Breaking News

Widespread Fraud in ICOs and Penny Stocks Shocked SEC’s Jay Clayton

fraud

First Read

Hits & Takes
JLN Staff

Thank you to all who donated to the Gofundme campaigns mentioned in the newsletter yesterday. I could not be more proud of you all for your outpouring of support and generous response. The goal for Anthony Di Benedetto has nearly been reached and the goal for the Burns family has been exceeded even more.~JJL

As heart-pulling as the stories in JLN were, yesterday was a somber day for me as I attended a wake for a childhood friend who made the ultimate decision. His brother asked all of us in attendance to reach out to someone we have not talked to in a long time and just say hello and listen. It was a powerful suggestion and reminder to care for and stay connected to our friends and family. Small acts of kindness can make a big difference.~JJL

In light of yesterday’s mislinked photo – apologies to Eurex CEO Thomas Book for misrepresenting him as TMX Group CEO Lou Eccleston – rest assured that JLN has developed an image verification tool using cutting edge machine learning techniques. (Now, that’s not true, but we will maintain our vigilance.) ~SD (EDITOR’S NOTE: All employees have been issued a See ‘n Say with only pictures of Mr. Book and Mr. Eccleston on it, so that is a sort of machine learning isn’t it?)

So far in our annual series with industry leaders that we film at FIA Boca we have released videos of former Liffe and LME CEO Garry Jones; CME Chief Commercial Officer Julie Winkler; Trading Technologies CEO Rick Lane; ASX Deputy CEO Peter Hiom; Cboe President and COO Chris Concannon; Cinnober Executive Chairman Nils-Robert Persson; Greenkey CEO Nader Shwayhat; LME CEO Matt Chamberlain; SGX EVP and Head of Derivatives Michael Syn; TMX CEO Lou Eccleston and Eurex CEO Thomas Book. (And there are plenty more to come!)~SD

On June 7, FIA Operations Americas will host its Annual Angelo LaSpina Golf Outing in Staten Island. Proceeds go to the FIA Operations Americas Division Scholarship Program. Sign up here.~SD

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A Reg Wrap
Spencer Doar – JLN

SEC Chairman Jay Clayton and SEC Director of the Division of Trading and Markets Brett Redfearn were in Chicago yesterday for an STA Equity Market Structure Symposium at the University of Chicago’s Gleacher Center. Here are some takeaways:

Perhaps biggest of all the endeavors on the SEC’s plate is the newly announced transaction fee pilot. While the agency has not established a quantitative measure to determine success or failure of the pilot, the hope is that the data gathered will finally shed light on the best way to revamp existing liquidity-related rebates and fees.

Clayton is very concerned about the Consolidated Audit Trail. Issues have arisen that were not considered in the (multi-year) planning period. He said the industry undoubtedly needs an audit trail and the firms charged with building it are more than capable. But that’s about it – questions about progress on the CAT were left hanging in the air. There was not a satisfactory answer or explanation for its delays or when it might be on track. He offered a rather glib response at one juncture, simply saying we’re at the stage where people know they have to mail a letter, but there’s no mailbox to put it in.

Clayton said during his tenure at the helm of the agency he has been shocked by the amount of fraud in ICOs and penny stocks.

It does seem like the SEC’s agenda for 2018 is one of the most ambitious in recent years. There will be three roundtables in 2018 to address some of the issues the SEC has prioritized. The first roundtable will deal with illiquid stocks. Does the industry need a one-size fits all market structure when 15 percent of listed equities account for less than one percent of daily volume? The second roundtable will deal with how to improve investment and development of the SIP. That will also serve as an opportunity to address market data in general. The third roundtable will address retail fraud.

