June 18 2015

elb2 Somewhat frantic at FESE today, delighted to see the new President is the wonderful Irish SE CEO Deirdre Somers while I had a simply terrific group of panelists today to open the event – my thanks to all for making it such a great event.

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Today in Exchange Invest:

Public Markets

HKEx Extends CEO Charles Li’s Contract By 3 years
Reuters

HKEx renewed the contract of CEO Charles Li for a further three years. Li’s contract will now end on Oct. 15, 2018 and his pay remains unchanged at HK$9 million (USD 1.16 mln) a year.

HKEx announcement here.

See also HKEx Employees’ Share Award Scheme.

MCX Employees Bid For Metropolitan SE Warrants
The Hindu Business Line

Some of the employees of MCX, individual investors and leading stock brokers seem to have placed bids for some of the 40 crore warrants of Metropolitan SE put on the block by MCX, mostly at the base price of ₹1.10.

Read our Premium Exchange Deals Brief.

CME Fights ‘John Doe’ Lawsuit About A High-Speed Spoofer (subscription)
Bradley Hope – Wall Street Journal

CME filed a motion to quash an attempt by a HFT firm from finding out the identity of the firm or firms allegedly “spoofing” its orders in the U.S. treasury futures market.

The motion says HTG Capital Partners is seeking information that is “highly confidential,” and that any dispute between trading firms is supposed to handled through confidential arbitration.

HTG filed its lawsuit in March (reported here).

In Premium (amongst other stories):
On Feds Hounds and Floors – Watch Out This Ends Badly…
The Post Floor Moral Breakdown

ICE Struggles To Get More Banks On Board For Libor (subscription)
Chiara Albanese – Wall Street Journal

FAO: Recently ICE has published a feedback statement on the responses received to the ICE Benchmark Administration (IBA) position paper on the evolution and enhancement of ICE LIBOR.

China To Drain $140bn From ASX
Herald Sun

Around $140 billion could be drained from ASX over the next decade as international investors divert funds towards China.

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

PLY: The perils of parochial monopoly writ large.

DTCC Proposes Global Data Harmonisation
Finextra

DTCC issued its recommendations on global data harmonization to the CPMI IOSCO Harmonization working group, detailing a proposed path towards a global data harmonization, with credit derivatives identified as the first step.

DB1 To Launch Marketplace For Video Game Objects
France24

DB1 plans to launch the world’s first marketplace for virtual objects by the end of the year, in a venture inspired by a group of video game enthusiasts working at the exchange.

The marketplace, which will be called Swapster, should be operational before the end of the year according to Alexander Höptner, who is in charge of the team responsible for the launch.

PLY: Not the first such venture but an interesting concept…

MOEX’s Innovation & Investment Market Announces New Strategy
MondoVisione

PLY: Having chaired a panel at the Moscow Open Innovation Forum last year, I can report from the frontline that Russian innovation is ignored at investor’s peril.

Private Markets

Vienna SE FY 2014 Financial Results
Vienna SE

Vienna SE operating profit increased to EUR 18.1 million, up 17.3% (2013: EUR 15.5 million). CEESEG operating income increased slightly to EUR 28.6 million (2013: EUR 27 million).

PLY: A welcome bounce in the previously moribund bottom line of the CEESEG.

Vienna Says Sale Decision For LJSE Planned For Summer
Georgi Georgiev – SeeNews

Read our Premium CEESEG Stakes Sales Brief.

Future Merger Of HCMC & Hanoi SE Likely As Vietnam’s Markets Mature
Vietnam Briefing

According to a plan released by Vietnam’s Ministry of Finance, Ho Chi Minh SE (HOSE) and Hanoi SE (HNX) are likely to be merged at the end of this year. If completed, the new Vietnam SE (VSE) will be headquartered in Hanoi, although it will also have a southern branch in HCMC.

During the period 2015-2020, VSE will be a 100% state-run unit managed by the Ministry of Finance. After 2020, member securities companies of VSE will be able to purchase a 10-25% stake in the exchange.

PLY: The merged entity will be a full department store – currently HOSE only trades large-cap stocks, and HNX handles smaller-cap stocks and the bond market.

Read our Premium Vietnam Exchanges Merger Brief.

