February 03 2016

elb2Out in ‘BigWorld,’ Hillary Clinton apparently won six consecutive coin tosses in Iowa the other day – with luck like that no wonder her brief futures trading experience had such stellar results…

At the same time, it does cause pause for concern. Next year the free world may inaugurate a new leader who has been chosen by a random process of chance in the early stages. Moreover, in this socialist age of the Democratic party lurching left, nobody even sees the economic value in building the process commercially. This knife edge conclusion is surely an ideal topic for a big league game show, with lots of tension and razzamatazz before the dimes defy gravity and hit the deck. Hey it could make great tv with a suitably high profile presenter. Er, like Donald Trump for instance…

Meanwhile, back in the market infrastructure parish, FCA prepares a crackdown on the retail leveraged (CFD/forex) field – hooray! – and there’s more, happy scrolling:

Public Markets

Playtech Looking At OpenBet Acquisition After Being Spurned By Plus500 & AvaTrade

LeapRate

After failing to acquire retail forex brokers Plus500 and AvaTrade late last year, online gaming and forex giant Playtech is apparently perusing rival OpenBet.

 

ICAP – Statement Regarding Transaction with Tullett Prebon

ICAP

ICAP notes the statement made by Tullett Prebon and confirms that it has also received a request for additional information and documentary material from US DoJ.

PLY: So far everything routine.

 

FCA Fires Warning Shot At Spread Betting Firms

Huw Jones – Reuters

FCA published on Tuesday a “Dear CEO” letter sent to firms selling so-called CFDs such as spread bets and “rolling spot” forex. Such letters from the FCA are often a last chance before enforcement action is taken.

PLY: Last chance saloon, drink up, prepare for a raid…that’s essentially the context behind a “Dear CEO” letter and for much of the murky leverage retail product market, it cannot come too soon, the FCA are right to be cracking down here.

 

Outlook 2016: A Fine Dark Pool Mess

Phil Albinus – Traders Magazine

After regulators dropped hints in 2014 that dark pools were going to be under greater scrutiny, the hammer finally came down. Last summer saw a wave of record fines for duplicitous or outright illegal activity with so many zeroes that one could be excused for thinking that the numbers came from Hollywood movie budgets.

 

NYSE Wants To Abandon Rule Some Say Contributed To Wild Session

Annie Massa & Dave Michaels – Bloomberg

NYSE wants to eliminate Rule 48, which the NYSE declares on volatile days with the goal of ensuring orderly trading. But it may have backfired on Aug. 24 by leaving traders in the dark about prices.

 

Esma Finalises New Settlement Rules (subscription)

James Rundle – Financial News

Esma has published long-awaited regulatory technical standards on settlement within markets in the European Union, providing details on who should pick up the tab for a failed trade.

 

Eurozone IPOs Set To Outpace US In 2016 (subscription)

Gavin Jackson & Nicole Bullock – Financial Times

 

MOEX Partners With Caderus Capital To Attract Chinese Investors, Issuers

Maria Nikolova – LeapRate

The collaboration seeks to develop MOEX’s ties with the investment community in China and to attract Chinese investors and issuers to the Russian market.

 

Sebi Sets Up Task Force To Review Commex Norms

Business Standard

Sebi has decided to review the existing risk management systems, delivery mechanisms and procedures for supervising warehouses by commodity exchanges. The task force, will submit its report in three weeks.

 

Transaction Tax, Shorter Trading Hours Bog Indian Market

Palak Shah – The Economic Times

Slashing the securities transaction tax (STT) and stamp duty on equity derivatives and extending trading time for currency futures are among the key recommendations given by an expert committee to the finance ministry ahead of the 2016 budget.

 

HKEx Listing Document Simplification Guide

HKEx

 

SGX Revises Calculation Methodology For Minimum Trading Price Requirement

MondoVisione

Private Markets

Taiwan SE Removes Day Trading Restrictions For Almost All Securities

MondoVisione

 

World’s First Bitcoin Mining IPO Falls Short

CNBC

The world’s first fundraising for an IPO of a company that “mines” bitcoins has raised 5.9m AUD ($4.2m) — far off its target of 20m AUD ($14m). The Bitcoin Group, based in Melbourne, Australia, announced on Tuesday that it had raised 5,927,168.40 AUD in a bookbuild for its listing on ASX.

PLY: At issue was really the way the BTC mining operations were hot a year or more back and margins have been hugely squeezed. Nowadays mining is quite concentrated and electricity prices are a very key factor.

 

Kraken Secures Investment From Japan’s Leading VC Firm

CCN

Bitcoin exchange Kraken revealed it had secured a “multi-million dollar agreement” with SBI Investment. Exact terms weren’t disclosed.

Special Section: FTI, NSEL, India at the Crossroads

PLY: MCX off 3%, FTIL down 2%.

