June 17 2016

elb2Plaudits to the Malta Stock Exchange and the inestimably excellent FESE team whose organisation remains the benchmark amongst the exchange associations for engagement, membership relative to brief and the ability to organise an excellent event. Under Chairman Deirdre Somers and DG Rainer Riess, the organisation is blossoming and the latest Convention was another excellent event. Thanks to my panellists, Joanna Cound (Blackrock), Fabrice Demarigny (Mazars), Guillaume Prache (Better Finance), Luc Vansteenkiste, (EuropeanIssuers) and Simon Zammit (the Malta SE CEO elect) who made a great impact with their pith discussing the future financing of Europe (thanks Tracey & Sara for the panel support).

On the Europe topic, I have a heap of mail to address and questions to answer so will continue the Brexit topic Monday but meanwhile you have 4 Premium briefs to catch up with:

Part 1: Brexit – Introduction

Part 2: Brexit 2 EU Dysfunction

Part 3: Spousal Abuse

Part 4: The Vote

…All written with an entrepreneurial investors’ eye.

Back to FESE, huge thanks to Chairman Joe Portelli and outgoing CEO Eileen Muscat for their brilliant organisation of the event culminating in a super soiree last evening at the exchange’s historic HQ.  Interesting statistic: the Malta SE has something over 75000 client accounts AKA one per household amongst the roughly 430000 Maltese citizens. Or put it another way, more clients trade in Malta than in Romania (population 20 million).

Amongst the many excellent speakers of the Convention, naturally Chairman Deirdre Somers shone while Veronica Augustsson, of Cinnober sparkled on fintech.. I thought Rafael Plata was a superbly elegant chairman of the CCP panel. Rafael is on top of his brief as EACH Secretary General and made the panel highly informative, even for those who may not be following clearing minutiae. Former EACH Chairman Markus Zickwolff was an excellent addition to the CCP discussion and Nick Collier’s sparkling pithy insights were a highlight of the third party regime panel chaired by WFE’s Nandini Sukumar. Christopher Buttigieg of the MFSA provided an excellent and inspiring closing address. Another great event, next year it’s Paris hosted by Euronext.

Oh and congratulations to the Irish SE, 14th best employer in Europe in their highly competitive sector at an awards gala last evening…

Public Markets

VEB In Talks To Sell MOEX Stake To Central Bank

Reuters

Russian state development bank Vnesheconombank (VEB) is discussing a sale of its 8.4% stake in Moscow Exchange (MOEX) to Russia’s central bank, Nikolai Tsekhomsky , VEB’s first deputy chairman said on Thursday. VEB, MOEX’s third-biggest shareholder behind the central bank and Sberbank, is considering selling the MOEX shares into the market.

 

German Doubts on DB1 Deal Grow as Brexit Fears Mount

Birgit Jennen – Bloomberg

German lawmakers are increasingly reluctant to see the merger of DB1 and LSE go ahead as planned if Britain decides to leave the EU.

QV Premium: DB1-LSE Merger Brief.

PLY: Brexit means DB1-LSE is DOA as the “merger of equals” notion is over 54% hyperbole while the Germans anyway are too protectionist to embrace free trade and the Hesse regulator has always been hypermarginal on agreeing anything which threatens one of their successful industries.

 

Nasdaq To Launch Non-Stop Auction Model (subscription)

Tim Cave – Financial News

Nasdaq is planning to follow rival exchange Bats Europe with a new order book that will run auctions throughout the day on its European stock markets, in an attempt to allow investors to place large orders without being picked off by nimbler traders.

PLY: Going, going, omnipresent. The winner of the FESE De La Vega prize has produced a paper arguing in favour of auctions from their research so far by the way…

 

China Probes Brokerages’ Futures Units Amid Frenzies in Trading

Bloomberg

Guotai Junan Securities, China’s third-largest brokerage by market value, said the CSRC suspects a “failure to effectively perform its duty as an asset manager,” in an exchange filing on Thursday. Orient Securities issued a similar statement Friday.

 

Shenzhen-HK Stock Connect Likely To Offer Investors Greater Diversity (subscription)

Wilson Lau – SCMP

Scheme, expected to be launched within this year, could draw more hi-tech companies from the southern Chinese city to raise capital from Hong Kong.

QV Premium: HKEx – SZSE Stock Connect.

 

Sebi To Take Action Against More Brokers For Manipulative ‘Self-Trades’

Palak Shah – The Economic Times

 

CFTC’s Market Risk Advisory Committee Announces Agenda For June 27 Public Meeting

MondoVisione

 

TABB Group: European Regulation’s Delegated Acts Will Intensify Inspection Of Research & Execution Costs

MondoVisione

 

CFTC Reopens Comment Period for Certain Elements of Regulation AT

CFTC

Private Markets

Dar es Salaam SE (DSE)’s IPO Oversubscribed Nearly Five Times

Reuters

DSE received bids worth 35.77 billion Tanzanian shillings ($16.4m) for the 15 million shares on offer worth a total 7.5 billion shillings ($3.43m) and intends to list its shares on the market’s main segment for trading on July 12.

PLY: Great result.

