Breaking News

John Lothian Newsletter: London Stock Exchange wins shareholder support for Deutsche Boerse deal; Costly data battle heats up between traders and equity exchanges; Battle lines drawn over London’s role in euro clearing

First Read

Seeking a win-win outcome after Brexit for financial services; Brexit does not end the UK’s dominance of trading and efforts to dismantle it may hurt Europe more
Steve Grob of Fidessa in FT
So, the stark reality of Brexit is setting in much like the feeling you get upon awakening after a long night out. “What just happened?” and “what do I do next?” seem to be dominating most people’s thinking right now.
/goo.gl/o0fDbu

***** We need the Steve Grobs of the world now more than ever. Thought leader, consensus builder, raconteur.

++++

Top Wall Street Regulator’s Salary Approaches $3 Million; Finra CEO Richard Ketchum plans to retire later this year
By DAVE MICHAELS – WSJ
The Financial Industry Regulatory Authority, which oversees stockbrokers and monitors trading on exchanges, paid its chief executive officer $2.9 million last year, according to its latest annual report issued this week.
goo.gl/bHvY61

***** OK, I will take the job.

++++

Democrats Back a Trading Tax, Say Speediest Traders a Threat
Nick Baker, John Voskuhl – Bloomberg
Clinton, Sanders both suggested levies on Wall Street; Exchanges and trading firms argue taxes would harm markets
Democrats drafting their party’s platform proposed taxing trades on U.S. exchanges and called the speediest traders a threat, stepping into two of the most contentious areas of modern markets.
goo.gl/ifuQUc

***** Get your wallets out.

++++

Algo Trading

++++

Snapchat’s Teen Fans Wince as App Catches On With Their Folks; An estimated 14% of U.S. smartphone users 35 or older are on messaging app
By YOREE KOH – WSJ
Paris Zeikos says he noticed a surprising trend on Snapchat. Parents have started creeping onto the messaging app, a social-media outlet long dominated by teens.
goo.gl/qYCZEH

***** The problem with early adopters is that sometimes the masses follow their lead.

++++

Why Good Storytellers Are Happier in Life and in Love; Studies find the way people tell their own stories has an outsize effect on their life satisfaction
By ELIZABETH BERNSTEIN – WSJ
In William Shakespeare’s time, the word “conversation” meant two things—verbal discourse, and sex. That’s how intimate the most well-known poet and playwright in the English language viewed the act of talking with another person.
goo.gl/cmlXF8

***** I did encourage you to be a storyteller last week. Tell The Story

++++

MWE Chi
MWE NY

***DA: We will feature 16 such storytellers at next week’s MarketsWiki Education events in Chicago, and 11 more in New York on July 19. Have your company’s interns signed up yet? Have you spread the word to the young folks in your life? Please help us help the future of the industry by checking us out and passing the word. Click HERE for more.

++++

“One person of integrity can make a difference”: The powerful words of “Night” author Elie Wiesel
Olivia Goldhill – Quartz
The Nobel Peace Prize laureate and author Elie Wiesel has died at the age of 87. The author of “Night,” which describes his experiences at Auschwitz concentration camp, was described as a “messenger to mankind,” when he was awarded the Nobel Peace Prize in 1986. Here are few of his most powerful messages.
goo.gl/E5kq9X

***** One person can make a difference. Be that person.

++++

Friday’s Top Three
In Friday’s newsletter, only a few clicks separated first place from third, mainly due to the fact that click counts were down ahead of the Independence Day holiday. Atop the list was the latest in a fraud case that won’t seem to die – Bank of NY Mellon settles $312 million claim tied to Sentinel fraud. In second place was a story line that seems to be putting the cart before the horse, European Cities Battle for London’s Finance Crown After Brexit Vote. Slow down, there, mates. London is barely down, and quite far from out as the chief financial hub. Rounding out the top three was the Brexit summary from the FIA, which asks and answers the question, “What now for cleared derivative markets?”