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Rosenthal Collins Group Appoints Steve Ivey Chief Risk Officer
Rosenthal Collins Group
Rosenthal Collins Group LLC (RCG), a leading independent futures brokerage and clearing firm, announced today the appointment of Steve Ivey as Executive Vice President & Chief Risk Officer. Ivey brings more than two decades of risk management experience in trading, liquidity, credit, operational and market risk.
/goo.gl/7KMtfP

***** When the risk gets too much, I bet he climbs up the wall.~JJL

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Will the Rockefeller Collection be the First Art Auction to Top $1 Billion?
Kelly Crow – WSJ
A century ago, Standard Oil baron John D. Rockefeller became one of the world’s first billionaires at a time when the U.S. government’s annual budget hovered at around $700 million. This month, the vast art collection amassed by his grandson David Rockefeller could make history of its own by selling for as much as $1 billion at Christie’s in New York. No other estate auction has ever crossed that mark.
/goo.gl/o4JSTg

****Thinking of big name American families, FX’s new series “Trust” about the Getty family has been a great watch so far.~SD

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Can Humans Understand How Robots Invest?; A new ETF buys stocks picked by artificial intelligence. That requires a leap of faith.
Sarah Ponczek – Bloomberg
For a guy who built a robot he hopes will banish human emotion from the investing process, Chida Khatua spends a lot of time trying to figure out how it thinks.
/goo.gl/aBao32

***** Warning, Warning!!!~JJL

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Aaron Rodgers converts Dalai Lama to Green Bay Packers fan, which is nice
The Guardian
Green Bay Packers quarterback Aaron Rodgers managed to recruit a new fan during a humanitarian mission to India this week – while perhaps taking a stride toward achieving total consciousness.
/goo.gl/No6a7d

*****The Dalai Lama is not to be confused with the Dawley Llama.~JJL

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Tuesday’s Top Three
Yesterday’s top three items were about tragedy and hope. The top read item was Crain’s story on LJM Partners in How the wrong bet on market volatility annihilated this mutual fund. Second and third were from the heart, two separate funding appeals for people in our industry. Sometimes reaching out can be a powerful thing. The first was a Gofundme appeal for the wife and family of James Burns, who died suddenly of a heart attack at the age of 49. Next was the Gofundme appeal from former Nymex and Comex staff member Anthony Di Benedetto for medical and foreclosure expenses. It is at times like these when this community has stepped up to help those in need. These certainly are two of them.

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MarketsWiki Stats
123,228,079 pages viewed; 23,067 pages; 212,663 edits
MarketsWiki Statistics

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Lead Stories

Widespread Fraud in ICOs and Penny Stocks Shocked SEC’s Jay Clayton
Nick Baker – Bloomberg
SEC chairman comments of first-year lessons in Chicago speech; Agency to weigh effectiveness of regulatory approaches, he says
The former Wall Street deals lawyer who leads the U.S. Securities and Exchange Commission said one of the biggest surprises of his first year heading the agency has been learning about the levels of fraud surrounding initial coin offerings and penny stocks.
/goo.gl/AwP8Ev

US sanctions heighten LME fears over Rusal exposure; Nervous investors are unwinding aluminium positions, even if it means a loss
Henry Sanderson – FT
As Matthew Chamberlain prepared to return from an annual copper conference in Chile on Tuesday, the youngest chief executive of the London Metal Exchange faced a dilemma.
/goo.gl/vjrDP6

China Adds Flesh to Bones of Plan for Big Bang Financial Opening
Bloomberg News
Quota for Mainland-Hong Kong stock connect will be quadrupled; Yi: Rate differential with the U.S. is in ‘comfortable range’
China’s plan for an historic opening of its financial sector came into sharper focus as the nation’s top central banker elaborated on pledges from President Xi Jinping that have buoyed global markets and eased trade tensions with the U.S.
/goo.gl/p1Bc6J

CME revokes approved status for Rusal’s aluminium
Reuters Staff
CME Group has revoked approved status for registration of Russian firm Rusal’s metal for delivery against its aluminium futures contracts, according to a notice on its website.
/goo.gl/9qRfYm

China Takes New Step Toward Opening Its Financial Markets to the World; Beijing pledges to launch stock trading link between Shanghai and London
Shen Hong – WSJ
China has pledged to launch a stock trading link between Shanghai and London by the end of this year, taking a fresh step towards opening up its financial markets and providing the U.K. with a vote of confidence ahead of Brexit.
/goo.gl/Rb3qLM

