October 20 2016

elb2

Expo has mostly been a case of conventional discussion so far it seems. In Europe, the Brexit debate (fuelled by ‘remainian’ hysteria) has become so juvenile and inadequately covered it makes one almost yearn for a good Presidential election campaign…let me just check…hmmm…5 seconds later and the remote control “off” button offers a compelling alternative… At least there’s this newsletter to offer a spot of calm scrolling during the day:

In Today’s Exchange Invest

Amongst today’s many interesting stories, GMEX announces its restructure after months of speculation on its future.

Events

Claim your discount code now via Exchange Invest: Burgenstock is coming soon (see banner on left- and use this discount code “YOUNG15” to get 15% off the delegate fee).

The Stuttgart SE 10th Anniversary MIFID Conference also advertised to your left looks most interesting and I am delighted to be chairing a session there November 17th.

In BigWorld

Apparently legalising cannabis in Colorado has boosted house prices by 8% as retailers bid for shop front space. Meanwhile the first cannabis company is seeking to list on NYSE (the marvellously anonymously branded “Innovative Industrial Properties”) while GMEX powered CX as well as AmericanEx are both in the, er, ‘canna-bourse’ space.

 

 

Public Markets

 

ICE’s Sprecher Criticizes Mifid II, European Financial Rules Set to Start in 2018
Wall Street Journal

PLY: Jeff Sprecher shows admirable restraint in merely calling MIFID II  ‘a terrible piece of legislation.’

ICE Unlikely To Bid For LSE – Sources
FOW magazine

PLY: Confirming prevailing EI analysis, this is perhaps the least surprising headline in months to EI readers.

Cramer: ICE CEO Just Crushed it, A Stock Worth Owning
CNBC

PLY: Sparing you the whole breathless article, the parish relevant part is:

The ICE: “I love that. More important, I want you to buy more ICE. We just did a nice profile of these exchanges and that company is making a lot of money. A lot of money.”

…Great to see Cramer endorsing the sector once again, returning to his theme first mentioned October 3rd.

Traders Who Doubt LSE-DB1 Deal Still Love LSE Shares
Bloomberg

PLY: Bloomberg catching up with the apathy of merger arb, as mentioned before in Exchange Invest. Really a forex story, Pound plunges, LSE goes up. I am not sure that really means anybody loves LSE right now, the prevailing narrative has been clearly broken. I see it being more a potential break-up play and certainly a shop in need of a new CEO if (more likely when) the merger of equal desperation falls apart. The company doesn’t cohere properly and the ‘MOED’ antitrust latency effect is making the lack of integration more apparent to outsiders. DB1 looks the better stock bet to me, the problem is the lack of trust in management, apart from a lack of faith in their abilities too but if properly managed, it has potential, even if it has lost its spot as a top tier player in the pyramid (after years of management rallentando).

DEALTALK-Euronext Faces A Bind Over LSE’s Clearnet Sale
Reuters

PLY: An interesting thesis but not one I can quite agree with as to do so is to drink the kool aid of LSE agitprop which suggests ‘sell Clearnet and the merger of equal desperation is done and dusted.’ That is a deft syllogism but reflects the dream of XavRol ridding himself of loss making Clearnet (and potentially see LCH back under UK regulation – albeit I am not so sure the French will be so eager to give up their influence), than reality or realpolitik. Unless the EU antitrust division has morphed into monkeys, I will be surprised if they don’t see through this.

Ergo, the idea that Euronext buying Clearnet is a possible impediment to them as it facilitates the DB1-LSE monopoly being permitted, is imho, somewhat fallacious.

Interview: Jenny Knott
The Trade

…Discussing recent ICAP acquisitions and the future of FinTech.

PLY: Practical common sense from Jenny Knott.

Gorman: NYC Could Take UK Derivatives Trading
FT

PLY: There is a Tom & Jerry cartoon where cat, mouse and dog battle over a steak with an argument so heated that the steak washes away down the gutter as they bicker over who gets what share.

DB1 Clearstream Unit Named In US Case Involving Bank Markazi
Reuters

PLY: Standard protectionist fodder from political American prosecutors. Copy paste release from DB1 (as also used passim by Euroclear in other cases).

FCA Approves SGX Baltic Exchange Takeover
Reuters UK

 

Private Markets

GMEX Group Restructures – Exchange Products To Spin-Off From Technology Business
GMEX

PLY: Delighted to see this in the public domain after much speculation in the marketplace on the future of GMEX. The split is in place. GMEX’s CMS futurised IRS business goes into its own orbit while the core of GMEX remains as a tech business with stakes in various entities. Exciting times and all the best to Hirander Misra and team with this new chapter in the GMEX story.

Former Tel Aviv Stock Exchange CEO Demands Current Chairman Resign
Haaretz

PLY: Hell hath no fury as a Yossi scorned. Again, as per my remarks last week, the movie rights here still appear more valuable than the bourse but in a fast moving picture, anything is possible before the third reel…. (more from yesterday here before somebody better at Hebrew-English than me and Google Translate, intervened from Haaretz).

China’s Major Holdings To Acquire Stake In National Stock Exchange of Australia
ChinaGoAbroad

PLY: Google Translate and I discern that China’s Major Holdings is to acquire 13.42% stake in National Stock Exchange of Australia but no other data available as we race to pixel…

Misys Struggles To Show It Has Changed Its Ways Ahead Of IPO
Reuters UK

PLY: Jurassic software combine fails to get the ‘new look’ of fintech after 4 years of PE ownership. The world has moved on and realisation is dawning that the cashflow of the dinosaur vendors is wondrous but they have an ongoing fight on their hands to maintain relevance in a much more agile world.

