April 28 2016

elb2LSE has a 7 billion dollar cause for clarification,  while it is a very positive day for technology.

Good news from Cinnober as JPX tasks them with a huge chunk of Risk Monitoring in addition to recently selling their state of the art derivatives clearing solution.

Good news from Computershare and SETL as they rather rain on the ASX parade by debuting a working Blockchain prototype while the incumbent monopoly only has a cheque stub to show for their hype to date.

In events, lots happening: It’s going to be the FESE Convention soon on the marvellous islands of Malta, hosted by the local exchange which ought to make for a fantastic event on 15/16th June. I’m chairing a panel on CMU-related topics and looking forward to the event: Book Here.

Also on the CMU theme, September 15th, InterContinental Hotel, Warsaw. First CEE CMU Capital Markets Summit, chaired by me, Patrick L Young. Latest confirmed speakers are market structure gurus Jacek Kubas and Hannes Takacs from the EBRD…oh and there’s great news on SEE Link today too…

Finally, if you fancy a video, here’s me with the excellent Katie Pilbeam discussing The mystery of TTIP with News.Markets.

Happy scrolling, various interesting stories today:

Public Markets

DB1 Q1 2016 Results

DB1

vs Q1 2015: net revenue €648.5m (USD 739m), up 8%, net profit €205.4m (USD 234m), down 7.6%.

PLY: Think how Q2 results will likely be weighed down with all the activity on the merger of equal desperation when the internal restructuring needed total attention.

 

Nasdaq Q1 2016 Results

Nasdaq

vs Q1 2015: net revenues were $534m, up 5%.

PLY: Busy quarter for NASDAQ with a few purchases bedding down etc.

 

JPX: Consolidated Financial Results For The Fiscal Year Ended March 31, 2016

MondoVisione

Operating revenue ¥114,776m (USD 1.06b), up 8.1% YoY, operating income ¥66,271m (USD 611m), up 23.8% YoY, net income ¥44,877m (USD 414m), up 30.4% YoY.

PLY: Interesting numbers emerge from a background of Abenomics.

 

BME Q1 2016 Results

MondoVisione

vs Q1 2015: €82.1m (USD 93.6m), down 11.7%, net profit of €42.9m (USD 48.9m), down 8.9%.

 

BGC Partners Q1 2016 Results  

BGC Partners

vs Q1 2015: revenues under U.S. GAAP USD 639m, up 16.7%, GAAP net income USD 22.2m, up 7%.

 

Nasdaq’s $1.1 bln ISE Deal Gets U.S. DOJ Approval

Reuters

Nasdaq Inc’s $1.1 bln acquisition of ISE from DB1 has received DOJ approval and still needs SEC approval. Nasdaq now expects to close deal in Q2 2016 vs earlier guidance of H2 2016.

QV Premium: Exchange Deals Brief.

 

LSEG Clarification Statement – Portfolio Margining Service Between LSEG & DB1

MondoVisione

PLY: The Exchange Invest inbox always draws a lot of correspondence on the ways David Warren has developed the art of exchange group accounts, first at NASDAQ, subsequently at LSE. Alas a $7 billion slip of the tongue has left him the latest to be subject to an LSE clarification notification. A rich irony given how DW has surely always been a beacon of capital efficiency himself?

It’s not so much that there are clarifications coming from LSEG after all its varied prognostications in recent weeks, it’s more the fact that many mouthed statements giving rise to often mealy mouthed clarifications only tend to raise more questions than they answer. I have a burgeoning inbox on this one, faith in LSE has been clearly damaged by the whole DB1-LSE bidding affair, as it has in DB1 too.

 

CMA Threatens ICE With Full Competition Probe Into Trayport Deal

Huw Jones – Reuters

The UK Competition and Markets Authority (CMA) said on Wednesday it is to open an in-depth investigation (previously discussed in March) into ICE takeover of Trayport unless the exchange can offer undertakings within five days.

CMA said it was concerned that ICE could use its ownership of Trayport’s software to raise prices and/or reduce the quality of its service to rival exchanges to divert its rivals’ trades to ICE’s own exchange and clearing house.

QV Premium: Exchange Deals Brief.