Britain’s FCA reviewing U.S. sanctions against Russian firms
Reuters Staff
Britain’s Financial Conduct Authority (FCA) is reviewing the new U.S. sanctions against Russian individuals and entities to determine the impact on UK-listed firms, it said on Wednesday.
/goo.gl/Ft6mYx

Crypto hedge fund known for eye-popping early returns lost nearly 50 percent last month; Crypto hedge fund Pantera Capital saw the value of its Digital Asset Fund cut nearly in half in March, according to an investor letter published Tuesday.
Kate Rooney – CNBC
Pantera Capital, a hedge fund that gained attention for returning 25,000 percent over its lifetime through the end of last year, saw the value of its cryptocurrency fund cut nearly in half in March, according to an investor letter Tuesday.
/goo.gl/odFGyy

SGX plans June launch of new Indian equity derivatives products; New product launch follows news of major Indian stock exchanges deciding to terminate market data and indices licenses.
Hayley McDowell – The Trade
The Singapore Exchange (SGX) will launch new derivatives products for Indian equities in June to replace its existing Nifty futures.
/goo.gl/N3z3h2

5 Questions with Michael Creadon, Cryptocurrency Analyst and Trader
Brian Mehta – Trading Technologies’ Trade Talk Blog
Michael Creadon is CEO at 4Rev, an independent research and analysis firm that focuses on cryptocurrencies. He previously served as CEO of Traditum, a Chicago-based proprietary trading firm that specialized in yield curve trading on the CME Group.
/jlne.ws/2GNiulM

Fintech Sales Pioneer USAM Group Expands Its Unique Service in Europe — USAM Group
PRLog
Leanne Bassett joins USAM London as a Senior Sales Executive…
Alan Grigoletto joins as USAM’s first-ever Italy based Senior Sales Executive…
/jlne.ws/2IHCJxr

Eurekahedge reports second month of losses for hedge funds in 2018
Beverly Chandler – Hedgeweek
Eurekahedge reports that hedge funds registered their second consecutive month of losses since the start of 2018, with the Eurekahedge Hedge Fund Index declining 0.51 per cent in March, while still outperforming the MSCI World Index which ended the month down 2.21 per cent.
/jlne.ws/2GNk8Uk

Ant Financial’s Mysterious Valuation Inflation; Alibaba affiliate apparently worth $150 billion, even as shadows spread over its growth and profitability
Jacky Wong – WSJ
China’s Ant Financial is looking ever more like an elephant, but investors should be wary of getting squashed.
/goo.gl/GTK6oZ

IHS Markit Adds Cybersecurity Risk Ratings to Research Signals; Factor-based investment research service enhanced with BitSight Security Ratings
Business Wire
Business information provider IHS Markit (Nasdaq: INFO) today announced that Research Signals, its quantitative equity research product, has enhanced its factor-based investment analyses with 35 cybersecurity risk factors on more than 3,000 public companies. The cybersecurity risk factors are based on security ratings from BitSight, a leading provider of actionable risk intelligence, and deliver investment risk indicators for institutional investors.
/goo.gl/Eury4U

Exchanges, OTC and Clearing

CME stockpiles cash at Fed
Louie Woodall – Risk.net
The CME Group deposited more than $28 billion of its cash to the Federal Reserve over the course of 2017 while drawing down its deposits and reverse repo trades with commercial banks and offloading billions of dollars’ worth of securities.
/goo.gl/pKT8jx

SGX updates on India equity derivatives plans
SGX
SGX will list new India equity derivative products in June 2018, to provide market participants with continuity and the ability to seamlessly transition their current India risk management exposures. These products also add to the existing India Single Stock Futures offering, which has garnered active participation from global institutional clients since its launch, demonstrating the demand for access products.
/goo.gl/Jqaadi

Chinese Version of Guide to TSE Trading Methodology
JPX
For investors to understand the TSE trading methodology, TSE offers “Guide to TSE Trading Methodology”, a guide book explains how transactions on the TSE market works. JPX released the Chinese version of the guide. To download the PDF file, please click the following link.
/goo.gl/bDnroi

