October 03 2013

elb2 The big (unreported) rumour of the day is that ICE are doing due diligence on SMX (the Singaporean asset of India’s beleaguered FTIL) where a clearing house is on offer alongside the somewhat dormant exchange.

Elsewhere in the festering NSEL fiasco, Jignesh Shah is amongst 60 or so folks being invited to police questioning…

Apologies but I am a tad busy today as I am moderating a private meeting of the FESE board. Of course I can’t tell you what’s happening today but I’ll be back for EI tomorrow.

Here’s today’s news with first up that breakthrough on the (prickly) EU college of regulators:

Public Markets

College Of Regulators Okays ICE-NYSE

PLY: Game (nearly) on! The Lowlands regulators’ board charged with overseeing Euronext says the deal offers approval (in regulator-speak at least). Jeff Sprecher is one step closer to control…

BGC Partners Launches Its SEF
BGC Partners
Bloomberg’s Multi-Asset Class SEF Opens For Trading
Automated Trader
Javelin Begins SEF Trading For Interest Rate Swaps Ahead Of Deadline

PLY: That makes 6 SEFs launched out of 18 applications of which 17 have been approved.

UAE Bourse Merger Gathers Steam As Advisers Hired

Abu Dhabi and Dubai have hired banks to advise on a possible merger of their two main stock exchanges,

Talks on a tie-up between the Dubai Financial Market (DFM) and the Abu Dhabi Securities Exchange (ADX) have occurred on and off since at least 2010, but they have been hindered by differences over valuations and Dubai’s 2009-2010 corporate debt crisis.

PLY: A merger with something like the gestation period of an elephant, it finally looks as if Abu Dhabi-Dubai is likely to happen following Qatar’s outright purchase of the local exchange from minority holder NYSE yesterday.

LME Ex-Chief Abbott, Others Net $31.7M In Sale To HKEx (subscription)
American Metal Market

LME ex-chief Martin Abbott and other members of staff collected $31.7mln from the sale of the bourse to HKEx.

EU Swaps Platforms In Limbo As CFTC Closed On Deadline Day

EU attempts to win exemptions from U.S. rules for swaps trading platforms that take effect today have been hampered by the partial shutdown of the American government.

Michel Barnier, the EU’s financial services chief, was unable to broker a deal with the U.S. CFTC ahead of a budget standoff that’s left many government offices shuttered, Chantal Hughes, a spokeswoman for Barnier, said.

“The current situation is clearly problematic, as American rules on SEF registration will enter into force today and we haven’t received at this stage meaningful relief for European companies,” Hughes said in reference to the U.S. standards on swap-execution facilities, or SEFs. “At technical official level there is no contact at this point in time, but there is contact at more senior political levels,” she said. “The CFTC is indeed closed.”

After A Merger At Home, Japan Exchange Wants To Grow In Asia (subscription)
Institutional Investor

The new JPX is benefiting from a revival in Japanese corporate confidence; can CEO Atsushi Saito win back business from Hong Kong and Singapore?

New Zealand’s Privatization Effort Propels Country’s IPO Market (subscription)
The Wall Street Journal

So far this year, NZX Ltd. has hosted a total of US$2.3 billion of IPOs, nearly double the $1.3 billion raised over the previous six years combined…

Ludwik Sobolewski (BVB): Capital Market, Less Developed Than Romanian Economy (subscription)

The local capital market is less developed than the economy in Romania, and there is a discrepancy between the stock market and the business milieu says new Bucharest CEO, Ludwik Sobolewski.

PLY: Ludwik correctly identifies that Romanian capital markets are, frankly, backwards while there are many entrepreneurs keen to develop Romanian businesses – and there the massive fissure emerges where European capital markets as a whole fail (but nowhere is it more obvious than in Romania).

Helsinki Bourse Chief Sees Pick-Up In Listings

PLY: Helsinki boss feels optimistic about new listings

Nasdaq Routs Orders Away From CBOE After Brief Glitch

Nasdaq OMX said on Wednesday that several of its operated exchanges briefly declared “self-help” against CBOE due to a market data issue that lasted about 12 minutes.

Private Markets

Canada’s Other Exchange

The amount and terms are confidential but Canada’s other stock exchange got a boost in stature September 30 as Dundee Corp closed a strategic investment in the CNSX. Dundee president/CEO Ned Goodman, a strong critic of the TSX Venture regulatory regimen, becomes CNSX deputy chairperson.