Lead Stories

London Stock Exchange wins shareholder support for Deutsche Boerse deal
Telegraph
The London Stock Exchange has won support from its investors to proceed with its £20bn merger with Deutsche Boerse, despite concerns that the firm is “shackling itself to a corpse” inside the European Union. An overwhelming 99.89pc of voting shareholders supported the deal going ahead, far above the 75pc threshold required. Having cleared this hurdle with LSE investors, the two companies have until July 12 to amass support among Deutsche Boerse’s shareholders, before working to win approval from several dozen competition authorities around the world.
jlne.ws/29frShd

London Stock Exchange Shareholders Approve Merger With Deutsche Börse; Challenges remain for the proposed tie-up following the Brexit vote
By TIM CAVE and IAN WALKER – WSJ
London Stock Exchange shareholders on Monday voted strongly in favor of a planned $30 billion tie-up with Germany’s Deutsche Börse, but after the U.K.’s decision to leave the European Union, bigger obstacles may lie ahead.
goo.gl/xJgTsQ

Costly data battle heats up between traders and equity exchanges; Information one of the biggest battlegrounds of the US finance industry
Robin Wigglesworth, Nicole Bullock and Gregory Meyer – FT
Information has become one of the biggest battlegrounds of the US finance industry, pitting banks, brokerages and trading firms against the exchanges that control the flow of financial market data.
/goo.gl/viKHkb

Battle lines drawn over London’s role in euro clearing; Clashes over important role in the City could set the tone for wider Brexit negotiations
Philip Stafford and Roger Blitz – FT
As the dust from Brexit settles, the battle over one of the City of London’s prestigious businesses is already escalating.
/goo.gl/1KCCr6

Goldman Sachs tells its asset managers to tighten belts; Non-essential travel ban imposed amid outflows and poor performance
Stephen Foley in New York – FT
Goldman Sachs has told staff at its asset management division GSAM to tighten their belts, amid outflows and poor performance from some of its largest funds.
/goo.gl/CTFo3T

Bond Markets Have a Message About the Economy That Stock Investors Might Not Want to Hear; There’s 60 percent chance of recession, according to a Deutsche Bank model.
Tracy Alloway
There’s a big disagreement brewing in global markets.
goo.gl/gcIZx1

LME considering to launch iron ore futures to meet hedging demand
Nikkei.com
The London Metal Exchange is considering to launch futures for iron ore and other steel raw materials to cater to growing demand from steel plants and other customers for hedging price volatility resulting from gyrating steel prices in China.
goo.gl/IJjgMk

CME to count on French grain firms in EU wheat battle with Euronext
BY GUS TROMPIZ – Reuters
CME Group faces a tough task getting Europe’s grain trade to adopt U.S.-style wheat futures, but backing from big French grain handlers gives it a chance of challenging Euronext in a market some traders say has room for only one exchange.
goo.gl/DG9fiw

LSE and Deutsche Boerse May Go Dutch to Win Over Regulators
John Detrixhe, Aaron Kirchfeld – Bloomberg
Firms may need to explore options to get nod from regulators; Brexit has made clearing, headquarters, politics more complex
London Stock Exchange Group Plc shareholders approved Deutsche Boerse AG’s acquisition of the 300-year-old exchange Monday in a near-unanimous vote. That was the easy part.
goo.gl/xTGK01

London exchange defends Deutsche Boerse deal after Brexit
BY HUW JONES – Reuters
The London Stock Exchange Group asked its shareholders to back a $27 billion merger with Deutsche Boerse on Monday, dismissing concerns it was “shackling itself to a corpse” after Britain voted to leave the European Union.
goo.gl/O7U84l

London Stock Exchange / Deutsche Börse: exchange of views; Politics should not intervene. They will
Lex – FT
If you did not like the London Stock Exchange-Deutsche Börse deal before the UK voted to leave the EU, you are unlikely to be more enamoured of it now. If, however, you found the deal sensible from industrial and regulatory points of view, you should do so still. What has changed is not the business or the rules governing it, but the politics.
/goo.gl/q8OnCP

‘Flash Boys’ Crusaders Seen Reaching Sixth Place Among Exchanges
Declan Harty – Bloomberg
Analyst sees IEX ‘significant achievement’ despite small size; CEO Katsuyama wants to steal business from NYSE, Bats, Nasdaq
IEX Group Inc. could triple its share of U.S. trading after converting its dark pool into an official stock exchange, according to an analyst.
Poised to open in mid-August, Investors Exchange may handle 2 percent to 5 percent of volume within the next five years, Weeden & Co.’s Andrew Upward estimated. In June, IEX’s current venue handled about 1.6 percent of trading.
goo.gl/1Bh7J6

