July 24 2013

elb2 Have a read and enjoy, apologies for the lack of comment today as I am immersed in a Liquidnet Europe board meeting – increased pith tomorrow…

Public Markets

NYSE Submits New Disaster Plan to Regulators (subscription)

Wall Street Journal

The New York Stock Exchange is seeking regulators’ approval for a new disaster-recovery plan that would allow the exchange to close while trading in Big Board-listed stocks shifts to an all-electronic platform.

The NYSE proposal, filed with the Securities and Exchange Commission late Monday, would replace a standing plan that drew resistance from some traders last year amid Superstorm Sandy. U.S. stock markets ultimately closed for two days to wait out the storm.

London Stock Exchange Revenues Up With Sri Lanka Tech Unit

Lanka Business Online

LSE group said its technology services revenues rose 28 percent reflecting the performance of MillenniumIT, a Sri Lanka-based securities exchange software developer it owns.

Japan Court Fines Tokyo Bourse Over $400m Bank Blunder


A Japanese appeals court Wednesday ordered the Tokyo Stock Exchange to pay $107 million compensation over its failure to stop a $400 million trade blunder in 2005, upholding the initial verdict.

The lawsuit against Asia’s largest bourse was filed by Mizuho Securities — part of Japanese mega bank, Mizuho Financial Group — which demanded 41.5 billion yen ($416 million) in compensation.

The Tokyo District Court ruled that the TSE must pay 10.7 billion yen to the securities firm, saying Mizuho must bear part of the responsibility after one of its employees placed an erroneous — and very costly — order.

Spain’s BME first half net profit down 2.7 pct


Spanish stock market operator BME said on Tuesday its first-half net profit fell 2.7 percent to 72 million euros ($95 million), hit by a decline in trading volumes.

Hong Kong ETF Turnover Surges 80% During First Half (subscription)

Financial News

Trading of exchange-traded funds in the Hong Kong market increased 80% during the first half of 2013, compared with the previous six months, as investors flocked to access mainland Chinese stocks.

Philippine Financial Industry Not Ready For Asean Integration By 2015


Financial industry executives today said the Philippines needs more time to prepare for Asean economic integration by 2015.

Philippine Stock Exchange president Hans Sicat said the local bourse is unlikely to join the planned integration of Asean exchanges two years from now.

The PSE has yet to begin the planned merger of its trading platform with that of the Philippine Dealing System (PDS).

Private Markets

Dark Pool Trading ‘Drops Off Cliff’

Sydney Morning Herald

Dark equity trading has slumped 40% after the securities regulator introduced a rule in May banning such trades unless they beat the best public quote.

The regulator now requires such trades to achieve a better price than public venues by at least one tick size, or occur within the midpoint between bids and offers. Dark pools are private venues that don’t display prices until after trades take place.

PLY: A vitally important story and especially one for the EU to consider. The Australian rule seeks price improvement to materially permit dark pool trading. To that end, Institutional Liquidity Pools such as Liquidnet are maintaining their business as they materially improve price for large block traders – a key point for the EU to consider in the autumn for their future regulatory issues!

US Dark Pool Transparency To Drive Key Policy Issues

The TRADE News

A move to increase public reporting of dark pool volumes by US regulators could lead to greater understanding of the execution venues, which would inform key regulatory initiatives.

While dark pools are key to many institutional investors’ trading strategies, an absence of standardised trading data has helped to fuel negative perceptions of off-exchange trading and limited the ability of watchdogs to craft a sustainable regulatory framework.

LME Denies Warehouse Policies Have Driven Up Metal Prices


LME refuted on Tuesday suggestions that its policies on warehousing had driven up prices for aluminium or caused a shortage of metal.

The LME, the world’s largest metals marketplace, also said it had no legal right to prevent trading companies from owning warehouse companies or capping the rent they charge to store metals in their depots.The comments come as the U.S. Senate banking committee began a hearing on Tuesday to discuss banks’ ownership of physical operations from metals warehousing to power plants.

Industrial users have been increasingly frustrated over the past three years as stockpiles of aluminum and other base metals have built up in warehouses that are part of the LME network, leading to big log jams and lengthy queues.

