Breaking News

Asia Pacific Finacial News from John Lothian News – August 11, 2017

Lead Stories

Wall Street’s ‘Fear Gauge’ Skyrockets as Tensions Rise With North Korea
Exit greed, enter fear. After a record-breaking run of buoyant market behavior, investors appeared unnerved on Thursday by a series of provocative remarks by President Trump and increasing tensions with North Korea.

Trump and Kim’s War of Words Has Asia Bracing for Conflict
By Jason Scott and Ting Shi – Bloomberg
China’s Global Times: Defend North Korea if U.S. attacks; Japan prepares to deploy missile interceptors: Nikkei
The escalating war of words between U.S. President Donald Trump and North Korean leader Kim Jong Un sent Asian markets tumbling as the region braced for more provocations from his regime next week.

Financial analysts suggest buying German Bunds in case of nuclear war
The Week
Financial analysts are putting their heads together to predict how nuclear war would affect the markets — you know, just in case. “The market’s view is likely too sanguine in short term,” analysts at Citi told The Wall Street Journal. “This reflects investors’ experience that geopolitical rhetoric can quieten as quickly as it escalates, and a pervasive belief that the true risk of military confrontation is minimal.”

More Trump Dump
South Korea’s stocks and currency fell after President Donald Trump warned North Korea that if it “does anything” to the U.S. or its allies “things will happen to them like they never thought possible.” South Korea will strengthen monitoring of financial markets and economy, and take action based on a contingency plan in case of any unusual movements, the Finance Ministry said in a statement after meeting with other ministries, Bank of Korea and financial regulators.

Exchange News

Offshore ringgit futures may hamper efforts to deepen onshore mart
Offshore trading of ringgit futures, such as the one introduced by the Singapore Stock Exchange (SGX), poses a threat to Bank Negara Malaysia’s efforts to deepen the onshore ringgit market, say economists. Singapore should respect the vision and strategic interest of its neighbouring countries, they said.

Tokyo Bitcoin Exchange Coincheck Launches Startup Investment Fund
Samburaj Das –
Japanese bitcoin exchange Coincheck is launching a new investment fund aimed at supporting startups developing virtual currency services and blockchain-based solutions.

HKEX Plans to Implement Proposed After-Hours Trading Enhancements
Enhancements to be introduced in three phases, starting with extension of after-hours trading of index futures to 1 am from 11:45 pm; Second and third phases include inclusion of index option contracts and extension of after-hours trading to 3 am respectively; Changes subject to regulatory approval and market readiness
Hong Kong Exchanges and Clearing Limited (HKEX) published its consultation conclusions today (Friday) on its proposed after-hours trading (AHT) enhancements.

HKEX and Cyberport Host Seminar on Proposed New Board to Accelerate Growth of Emerging New Economy in Hong Kong
Hong Kong Exchanges and Clearing Limited (HKEX) and Cyberport today jointly hosted a seminar at Cyberport entitled “Hong Kong’s Evolving Regime: New Board for New Economy Companies” that gathered representatives of HKEX, industry leaders and aspiring technology entrepreneurs for a discussion of HKEX’s New Board proposal.

Exchange Updates Guidance to Help Improve Listing Document Quality and Clarity
Exchange recommends page limits for two more listing document sections;
Vetting may be suspended if listing documents are not succinct and focused on material information; GEM Listing applications may be returned if fundamental issues are not clearly understandable after two rounds of comments from the Exchange
Clearly and succinctly drafted listing documents for equity securities of new applicants (listing documents) expedite the vetting process. With the aim of improving the quality and clarity of listing documents, The Stock Exchange of Hong Kong Limited (the Exchange), a wholly-owned subsidiary of Hong Kong Exchanges and Clearing Limited (HKEX), published today (Friday) two updated Guidance Letters – HKEX-GL86-16: “Guide on Producing Simplified Listing Documents Relating to Equity Securities for New Applications” and HKEX-GL56-13: “Guidance on (i) disclosure requirements for substantially complete Application Proofs; and (ii) publication of Application Proofs and Post Hearing Information Packs on the Exchange’s website”.

FinTech News

Singapore fintech hub to set up office in India
Singapore Business Review
It also plans to open offices in London, New York, and the Middle East. Bloomberg Technology reported that Singapore fintech hub Lattice80 plans to open an office in India by the end of next month, the first step in a global expansion that will spread to London, New York and the Middle East.

Fintech players welcome open banking paper
By Penny Pryor – Financial Observer
The fintech community has welcomed the government’s release of an issues paper on its review into open banking.

Regulatory News

Australian financial chiefs lash poor banking culture amid fresh CBA scandal
Two of Australia’s most senior financial officials called into question the integrity of the country’s top banks on Friday, saying they risked losing public trust in the wake of unprecedented money-laundering and terror financing allegations.

CFD regulation and the global impact – A comprehensive guide
James O’Neill, Director of ILQ Australia Pty Ltd, examines the differing regulatory requirements applying to contracts-for-difference across Australia, Cyprus, the UK and the US, makes a comparative study of OTC leveraged derivatives in selected jurisdictions, looking at rules relating to the handling of client money, fair market

Chinese Regulator Launches Probe Into Tencent, Weibo and Baidu
Bloomberg News
Regulator investigates reports of content law violations; Users have reported instances of porn, violence and rumors
China’s online watchdog has launched an investigation into reports of multiple violations at news services run by Tencent Holdings Ltd., Baidu Inc. and Weibo Corp., as the government continues to tighten scrutiny over internet content.

Investing News

U.S. Short Sellers Missed Out on Biggest China Slump This Year
By Richard Frost – Bloomberg
The worst selloff in Chinese shares since November took U.S. traders by surprise, with short interest in one of the biggest exchange-traded funds tracking the country’s stocks near a two-year low.