 

Market Coupling Key To Balkan Power Bourse Liquidity

Maja Zuvela – Reuters

Spot power exchanges launched in the Balkans this year must focus on integration to assure adequate liquidity and sustainability and help to establish reference pricing Bulgaria’s IBEX has the highest liquidity of the three, with average traded volume at about 250 megawatt-hours (MWh) a month, while the Serbian SEEPEX and Croatian CROPEX see much less trade.

Special Section: FTI, NSEL, India at the Crossroads

PLY: MCX flat, FTIL up 5%.

Technology

Canada Experiments With Digital Dollar On Blockchain (subscription)

Financial Times

Country’s central bank poised to embrace technology behind bitcoin.

Products

Nasdaq Rattles ICE’s Cage In Gas Oil Futures (subscription)

Gregory Meyer – Financial Times

One day this week almost 30% of the volume in gas oil futures, a diesel benchmark, was transacted on Nasdaq’s NFX exchange. A year ago the percentage was zero, as NFX only opened last July.  The expansion is a challenge for ICE, a commodity markets titan that relied on gas oil for $93m in revenue last year. Nasdaq has promised to charge half the fees of incumbent energy exchanges.

Nasdaq’s gas oil market contains unusual trading patterns. In typical commodity futures most volume comes from contract months that are closest to delivery. But on NFX the most active contracts are for gas oil delivered next winter.

 

MCX Gearing Up For Options Trading In Commodities, Currency Derivatives

The Hindu Business Line

MCX Eyes Product Innovation, To Launch Agricultural Offerings

Jayshree P. Upadhyay – Livemint

Product innovation and the launch of agricultural products are the key focus areas for Mrugank Paranjape, the new MD & CEO of MCX.

 

World’s First Tea Futures Contracts May Be Started in Kenya

Adelaide Changole – Bloomberg

Kenya, the world’s biggest exporter of black tea, is considering introducing the world’s first futures contracts for the leaves to help stabilize prices and enable growers to guarantee income from their production. INTL FCStone has held talks with industry representatives in the East African nation about introducing the derivatives, Stuart Ponder, SVP for emerging markets, said in an interview June 13 in the capital, Nairobi.

FAO: Jakarta Futures Exchange (JFX) and also Dubai Gold & Commodity Exchange (DGCX) were planning tea futures last year (reported in October here and here). The largest tea producer in the world is China followed by India, Kenya and Sri Lanka.

 

Launch Date For NZ Milk Price Options

MondoVisione

NZX is pleased to announce that the launch of milk price options contracts will occur on 30 June 2016. This follows the successful launch of milk price futures contracts on 27 May.

 

Sebi Directs Commodity Exchanges Not To Launch New Chana Contract

Anirudh Laskar – Livemint

The move is attributed to the gap in demand and supply of chana in the market.

Indexes

Results Of MSCI 2016 Market Classification Review – MSCI Will Delay Including China A Shares In The MSCI Emerging Markets Index

MondoVisione

Career Paths

At the quarterly meeting of the Exchange Council of the European Power Exchange EPEX SPOT, the members elected Bernhard Walter, Head of Market Design & Regulatory Affairs at EnBW AG, as the new Chairman of the Exchange Council. He follows Peter Heydecker who steps down after four years.

The members of the Exchange Council also agreed on a restructuration of the Council in the light of the merger with APX. The election of the following representatives was approved by the Exchange Council in order to keep a balanced representation of the membership structure of EPEX SPOT:

Mr. Andreas Bader, Vice President Shift Trading & Market Access at Statkraft,

Mr. Andreas Gelfort, Head of Benelux/UK Power/Cross Commodity & Emission Trading & MD at Vattenfall Energy Trading Netherlands,

Mrs. Therese Gjerde, VP – Head of Spot Management at Bergen Energi,

and Mr. Lucien Wiegers, Director Trading at Eneco Energy Trade.

Furthermore, Vincent van Lith, ABN AMRO Bank Frankfurt Branch, was appointed as new member for the category banks, financial services providers and clearing banks.

Kx Systems appointed data storage expert Glenn Wright as a Senior Architect. Wright is joining from DNN Storage.

Eka, provider of commodity management software solutions, appointed Sudhir Anandarao as COO, Analytics.

The Ontario Securities Commission (OSC) appointed Kelly Gorman as Chief of the Office of the Whistleblower, effective immediately. The Office of the Whistleblower will open to receive tips on July 14, 2016.

Odds Firm On Dominic Stevens As Funke Kupper’s ASX Heir (subscription)

The Australian Financial Review

Stevens was CEO at funds and insurance outfit Challenger until 2012 and joined the ASX board the following year.

FAO: EFK resigned in March (QV Premium: A Tribute to ASX CEO EFK).

Financial Calendar

17.06 – CBOE $0.23 quarterly cash dividend payment

New! 28.07 – CME Q2 2016 Results

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

Other stories

Singaporean & Australian Regulators Sign Agreement To Support Innovative Businesses

MondoVisione

 

IIROC Publishes Final Membership Disclosure Rules

MondoVisione

 

Kerviel Plays Covert Recording in Bid to Unravel SocGen Case

Gaspard Sebag – Bloomberg

 

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