As 2-and-20 Fees Under Fire, Asia Hedge Funds Seek Cost Cuts
Klaus Wille, Suzy Waite – Bloomberg
Bigger funds are joining ‘platforms’ as costs rise, fees fall; Credence Global, Black Crane among hedge funds on platforms
When Ruhong Huang’s Hong Kong-based hedge fund crossed a key milestone after gathering $100 million in assets, he made an unusual choice. Rather than continuing to go it alone, he decided to join a “platform” to help his firm with everything from hiring administrative staff to handling compliance.
goo.gl/np52vn

Black Swans and Game Theory: A Post-Brexit Guide to Bond Trading
Liz McCormick, Anchalee Worrachate – Bloomberg
Judging political risk increasingly important for investors, U.S. election, euro-region risks cloud outlook for 2016
Bond investors are used to factoring things like economic growth and inflation into their models. They have less experience with politics, and these days political risk is crucial.
goo.gl/QS02rT

Three Former Barclays Traders Convicted in Libor-Rigging Case; The jury couldn’t reach verdicts for two of their co-defendants
By MARGOT PATRICK and JOSIE COX – WSJ
Three former Barclays employees have been convicted of conspiracy to defraud in connection with an investigation into the manipulation of Libor interest rates.
goo.gl/JXEOSH

Almost Everyone Thinks the Pound’s Days Are Numbered
Marianna Duarte De Aragao – Bloomberg
Median of post-referendum forecasts is for 6% drop by year-end; Sterling is 11% weaker since U.K.’s decision to quit EU
The pound will fall even further than its three-decade low reached in the immediate aftermath of the Brexit vote, according to almost all the analysts who’ve changed their forecasts since the referendum.
goo.gl/4hOs28

Deutsche Bank Survey Finds Most Staff Aren’t Proud to Work There
Keith Campbell, Nicholas Comfort – Bloomberg
Results are ‘sobering picture of the mood inside our bank’; Staff still experience slow decision-making, complex processes
Deutsche Bank AG said a survey of staff found fewer of the German bank’s employees feel committed to the lender than they were a year earlier, with less than half saying they are proud to work at the firm.
goo.gl/YjQZ10

Non-bank market-makers appear to pass Brexit test
By Joel Clark – Financial News
Non-bank market-makers have been accused of creating fair-weather liquidity that disappears when markets get stormy. But during the typhoon of June 24, market participants said they continued to function.
goo.gl/xVhLWn

Brexit

Brexit: Leaving the EU threatens fund passport; European sales of Ucits products by UK managers face disruptions
Chris Flood – FT
Britain’s historic vote to leave the EU threatens to disrupt fund sales by UK managers across Europe, curtailing future asset growth and damaging profits.
/goo.gl/3YLzJk

No Brexit Without Vote in Parliament, London Law Firm Warns
Robert Hutton, Kit Chellel – Bloomberg
Mishcon de Reya, a top London law firm, said it’s representing a group of unidentified clients threatening legal action against the British government if it tries to initiate the process of leaving the European Union without consulting parliament.
goo.gl/N0V9dI

Bank of England eases rules for banks to meet Brexit challenge
BY DAVID MILLIKEN AND HUW JONES -Reuters
The Bank of England took steps to ensure British banks can keep lending and insurers do not dump corporate bonds in the “challenging” period that is likely to follow the country’s shock vote to leave the European Union.
goo.gl/hnomwr

Brexit Accelerates the British Pound’s 100 Years of Debasement
Simon Kennedy, Lukanyo Mnyanda – Bloomberg
The last century is a ‘downward ladder’ against the dollar; Boris Johnson sees pound pessimism as ‘wildly overblown’
In 1967, U.K. Prime Minister Harold Wilson declared devaluation wouldn’t diminish the “pound in your pocket.” Chancellor of the Exchequer Norman Lamont admitted he was heard “singing in the bath” after sterling’s link to the deutsche mark was severed in 1992, sending the currency tumbling.
goo.gl/Wb8TYi