PLY: A bit of a stress for the ICE albeit I am still confused why CMA (and its predecessors) seems to have such difficulty understanding the trading of commodities…

 

LSEG Result Of AGM

MondoVisione

LSE Says Merger With DB1 ‘Compelling’ As Revenues Rise

Marion Dakers – Daily Telegraph

LSE Comments At AGM On Deal With DB1

Reuters

Merger expected to be completed by end of 2016 or during Q1 2017.

PLY: Haven’t seen any updates recently on the supercavitating pig project but it too must be progressing if this merger is making headway.

DB1 Reports Profit Decline, Says LSE Merger on Track (subscription)

Ulrike Dauer – Wall Street Journal

PLY: The “on track” mantra is the standard blob answer in mergers, albeit I am just not sure what ‘track’ we are on. The at the time revolutionary but now rather tired Hesse-Darmstadt authobahn of the early 1930’s? The Nurburgring? One of those outrageously fiddly stone covered stages with breathtaking Irish Atlantic coastal views? One…okay you get the gist…

LSEG, DB1 Say Merger On Track

Noor Zainab Hussain & Jonathan Gould – Reuters

LSEG & DB1 said their planned $30 billion merger was on track and steadily winning support, despite a looming UK vote on continued membership in the EU.

PLY: They also sing unified missives at the end of Mozart operas, I’m not convinced everybody really manages to come to a happy ending in, say, Don Giovanni, but it’s standard operatic procedure.

DB1 Takes Aim At Local Opposition To London Merger

John Detrixhe & Angela Cullen – Bloomberg

DB1’s plan to take over LSEG has been facing objections at home, forcing the company to strike a difficult balance between shareholders and locals as it seeks to create a European industry powerhouse.

QV Premium: DB1-LSE Merger Brief.

PLY: The more we hear, the more this merger of equal desperation looks to be an occasion where shotguns may be wielded all the way up the altar…until the high priests of regulation anyway say no, that is.

 

MOEX Announces AGM Results

MondoVisione

 

Finra: IEX Exchange Bid Should Be Judged On Its Own Merits

Reuters

PLY: Yip, yip yip and bring it on, regulate IEX now, let competition commence in whatever strands IEX brings to the party.

 

ATHEX To Join SEE Link

SeeNews

SEE Link, set up in May 2014 by the stock exchanges of Bulgaria, Macedonia & Croatia with the backing of EBRD, became fully operational last month.

Presently, only Bulgarian, Macedonian and Croatian listed companies trade via the platform, but the bourses of Belgrade, Ljubljana, and Banja Luka are expected to join it soon, following the completion of certain technical issues. Hence, the Athens SE (ATHEX) will become the seventh one in the regional stock market.

QV Premium: SEE Link Project Brief.

PLY: Excellent news, SEE Link is a great project and has considerable potential.

 

EBRD Eyes More Polish Projects, Plans To Aid WSE

Anna Koper – Reuters

EBRD plans to invest up to 700 million euros ($800 million) in Poland this year, including a project to help the Warsaw SE (WSE) return to growth.

GPW had surpassed its Vienna rival to become CEE’s largest equity market. But its overall market capitalisation has shrunk 26% YoY to 1 trillion zlotys ($260 billion) by end-March.

PLY: The problem in Poland is more one of government (and not party political, government has been apathetic about enterprise for a decade now) than something EBRD can necessarily solve.

 

Parl Panel Seeks Forensic Audit Of Shareholding In IEX

Business Standard

A Parliamentary panel sought forensic audit of the shareholding pattern of Indian Energy Exchange (IEX) to check whether FTIL holds any stake in the company through cross holding, buy-back arrangement or any other means.

QV Premium: FTIL Stakes Sales Brief & IEX India Sale.

 

SEC Seeks Public Comment on Plan to Create A Consolidated Audit Trail

SEC

Statement Of SEC Chairman Mary Jo White At An Open Meeting On A Notice Of The Consolidated Audit Trail National Market System Plan

MondoVisione

Statement Of SEC Commissioner Michael S. Piwowar At Open Meeting Regarding The Consolidated Audit Trail NMS Plan

MondoVisione

Statement On The Notice Of The Joint Industry Plan On The Consolidated Audit Trail (“CAT”), SEC Commissioner Kara M. Stein, April 27, 2016

MondoVisione

 

Citadel In European Market Making Expansion

Joe Parsons – The Trade

Citadel Securities is to expand its market-making service, offering US Treasuries & CDS to European investors for the first time.