HKEX Comments On Stock Connect Daily Quota Expansion
HKEX
Hong Kong Exchanges and Clearing Limited (HKEX) has issued a Business Update following the joint announcement from the China Securities Regulatory Commission and Hong Kong’s Securities and Futures Commission about the expansion of the existing daily quota under the Stock Connect. From 1 May 2018, the Northbound daily quota will be increased from RMB13 billion for each of the Shanghai Connect and the Shenzhen Connect to RMB52 billion and the Southbound daily quota will be increased from RMB10.5 billion for each of the Shanghai Connect and the Shenzhen Connect to RMB42 billion.
/goo.gl/ywuFjJ

Extension of trading hours for selected benchmark futures and MSCI futures to 21 hours
Eurex
Eurex Deutschland plans to extend its trading hours for selected equity index, fixed income, volatility and MSCI futures into the Asian time zone in December 2018.
/goo.gl/mMVTPB

Deutsche Boerse and the Hessian Ministry of Economic Affairs bring together sustainability initiatives in the financial center of Frankfurt; New Sustainable Finance Cluster brings together activities in the area of ??sustainable finance
Deutsche Boerse Group
Deutsche Boerse’s Accelerating Sustainable Finance Initiative and the Green Finance Cluster Frankfurt of the Hessian Ministry of Economic Affairs announced their merger on Wednesday. Under the name of Sustainable Finance Cluster, all activities of the two initiatives will continue together in the future. The aim is to make even more efficient use of financial market expertise in the field of sustainable finance on the basis of a broad dialogue, and above all to formulate and implement concrete approaches to the future viability of national and international financial market structures.
/goo.gl/6se5Wh

Retail Estates lists on Euronext Amsterdam
Euronext
Retail Estates (ticker symbol: RET), a leading real estate company specialised in out-of-town retail real estate, began trading on Euronext Amsterdam today.
/goo.gl/yz5rJH

UBS MTF lists more than 50 stocks suspended by MiFID II DVCs; Bans will be implemented over a six month period, effective from 13 April, but capped instruments remain available for trading under LIS waiver.
Hayley McDowell – The Trade
UBS multilateral trading facility (MTF) has announced that 57 stocks will be suspended from trading after breaching MiFID II’s double volume caps (DVCs).
/goo.gl/HzATa9

MOEX awards best traders among Siberian University students
MOEX
On 10 April 2018, Alexander Afanasiev, CEO of Moscow Exchange, awarded winners of the Novosibirsk Region Governor’s Cup for On-exchange Financial Market. The contest was held among students of Siberian universities at the initiative of Moscow Exchange and with support from the Novosibirsk regional government. The awards ceremony took place today at the annual Exchange Forum in Moscow.
/goo.gl/fdqV5m

https://jlne.ws/2H8nqRB

China Futures Market Monitoring Center: 1st Full-Market Testing For International Business Of Iron Ore Futures Completed
MondoVisione
On March 31 and April 1, Dalian Commodity Exchange (DCE) organized China Futures Market Monitoring Center, futures-company members and information providers to carry out the 1st full-market testing for the business of ushering in overseas traders of iron ore futures. The testing aims to promote initial preparations for the international business of iron ore futures and guarantee the successful operation of relevant business.
/goo.gl/rDPdkv

Fintech

Matrix Executions Expands Offering with Cboe Silexx Integration
MarketWatch
Matrix Executions, LLC. (“Matrix”) now offers Cboe’s Silexx OEMS users an additional option for routing. Matrix Executions, a newly formed agency only broker-dealer, serves the needs of exchanges as well as institutional and retail professionals.
Silexx, an innovative multi-asset order and execution management system (OEMS) caters to institutional customers throughout the U.S. With the Silexx OEMS, users can efficiently trade multiple equities based asset classes using Matrix routing and algorithmic strategies from one platform.
jlne.ws/2IJRlfT

Temenos wins regulatory approval for Fidessa takeover; The UK’s FCA and antitrust authorities in the US have approved Temenos’ acquisition of Fidessa.
Hayley McDowell – The Trade
Temenos has gained approval of its £1.4 billion bid to acquire technology vendor Fidessa from regulatory authorities in the UK and the US.
/goo.gl/fnBpLo

