May 25 2015

elb2 Yes, it is a bank holiday in many parts, including Hong Kong, UK, USA and I think the French are off too (plus ca change – at least they can reliably partake of one element of globalisation: the days off, a sort of cross border ‘pont,’ if you will) but our team are so enthusiastic we have produced an Exchange Invest Daily anyway…

Overnight, election of a new Polish President comes as a shock to those locked in the Warsaw bubble. There is no immediate change for Polish markets per se but watch for the autumn general elections which will be exciting, to put it mildly.

Today in Exchange Invest: Plus 500 is right in the crosshairs of a short seller who has produced a lengthy explanation of his reasons for seeking a vast further depreciation in the shares of the AIM listed retail broker-internaliser. HKEx leading the competitive marketplace for international commodity competition with China (as an aside, my trivia for today: China between 2011-2013 produced more cement than the USA during the entire 20th century). India’s FMC refuses to endorse new (insider) CEO of MCX, citing irregularities in the recruitment process. SEC to collect more big data as it shadow boxes with shadow banking…

The heartening news of the day is that despite the horrific 7.8 magnitude (Richter Scale) Earthquake which killed over 8000 people April 25th and the 7.3 aftershock of May 12 which killed over 100 more, the Nepal Stock Exchange is back in business. Well done to all parties who have got the market trading again after a month of inactivity as Nepal came to terms with the tragedy.

On behalf of the Exchange Invest team, I wish all readers celebrating, a Happy Bank Holiday and clearly a heartfelt Happy Memorial Day to all our readers in the United States.

Public Markets

Cable Car Shorts Plus500
Cable Car Capital Blog

Plus500 Suspends Shares After It Suffers A Shorting Attack
CITY A.M.

PLY: It’s a Bank Holiday so LSE is closed but Plus500 is under pressure. The Cable Car Capital blog makes fascinating reading – a highlight:

“In its 2014 annual report, Plus500 claimed to be profitable on 349 trading days, up from 297 in 2013. This is startling not only because of its consistency. It is also remarkable because a typical trading year has only 252 trading days, depending on the timing of holidays and weekends. If Sunday nights are included (when interbank forex markets are open) there are still only 304 trading days. Evidently, Plus500 is also profitable on Saturdays when underlying securities markets are not even open!”

The whole series is fascinating…

As LME Looks East, CME Throws Down Challenge In West
South China Morning Post

Hong Kong’s Bold, But Uncertain Pitch For China Commodity Trade
Daily Times

The grand old London lady of metals trading is all part of Charles Li’s vision of positioning Hong Kong as the renminbi gateway between mainland China and international markets. The HKEx chief is confident the LME will help open up a commodities channel to complement the newly-opened Stock-Connect highway.

However, while HKEx looks east, US exchange CME has just thrown down a challenge in the west with an announcement it is planning to launch a zinc contract for North American users.

Read our Premium: Capital Markets Transformation – Exchanges & Markets, ETPs & Exchange Infrastructure – Brief Part 1,Part 2, Part 3, Part 4, Part 5

Shanghai Stock Exchange Extends Disclosure Times
Reuters
The Shanghai Stock Exchange has extended the time range during which listed companies are allowed to make public statements, improving timely disclosure and bringing the exchange more in line with international practice.

Read our Premium: Capital Markets Transformation – Exchanges & Markets, ETPs & Exchange Infrastructure – Brief Part 1,Part 2, Part 3, Part 4, Part 5

PLY: There is still much work to be done with Chinese corporate information but progress is being made.

CFTC Announces Agenda For Upcoming Market Risk Advisory Committee Meeting
The National Law Review

On June 2. MRAC will discuss: (1) the Bank of England’s CBEST Program and its impact on addressing cybersecurity threats; and (2) the concentration of FCMs and its effect on, and other factors currently affecting, derivatives markets liquidity.

Singapore, Zhengzhou Bourses To Jointly Develop Commodities Markets
Hellenic Shipping News Worldwide

SGX and China’s Zhengzhou Commodity Exchange plan to collaborate on developing commodities markets, having signed an MOU.