Britain turns to private sector for complex Brexit talks; Britain seeks consultants to bridge trade negotiator gap with Brussels
George Parker, Sarah Gordon and Sarah Neville in London – FT
Britain is turning to the private sector to prepare for Brexit, seeking to second consultants to boost a civil service with almost no experience of complex trade negotiations.
/goo.gl/qDIZC8

Brexit: Asset managers retreat from the City of London; Brexit threatens UK’s position as world’s second-largest fund management centre
Chris Newlands, Madison Marriage and Attracta Mooney – FT
Asset managers have begun their slow detachment from London following Britain’s historic vote to leave the EU, with fund companies finalising plans to reduce their reliance on the City.
/goo.gl/Wgj1Ev

Brexit Is a Lehman Moment for European Banks
By Mark Gilbert – Bloomberg
European banks are undergoing a real-life stress test in the wake of Britain’s vote to leave the European Union. Their share prices were already down 20 percent this year; since the referendum result was announced, they’ve doubled that decline. If the rot isn’t stopped soon, Europe will have found a novel solution to the too-big-to-fail problem — by allowing its banks to shrink until they’re too small to be fit for purpose. The answer is found in the adage never let a good crisis go to waste.
goo.gl/ZnsEBJ

Brexit is an opportunity for European market, Euronext CEO says
Malay Mail Online
The UK vote to leave the EU is a growth opportunity for euro zone-based market places and market players will have to reorganise their businesses within the EU, Stock Exchange operator Euronext NV Chief Executive Officer Stephane Boujnah said yesterday.
goo.gl/vnXkUy

Post-Brexit, the Real Risk Is Europe Could Fail
By Jean-Michel Paul – Bloomberg
While the short-term economic consequences of Brexit are not to be dismissed, it is the impending failure of the European project that should provoke the bigger sense of concern. The EU’s two biggest achievements since the establishment of the single market — the euro and border-free travel — are both under threat. These implosions would be a magnitude more painful than the British vote.
goo.gl/wR83G3

Exchanges, OTC and Clearing

Why LSE Group Investors’ Votes May Be Wasted; Brexit threatens to crack the common regulatory ground in Europe and derail the merger
By PAUL J. DAVIES – WSJ
Voters sometimes worry their ballot won’t really count. Shareholders in LSE Group and Deutsche Börse must be feeling that ahead of votes on their merger.
goo.gl/KJEyfV

WFE: FOCUS – June 2016
In this edition, we hear from Oscar N. Onyema, CEO of the Nigerian Stock Exchange about his vision for the NSE, and from Alexandre Zeller, Chairman of SIX Group, who tells us about their middle ground approach to demutualisation.
We have an interesting piece from Rainer Riess, Secretary General of FESE, who discusses the themes that arose at their recent annual convention. And in an author’s slot, the Egyptian Exchange’s Dr Shahira Abdel Shahid discusses her new book with us.
We hope you enjoy the issue. Please send us your feedback as we develop and refine this publication, as well as any ideas for future features or interviews.
goo.gl/2L89OX

Flashboy Brad Katsuyama On The Future Of IEX After Winning SEC Approval
Steven Bertoni – Forbes
IEX Group, Brad Katsuyama’s controversial trading platform, won stock exchange status from the Securities and Exchange Commission on June 17th.
goo.gl/xUBuFG

Wiener Börse: 1HY: Austrian Stock Market Moves In Line With Europe
Mondovisione
The first half-year of 2016 on the Vienna Stock Exchange was an eventful one. After the increase in trading volumes in the first three months of the year, in April and May prices declined again. The Vienna Stock Exchange was unable to avoid European trends. Already in June equity trading had caught up with the first quarter of 2016, reaching EUR 5.94 billion. The Austrian leading index, the ATX, dropped in the first half of the year by 12.56% (-10.71% incl. dividends) along with other Western European indices (DAX: – 9.89%, Eurostoxx – – 12.33%). The Brexit vote triggered volatility around the end of the second quarter, and as expected, trading volumes were also high on the Vienna Stock Exchange.
goo.gl/lUOvUE

