July 31 2015

elb2

Today’s EI News is being ‘pithed’ amidst the world’s largest rally of Citroen 2CVs – some 3000 are here in my Polish eyrie today. (For our American readers, that’s roughly the same collective horsepower as a couple of hundred classic muscle cars). Meanwhile, amidst the 2 stroke frenzy, there is full on four stroke action throughout the market infrastructure:

The rapid rejuvenation of SFOA continues apace. If you haven’t already, register NOW: SFOA Bürgenstock 2015. My Crossfire panel will open proceedings on the morning of September 23rd with a fantastic line-up: OCC CEO Craig Donohue, ICE’s European supremo David Peniket, NASDAQ’s head honcho in Stockholm, Magnus Billing and former Swiss Exchange boss Christian Katz will join me in Geneva for what promises to be a fascinating opening to a great event. Burgenstock needs our industry support this year – join me as we collectively complete the prodigal son repo trade. Europe’s leading derivatives conference back on an upswing.

…My latest RT column, a global macro missive  is now online too: Is This As Good As It Gets?

Today, Tel Aviv set to demutualise, CME results, DB1 hybrid completed, bidding war for IDC looming?  …and lots more, let’s get scrolling:

Public Markets

CME Q2 2015 Results

CME

vs Q2 2014: revenues $820 mln, up 12%, operating income $495.1 mln, up 20%, net income $265 mln, up 0.4%, EPS diluted 0.78

CME CEO Phupinder Gill on Q2 2015 Results – Earnings Call Transcript (subscription)

Seeking Alpha

BME H1 2015 Results

BME

vs H1 2014: revenues €181.3 mln, up 7%, net profit €91.6mln, up 9.3%,  EBITDA €128.8 mln, up 7.7%

DB1 Places Hybrid Bond Of EUR 600 Million

DB1

Financing of STOXX transaction completed.

Topic discussed yesterday. EI reported earlier this week that DB1 successfully concluded the negotiations regarding the full acquisition of STOXX AG & Indexium AG from SIX Group

Read our Premium Exchange Deals Brief and Index Companies Deals Brief

ATHEX To Reopen Monday, After Bank IT Tests

Kathimerini

Athens Exchange will reopen on Monday, the head of the Capital Market Commission, Costas Botopoulos, said in an interview.

Nasdaq, Markit Have Expressed Interest In IDC (subscription)

Gillian Tan & Bradley Hope – Wall Street Journal

Nasdaq, Markit and some private-equity firms are among potential suitors eyeing Interactive Data Corp. (IDC). Company could be worth $5 billion, including debt ($2.2 billion of debt outstanding as of March 31).

Sarao Said To Seek Bail Again 3 Months After Flash-Crash Arrest

Suzi Ring – Bloomberg

Read our Premium The Kennel – Premium discussion of the “Hound of Hounslow”.

Euronext Expects New CEO “Over Summer” (subscription)

Luke Jeffs & Cian Burke – FOW

Euronext In ‘Organic’ Rather Than Predatory Growth Mode (subscription)

Financial News

PLY: Having come from total basket case to credible business in a year there is still a lot of defending for Euronext despite the recent broad TOMs victory. Optionality is considerable, despite those clarion calls of investment bankers, it doesn’t have to involve M&A, certainly not yet anyway…

ITG Shares Plunge On Likely Dark Pool Settlement With Regulators

Reuters

ITG’s Dark Pool Fine Explained (subscription)

Financial News

FAO: ITG said yesterday it may pay a record penalty of $20.3m to SEC for violations at a prop trading pilot ITG ran in 2010 and 2011.

China Watchdog Probes Automated Trading As Stocks Slip Again

Samuel Shen & Pete Sweeney – Reuters

China Regulator Seeks Trading Records From Chinese, Foreign Brokerages

Michelle Price & Pete Sweeney – Reuters

China is asking foreign and Chinese-owned brokerages in Hong Kong and Singapore to hand over stock trading records, extending its pursuit of investors shorting Chinese stocks to overseas jurisdictions.

Read our Premium China Capital Markets Transformation Brief – Main File.

PLY: Whatever the Cantonese/Mandarin is for “blamestorming” it must be amongst the most used set of characters in the Chinese language currently, at least in government circles. QV My global macro missive: “Is This As Good As It Gets?

U.S. Must Wait For EU Hedge Fund “Passports”

Huw Jones – Reuters

EU faces a regulatory spat with the US after ESMA said it could not give U.S. hedge funds a “passport” to operate across the EU. ESMA said it could not recommend giving a passport to hedge funds from the US because it risked creating uneven competition.