PLY: Which adds to the competitive excitement in China and of course Hong Kong. Interesting times.

Dubai Financial Market Plans To Implement Enhanced Pre-Closing & Trading At Last Session As Of June 4
Mondovisione

Dubai Financial Market (DFM) plans to implement an enhanced Pre-closing session arrangement as well as Trading At Last session (TAL) as of Thursday, June 4, 2015.

Private Markets

Nepal Stock Exchange Resumes Operations After One Month
Big News Network

The Nepal Stock Exchange (Nepse) resumed its operations on Sunday almost a month after the April 25 earthquake that wrought severe devastation in the Himalayan country.

The market restarted transactions after relocating from some buildings which were badly damaged by the 7.9-magnitude quake last month. Nepse has been operating its system from its head office while the server is located inside the home ministry.

PLY: I am delighted to hear that after a long period of silence (it was impossible to contact the exchange for some weeks), that NEPSE is back in business.

China Readies National Carbon Market To Fight Climate Change
The Japan Times

The Beijing Environment Exchange — one of seven pilot markets in China for trading carbon appears becalmed but things may change…

Bitok Bitcoin Exchange Announces 0% Fees for Deposits & Withdrawls
Bitcoinist.net

Bitok.com, a Bitcoin exchange registered in England, has just announced a campaign which will allow users to deposit and withdraw funds with 0% fees. With the fees removed, Bitok is now significantly cheaper for traders in terms of the fees they pay. In addition to BTC trades, Bitok also allows users to trade for Litecoin (LTC) and Dogecoin (Doge) in several different currency pairs (fiat currency and cryptocurrency.

PLY: In the rapidly expanding world of cryptocurrency, naturally the two most important words in the English language: Due Diligence clearly apply.

SEC To Introduce New Rules For ‘Shadow Banking’
The Irish Times

Asset managers will have to make unprecedented disclosures about their so-called “shadow banking” activities as part of new reporting rules proposed by the US regulator. Concerns that the asset management industry could pose the next threat to stability has prompted a drive for greater supervision that is being resisted strongly by investment managers.

PLY: Regulators are determined to hold back any progress that may threaten banks, at the same time, accelerating the banks’ demise for various reasons. Shadow banking remains an inaccurately labelled bogeyman in markets while regulators like SEC insist on building a big data rod for their own backs which will haunt them in future when it becomes clear they had data up to (and above) waist height but could not process it effectively…

Special Section: FTI, NSEL, India at the Crossroads

MCX off 1.5%, FTIL flat.

Technology

Technical Glitch Hits DSE Trading For Hours
Dhaka Tribune

The country’s prime bourse failed to open the trade in the morning as no brokerage firms could log in with the main server.The problem was fixed after lunch and trading resumed at 2:20 pm and ended at 4pm. Trading usually begins at 10:30am and ends at 2:30pm, shortening trading hours.

The last glitch was on April 13, 2014, disrupting for more than two and a half hours.

Products

NSE Plans To Launch New 10-Year Bond Futures
Business Line

NSE is working towards launch of new interest rate futures (IRF) contracts based on the new benchmark 10-year 2025 Government bond which was auctioned last week with as much as 9000 crore (USD1.5 bln) being purchased.

PLY: Not sure why they can’t just add the old 10 year to the delivery basket for future months? Clearly I am missing something here in the haste to pixel (perhaps one of those volatile CTD foibles)…

Indexes

China To Launch First Stock Index Options Soon
Reuters

The China Financial Futures Exchange (CFFEX) will soon launch the country’s first-ever stock index options, state media reported on Monday, giving investors more hedging tools as the government steps up financial market reforms. The first batch of stock index options would be based on China’s blue-chip CSI300 index.CSI300 and SSE50 .SSE50 index as well as the small-cap CSI500.