SGX review shows state of companies’ disclosures good with room for improvement
SGX
Mainboard companies reviewed for their Code of Corporate Governance (CG Code) disclosures scored an average 60% in an inaugural study by Singapore Exchange (SGX). Adherence to guidelines of the CG Code can be improved and deviations should be better explained, SGX said, adding that disclosures on “remuneration matters” were most in need of improvement.
goo.gl/Ag1peZ

SGX launches independent research paper on Retail sector
SGX
Singapore Exchange (SGX) launched an independent research report covering the retail sector in four ASEAN countries (Singapore, Indonesia, Malaysia and Thailand). This is part of SGX’s on-going efforts to educate and keep investors better informed of the sectors that are covered by its listed companies.
goo.gl/IIlQj1

Trading statistics June 2016
Eurex
Highest monthly trading volumes in 2016
In June 2016, the international derivatives market Eurex, part of Deutsche Börse Group, recorded an average daily volume of 9.4 million contracts (June 2015: 8.6 million), an increase of around 10 percent. In total, 207.7 million contracts were traded at Eurex in June. On 14 June, daily volume recorded an annual high with more than 17 million contracts.
goo.gl/o67mWE

Cash market turnover of Deutsche Börse achieved in June 134.9 billion euros
Deutsche Boerse
In June, the trading volume of all traded securities species was due to trading venues Xetra, Frankfurt Stock Exchange and Tradegate Exchange at a total of 134.9 billion euros (June 2015: 149.3 billion euros). Of this amount, 123.9 billion euros on Xetra (June 2015: EUR 140.1 billion). The average Xetra daily turnover in June was EUR 5.6 billion (June 2015: 6.4 billion euros). Euro 4.2 billion turnover achieved the trading venue Frankfurt Stock Exchange (June 2015: 4.1 billion euros). At the Tradegate Exchange * of sales in June was around EUR 6.8 billion (June 2015: 5.1 billion euros).
goo.gl/zUKCCd

Byron Baldwin: “The European Swaps Market – Futurisation Next?”
Eurex
With the European swaps market now fully in the grip of the EMIR timetable for mandatory central clearing of OTC IRS, what is next for this market? What about exchange traded Swap Futures as an alternative to cleared IRS?
goo.gl/P4p4i3

Japanese Commodity Markets Monthly Volume and Open Interest
JCCH
goo.gl/6MC9Lf

Bats Global Markets Statement On ISE Form 4 Filing
BATS
Bats Global Markets, Inc. (Bats: BATS), a leading global operator of exchanges and services for financial markets, provides the following additional information related to the Form 4 filed by International Securities Exchange Holdings, Inc. (ISE).
goo.gl/QjmBhU

Bats Global Markets to Hold Second Quarter 2016 Earnings Conference Call Thursday, August 4
BATS
goo.gl/EI6fCH

OneChicago Announces Trading Volume for June 2016; YTD Volume outpacing 2015 by 13%
OneChicago
OneChicago, LLC (OCX), a securities finance exchange, today announced its June 2016 volume of 1,343,750, a decrease of 22% year-over-year. OneChicago is a CFTC and SEC regulated exchange offering Single Stock Futures (SSF), a Delta One product, on approximately 1,800 equities, including ADRs and ETFs.
/goo.gl/wDIAPd

Politics

Wall Street Takes a Hit in Democratic Party’s Platform Draft
Michael Riley, John Voskuhl – Bloomberg
New taxes, $15 minimum-wage call a nod to socialist Sanders; Presumptive nominee Clinton looking to solidify left flank
Wall Street was hit hard in the latest draft of the Democratic Party’s platform, which reflected the influence of Bernie Sanders by taking a sharp leftward turn from 2012 on a range of issues, from regulation and taxes to support for a $15 minimum wage.
goo.gl/6y7jMI

Wall Street worried about Donald Trump; More bankers are donating to Hillary Clinton than her Republican rival
Laura Noonan – FT
America’s bankers are backing the Democrats in record numbers as they fret over the unpredictability of Republican presidential candidate Donald Trump.
/goo.gl/AQCqMb