Ex-Nomura Manager Admits to Insider Plot With Wife’s Account
By Erik Larson – Bloomberg; Plot involved trades in NeuStar ahead of Golden Gate purchase
A former risk manager at Nomura Holdings Inc.’s Americas division in Manhattan pleaded guilty to securities fraud, admitting he traded last year using inside information about a private equity fund’s planned takeover of a technology company.


Aging Japan Puts A Strain On The Financial System
By Gaston Gelos and Sònia Muñoz – Seeking Alpha
Japan’s population is shrinking and getting older, posing challenges to the nation’s financial system. How Japan copes could guide other advanced economies in Asia and Europe that are grappling with the same trends but are at an earlier phase of similar demographic developments.

Mainland China

China’s economic problems are exactly why its global influence is expanding; Slowing economic growth in China is spurring its top leadership to expand the country’s influence beyond its shores; China’s efforts follow similar longstanding efforts by neighbors Japan and South Korea; China is also trying to buy its way into influence with its massive investment
Huileng Tan – CNBC
Slowing economic growth in China is spurring its top leadership to expand the country’s influence beyond its shores — a development that was most recently on display at an annual forum of the Association of Southeast Asian Nations.

China ‘granny gang’ jailed in lending clampdown; Elderly female debt collectors intimidated borrowers into paying up
Emily Feng in Beijing – FT
A Chinese court has sentenced 14 members of a roving band of elderly female debt collectors to as many as 11 years in jail, in the latest sign of the country’s clampdown on informal channels of lending.

China Takes On State-Owned Firms; A new directive suggests an ambitious effort under way.
By Christopher Balding – Bloomberg
A little-noticed statement last week could portend the next big battle in China’s effort to control its debt. On Aug. 2, the finance ministry issued directives that state-owned companies improve returns, control risks and make sure that “projects are financially viable before decisions are made.”

Hong Kong

The World’s Most Expensive Housing Market Just Got Even Pricier
By Eric Lam – Bloomberg
The world’s priciest housing market got even more expensive in the second quarter. Hong Kong’s housing affordability ratio, which measures the proportion of income spent on mortgages, worsened to about 67 percent for the quarter, the government said Friday, up from 56 percent in the year-earlier period.


Online hiring in finance sector sees high Asian growth
by Santi Arnaiz – HRD
According to the latest Monster Employment Index, Singapore’s Banking and Financial Services Industry (BFSI) saw an 11% hike in online hiring activity this year, the steepest recorded growth in Southeast Asia.

Singapore economic growth accelerates in second quarter, beating forecasts; Singapore’s economic growth accelerated in the second quarter, with gross domestic product rising 2.9 percent on-year, beating forecasts
Leslie Shaffer – CNBC
Singapore’s economic growth accelerated in the second quarter, with its gross domestic product rising 2.9 percent on-year, beating a Reuters poll forecast for 2.6 percent growth.


Vietnam launches derivatives market
Vietnam has opened a derivatives market in a bid to draw more investment to its capital markets, with futures contracts set to launch first, the Hanoi Stock Exchange said on Thursday, August 10.



Thailand ranked 10th in Asian digital rankings Survey finds Thailand besting only 
A digital talent shortage, fewer digital products and uncertain policies have put Thailand near the bottom of the digital nation index, says a Singapore-based advisory firm.

Thailand, Philippines Want No Part of Asia Dollar Bond Boom
By Lianting Tu and Carrie Hong – Bloomberg
Asian financial crisis remains fresh in the memory of issuers; Two countries relying instead on strong domestic bond markets
Over in Asia’s booming dollar-bond market, there are two notable absentees: Thailand and the Philippines.


Philippine Peso Falls to Fresh 11-Year Low
By Siegfrid Alegado , Cecilia Yap , and Ditas B Lopez – Bloomberg
Peso, Asia’s worst performer, fell to lowest level in 11 years; Central bank held key rate while raising inflation forecasts
Philippine central bank Governor Nestor Espenilla said the peso will trade within “manageable levels” with a flexible exchange rate policy. The currency extended declines.


1MDB Makes Payment of $350 Million to Abu Dhabi’s IPIC; 1MDB payment is part of compensation to IPIC for emergency loan and other financial support
By Yantoultra Ngui – WSJ
Malaysia’s troubled state-investment fund 1Malaysia Development Bhd., or 1MDB, said Friday that it had paid the equivalent of $350 million to Abu Dhabi’s sovereign International Petroleum Investment Co. after missing a pair of deadlines.

Malaysia’s central bank criticises SGX’s trading of ringgit futures
Malaysia’s central bank Bank Negara Malaysia on Wednesday (Aug 9) hit out at the Singapore Exchange (SGX) after the bourse rolled out the trading of ringgit futures on its exchange last month.


India bids farewell to the typewriter in drive to digitise economy
Saptarshi Ray – Telegraph
Though largely redundant in many parts of the world the familiar sound outside Indian courts and municipal buildings is often the clack of plastic keys and the punch of steel hitting inky ribbon.


Directors must ask if they would pass ‘the front page test’
by Joanna Mather, Patrick Durkin, Jacob Greber – AFR
Company directors have pushed back at Australian Securities and Investments Commission chairman Greg Medcraft’s use of the Commonwealth Bank crisis to advance the notion that directors can be held responsible for ruining a company’s reputation.

Australia to invoke mutual defence pact if North Korea attacks US; PM Malcolm Turnbull issues pledge after talks with US vice-president Mike Pence
Jamie Smyth in Sydney – FT
Australia has said it would invoke its longstanding military alliance with America in the event the North Korean regime attacks the US.

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

About Author

Lothian is executive chairman and CEO of John J. Lothian & Co. and editor of the John Lothian Newsletter. He publishes,,, and three industry newsletters.