PLY: Equivalence, physicality and related presence terms with a whiff of hypocrisy on all sides… it makes the latest trans-Atlantic regulatory slip resemble a Kardashian-style reality show, only with grey participants.

LSEG Signs Agreement With Casablanca SE (CSE) To Launch ELITE In Morocco

LSEG

PLY: An interesting move – the difficulty is the equivalence (that word again) of the corporate regimes. AKA Morocco still hasn’t got to banging the rocks together to enable small business and its French colonial legacy doesn’t help. However LSE is at least trying to promote capitalism.

CBOE & SGX To Launch CBOE Options Institute At SGX

PRNewswire

“CBOE Options Institute at SGX” is expected to launch in Q4 2015.

Tokyo SE: Compliance With IOSCO Principles For Financial Benchmarks

MondoVisione

ESMA Publishes Responses Received To The Consultation On Virtual Currencies And Distributed Ledger Technology

MondoVisione

To view the responses, please see the consultation page.

Private Markets

SunGard Data Systems Q2 2015 Results

SunGard

vs Q2 2014:  revenue $687 million, up 2%, operating income $108 million, up 43%,  adjusted EBITDA $178 million, up 12%

Read our Premium SunGard IPO Brief.

Best Efforts Bank Acquires Stake In Saint Petersburg SE

Reuters

…Acquires 12.3398% stake.

PLY: Alas no St Petersburg trips on the horizon for me but I ought to be back at the Moscow Open Innovation Forum in October.

TASE Gets Members’ Approval To Become For-Profit

Reuters

Banks To Get 70% Stake In TASE

Haaretz

Tel Aviv SE (TASE)’s board approved a compromise Thursday to allocate 70% of the stock it will issue when it becomes a LLC to its bank members (foreign banks including Citigroup, UBS and HSBC). The remaining 30% would go to brokerage houses and foreign financial services companies.

BATS Files Client Suspension Rule To Expedite Action Against Customers Engaging In Layering & Spoofing

BATS

BATS Takes Step To Crack Down Promptly On Market Manipulation

John McCrank – Reuters

BATS said its “Client Suspension Rule,” which requires approval from the SEC, would allow the company to halt manipulative conduct within weeks of detection, rather than the years it takes under the current regulatory process.

PLY: Good step forward…

KRX & KPX Agreed To Cooperate In Attaining The National Greenhouse Gas Emissions Reduction

MondoVisione

SET To Help YSX Establishment

Khine Kyaw – Myanmar Eleven

Stock Exchange of Thailand (SET)  is ready to help the Yangon SE (YSX), which Myanmar in cooperation with Japan’s Daiwa Securities Group plans to launch after the November 8 elections.

Read our Premium ASEAN Exchanges Project Brief.

Tanzania: Dar Set For Commodity Bourse

allAfrica

Read our Premium Rise of Africa Brief – Part 5.

Dividend News

BME will distribute on September 11 a gross €0.40 per share, its first interim dividend against 2015 earnings.

Special Section: FTI, NSEL, India at the Crossroads

PLY: MCX up 2%, FTIL flattish.

NSEL Crisis: Role Played By FMC, Other Agencies

Business Standard

How FTIL Lost Face In The Two Years Since NSEL Crisis

Ashish Rukhaiyar – Livemint

The last two years saw FTIL sell its stake in MCX, MSEI and IEX even as it is fighting various legal battles to claim its right to own an exchange in India.

PLY: A very polite description given that Jignesh Shah’s company has been seen to plummet in the eyes of the rest of the world…

Two Years Of Blame Game, Legal Tangles

Business Standard

After NSEL suspended trading on July 31, 2013, following a government diktat, there was a Rs 5,600-crore ($900 mln) payment default by borrowers of funds against pledging of commodities. In these two years, only about 10% of the dues have been cleared.

Read our Premium NSEL Scandal Brief – Main File.

PLY: The Indian blob has, with much energy and remarkable amounts of application, so far delivered a sensational 100% all round “lose lose” to everybody involved…with knock on damage to India Inc as a whole. That takes organisation.

Technology

TMX’s Eccleston Talks HFT, Says It’s Not Going Anywhere

Waters Technology

TMX CEO Lou Eccleston shares his thoughts on HFT and why the industry needs to learn to accept it.

JPX Published An English Version Of JPX Working Papers, Vol.4 “Analysis Of HFT At TSE”

MondoVisione

Products

CME Denies Problem With Soy Crush Spread After Futures Pits Close

Reuters

CME surveys of market participants show they are satisfied with their ability to electronically execute the transactions, known as crush spreads.