Investing and Trading

Soc Gen Report Validates Managed Futures
www.valuewalk.com
Managed futures trend following strategies have a very different return profile than those of standard assets, a Societe Generale study noted, while recommending inclusion of the strategy in a portfolio. By just adding a 20% trend following exposure to a portfolio, the Sharpe ratio of the diversified equity portfolio increased by 40% and drawdowns were reduced by 8%.
jlne.ws/29frTl8

VIX Tempest Plays Havoc With Volatility Notes Taking Futures Cue
Joseph Ciolli – Bloomberg
Post-Brexit price swings have roiled exchange-traded products; Inverse ETN fell along with spot VIX on Monday amid turmoil
The market convulsions of the last week have been a lesson in the complexity of volatility markets for investors who bought exchange-traded notes tied to turbulence in equities.
goo.gl/Zyuezc

Kyle Bass Says China’s Corporate Bond Market Is ‘Freezing Up’
Ye Xie, Saijel Kishan – Bloomberg
Company defaults have more than doubled since last year; China’s corporate debt market contracted by a record in May
Kyle Bass, the hedge-fund manager who’s wagering on a devaluation in China, said the country’s $3 trillion corporate bond market is “freezing up” amid rising defaults and canceled debt sales.
goo.gl/aLbZqw

The 500 Tons of Gold That Show Global Rise in Investor Angst
Ranjeetha Pakiam – Bloomberg
Bullion holdings in ETFs extend surge after U.K.’s Brexit vote; Prices have rallied 27% this year with Fed seen holding rates
Global gold holdings have expanded by more than 500 metric tons since bottoming in January in a signal of investors’ rising concern about slowing growth, a Federal Reserve that’s probably on hold and the ructions caused by Britain’s vote to quit the European Union.
goo.gl/wyjDuu

Private equity groups look to profit from Brexit uncertainty; European funds put on brave face amid worries about the UK investment market
by: Joseph Cotterill – FT
Bill Conway, co-chief executive of Carlyle, flew into London in the Brexit aftermath for a routine check-up on the US private equity group’s investments in the region.
/goo.gl/LphsF7

Why climate change is an education issue
BY FELIPE CALDERON – Japan Times
Climate change affects us all, but we still are not acting as quickly as we should to address its causes, mitigate the damage and adapt to its effects. Many people don’t understand the risks climate change poses to global economic and social structures. And, sadly, many who do understand are dismissive of the far-reaching benefits a global shift to sustainability and clean energy would bring about.
goo.gl/SZxSOx

Gilt auction clocks record low yields
by: Joel Lewin – FT
The UK’s first government bond sale since the country voted to leave the EU has passed hiccup free, with record low yields and robust demand.
/goo.gl/drLrR6

Slide in shares of asset managers sparks job fears; UK-listed Henderson and Jupiter among the hardest hit after Brexit vote
by: Madison Marriage and Chris Flood – FT
Fears are growing over redundancies across the asset management industry as shares of some of the world’s largest listed investment groups tumbled in the wake of Britain’s vote to leave the EU.
/goo.gl/9zyY25

Hedge Funds Set for Worst First Half Since ’11 on Turmoil
Saijel Kishan – Bloomberg
Managers lost 1.1% on average through June 29, HFR index shows; Criticism mounts over high fees and crowding into same trades
The first six months of the year is turning out to be a period hedge fund managers want to forget.
goo.gl/z0vbGY

Institutions

Shallow markets help CTAs profit from June’s Brexit surprise
FT.com
A swift about turn by hedge funds which rely on computers to direct trading helped prompt a recovery for several markets last week in the aftermath of Britain’s vote to leave the EU, according to strategists at JPMorgan. The influence of a group of funds which collectively manage around $330bn, according to BarclayHedge, highlights questions about the depth of trading in stock markets when small changes in the balance of buyers and sellers can have outsize effects on prices.
jlne.ws/29frdw0

Thiam Says Credit Suisse Won’t Be Dismantled or Sold
Jeffrey Voegeli – Bloomberg
Investor doubts surface after Thiam’s year on the job; Some employees, investors have criticized bank’s leadership
Credit Suisse Group AG’s Chief Executive Officer Tidjane Thiam said the bank he’s been leading for a year will neither be dismantled nor sold.
goo.gl/gwxNZU