Omani Bourse Needs Market Makers To Develop Bond Market
Times of Oman

The CMA chief also said that the reintroduction of margin trading on the Muscat Securities Market (MSM) was important for enhancing liquidity.

Can Shanghai Gold Price Ever Become A Regional/Global Benchmark?
The Bullion Desk

PLY: Good question given DGCX now licensing the price outside China and all the many competitors in the gold field…

Very Positive Budget Proposals For Maltese Capital Markets
Gozo News (press release)

The Malta Stock Exchange (MSE) said that it welcomes with satisfaction the importance given to Capital Market development in this year’s Budget

PLY: Indeed and some useful deregulatory measures to encourage general commerce too in a sound budget from Finance Minister Professor Scicluna

NSE Beats Nigeria Bourse For First Time On Foreign Inflows
Business Daily (press release) (blog)

PLY: Interesting regional competition.

Nairobi Securities Exchange raises Kshs.5.8 Million During 2016 Charity Trading Day
African Markets

PLY: Almost 60000 US dollars raised from the second NSE charity day –  well done!

Japan To Tighten HFT Regulations
Reuters

 

Special Section: FTI, NSEL, India at the Crossroads

 

MCX-SX case: Special Court Grants Bail To Jignesh Shah
The Indian Express

Over a month after he was arrested by the CBI, Jignesh Shah was granted bail.

PLY: Any markets on how many days he stays out this time given he now has three cases to potentially imprison him at any time? #Shahdenfreude

NSEL Scam: What Were RBI’s & FSDC’s roles?
Livemint

PLY: Fascinating and understandably frustrated editorial. The blob knew the problems that could arise but sat by passively. Not good news for India Inc. as the NSEL mess festers.

Technology

 

KRX Inks IT Deal With Vietnamese Bourse
Korea Times

PLY: KRX has been a quiet success story in IT exportation by a legacy bourse in recent years. The Vietnamese deal (using the next gen system now in production: EXTURE+)  is just the latest on top of deals dating back to 2007 with Malaysia, Cambodia, Laos, the Philippines, Thailand, Uzbekistan, Azerbaijan and now, Vietnam.

Nasdaq Corporate Solutions Brings Open Source Technology To Enhanced IR Website Platform – New Suite Of Capabilities For IR Professionals To Boost Strategic Intelligence And Improve Stakeholder Communications
NASDAQ

PLY: More interesting incremental development in ‘country club’ member relations.

CME Group Collaborates With TickSmith To Provide Customer-Friendly Access To Historical DataMine
MondoVisione

PLY: Interesting part of the data narrative, mining the old stuff, as often discussed with advisory clients for some time now. Not hugely material but incrementally beneficial and essentially close to garnering money for nothing.

How NSE’s Market Data Will Boost Investment
Guardian (press release)

 

Products

 

Eurex Launches Total Return Futures
MondoVisione

Red Chilli Farmer Subsidy Ceremony Held At PMEX
The News International

PLY: Good move, fees refunded to farmers hedging on PMEX. Plus I love that headline – those who would go to the opening of a door in the parish must be upset to have missed out on this splendidly titled invitation.

Regional Stock Exchange (BRVM) Becomes 1st African Stock Market In Islamic Finance
Proshare Nigeria Limited (press release) (registration)

Indexes

Shenzhen-HK Connect May Prompt MSCI Inclusion
pulse

Palestine Exchange Modifies Al-Quds Index Methodology
Mubasher Info

Career Paths

 

The HK Financial Secretary has re-appointed Dr Kelvin Wong Tin-yau as a Non-Executive Director of the SFC for a term of 2 years with effect from 20 October 2016 (he first joined the regulator’s board  20 October 2012).

MCX To Get New Chairman Soon
Times of India

PLY: Update to yesterday’s notice as the announcement of a replacement board director for current Chairman  Satyananda Mishra, clearly creates a vacancy.

GE Cybersecurity Chief Departing For Thomson Reuters
Wall Street Journal (blog)

Tim McKnight has been named chief information security officer at ThomsonReuters Corp., effective Oct. 31st.

PLY: I admire a man who clearly has an appetite for a challenge.

Crowdfunding

On Investment Crowdfunding, Diversification & The Wisdom of the Crowd
Crowdfund Insider

 

Other Stories

Keynote Remarks of Chairman Timothy Massad: FIA Futures & Options Expo
CFTC

FIA & FIA Japan Sign Formal Affiliation Agreement
MondoVisione

GPW Opens Public Consultations On New Sector Classification Of Listed Companies
MondoVisione

Collection Of FTT Expected To Cost Millions
Reuters

Ten EU countries are looking to add an FTT to bond, stock and derivative transactions, but collection costs in Germany alone could hit €8 million due to high trading volume. Costs could range significantly, according to an EU document, with Slovenia estimating €1.5 million to €2 million and Austria estimating implementation costs at less than €1 million.

PLY: Excellent insights from Huw Jones ends today’s Exchange Invest daily bulletin on a sanguine note as another EU folly is found wanting (business as pretty much usual then). Pity we couldn’t have that money spent on developing the EU capital markets instead of this wanton action of vandalism by the blob.

…Bit of a marathon day (and whisper it softly not a single blockchain story!). At least (so far) the press releases from Expo have not turned uber-nebulous either.
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