UK takeover panel sets Fidessa counterbid deadline
Philip Stafford – FT
The UK Takeover Panel has sought to hurry along the battle for Fidessa by telling the two potential counterbidders they have 10 days in which to make a firm offer for the UK trading software company.
/goo.gl/VA3xDK

Quantitative Brokers appoints new tech chief from Bloomberg Tradebook; New chief technology officer at Quantitative Brokers previously oversaw Bloomberg Tradebook’s equities, options and FX algorithms.
Hayley McDowell – The Trade
Futures and US cash treasury algorithm and analytics provider Quantitative Brokers has appointed a new chief technology officer who has joined the firm from Bloomberg Tradebook.
/goo.gl/ZLG6xY

Cryptocurrencies

Digital Day 2018: EU countries to commit to doing more together on the digital front
European Commission
Tomorrow the Commission will bring ministers, representatives of EU countries, industry, academia and civil society representatives together to encourage cooperation in artificial intelligence, blockchain, eHealth and innovation.
/jlne.ws/2v4siSM

European countries join Blockchain Partnership
Digital Single Market
22 European countries signed today a Declaration on the establishment of a European Blockchain Partnership. The Partnership will be a vehicle for cooperation amongst Member States to exchange experience and expertise in technical and regulatory fields and prepare for the launch of EU-wide blockchain applications across the Digital Single Market for the benefit of the public and private sectors. This should ensure that Europe continues to play a leading role in the development and roll-out of blockchain technologies.
/jlne.ws/2v3ib0t

Japan: Self-Regulatory Group Study Reveals 3.5 Mln Active Crypto Investors
CoinTelegraph
Japan delivered new statistics about cryptocurrency use on Tuesday, April 10 as regulators and industry players push for greater transparency in the country’s market.
A report from Japan’s self-regulatory body the Japanese Cryptocurrency Business Association (JCBA) revealed at a meeting of a study group commissioned by the Financial Services Authority (FSA) analyzed various data from 17 major exchanges in 2017.
/jlne.ws/2GNRYIT

FCA to publish cryptocurrency review later this year; Confirmed firms offering crypto derivatives must be regulated
Jayna Rana – Investment Week
The Financial Conduct Authority (FCA) has announced its intention to outline its views on cryptocurrencies later this year, as revealed in its business plan for 2018/19.
/goo.gl/syF4We

The World Is Cracking Down on Bitcoin—Except Japan; Even after a massive hack, the Japanese government is sticking to its crypto-friendly policies.
Yuji Nakamura, Aki Ito – Bloomberg
Over the last few months, governments around the world have cracked down on bitcoin and other cryptocurrencies. But one country is sticking to its crypto-friendly policies: Japan. This week on Decrypted, Bloomberg Technology’s Yuji Nakamura and Aki Ito take you to Tokyo to meet the unlikely characters who helped turn Japan into the world’s premier bitcoin hub, including investor Roger Ver, a.k.a. Bitcoin Jesus.
/goo.gl/q8b5ZR

The @Bitcoin Account Is Back From Suspension and Tweeting Against Bitcoin
Camila Russo – Bloomberg
The @Bitcoin account is back up on Twitter after being suspended Sunday, and the verbal jabs are just as intense.
/goo.gl/oWTzxF

Lessons on Bubbles From Bitcoin; Until there is a way to bet against an asset, its price will be set by the most upbeat buyer.
Noah Smith – Bloomberg
The recent Bitcoin bubble wasn’t the first, and it might not be the last. Once in 2011 and twice in 2013, the price soared and then crashed:
/goo.gl/7yUQEc

A veteran Wall Streeter has left Credit Suisse for a crypto trading desk
Frank Chaparro – Business Insider
A Credit Suisse trader is the latest Wall Streeter to flee finance for crypto Nelson Minier, a Bronx-native, has joined the cryptocurrency exchange Kraken as a trader for its new over-the-counter trading operation, two people familiar with the situation told Business Insider. Over the course of nearly 20 years, Minier has worked for almost every major Wall Street firm, including Bear Stearns, Morgan Stanley, UBS, Citigroup, JPMorgan, and most recently Credit Suisse.
/goo.gl/8cMTCE