London Banker Bonuses Set to Shrivel as Brexit Hits Dealmaking
Ambereen Choudhury, Stephen Morris – Bloomberg
Recruiters say job preservation key as some bonuses to be zero; Bankers’ waning market power means firms likely to pay less
Just be glad you have a job. That’s the message London’s investment banks will be giving their staff this year, with bonus pools set to be cut by at least a quarter, as the U.K.’s decision to leave the European Union stymies dealmaking and threatens higher costs from moving staff, executives and recruiters said. Some bankers won’t even be that lucky, as a further round of job cuts in London are likely in September if client activity doesn’t pick up, according to multiple banking executives, who asked not to be named discussing personnel matters.
goo.gl/Jn7zSB

Fintech

Executives Struggle With Software Risk
By BEN DIPIETRO – WSJ
The pervasive use of software throughout all aspects of business has added another layer of risk to the corporate equation, as compliance, IT and the C-suite, among others, try to put in place controls and procedures to minimize risks and keep data secure.
goo.gl/2JANQm

In race to be Asia’s fintech hub, Singapore leads Hong Kong
Reuters
Singapore is rushing to reinvent itself as Asia’s financial technology, or fintech, hub to fend off a regulatory threat to its wealth management industry and revive a sluggish economy. State funding, light-touch regulation and a recent move to allow start-ups to test financial products in a controlled environment have put Singapore ahead of rival Hong Kong to be Asia’s fintech hotspot.”
jlne.ws/29vmXGZ

Opinion: Brexit is a tragedy, but it could be the making of UK Fintech
TechCrunch
Let there be no doubt – Brexit is a tragedy. Instead of taking on challenges with its European partners, Britain is taking precisely the wrong course, injecting needless uncertainty and negativity into the economy.
/goo.gl/Wmw8VH

EconoTimes
Blockchain technology can help create efficient capital market infrastructure: Report
Tuesday, July 5, 2016 7:32 AM UTC
Deutsche Börse’s corporate venture arm, DB1 Ventures, in partnership with Celent, a division of Oliver Wyman, has released a paper that highlights the power of future collaboration between leading financial infrastructure players and fintech firms.
goo.gl/SgcVGF

Post-Brexit, Market Data Vendors Predict Uncertain Future; Britain’s decision to leave the EU is expected to have little effect on the implementation and application of MiFID 2 on the UK markets. However, it may distract the industry from the fundamental problems that still exist within the text of the regulation. Inside Market Data looks at what impact Brexit may have on market data vendors.
Joanne Faulkner – Waters Technology
In the immediate aftermath of Britain’s decision to leave the European Union (EU), there were questions over what the result could mean for the applicability of European financial regulation to the UK market. Might the UK no longer need to comply with MiFID 2? Or would UK firms still have to adhere to the regulation in order to trade with European market participants covered by the regulation? The UK’s financial regulator, the Financial Conducted Authority, nipped this speculation in the bud almost immediately with a statement issued on June 24, the day after the Brexit vote.
goo.gl/P24GeA

Cinnober share added to second index
Cinnober
Market operator Nasdaq has announced the results of the semi-annual review of the First North 25 Index (Nasdaq Stockholm: FN25), which took effect when the market opened on Friday, July 1, 2016.
goo.gl/FX2SDu

Regulation

Brussels approves ‘misleading’ new legislation for retail funds; Investor rights groups and asset managers dismayed over Priips
by: Attracta Mooney – FT
Investor rights groups and asset managers have failed in their bid to overhaul controversial European rules they have warned will be “vastly misleading” for retail investors after lawmakers in Brussels signed off the legislation.
/goo.gl/FRvQIF

Exclusive: Banks saw unprecedented step up in market supervision around UK vote
BY PATRICK GRAHAM – Reuters
Central banks raised oversight of currency markets to an unprecedented degree around Britain’s shock vote to leave the European Union, demanding detailed updates from major trading desks every six hours throughout last week, industry sources said on Monday.
goo.gl/379Hw5

Barclays Libor verdicts provide much-needed victory for SFO; Convictions ‘restorative’ for reputation following earlier acquittals
by: Jane Croft and Caroline Binham in London -FT
After a mixed record in recent years, the UK’s Serious Fraud Office badly needed a win.
/goo.gl/wLrvCl