Technology

Goldman Sachs Backs Blythe Masters Blockchain Startup (subscription)

Anna Irrera – Financial News

Goldman Sachs and IBM have joined the group of large firms backing the blockchain startup led by JP Morgan’s former commodities chief Blythe Masters.

PLY: Adding to the 13 names from last week, which only makes my thesis more pertinent, as expounded in EI Premium.

 

Nasdaq to Deliver SMARTS Trade Compliance Technology to Koch Supply & Trading

Nasdaq

 

This Man Wants To Upend The World Of HFT

Anora Mahmudova – MarketWatch

PLY: Profile of Eric Scott Hunsader, and NANEX, interesting reading.

Products

JSE Offers Protection Against Price Risk For Participants Exposed To Beef Carcass Prices With A Beef Derivatives Contract

MondoVisione

PLY: Good trade for a JSE commodity franchise begun by SAFEX when the post Apartheid government had to abandon the unwieldy, expensive subsidy regime.

 

EEX Exchange Looks Beyond Freight To Steer Through Dry Shipping Storm

Jonathan Saul – Reuters

Cleartrade Exchange is expanding its commodities business, aiming to boost fertiliser and bunker fuel derivatives activity after a lukewarm reception for its dry freight futures, partly due to turmoil in the shipping market.

PLY: Singapore-regulated Cleartrade, 52% owned by DB1’s EEX, is in an interesting position albeit at a tricky point for freight…

 

NCDEX Begins Probe In Castor Seed Issue

The Hindu

With Sebi seeking explanation for suspending futures trade in castor seeds, NCDEX on Monday said a probe by an external audit firm has been initiated into the role of brokers and individual traders.

 

Sebi To Set Up Panel To Improve Derivatives Market Functioning

TOI

Sebi has decided to set up a high-level eight-member committee to improve the derivatives market functioning. The Commodities Derivatives Advisory Committee (CDAC), will be responsible for improving transparency and expand the number of players in the market among others.

Indexes

CBOE to Begin Overnight Dissemination of CBOE Volatility Index (VIX)

CBOE

 

ESMA Updates On Supervisory Work On Closet Indexing

MondoVisione

 

New Inflation-Linked Index Launched By BM&FBOVESPA And S&P Dow Jones Indices

MondoVisione

Career Paths

The Trade reports that LSE has named a new ten-man BoD for its new interest rate futures exchange, CurveGlobal.

The board consists of some Europe’s most senior derivatives bankers, as well as the CEO of the LSE, Nikhil Rathi, according to company filling’s.

BNP Paribas has also become the latest investment bank to purchase a stake in the venture, and joins the likes of Barclays, Bank of America Merrill Lynch, Citi, Goldman Sachs and Societe Generale which have all invested in the new exchange.  

Joining the board are Gaspard Bonin, deputy global head of derivatives for BNP Paribas; Ashlin Kohler, director for EMEA rates and credit ecommerce at Citi; Richard Sears, global COO of macro rates and trading for Barclays; and John Deters, chief strategy officer at the CBOE, among others.

Last year, the LSE took on industry veteran Cathryn Lyall as the venture’s new COO. The exchange group is still in the interview process in appointing a new CEO of the venture…

PLY: The lack of Rita-Curve CEO remains a surprising omission, to put it mildly… Incidentally, as I race to the airport, I seem to recall that Curve COO Cathy Lyall is also a NED at Deutsche Bank in London.

Financial Calendar

03.02 – CBOE Q4 2015 Results

04.02 – ICE Q4 2015 Results

04.02 – ITG Q4 2015 Results

04.02 – SGX 5 cents interim dividend payment date

05.02 – CME Q4 2015 Results

New! 16.02 – ISE Mercury Launch

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

Analyst Notes

TMX Price Objective Lowered By Scotiabank From C$50.00 To C$48.00 – “Sector Perform” Rating

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

Crowdfunding

P2P Loans In UK Break Through £2 Billion Barrier In 2015

Finextra

The P2P lending industry lent more than £2.2 billion in 2015 according to new figures released from the P2P Finance Association (P2PFA).

Other stories

SEC & FINRA to Hold Regional Compliance Outreach Programs for Broker-Dealers

SEC

 

FTSE Russell Expands Latin American Business With New Office In Mexico City

MondoVisione

 

Opening Remarks To The Equity Market Structure Advisory Committee Meeting, SEC Chairman Mary Jo White, Feb. 2, 2016

MondoVisione

Remarks At The SEC Equity Market Structure Advisory Committee Meeting, Commissioner Michael S. Piwowar

MondoVisione

 

HKEX CEO Charles Li: Charles Li Direct: Why Our Strategic Plan Is Important To Hong Kong

MondoVisione

 

 

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