 

Sebi Issues Clearances To Commodity Brokers

Ashish Rukhaiyar – The Hindu

Nearly seven months after taking over as the commodity market regulator, Sebi has started issuing the first set of registrations for commodity brokers. 144 entities have been registered as brokers in the commodity derivatives segment as on March 31. QV Premium: SEBI-FMC Merger Brief.

Private Markets

SIX Annual Report 2015 – Now Available

MondoVisione

 

Japanese BTC Exchange bitFlyer Raises $27 Million

CCN

In a funding round led by Japanese investor SBI Investment and Tokyo-based venture capital firm Venture Labo Investment, bitFlyer has raised around 3 billion yen ($27 million) in new capital.

Dividend News

BGC Partners declared a quarterly qualified cash dividend of $0.16, payable on June 1, 2016, record date May 16, 2016.

MOEX 2015 dividend of RUB 7.11, payment date 20 June, record date 16 May 2016.

Special Section: FTI, NSEL, India at the Crossroads

PLY: MCX off 1.5%, FTIL down nearly 2%.

Technology

JPX Taps Cinnober For Risk Monitoring

Cinnober

JPX has chosen Cinnober for risk monitoring across the entire Japanese market of equities, bonds, futures, options, CDS & IRS. This follows an announcement earlier this year where JPX selected Cinnober for the clearing of the exchange’s listed derivatives market.

PLY: Great deal for Cinnober whose real-time clearing platform is already being installed at JPX.

 

Computershare & SETL Demonstrate Australia’s First Working Blockchain Solution

MondoVisione

PLY: So Computershare, being a for profit kind of company which works competitively as opposed to a monopoly vacuum, debuts a prototype Blockchain while elsewhere an incumbent monopoly huffs and puffs its innate brilliance with nothing to show but a cheque stub…

 

DB1 Launches FinTech Hub In Frankfurt

DB1

DB1’s FinTech hub was launched in Frankfurt, making DB1 to support the Hessian State Government’s FinTech initiative to set up a FinTech cluster in Frankfurt.

PLY: And on the big picture, this only serves to reinforce why the HQ of a merged DB1-LSE will struggle to make it out of the boundaries of Hesse.

 

Broadridge Launches Global Solutions Partner Program

MondoVisione

Products

Nasdaq Mulls New Exchange To Ease Trading In Illiquid ETFs

John McCrank – Reuters

PLY: …which also elegantly tries to head BATS off at the pass as it endeavours to grow in ETFs.

 

LME Head Says China Traders Don’t Know What They Buy in Boom

Jasmine Ng – Bloomberg

“Why should steel rebar be one of the world’s most actively-traded futures contracts?” Garry Jones, LME CEO, said at a conference in Singapore on Wednesday. “I don’t think most people who trade it know what it is.”

PLY: I am minded to agree. The Chinese metals bubble appears remarkable, particularly on the domestic exchanges.

 

UK’s FCA Proposes Measures To Improve The Effectiveness Of UK Primary Listed Debt Markets

MondoVisione

FCA Sets Outs Plans To Improve Debt Markets (subscription)

Caroline Binham – Financial Times

FCA pledges to become more ‘user-friendly’ for debt market participants.

 

Tradition To Launch Collateral Trading (subscription)

Philip Stafford – Financial Times

Tradition, the Swiss IDB, is to launch a new collateral trading platform from next month that aims to shore up Europe’s misfiring repo market.

 

MOEX Launches New Transactional Binary Protocol For Derivatives Market

MondoVisione

 

Dubai Mercantile Exchange Lists Middle East Fuel Oil Derivatives

MondoVisione

Middle East 180cst and 380cst high-sulfur fuel oil (HSFO) will be available to trade through DME from 16 May 2016.

 

SGX & REITAS Launch First Ever REITs Race

MondoVisione

 

ESMA Update On Reporting Structured Finance Instruments Information Under The CRA Regulation

MondoVisione

Indexes

Asia Index Unveils S&P BSE Gold Hedged Indices

The Hindu

Asia Index, a jv between S&P Dow Jones Indices and BSE, announced the unveiling of S&P BSE Sensex Gold Hedged Index and S&P BSE Sensex Dynamic Gold Hedged Index.