CME Spared Open-Outcry Options Traders, But for How Long?

Brian Louis – Bloomberg

Is CME starting to lose its rationale for letting options traders stick around the pits, yelling and waving their hands to buy and sell the contracts?

FAO: CME ended open-outcry trading in most of its futures markets earlier this month.

ICE Has Options In Evolving Rates Market (subscription)

William Mitting – FOW

India – Bourses To Launch New 6-Year, 13-Year Government Bond Futures

NDTV

ADX, DME Explore Possibility Of Stock Futures

Hadeel Al Sayegh – Reuters

Abu Dhabi Securities Exchange (ADX) is considering introducing with the Dubai Mercantile Exchange (DME) f&o contracts for specific Abu Dhabi stocks as well as market index futures.

Career Paths

Bloomberg reports that ICAP is revamping the management of EBS BrokerTec with Dan Cleaves and Darryl Hooker appointed to jointly run EBS BrokerTec Markets. Phil Harris, previously of Nasdaq and 360T, becomes head of EBS Market. (press release here)

Reuters reports FCA named Megan Butler as director of supervision from September for a year. FCA’s current director of supervision for wholesale markets, Tracey McDermott, will become acting CEO of the watchdog while it finds a new CEO to replace Martin Wheatley, who is leaving mid-September.

FCA appointed the Director of Strategy and Competition, Christopher Woolard, to its Board.

Bloomberg reports that BlackRock elected Gordon Nixon, the former President & CEO of Royal Bank of Canada, as an independent director.

Bloomberg reports that Citadel hired a team from hedge fund Two Ocean Capital for its equities group that will start trading later this year. Joel Revill and his two analysts will cover consumer stocks and will start at Citadel’s new unit Garrison Capital group in October.

ESMA: New Consultative Working Group For The Investor Protection & Intermediaries Standing Committee

MondoVisione

Following the call for interest for the renewal of the Consultative Working Group for the Investor Protection and Intermediaries Standing Committee, ESMA announced the composition of the new group.

ESMA Vacancy Notice – Senior Policy Expert (Deadline 9 September 2015)

MondoVisione

Deadline: 09/09/2015. Please refer to our vacancy page for the details on this position (Ref.2015/VAC17/AD9) and how to apply.

ESMA Vacancy Notice – Head Of Corporate Affairs Department – Deadline 15 September 2015

MondoVisione

Deadline: 15/09/2015. Please refer to our vacancy page for the details on this position (Ref.2015/VAC14/AD10) and how to apply.

PSU Bank Nominees On MCX-SX Board Get CAG Flak

Business Standard

Financial Calendar

Today – CBOE Q2 2015 Financial Results

Next week

Aug 04 2015- Lending Club Q2 2015 Financial Results

Aug 05 2015

ICE Q2 2015 Financial Results

TMX Q2 Financial Results

Aug 06 2015 – FXCM Q2 2015 Results

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

Analyst Notes

Deutsche Bank Reaffirmed Their “Buy” Rating On Charles Schwab – $42.00 Target Price

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

Crowdfunding

Numis To Partner With Crowdcube To Offer Retail IPO Access (subscription)

Financial Times

Crowdcube Ready To Take On IPO Market With £6m Investment

Startups

Crowdcube has secured £6m funding in a deal led by Numis and Draper Esprit, alongside existing backers Balderton Capital.

FAO: This comes after Seedrs raising $15.6 mln to launch in US (reported yesterday).

Other stories

Small Investors Need Not Stay Away From Stock Market: SEBI Chairman

Business Standard

Highlighting the long term growth prospects of the Indian stock market, SEBI Chairman U K Sinha urged small investors to invest in the same through mutual funds and pension schemes.

A Shipping Disaster’s Lessons For Dodd-Frank (subscription)

Randall Kroszner – Financial Times

Beware of unintended consequences and cost-benefit trade-offs.

PLY: A brilliant, erudite explanation with an elegant historical metaphor which alas is far too obvious for the boneheaded bloated blob class of linear committee dwellers who have created the current anti-enterprise fiasco masquerading as a regulatory system which is merely a bludgeon against progress, created due to the ongoing myopia of a tired and incapable political class.

Global Stock Markets Can Deliver Robust Returns Despite FX Swings

Reuters

Cass Business School, Bank of England and City University Hong Kong study used data from more than 40 stock markets, observed over 30 years.

 

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