Stock index options will be the third product to be launched by the CFFEX, set up in 2006 to help develop China’s financial derivatives markets. The exchange currently trades stock index futures and government bond futures.

Read our Premium China Capital Markets Transformation – Exchanges & Markets, ETPs & Exchange Infrastructure – Brief Part 1, Part 2, Part 3, Part 4, Part 5

BM&F Bovespa : Launch Of Co-branded S&P/BOVESPA Smart Beta Family Of Indices
4 Traders

BM&FBOVESPA (BVMF), and S&P Dow Jones Indices (S&P DJI), will create new, co-branded Brazilian equity indices.

New Norwegian Index For Medium-Sized Companies
Oslo Børs

The new index for medium-sized companies, the Oslo Børs Mid Cap Index (OSEMX), will be launched on 1 June 2015. Companies with a market capitalisation between NOK 1 and 15 billion (USD 130 million to 2 billion) will be eligible for inclusion.

Trio of Indexes Based On JPX-Nikkei 400 To Launch In August
Nikkei Asian Review

TOKYO — Nikkei Inc., Japan Exchange Group and the Tokyo Stock Exchange will start three new indexes based on the JPX-Nikkei Index 400.

The JPX-Nikkei 400 was created in January 2014 consisting of companies that meet certain investor-pleasing criteria, such as efficient use of capital. The new trio, to launch Aug. 3, will provide benchmarks for various types of investment strategies, such as leveraging or hedging, the companies said.

Career Paths

Commodity derivatives markets regulator Forward Markets Commission (FMC) rejected proposal of Multi Commodity Exchange to appoint Balasubramaniam Venkataramani as MD & CEO.

PLY: A remarkable move. FMC apparently queried the process by which Mr Venkataramani was appointed, unclear that it was suitably transparent with sufficient advertising in the public domain etc: The process had involved an executive search firm… Not good news for MCX and it is surprising the share is only down 1.5% currently as it urgently needs firm strategic management to move forward.

Financial Calendar

This week:

25 May

JPX AGM

26 May

Ex-dividend date date ATHEX dividend of 0.189 euros per share

27 May

Record date ATHEX dividend of 0.189 euros per share,

29 May

Record date CBOE $0.21 quarterly cash dividend
Record date TMX $0.40 dividend
Oslo Bors NOK 8.20 dividend payment
BGC Partners $0.14 quarterly dividend payment

Next month:

Interactive Brokers Group, Inc. to Issue Quarterly Dividend of $0.10 on June 12t
CBOE Holdings, Inc to Issue Quarterly Dividend of $0.21 on June 19th

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

Analyst Notes

CBOE Holdings Price Target Lowered to $48.00 at Barclays. “Equal Weight” Rating
HSBC Reaffirms “Hold” Rating for London Stock Exchange Group Plc
Thomson Reuters Receives “BBB+” Credit Rating from Morningstar. Moderate default risk.
Barclays Reaffirms Overweight Rating for London Stock Exchange Group Plc

New Report Available: NDAQ – Financial & Strategic SWOT Analysis Review
PR Inside

Profile compiled by GlobalData.

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

The Revolution In Real Estate Crowdfunding
Iulia Davidescu – The Market Mogul

PLY: We have seen multiple variants on real estate crowdfunding and indeed have some interested parties looking at projects through my sister company, the HanzaTrade crowdfunding platform.

Other stories

Zero Tolerance!
Neil Crammond via LinkedIn

PLY: Neil Crammond is on the warpath against exchange practices that have not demonstrated a fair and open market – the book on the topic he is preparing ought to make embarrassing reading for many venues and regulators alike…

Bitcoin In North Korea & Other Places You’d Never Expect
Joseph Young – CoinTelegraph

The number of bitcoin merchants has surpassed the 100,000 mark in 2015. BitPay alone has processed over 800,000 transactions totaling around US$260 million between 2013 and 2015.

PLY: Given its wondrous status as not dependent on the Quantitative Easing class, it is noticeable how global Bitcoin is – even reaching North Korea…

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