Bittrex Reopens New Customer Registrations; The company also unveils upgraded website for customers
Bittrex
Bittrex, the premier U.S.-based blockchain trading platform, today announced the resumption of new user registrations and the launch of its enhanced website. In addition, Bittrex is now supporting corporate accounts and accepting new corporate applications.
/goo.gl/kiEZLY

Politics

The Law Is Coming, Mr. Trump
The Editorial Board – NY Times
Why don’t we take a step back and contemplate what Americans, and the world, are witnessing?
/goo.gl/4ENUZJ

Zuckerberg Asks Congress to Be Friends
Kathleen Hunter – Bloomberg
It’s day two in the hot seat for Mark Zuckerberg. And if the Facebook chief was hoping his congressional appearance would help stave off a regulatory push, his Senate testimony yesterday will give him pause.
/goo.gl/5K8TBr

Regulation

Mark Carney Gets a New Right-Hand Man
Lucy Mean – Bloomberg
James Benford appointed governor’s private secretary; Previous holders including Alex Brazier, Andrew Bailey
Mark Carney has a new right-hand man in a position that’s previously been a stepping stone to the highest ranks at the Bank of England.
/goo.gl/9EEGUw

Incentivizing Post-trade Risk Reduction
International Swaps and Derivatives Association
Post-trade risk reduction has become increasingly common as a means to reduce risks in the derivatives market. Portfolio compression is a case in point: offsetting trades between multiple parties are torn up, which reduces the size of gross exposures, in turn reducing systemic risk. Over EUR1,000 trillion in derivatives exposures has been eliminated in this manner.
/jlne.ws/2JzHF8Z

****Above is the summary of the white paper – to go straight to the full white paper click here.

Proposed Rule Change Relating to the Establishment of a Second Trade Reporting Facility in Conjunction with Nasdaq, Inc.
FINRA
Financial Industry Regulatory Authority, Inc. (“FINRA”) is filing with the Securities and Exchange Commission (“SEC” or “Commission”) a proposed rule change to adopt rules relating to the establishment of a second Trade Reporting Facility or “TRF” to be operated in conjunction with Nasdaq, Inc. (“Nasdaq”). The second FINRA/Nasdaq Trade Reporting Facility (“FINRA/Nasdaq TRF Chicago”) would provide FINRA members with another mechanism for reporting over-the-counter (“OTC”) trades in NMS stocks and complying with FINRA’s requirements with respect to back-up trade reporting arrangements.
/goo.gl/bta9GW

Retirement Isn’t Free—But Your 401(k) Match Is
FINRA Staff
Are you making the most of your company’s 401(k) match? Each year, Americans leave billions of dollars in 401(k) company matches on the table. Take steps today to make sure you aren’t one of them by making the most of your company’s 401(k) match.
/goo.gl/HmvhQa

ESMA updates its double volume cap register
ESMA
The European Securities and Markets Authority (ESMA) has updated today its public register regarding the double volume cap (DVC) mechanism under the Markets in Financial Instruments Directive (MiFID II).
/goo.gl/pZqqji

ESMA asks Commission to clarify ancillary activity test under MiFID II
ESMA
The European Securities and Markets Authority (ESMA) has today written a letter to the European Commission regarding the exemption from authorisation as investment firm which non-financial entities are eligible for when their commodity derivative trading activity is ancillary to their main business as set out in Directive 2014/65/EU on markets in financial instruments (MiFID II).
/goo.gl/9T3eAy

Investing and Trading

The 50 cent options trader who bets on market volatility says a financial ‘earthquake’ is coming
Sam Jacobs – Business Insider Australia
The market meltdown in early February — when US stocks had their biggest one-day fall in six years— proved to be more of a financial tremor, but the threat of an actual earthquake remains.
/goo.gl/cwE96J