Addressing a September 12 panel discussion hosted by the Venture Capital Markets Association, Goodman called the Venture “a feeding source for the legal community.” He added, “You need two hands to lift the TSXV’s book of regulations and policies. It’s absolutely mind-boggling all the things you’re required to do to raise a half-million dollars—which means that half of that half-million will go to lawyers.”

The CNSX model, on the other hand, “reduces the time and expense companies face in going public, and in maintaining a listing, along with a high level of continuous disclosure,” Goodman said in a statement accompanying the September 30 announcement.

PLY: Somewhere between the TSX and crowdfunding, sits the CNSX.

DTCC Completes Omgeo Acquisition

PLY: Another completed move forward for post trade.

Special Section: FTI, NSEL, India at the Crossroads

PLY: Jignesh and a select 60 others are invited for police questioning while rumours swirl in Singapore that FTIL market SGX is receiving DD from ICE…

MCX shares are down 3.1 % while FTIL is up 1.6 %.

FT Group’s Overseas Drive Faces Speed Bumps
Business Standard

PLY: From Bourse Africa across the globe, FTIL’s foreign exchange ambitions have ultimately disappointed as a whole despite some encouraging performances such as DGCX. Now all such stakes are presumed for sale.

NSEL Probe: EOW Summons Jignesh Shah, Massey, Defaulting Brokers
The Indian Express

The Economic Offences Wing of Mumbai Police has summoned bourse’s promoters, including Jignesh Shah, defaulting brokers and senior officials (around 60 in total) for questioning, even as raids continued at exchange’s different premises today.

Remuneration Up For FTIL Directors, Dividend Payout Unchanged
The Financial Express

FTIL paid a total amount of Rs 21.56 crore (USD 3.45 mln) to its three executive directors in the last fiscal, up from about Rs 17.87 crore (USD 3.41 mln) in the previous year.

Why Govt Sat For More Than A Year On NSEL Discrepancies
India Today

PLY: Smoking gun alert: Can the NSEL stasis end up with the lawyers also pursuing the government for their oversight or lack thereof?


Computer Derivatives: The Next Big Thing In Commodities?

Imagine being able to build a data center with a guarantee that a portion of your future capacity will be bought at a certain price for an extended period of time before you even built the data center? A new group of companies are working on making this kind of vision a reality.

PLY: A fascinating development in the market but then again as noted before I am a director of a data centre so I would say that…but even then I do still believe in it!

Thomson Reuters To Review Business Units (subscription)
The Wall Street Journal

Thomson Reuters Inc. plans a fresh review of the company’s business units, in the latest sign the data provider is looking for ways to respond to weak demand from its financial services clients.

PLY: Rome wasn’t burnt in a day. TMR continue to obfuscate with reviews instead of action to make the business the powerhouse it ought to be; if only it had an outbreak of management.


ICE Plans To Launch First Global Cotton Contract Next Year

ICE plans to launch the first global cotton futures contract in early 2014, the Atlanta-based exchange said on Wednesday, giving merchants, mills and growers their first alternative to pricing on the U.S.-only contract.


CME Temporarily Suspends Lean Hog And Feeder Cattle Indexes
CME Warns Shutdown May Disrupt Livestock Futures Contracts (subscription)
The Wall Street Journal

PLY: The government shutdown is hitting not the unemployment data but also hog prices…

Career Paths

Markit, the financial data provider, has appointed Jeff Gooch, head of its trade processing business MarkitServ, as CFO, according to two people familiar with the situation.

TeraExchange, LLC announced that Andrew V. Waskow has been appointed Chief Compliance Officer and Senior Vice President. Mr. Waskow will manage compliance and regulatory affairs on a global basis.

Financial Calendar


Hellenic Exchanges EUR 0.03 special dividend (share capital return) payment

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

Analyst Notes

Betfair “Buy” Rating Restated At Citigroup Inc. – GBX 1,150 Price Target
Tullett Prebon“buy” Rating Reiterated At Goldman Sachs GBX 410 Price Target

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.

Other stories

Chinese IPOs: Back In The USA? (subscription)
Financial Times

The door is not exactly being kicked wide open. But after two years of accounting scandals and critical reports from short-sellers, Chinese companies are slowly making their way back to Wall Street again – and it’s not just Alibaba eyeing up New York.

On Monday, Qunar, a popular travel website in China, filed paperwork with SEC to raise $125m in an initial public offering, one of several smaller offerings to emerge of late.

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