UBS ordered to provide France with tax information
BY JOSHUA FRANKLIN – Reuters
UBS (UBSG.S) has been ordered by Switzerland’s tax agency to provide France with tax information, the Swiss bank said on Tuesday, adding that it expected other countries to file similar requests.
goo.gl/aiVmIJ

Three former Barclays bankers found guilty over Libor rigging; Convictions hailed as a success for the UK’s Serious Fraud Office
by: Jane Croft
Three former Barclays bankers have been found guilty by a jury of conspiring to rig a key interest rate in a high-profile trial.
/goo.gl/nSctBH

Bank of England beefs up forecasting team and adds 300 new staff
Telegraph
The Bank of England has hired more than 300 new staff as it beefed up teams including its economic forecasting unit and its bank monitoring squads in the lead up to last month’s Brexit vote.
goo.gl/XqVokL

$160 BILLION IN FINES LEVIED SINCE ’08 FINANCIAL CRASH
BY CLARK MINDOCK – Newsweek
In the eight years since the 2008 financial crisis rocked markets and sent world economies into a downward spiral, many of the big banks that came to be seen as the face of that recession have spent a fortune on fines and settlements. The cases involve everything from fraud to toxic securities to loan and foreclosure abuse.
goo.gl/ObBKSY

Amendments to NFA Interpretive Notice: Forex Transactions
NFA
goo.gl/wYlRQf

U.S. charges Spanish man with lying in Potash insider trading probe
BY JONATHAN STEMPEL – Reuters
A U.S. grand jury has charged a Spanish investor with lying to regulators probing insider trading ahead of an August 2010 hostile bid for Potash Corp of Saskatchewan Inc, even though he had been cleared of charges over his own trading.
goo.gl/YfB26Z

German financial watchdog opens whistleblower bureau
Reuters
German financial watchdog Bafin is opening a new office on Monday dedicated to corporate whistleblowers, aiming to encourage more business insiders to expose wrongdoing.
goo.gl/RhyKOw

SEC launches probe into Silicon Valley executive Nikesh Arora; Watchdog has asked disgruntled SoftBank investors for information – FT
by: Leo Lewis in Tokyo, David J Lynch in Washington, and Kana Inagaki in Tokyo
US regulators are probing a range of transactions linked to Nikesh Arora, the Silicon Valley executive who has managed two of the world’s biggest technology companies.
/goo.gl/55GpXz

Regions

Singapore banks eye Facebook IDs for transfers; Service could also use Twitter usernames for payments
by: Jeevan Vasagar in Singapore
Banks in Singapore are collaborating on a new service that would allow customers to make payments using Facebook IDs or Twitter username.
/goo.gl/bTsMWp

NSE launches trade repository for corporate debt; The repository will provide consolidated information on over the counter deals in corporate bonds across exchanges
Business Standard
Leading stock exchange NSE today said it has launched a trade repository for Indian corporate debt, a move that will provide easy access to information on over the counter deals.
goo.gl/xbWSfw

Social Day Event in Singapore
Eurex
Our Deutsche Börse (DBG) colleagues from the Singapore office joined the Association of Persons with Special Needs (APSN*) team for our annual DBG Social Day event, on 24 June 2016. This year, DBG decided to conduct a half-day acrylic painting session supported by the APSN and the Visual Arts Centre Singapore. Acrylic painting activity was chosen as it combined both the fun and educational elements catered for the group of young people with special needs. The results prove that this worked perfectly well.
goo.gl/TsuxXJ

This economist thinks China is headed for a 1929-style depression
By Sue Chang – MarketWatch
Andy Xie isn’t known for tepid opinions.
The provocative Xie, who was a top economist at the World Bank and Morgan Stanley, found notoriety a decade ago when he left the Wall Street bank after a controversial internal report went public. Today, he is among the loudest voices warning of an inevitable implosion in China, the world’s second-largest economy.
goo.gl/JolGdJ

0.00 avg. rating (0% score) - 0 votes

About Author

Doug Ashburn is a former editor-at-large of John Lothian News. He left in late 2016 and is now the managing editor of T3 Custom.