July 29 2013

elb2 It was great to see many readers last week and garner so much positive feedback about EI. Lots happening in the world and today in particular we have a series of fascinating crowdfunding articles. Data loss is a worry for exchanges everywhere…

There’s lots happening out there, maybe not so much of it in the news today but have a scroll, there are stories worth reading whatever your orientation in the rich tapestry of financial markets infrastructure!

Public Markets

Nasdaq, Others, Targeted by Hackers (subscription)

Wall Street Journal

Data Breach Resulted in ‘Hundreds of Millions’ of Dollars in Losses

More than a dozen companies were the target of what prosecutors described as one of the largest data breaches uncovered to date, which resulted in “hundreds of millions of dollars” in losses.

Federal prosecutors charged a cadre of Eastern European hackers with stealing credit-card information and other personal data from companies including Nasdaq OMX Group Inc.

PLY: All exchanges are frequently targeted as the recent WFE report showed…

Charles Schwab – Cautiously Upbeat

Seeking Alpha

Brokerage giant Charles Schwab Corp on Friday gave a cautiously upbeat assessment of client confidence and the outlook for interest rates, but warned investors against overconfidence about its near-term outlook

“Things are generally better than worse,” IR head Rich Fowler told analysts and investors at Schwab’s summer “business update” held just ten days after the company reported a disappointing 7 percent fall in its second-quarter profit.

Private Markets

Sebi Pushes Online Trading Of Rupee Bonds

IFR Asia

The Securities and Exchange Board of India met with market players this month to hear suggestions on improving the online trading volumes of domestic corporate bonds on the stock exchanges.

PLY: So far despite MCX and NSE listings, no increase in volatility. I remain of the opinion the problem is Indian online retail ‘investors’ seek capital gain, income is an afterthought. That requires a quantum leap in investor education.

NSE Puts Up Fight Over New Laws For Futures Exchange

Business Daily

The Nairobi Securities Exchange (NSE) has petitioned MPs to drop a new law proposed by the Capital Markets Authority (CMA) which if passed will require the bourse to apply for a fresh licence to operate the lucrative futures market.

Private Firms To Gain From Bond Futures

Global Times

Chinese regulators are hurrying to relaunch the government bond futures market after an 18-year hiatus as China tries to funnel investment into the struggling private sector and prepare to liberalize bank deposit rates, traders said.

A healthy bond futures market is a key requirement for the next, riskier step of freeing up savings deposit rates.

PLY: Be careful what you wish for may be the maxim here for China… Overall it is still progress clearly in freeing up China’s markets.

NCDEX Spot Exchange In Pact With Origo Commodities India

Economic Times

NCDEX Spot Exchange said it has signed an agreement with Origo Commodities India to provide a platform for farmers to place their produce directly on the exchange through the Primary Agriculture Cooperative Societies (PACS).

This initiative would help change the dynamics of trade and supply chain of agricultural commodities with respect to storage, commodity financing, trade facilitation and other value added services that could make farmers a key point in the entire value chain of agri-commodities.

PLY: Freeing up the small farmer to farm and remove the precarious nature of his crops through hedging and so forth is simply one of the best ways to help poorer agri-economies thrive.


CME Group Announces New Australian Dollar – Denominated Wheat Swaps

CME Group, the world’s leading and most diverse derivatives marketplace, today announced the launch of two new centrally cleared, over-the-counter (OTC) wheat swaps to be denominated in Australian dollars (AUD).
Pending CFTC review, both the AUD Chicago Soft Red Winter (SRW) Wheat Swap and the AUD KC Hard Red Winter (HRW) Wheat Swap will be available for clearing on CME ClearPort on Monday, August 12, 2013. These contracts will be listed with and subject to the rules and regulations of the CBOT.


Singapore Exchange’s MSCI India May Lure Out More FIIs

Economic Times

SGX is planning to launch the MSCI India Index Futures to provide global investors a one-stop access to Asia’s key markets, a move which could undermine the Indian government’s efforts to shift the country’s stock-related activities to the domestic market.

PLY: For one approved Foreign Investors (FIIs) may prefer the cheaper trading fees at SGX, for another most investors are locked out of India – SGX once again finds a suitable index arbitrage to exploit where local regulations are strangling the home market (qv the great Nikkei Dow table thump arguments of the 1990’s).

Financial Results/Dividend News

Charles Schwab declared a Q2 dividend of $0.06 per share to be paid on Friday, August 23rd. This represents a $0.24 dividend on an annualized basis and a yield of 1.08%.

Financial Calendar

NYSE Euronext 2Q Financial Results, tomorrow, July 30
TMX Group Ltd Q2 results will be published August 1st
CME Group Inc. will announce Q2 earnings pre-open Thursday, August 1st
CBOE Holdings, Inc.will announce Q2 results 2013 pre-open Friday, August 2
BGC Partners, Inc. financial results will be published August 1st

Analyst Notes

Citigroup Inc. raised CME target price to $82.00
Betfair stock rating reaffirmed “buy” by Societe Generale
CME stock reaffirmed “hold” by Keefe, Bruyette & Woods

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.


PLY: A series of articles today all interesting in their own way but each demonstrates that the crowd is surging forward and the regulators are failing investors and issuers alike…

3 Perspectives On Crowdfunding: 1 Message To the SEC: Ready When You Are


Robert Carbone, Michael Nall and David Loucks all come to the crowdfunding space from different perspectives but all one one message for the SEC: we’re ready to go whenever you are.

Daniel Gorfine: Crowdfunding Is Missing The Crowd

Crowdfund Insider

It’s important to note that the SEC’s recent action only addressed the sections of the law dealing with wealthy investors, not crowd investing. In fact, more than six months past its Congressional deadline to act, the SEC has still failed to even propose the regulations necessary to implement the crowd investing portions of the law.

Canadians Turn To Crowdfunding To Generate Money For All Sorts Of Causes


Crippled by mounting financial debt, father and son duo David and Brian Best had few options left to save the potato farm their family has operated in Tryon, P.E.I., since the early 1930s.

It was a customer who dropped in to Best Acre Farms to buy seed potatoes that sparked the family’s current bid to save their livelihood — crowdfunding.

MoolaHoop Launches Crowdfunding Platform Dedicated To Women Entrepreneurs


Despite the fact that women own 10.6 million businesses in the U.S. and represent 35 percent of startup business owners, they receive a piddling 4.2% of venture capital funding. This means women-owned companies tend to be smaller and grow more slowly than companies owned by men. MoolaHoop launched a crowdfunding platform for women entrepreneurs today to bridge this gap.

Other Stories

Foreign Investors Seek Growth In Zimbabwe


The Zimbabwe Stock Exchange has made 40% for investors brave enough to take on the risk despite controversial land and indigenisation policies still looming large. But they are not keen to miss out on the long-term growth story and are willing to ride out any short-term election volatility.

What’s Wrong With Indexes?

Seeking Alpha

A broad-market index matches as closely as possible the return of the overall stock market. So if funds seek to track U.S. stock market indexes and the stock market continues to set record highs like Monday, July 22nd, then why would investing in these indexes not be beneficial?

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