenders to keep them alive, representing another shift for the nation toward more market-oriented practices.
Putin’s Spending Spree Is So Far Just $53 Billion in the Bank
Andrey Biryukov – Bloomberg
Spending in 2019 is running at slowest pace in five years; Budget surplus reached 3.8% of GDP by end of September
The Russian government’s unusual stinginess with spending this year has turned it into one of the biggest depositors in the banking system, fattening the balance sheets of big state banks and depressing deposit rates.
Violence brings Hong Kong to ‘brink of total breakdown’: police
Clare Jim, Jessie Pang – Reuters
Hong Kong police fired tear gas on Tuesday in the Central financial district, over the harbour in Mong Kok and at universities to break up pro-democracy protests which they said were leading the city to the “brink of total breakdown”.
Swiss to Keep Emergency Coffee Stockpile, Tages-Anzeiger Reports
Corinne Gretler – Bloomberg
Government gives in to protest from industry, coffee lovers; Swiss had considered stopping stockpiling coffee from 2022
After a public outcry, Switzerland has decided that keeping a three-month emergency coffee supply is an essential safeguard, Tages-Anzeiger reported.
Nigel Farage clings to the limelight while keeping Brexit alive; Watching him cull half his party’s candidates was to see a man facing the final curtain
Robert Shrimsley – FT
Like an actor who cannot bear to leave the stage, Nigel Farage has insisted on grisly encore after grisly encore. It has been a memorable performance — an absolute political scene stealer — but the leader of the Brexit party finds it hard to reconcile himself to the best supporting actor award.
General election 2019: Farage calls on Tories to stand aside for Brexit Party
Nigel Farage has insisted he will stand candidates in Labour-held marginal seats, despite coming under pressure from the Conservatives to step aside. The Brexit Party leader announced on Monday that his candidates would not run in seats won by the Tories at the 2017 general election. But he told ITV his candidates would contest Labour seats as they had “turned [their] back on Brexit”. Tory Chairman James Cleverly warned the plan posed a “danger” to his party.
Biggest fall in UK employment in four years as firms axe part-time staff
Tom Belger – Yahoo Finance
The number of people in work in Britain has fallen at its fastest pace over a quarter in more than four years as employers have axed jobs, new figures show. Employment is still near record highs as Britain gears up for a general election and another Brexit deadline, but the proportion of people in work fell 0.1 percentage point to 76% between July and September.
Nigel Farage’s Brexit Party Gives Boris Johnson an Election Boost
Max Colchester – WSJ
Britain’s euroskeptic Brexit Party said it wouldn’t contest hundreds of Conservative Party-held districts in next month’s U.K. election, boosting Prime Minister Boris Johnson’s chances of re-election. Brexit Party leader Nigel Farage said his upstart party wouldn’t field candidates in 317 seats won by the Conservatives in the 2017 election to avoid splintering the pro-Brexit vote and paving the way for anti-Brexit parties to form a coalition to call another referendum. “I think our announcement today prevents a second referendum from happening,” Mr. Farage said. “That is the single most important thing for our country.”
Financial Times Names Khalaf Editor After Lionel Barber Ends 14-Year Stint
Thomas Seal – Bloomberg
Barber oversaw digital subscriber drive and sale to Nikkei; Paper recently moved back to historic City of London HQ
Lionel Barber will step down as editor of the Financial Times newspaper after 14 years in the post and will be replaced by Roula Khalaf, currently deputy editor, in January.
Booth receives $10 million to aid military vets; The University of Chicago’s business school will offer financial aid to current and former members of the U.S. armed forces, including those who will return to active duty after receiving a degree.
Lynne Marek – Crain’s Chicago Business
A family foundation tied to the late Charles “Mike” Harper, former CEO of Chicago agribusiness ConAgra Brands, has donated $10 million to the University of Chicago Booth School of Business for military veteran scholarships, the foundation and school said in a joint statement.