Ex-U.S. Agent Charged With Bitcoin Theft To Plead Guilty
Joel Rosenblatt – Bloomberg

Shaun Bridges, one of two former U.S. agents charged with pocketing hundreds of thousands of dollars in digital money (reported here) during the investigation of the illegal Silk Road Internet drug emporium reached a plea agreement with prosecutors.

Special Section: FTI, NSEL, India at the Crossroads

PLY: MCX and FTIL up circa 1%.

Sebi To Initiate Fresh Proceedings In NSEL Scam
Jayshree P Upadhyay – Business Standard

Sebi is going after the guilty in the NSEL scam in a more concerted way, as the Sebi-FMC merger gets closer to completion.

PLY: It is never too late to see justice, please let’s hope it happens soon…

Read in Premium

NSEL Scandal Brief – Main File
NSEL-FTIL Merger Brief
SEBI-FMC Merger Brief

Products

ICE Moves Closer To Launch Of Long-Awaited Global Cotton Contract
Reuters

U.S. House Agriculture Committee approved a bill to allow U.S. futures exchanges, to handle foreign-grown cotton at delivery points around the world, after recent ICE threats to list a new global cotton-futures contract outside the U.S.

In October last year EI reported that ICE was aiming to launch a global cotton contract.

CME Declares Force Majeure For Corn, Soy Shipping Stations Due To Illinois River Floods
Reuters

Career Paths

Deirdre Somers, CEO of Irish SE, was elected as the new President of FESE on 17th June 2015 for a term of three years. The election was unanimously approved by the FESE General Assembly at their bi-annual meeting in Oslo.

PLY: The perfect choice, I am delighted for Deirdre and FESE who have a perfect new Chairman who will drive the organisation forward.

HKEx renewed the contract of CEO Charles Li for a further three years. Li’s contract will now end on Oct. 15, 2018 and his pay remains unchanged at HK$9 million (USD 1.16 mln) a year.

At the AGM of Wiener Börse and CEESEG, the following resolutions on changes to the supervisory board were passed: Stefan Dörfler (Erste Bank) and Wilhelm Celeda (Raiffeisen Centrobank) have joined as new members of the supervisory body of Wiener Börse and CEESEG. They succeed Franz Hochstrasser and Michael Spiss. Willibald Cernko (Bank Austria) will continue to serve as chairman of the supervisory board.

FX Week reports that Malcolm Baker, senior director, interest rates and fx products for Asia-Pacific at CME, has left the firm to set up an independent FX market-maker called Two Tens in London. Baker worked at the exchange in Singapore for more than two years, reporting to London-based Will Patrick, executive director, FX products.

Bloomberg reports that BlackRock corporate bond trader Chris Dennis has left the firm to join Liquidnet next month.

Financial News reports that David Wright, Iosco’s Secretary general, is to depart in 2016.

Financial Calendar

FESE Convention – Oslo – June 17-18
CBOE $0.21 quarterly cash dividend payment – June 19

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

Analyst Notes

Keefe, Bruyette & Woods Increased Their Price Objective On CME From $92.00 To $98.00 – “Market Perform” Rating
Keefe, Bruyette & Woods Reduced Their Price Target On ITG To $32.00 – “Outperform” Rating

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.

Crowdfunding

UK Tax Authority HM Revenue & Customs Opens Up ISAs To P2P Investment Trusts
Midori Yoshimura – Crowdfund Insider

HM Revenue and Customs (HMRC) will allow savers to hold P2P lending investment trusts in their Individual Savings Accounts (ISA). The change will take effect July 1.

Other stories

EU Regulators Stick To Their Guns Over Broker Commission Rule
Huw Jones – Reuters

IOSCO Publishes Report On Credible Deterrence Approaches In Securities Market Regulation
MondoVisione

IOSCO has published the report Credible Deterrence, which identifies key enforcement factors that may deter misconduct in international securities and investment markets.

IOSCO: Meeting The Challenges Of A New Financial World
MondoVisione

New SOI Introduces Fresh Set Of Measures To Track New Zealand’s Financial Markets Authority Success Over Medium-Term
MondoVisione

The Financial Markets Authority’s Statement of Intent (SOI) for 2015-2019 marks a further step in the agency’s evolution as a modern, risk-based conduct regulator.

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