PLY: True LME don’t control the warehouses but they can certify others which are more efficient surely?


Airtel Money To Support Madagascar Commodities Exchange


Airtel Madagscar has signed a contract with the Mercantile Exchange of Madagascar (MEXM) to set up a modern, reliable and secure payment system. MEXM customers will be able to use Airtel Money to register with the exchange, to follow raw material prices in real time, and to make online payments for all their stock market transactions.

Career Path

Turquoise Chief Set To Join BAML (subscription)

Wall Street Journal

Natan Tiefenbrun CEO of LSE’s Turquoise, MTF has resigned and is set to join Bank of America Merrill Lynch (BAC).

His resignation comes two months after it emerged in May that the LSE had hired a senior BAML executive into a newly-created role as its head of equities. Brian Schwieger, BAML’s head of execution services, is set to join the LSE as its head of equities next month.

Dr. Peter Leukert Joins FIS to Lead Transformational Thought Leadership for Global Financial Institutions

The Herald | HeraldOnline.com

Key Facts named German CIO of the year in 2011, Dr. Peter Leukert joins FIS after successful roles as Global CIO of NYSE Euronext and CIO of Commerzbank. Dr. Leukert will focus on strategy and transformational thought leadership for global financial institutions.

As part of his new role, Dr. Leukert will lead the company’s strategy and thought leadership initiatives related to the unique transformational needs of global financial institutions.

Financial Calendar

NASDAQ OMX Group (NDAQ) Set to Announce Quarterly Earnings Today. Earnings Conference Call At 8:00 AM ET
GFI Group (GFIG) Set to Announce Earnings tomorrow

Analyst Notes

London Stock Exchange Group Plc’s “Overweight” Rating Reaffirmed at Barclays Capital

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

All Analysts, Banks and Brokers are welcome to contribute to this section.


New Crowdfunding Site Builds a Buzz for Businesses


A new online site is making it easier for investors to find businesses worth committing their money to.

Seederella.com is first industry-wide crowdfunding search engine that compiles projects from hundreds of different crowdfunding sites into one location. It lets users search and browse crowdfunding projects from a variety of platforms, such as Kickstarter, Kiva, RocketHub and Crowdcube, all in one place.

Crowdfunding Site Crowdcube To Partner With Innovation Warehouse

Crowdfund Insider

Startup accelerator Innovation Warehouse and UK based equity crowdfunding company Crowdcube have announced a formal partnership in their shared mission of growing and building innovative companies.

Luke Lang, co-founder of Crowdcube, said “There’s a massive affinity between Crowdcube and Innovation Warehouse, not only in terms of helping brilliant new ideas become reality, but also in terms of our ethos and approach.”

Innovation Warehouse, which has sites in London and Portsmouth, brings togetherentrepreneurs, investors and innovators to provide startup accelerator programmes as well as shared office space and co-working on a not-for-profit basis.

Crowdfunded Gun Buyback Program Launching In San Francisco


Crowdfunding is typically used to finance projects related to the arts or technology, but the funding model made famous by Kickstarter is now being used to take guns off the streets of San Francisco.

The founders of Gunbygun.org say their site creates a market-­based system that allows online funders to take guns out of their communities in a way that hasn’t been possible before.

“It’s funny, because people are paying to have less of something around them,” Ian Johnstone, co-founder of Gunbygun, told ABC News/Univision. Johnstone, a technology entrepreneur, formed the site with Dr. Eric King, a researcher at UC-Berkeley.

Other Stories

Forbes: Year-Over-Year Global Exchanges On the Rise, Soft Q2

The Options Insider

In a 2013 quarter-over-quarter comparison of financial exchanges, the Dubai Financial Market had the strongest performance with a second quarter rise of 62.1 percent versus the first quarter’s 3.6 percent, according to Forbes.

For year-to-date figures, the winner was the newbie, the Japan Stock Exchange, whose share price jumped 102.8 percent through June 29, 2013, according to the FTSE Mondo Visione Exchange Index.

These numbers came as the second quarter figures reflected softer values as public exchanges saw their share prices decline compared to the first quarter.
In addition, for the U.S. exchanges in the second quarter, their share values also rose.

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