Career Paths

LSEG shareholders, during the AGM, re-elected Jacques Aigrain, Paul Heiden, Raffaele Jerusalmi, Andrea Munari, Stephen O’Connor, Xavier R Rolet & David Warren and elected Donald Brydon CBE , Professor Lex Hoogduin, David Nish & Mary Schapiro as directors.     

PLY: Trebles all round – ‘would you like any ice with that?’ Oh, sorry for mentioning the elephant in the room again…

MOEX shareholders approved the new composition of the Supervisory Board, with 12 directors (board size reduced from 15) including five independent directors. 14 candidates were on the list for voting.

The newly elected Supervisory Board:

Alexander Afanasiev, CEO, Executive Board Chairman, MOEX

Yuan Wang, independent director;

Sean Glodek, member of the Executive Board, Deputy General Director at RDIF, NED;

Andrey Golikov, Deputy Chairman of the Supervisory Board of MOEX, NED;

Mariya Gordon, Member of Supervisory Board, PJSC ALROSA, independent director;

Valery Goreglyad, Chief auditor at Bank of Russia, NED;

Yuriy Denisov, Deputy Chairman of Supervisory Board of NCC Clearing Bank, NED;

Bella Zlatkis, Deputy Chairman of the Executive Board at Sberbank, NED;

Anatoly Karachinsky, President of IBS Group IBS, independent director;

Alexey Kudrin, Chairman of the MOEX Supervisory Board, NED;

Duncan Paterson, independent consultant, independent director;

Rainer Riess, Director General, FESE AISBL, independent director.

MOEX‘s new Supervisory Board met for the first time on 27 April 2016 following its election at the Company’s AGM. Alexey Kudrin was reelected as Chairman of the Supervisory Board and Andrey Golikov was re-elected as Deputy Chairman.

Acting upon the recommendation of its Nomination and Remuneration Committee, the Supervisory Board recommended that Anna Kuznetsova and Igor Marich be elected to join the MOEX Executive Board, which, at present, consists of: CEO Alexander Afanasiev, CFO Evgeny Fetisov, Chief Information Officer Sergei Poliakoff, and COO Dmitry Shcheglov.

PLY: Just a reminder, Niki Beattie stood down from the board ahead of this AGM.

FOW reports that Ufuk Ozdemir will serve as a stand-in Chief Information Officer of BIST, after Adnan Metin resigned on April 14.

Mr. Rashid Al Baloushi, CEO of Abu Dhabi Securities Exchange, has been selected by the members of the Arab Federation of Exchanges to become a member in the Federation’s Executive Committee.

Financial Calendar

28.04 – CME Q1 2016 Results

28.04 – HKEX AGM

28.04 – SIBEX EGM & AGM  

29.04 – CBOE Q1 2016 Results  

29.04 – WSE Q1 2016 Results – announcement

Warsaw SE & WOOD & Company – conference call followed by a Q&A session to discuss Q1 2016 results 10:00 EST / 14:00 GMT / 15:00 CET Speakers: Paweł Dziekoński & Grzegorz Zawada – VPs of the GPW Management Board.

New! – 05.05 – Bats Q1 2016 Results

New! – 15-16.06 – FESE Convention 2016 – Malta

All forthcoming exchange / investment related events are now listed in our Events page.

Other stories

Speed-Chess Champ Oystacher Claims Ignorance in Spoofing Case

Matthew Leising & Janan Hanna – Bloomberg

On paper, Igor Oystacher is a speed-chess champion who commands a lightning-quick intellect, allowing him to cast aside allegations he manipulated futures markets for years. Under questioning in a Chicago courtroom, he frequently professed ignorance.

 

AgriClear Announces Collaboration with Canadian Beef Breeds Council

TMX

AgriClear announced it is entering into a collaborative marketing agreement with The Canadian Beef Breeds Council (CBBC), an umbrella organization representing the purebred cattle sector in Canada.

 

ESMA Publishes Responses To The Consultation On MAR Guidelines

MondoVisione

 

Remarks At The Meeting Of The Equity Market Structure Advisory Committee, SEC Commissioner Kara M. Stein, April 26, 2016

MondoVisione

 

JPX: Notice Of Partial Amendment To The Articles Of Incorporation

MondoVisione

 

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