August 10 2015

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Monday morning dawns and if you are in the derivatives world, have you registered for Burgenstock yet? Plaudits to GMEX, who had a smooth launch Friday with some trading, as they scale up for more business after summer.

Elsewhere, FTIL and MCX quarterly losses contrast with an interesting profile of the NSE CEO. Norway Wealth Fund places in print arguments previously seen at FESE Convention – “it’s the blocks, stupid” to paraphrase the more competent end of the Clinton family. German socialist eager for FTT to destroy European capitalism and there’s more, including the New York exodus provoked by the overly prescriptive ‘Bit licence,’ happy scrolling:

Oh and if your Romanian is remotely fluent, an interview with me in their national financial newspaper “Bursa” can be found here.

Public Markets

MCX Reports Rs 34.26 Crore ($5.34 Mln) Loss In April-June Quarter

The Economic Times

MCX reported a loss of Rs 34.26 crore ($5.345 mln) for the April-June quarter of 2015-16 mainly due to an exceptional provision and loss of Rs 59.4 crore ($9.3 mln) related to its investment in Metropolitan Stock Exchange of India.

FTIL Reports Rs.34.15 Crore ($5.35 Mln) Loss For June Quarter

Ashish Rukhaiyar – Livemint

Loss of Rs.34.15 crore ($5.35 mln) for the quarter ended 30 June. The company had posted a profit of Rs.128.25 crore ($21 mln) in the year earlier because of a one-time gain of Rs.129 crore ($21.1 mln) due to sale of assets.

Total income fell to Rs. 35 crore ($5.49 mln), down 21%.

CBOE Completes Acquisition Of Livevol Data, Analytics Platforms

PRNewswire

CBOE has finalized the acquisition (announced in June) of the market data services and trading analytics platforms of Livevol, effective August 7.  Financial terms were not disclosed.

Read our Premium Exchange Deals Brief.

Stock Exchanges Must Improve Trading Model – Norway Wealth Fund

Reuters

Global stock exchanges are failing to meet the needs of large institutional traders and are increasingly losing out to private equity when companies seek to raise cash, the world’s largest sovereign wealth fund said in a report published on Friday.

PLY: A highlight of the FESE Convention in Oslo was a concise presentation by Yngve Slyngstad of the Norwegian SWF which as it has circa $875 bln under management and owns around 1.3% of listed shares globally, ought to be listened to. The message is similar to what it was in Oslo: “it’s the blocks, stupid.”

As an amusing aside, Europe’s large Institutional Liquidity Platforms Liquidnet and ITG were not at the event while LSE is curiously agnostic to FESE in its supplicancy to banks. At least they can now read this report some weeks later…

German Politician Calls For Momentum On FTT

Reuters

PLY: Leading German SPD politician Thorsten Schaefer-Guembel told Bild am Sonntag:

“The financial transaction tax must come as quickly as possible. It can’t be that those who caused the financial crisis escape responsibility with the solution,”

…Good point: when will we see the politicians in the dock like the spendthrift Gordon Brown of Britain? …I still don’t follow why the political classes are determined to destroy the savings of their citizens though…

Read our Premium EU FTT Brief Part 2.

Private Markets

Chitra Ramkrishna: ‘All Competition Inspires Me’

Mobis Philipose & Ravi Krishnan – Livemint

PLY: Correct answer from the most powerful woman in world exchanges. Interesting comparative: NSE net profit is 6.5 times that of BSE…

Stock Exchanges From Accra To Lagos Unite To Allow Cross-Border Trading

Mail&Guardian – Africa

Ghana, Sierra Leone and Nigeria link their exchanges to facilitate cross border trading.

Read our Premium Rise of Africa Brief – Part 5.

Bitcoin Exchanges Kraken & Bitfinex Cut Services In New York

Pete Rizzo – CoinDesk

Kraken and Bitfinex have indicated they will not be applying for licenses to operate in New York.

Bitcoin Exchange Bitstamp Applying For BitLicense

CryptoCoinsNews

FAO: More about Lawsky’s BitLicense release here.

PLY: The BitLicense it is clear already is a divisive failure which is harming New York’s financial district, driving business to the other states and even to Europe. Mr Lawsky’s analogue 1970’s industrial regulatory approach has no place in modern markets but then again this is the city whose Mayor thinks Uber is bad for it. New York is at risk of cutting itself adrift from the future of finance.

Dividend News

FTIL interim dividend of Rs.5 per share.

Special Section: FTI, NSEL, India at the Crossroads

PLY: MCX is off 2%, FTIL down 3.5% while the broad market was off 0.5%.

FTIL, NSEL Merger Delayed For 3 Months Till Oct 31

Prerna Baruah – Moneycontrol

The Bombay High Court has extended the deadline for the merger between FTIL and NSEL to October 31. This comes after the Ministry of Corporate Affairs alleged that FTIL was purposely delaying the process.

