October 24 2014

elb2

TMX take steps to ward off the Aequitas threat. Indian depository stakes up for grabs on back of forced sell-off. Lots of HKEx-LME news as metals week winds up. Options are clearly a go in China soon – but will equity or commodity products come first? Euronext CEO talking the SME talk while Lancaster bourse plan dive bombs on back of JOBS act. Signs continue to emerge that the new CFTC Chairman has a vestige of humanity while Japan embraces Bitcoin …all this and more in a bumper EI.

Meanwhile at the micro end of the business spectrum, our startup club Mission ToRun made a great leap forward – it’s an active beta weekend and I look forward to sharing the latest startup in my portfolio next week, stay tuned and meanwhile here’s today’s EI:

Public Markets

TMX To Streamline Its Equities Trading Offering
TMX

TMX is restructuring equities trading. Changes will be made to TSX, TSX Venture Exchange, TMX Select & Alpha Exchange.

PLY: Reduce complexity, increase options for avoiding HFT. In general avert the threat of Jos Schmitt and Aequitas:

TMX To Install ‘Speed Bump’ To Slow HFT Traffic, Ahead Of Aequitas Launch
Barbara Shecter – Financial Post

HKeX Signs Deal Aimed At LME Asia Warehouse Expansion
Reuters

HKeX has signed a preliminary deal with China Merchant Group companies aimed at expanding LME warehouses in Asia and developing new products / services for the Asian market.

LME press release here.

LME, HKEx Agree Member Fee Waiver
Luke Jeffs – FOW

LME & HKEx are seeking to forge closer ties between Europe & China with a reciprocal arrangement that will see both markets waiving membership fees for members of the other exchange.

LME Week Dinner: The Most Opulent Metal Update In The Kingdom
Stuart Burns – Metal Miner

In a robust dinner speech, HKEX CEO Charles Li listed progress made by LME in the 2-and-a-half years since it was taken over by HKEx.

Euronext Repositioning To Finance SMEs Too
Shoaib-ur-Rehman Siddiqui – Business Recorder

“Creating jobs in Europe is the top priority and 80% of employment is created by SMEs which obtain up to 95% of their funding through banks,” said CEO Dominique Cerutti.

Emir Reporting Rules Set For Stronger Enforcement (subscription)
Tim Cave – Financial News

ESMA is launching a crackdown on derivatives trade reporting breaches, in response to concerns over the poor quality of data collected.

CFTC Chairman Offers Hope To Derivatives End-Users (subscription)
Mark Pengelly – Risk

New CFTC chairman Timothy Massad seems to be steering the agency towards a more deliberate and pragmatic approach to Dodd-Frank regulation.

Private Markets

Exchanges Plan Stake Sales In Depository Arms
Sachin P Mampatta – Business Standard

India’s two national bourses plan to sell stakes in their depository arms, which together account for 22 million investor accounts and demat assets worth Rs 121 lakh crore (USD 1,974 bln).

National SE (NSE) is in talks with institutional investors for unloading its stake. The BSE plans an IPO. The transactions are required to meet a three-year deadline, ending 2015, to reduce stake.

PLY: Another element of the daft micromanagement of India’s exchange landscape which suits SEBI but not prosperity. At the same time an interesting investor opportunity albeit induced as opposed to desired on the part of the sellers.

TAIEX To Launch Online Cross-Border Stock Exchange Platform
Want China Times

Taiwan SE (TAIEX) is building a cross-border online trading platform following agreements for direct trading between Taiwan and Singapore, Japan & the UK, expected to launch within six months.

Lancaster Stock Exchange Proposal Dies From Lack Of Financial Backing
Tim Mekeel – Lancaster Online

“Everybody was very happy with the idea if someone else put the money into it…,” said W. Trexler Proffitt Jr., who launched the concept in 2008.

PLY: Crowdfunding is increasingly the regional exchange solution it seems especially in the US with the JOBS Act (albeit slightly slowed due to sclerotic SEC adoption).

Japan Wants To Be The Most Bitcoin Friendly Country
Crypto Coins News

PLY : Despite Mt Gox, Japan is making progress.

Special Section: FTI, NSEL, India at the Crossroads

PLY: FTIL continues to rise up 9% as post NSEL scenarios percolate while MCX enjoys a post Diwali bounce up 2%.

Technology

Speed-of-Light Trading Grows In Europe With McKay Network
John Detrixhe – Bloomberg

McKay Brothers International, a Geneva-based provider of networks for trading firms, plans to activate a microwave data link covering the 370 miles (600 kilometers) between Basildon on the outskirts of London, where markets including ICE house computers, and EUREX Frankfurt. The goal is to migrate McKay’s Quincy Extreme Data service from a third-party system onto the company’s own wireless network.

The European Market Data Debate (subscription)
Philip Stafford – Financial Times

Few topics in European exchanges stir the passions like price and access market data.

Often a delicate subject, it’s particularly acute right now as everyone tries to find ways to economise and authorities finalise the rules of Mifid II.

Products

Euronext Introduces Higher Quality Criteria For Wheat Futures
Reuters

Euronext will introduce new quality terms for its milling wheat futures with effect from its September 2017 contract, it said on Thursday, after a rain-hit crop this season highlighted the inadequacy of the current criteria.

Shenzhen Stock Exchange Nears Equity Options Launch (subscription)
Gabriel Wildau – Financial Times

Shenzhen SE is poised to launch equity options by year end as it launches advanced testing – which involves all the elements of trading – of stock options based on shares of China Vanke, the country’s largest listed developer.

PLY: The options race is on in commodities too.

How Commodity Bourses Can Survive
Shyamal Gupta – The Hindu Business Line

PLY : Three simple words required to make Indian commodity exchanges thrive: confidence confidence confidence.

Financial Calendar

Today

NASDAQ OMX Q3 2014 Financial Results
Record date Tullett Prebon 5.6p interim dividend

Next week

DFM BoD Meeting Monday 27 October 2014
CME Q3 2014 Financial Results
CBOE Q3 2014 financial results
BGC Partners Q3 2014 Financial Results
Thomson Reuters Q3 2014 Financial Results

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

Analyst Notes

HSBC Upgraded LSE To “Overweight’ – GBX 2,100 Price Objective

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

ESMA Publishes Latest Statistical Data On Prospectus Approval & Passporting In EEA
MondoVisione

ESMA has published two reports containing the latest statistics for prospectuses approved and passported by National Competent Authorities in EEA, covering 2013 and H1 2014.

PLY: Dear ESMA, if you write fewer words in your releases and made things succinct and clear, you might at least go some way to making your budget go further to cope with your unsustainable workload.

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