January 14 2016

elb2Welcome to Issue number 666 albeit not a beast of an Exchange Invest Daily but a brief sampling of pith and insight.

A slight housekeeping kerfuffle means my Malta FinTech briefing will now take place Monday, February 1st, not as previously suggested: Details here, all welcome, an RSVP would be helpful too, please. This is a rare public briefing of the kind I do frequently in private – if you would like to book one on this or related market infrastructure / exchange topics, get in touch.

In today’s bulletin, Goldmans are backing IEX as the battle for the soul of capitalism continues. As one experienced HFT hand put it the other day “if IEX want to risk their money on a market, let’s see if they can profit.” Amen to that…

Public Markets

Goldman Sachs Throws Support Behind IEX Exchange Application

Channel NewsAsia

Goldman Sachs Group has thrown its support behind upstart trading venue IEX Group’s bid to become a U.S. stock exchange, asking regulators to use the opportunity to address broader issues related to how the market is structured.


European Dark Pools Expand In Face of Rules Limiting Their Use

John Detrixhe – Bloomberg

The region’s dark pools  enjoyed a 45% jump in the value of trading they handled in 2015, according to ITG. Public exchanges saw a 28% increase.


China’s SAFE Not Limiting FX Sales To Individuals


China’s FX regulator has said it is not placing limits on foreign currency sales to individuals beyond the usual annual cap of $50,000.


GFI Group – Successful Completion Of Its Consent Solicitation With Respect To Its 8.375% Senior Notes Due 2018


PLY: Essentially the GFI notes are now BGC notes.


Former LSE Executive Launches U.S. Retail Brokerage Ustocktrade

John McCrank – Reuters

Tony Weeresinghe says he wants to help educate underprivileged children, and he plans to do it one stock trade at a time. The former head of global development for the London Stock Exchange Group on Wednesday launched Ustocktrade, a low-cost U.S. online retail brokerage that aims to “bring Wall Street to Main Street.” Weeresinghe started Ustocktrade, a private stock trading platform known as an alternative trading system, to help fund a non-profit organization called the Cainan Foundation that he and his wife set up to build schools for disadvantaged children. Borkerage Profits will fund the foundation’s first school in Weeresinghe’s native Sri Lanka, with others to follow around the globe, he said in an interview.

PLY: Fascinating numbers on this platform from the man who created Millennium IT which he sold to LSE.

Private Markets

CMC Float To Trigger £200m ($290m) Windfall For Founder Peter Cruddas (subscription)

Harriet Agnew – Financial Times

Peter Cruddas, the City of London tycoon and Brexit supporter, is set to make more than £200m ($290m) from the CMC Markets IPO, the spread betting company he set up in 1989. CMC said on Wednesday that it was pressing ahead with plans to float on the main markets of the LSE. The IPO, set to take place next month, is expected to value the company at about £750m ($1.08bln).


‘Eligible’ Clients Can Participate In CMC Markets’ Plans To Float On LSE Next Month

Jane Denton & Jonathon Hopkins – This Is Money

‘Eligible’ new and existing account holders will be able to participate in the float based on a tier system determined by their average trading costs per month.


NCDEX Starts Online Warehouse Space Booking

Business Standard

Integrated within its electronic commodity accounting system, COMTRACK, the system will enable a depositor to check availability and book space in a warehouse of choice, at a click, from home or office. NCDEX said the facility was also being made available on its Markets mobile app, through the Book-My-Warehouse tab.

PLY: A useful innovation, AirBnB for warehouses.


Small Somalia SE Has Big Dreams

Dinfin Mulupi – How We Made It In Africa

Somali SE started trading last September, marking a milestone for the Horn of Africa country as it seeks to rebuild its economy after over two decades of conflict and lawlessness. The stock exchange was founded by the Somali Economic Forum, an independent organisation that seeks to promote foreign direct investment into the country. QV Premium: Rise of Africa Brief – Part 5.

PLY: Another new exchange launched during 2015, as the Age of the Exchange takes hold.

Special Section: FTI, NSEL, India at the Crossroads

PLY: MCX flat, FTIL off 2%.

NSEL Recovers Rs 1,233 Cr (USD 184 Mln) From 23 Traders

The Economic Times

NSEL has claimed that it has secured recoveries worth Rs 1,233.02 crore (USD 184 mln) from 23 defaulters who owe a total amount of Rs 4,515.93 crore (USD 673 mln).

PLY: Taking far too long but at least better than nothing.


CLB Adjourns Hearing To Jan 29 On FTIL Case

K. R. Srivats – The Hindu Business Line

The Company Law Board (CLB) on Wednesday set the next hearing in the FTIL Board supersession matter for January 29, while allowing all parties concerned to file their responses and rejoinders to the matter.

QV Premium: NSEL-FTIL Merger Brief & NSEL Scandal Brief – Part 16.


Ipreo & Symphony Partner On Deal Communications Tools


PLY: This ought to be a harmonic solution for both parties with an expansion in their products.


BSE To Begin Price Reasonability Check In Equity Derivatives

The Economic Times

To strengthen its pre-trade risk management framework, BSE has decided to introduce price reasonability check (PRC) for equity derivative segment as well as currency options from January 18.

PLY: A tool to help avoid errant fat fingers.


SBI To Partner With SIDBI & NSE


State Bank of India (SBI) will partner with SIDBI and National SE (NSE) to set up a trade receivables platform to facilitate better credit flow to SMEs.

PLY: Good idea.


China Launches Interbank Gold Trading System


China launched interbank gold trading at the beginning of this year, in an effort to open up the country’s bullion market. The trading mechanism is introduced by Shanghai Gold Exchange and the China Foreign Exchange Trading System.


Office Of Financial Research Update – “The U.S. Bilateral Repo Market: Lessons From A New Survey”



KRX Published KOSPI 200 Total Return Index Series


Career Paths

Russell Investments appointed Vernon Barback as President, effective January 21. Barback will be a member of the firm’s Executive Committee, reporting to CEO Len Brennan.

Yeszhan Birtanov, Chairman of the management board at the Kazakhstan SE (KASE), resigned in connection with his transfer to another job. Natalya Khoroshevskaya, the Deputy Chairman of the KASE management board, was elected acting Chairman.

WSJ reports that Goldman Sachs is planning to cut up to 10% of its fixed-income traders and salespeople later this quarter, a steeper-than-usual pruning of the firm’s least-productive employees.

TABB Metrics, the data-driven division at TABB Group, named Paul Schmid as director of sales for Clarity, the U.S. equities best execution service.

Financial Calendar

CFTC’s Technology Advisory Committee – January 26, 2016 (press release)

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

Analyst Notes

NASDAQ OMX Price Objective Reduced By Barclays From $67.00 To $66.00 – “Overweight” Rating

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

Other stories

Six Former Brokers Acted As ‘Well-Oiled Machine’, Libor Trial Hears

The Guardian

Defendants conspired with convicted trader Tom Hayes to manipulate inter-bank lending rate, prosecution tells court.

PLY: Not clear if this refers to their alleged ability to act in concert or how much they drank – although I am sure the latter requires a lower burden of proof, these are experienced moneybrokers we are talking about, after all.


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