PLY: Indian corporate governance suicide postponed.

Writ Petition Against Govt On NSEL & FTIL Amalgamation

dna

Read our Premium NSEL-FTIL Merger Brief and NSEL Scandal Brief – Part 16.

Technology

Asset Managers Jump Into Bond Market Utility Neptune Project (subscription)

Philip Stafford – Financial Times

Neptune, a not-for-profit utility (which went live Friday), backed by a wide range of financial institutions including Goldman Sachs, Morgan Stanley and State Street Global Advisors, is the most widely-supported attempt to overcome fears of a dearth of liquidity in fixed income markets.

Algorithmic Trading: The Play-at-Home Version (subscription)

Austen Hufford – Wall Street Journal

Building computer trading models has become the latest DIY craze.

PLY: Did this story drop through a wormhole from 1992? Even by the low standards of the dead tree press, this story has a certain latency…

Products

ADX Eyes Derivatives Market Launch In 3 Years

Sarah Diaa – Gulf News

Vietnam Set To Open Derivatives Market Next Year

Thanh Nien News

Indexes

China Market Turmoil Could Delay Hong Kong Futures Plan

Michelle Price – Reuters

PLY: Readers may recall how years ago Japanese officials did everything but beat the table with their shoes at a meeting where SGX politely but firmly insisted on maintaining trade in the Nikkei futures, which, as always, incapable politicians sought to scapegoat in the blamestorming swirl of a bear market.

As TASE Trading Volume Drops, The Stock Exchange To Revamp The Indexes

Dror Raich – Haaretz

TA-25 to become TA-35; TA-100 expanded to TA-125 as benchmarks will widen in bid to up trading volumes.

Career Paths

In the wake of losses from the Swiss Franc revaluation kerfuffle, FT reports that Chris Hill, CFO of IG Group, has become the second senior executive in a month to announce his departure from the group, saying he will leave early next year for FTSE 100 fund manager Hargreaves Lansdown. Previously, Tim Howkins, IG’s CEO, announced his retirement after nine years running the company.

FCA Changes Spark Staff Exit Fears (subscription)

Financial News

It is hard for FCA to keep talent: it cannot compete on pay and recruiters say the changes at the top are unsettling

PLY: The FCA, having gone through vast salary inflation has failed to deliver appreciably better service or competence. Making decisions outside of a core box ticking mentality remains broadly 7 sigma (in the purest sense of the phrase). Management is required, not throwing more money at a broken system.

FCA Top Spot: A Job Few People Would Want (subscription)

Financial News

The list of those capable of doing Martin Wheatley‘s job is already short. Cut it to those who would want to, and it shortens again – possibly to zero.

PLY: Problem is one of definition. The ability to reshape regulation in a way which works for the population has already been broadly missed, despite sounds efforts by some within the FCA. Given carte blanche and management control, there is huge opportunity to make a better market for all – if that is abandoned then London too is easing itself away from the future of finance.

Financial Calendar

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

Analyst Notes

ICE “Buy” Rating Reiterated By Deutsche Bank – $256.00 Price Objective, Up From $252.00

ICE “Hold” Rating Restated By Standpoint Research –  $257.00 Price Target

NASDAQ OMX “Hold” Rating Reiterated By Standpoint Research – $58.00 Target Price

CBOE “Hold” Rating Restated By Standpoint Research – $60.00 Target Price

AlphaValue Reiterated Their  “Add” Rating On LSE – GBX 2,788 Target Price

TD Securities Decreased Their Price Objective On TMX From C$62.00 To C$58.00 – “Buy” Rating

TMX Target Price Reduced By Scotiabank From C$56.00 To C$55.00

A full table of current analysis can be found on our Analyst Ratings page which is updated daily.

Crowdfunding

P2P ‘Land Grab’ Draws More Than 100 Startups (subscription)

Judith Evans – Financial Times

Some 114 companies have sought full authorisation since FCA took over regulation of P2P last year, while 178 companies have interim permission to operate, according to figures obtained from the FCA by Bovill, a regulatory consultancy. The numbers far exceed an estimate by the FCA at the end of last year that 56 platforms were in operation.

PLY: Here is one area where the FCA has not done badly and hence the opportunity remains alive while all too many regulators are trying to kill it.

Crowdfunding Sites Aim To Make The Law Accessible To All (subscription)

Jonathan Ford – Financial Times

PLY: The fascinating case of legal crowdfunding, a mixture of hard investment and a little dose of philanthropy…

Other stories

IOSCO Publishes Report On Post-Trade Transparency In The Credit Default Swaps Market

MondoVisione

Additional Dissenting Comments On Pay Ratio Disclosure, SEC Commissioner Michael S. Piwowar, Aug. 7, 2015

MondoVisione

 

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