Opinion: The surprising reason stock-market investors on higher floors take more risks; Scientists are just starting to understand how buildings that surround us can have a powerful impact on our decision
Sina Esteky – MarketWatch
Stocks have been on a bumpy ride lately as concerns over a trade war prompt investors to rethink their appetite for risk.
/goo.gl/QWA3aB

Institutions

Exposed: Lehman Brothers internal FX training manual – Want to know what Tier 1 banks teach their FX desks? Look no further
Andrew Saks-McLeod – FinanceFeeds
The Tier 1 banks dominate the FX industry from their Canary Wharf nerve centers. Last look, counterparty credit restriction and lack of accountability when things go awry remain moot points for liquidity takers. Here is what they teach their FX staff.
/jlne.ws/2IE8tDN

British Banks Will Have to Cut Ties to Sanctioned Oligarchs, U.S. Says
Ellen Barry – NY Times
The United States on Tuesday ratcheted up its efforts to block Kremlin-linked industrialists from doing business in the West, warning that British banks will have to sever their relationships with the tycoons if they want continued access to American financial institutions.
/goo.gl/c7FJFw

Fidelity Is Rethinking How It Charges You for Financial Advice; The changes mark the latest attempt by a large wealth manager to simplify its fees
Sarah Krouse – WSJ
Fidelity Investments is overhauling what it charges affluent clients for financial advice, one of the biggest-ever pricing shake-ups for a firm that oversees hundreds of billions in wealth held by American investors.
/goo.gl/fheBgz

Barclays to Shut $1.2 Billion of ETNs, But Do Investors Know?
Rachel Evans – Bloomberg
Holders remain in 50 notes that Barclays will close Thursday; The British bank is ‘streamlining’ platform and lowering fees
If you own an exchange-traded note sold by Barclays Plc, go check your mail. Now. The British bank is retiring or replacing roughly half of its U.S. offerings on Thursday, according to statements from the company. The plan affects 50 ETNs with about $1.2 billion in assets, data compiled by Bloomberg show. Yet, as of last week, assets stubbornly remained in the notes, meaning investors appear to be oblivious to a shake up that could strand them with hard-to-trade securities.
/goo.gl/HLnjZ1

Regions

Moscow urges calm as chill hits from new round of US sanctions
Kathrin Hille and Max Seddon – Financial Times
It was standing room only at Russia’s largest stock exchange on Tuesday as the country’s top economic policymakers faced an unenviable job: trying to persuade a crowd of skittish investors that the economy can weather the latest sanctions imposed by the US.
/jlne.ws/2IJprAu

US-China rivalry will shape the 21st century
Martin Wolf – Financial Times
China is an emerging superpower. The US is the incumbent. The potential for destructive clashes between the two giants seems potentially unbounded. Yet the two are also intimately intertwined. If they fail to maintain reasonably co-operative relationships they have the capacity to wreak havoc not only upon each other, but upon the entire world.
/jlne.ws/2IKfjrv

China accelerates opening to foreign financial groups; Majority stakes to be permitted in securities and fund management companies within months
Tom Mitchell and Hudson Lockett – FT
Foreign financial groups will be allowed to take majority stakes in securities, fund management, futures and life insurance companies “within a few months”, China’s central bank said on Wednesday.
/goo.gl/mHVMut

Hard questions for India’s private sector banks; Doubts over performance of non-state lenders ICICI and Axis after surge in bad loans
Simon Mundy – FT
A landmark moment for India’s male-dominated business sector came in the summer of 2009, when Chanda Kochhar and Shikha Sharma took charge of its two largest private-sector banks by assets.
/goo.gl/66DLVr

Deripaska’s Two-Decade Wooing of U.S. Ends in Financial Meltdown
Stephanie Baker – Bloomberg
For two decades, Oleg Deripaska pursued one of the few things he couldn’t buy—American acceptance—with all the tenacity you’d expect from a man who built what was once the world’s ninth-largest fortune.
/goo.gl/W6jbBS

Russia Investors Offload Ruble as U.S. Sanctions Spook Market
Natasha Doff, Ksenia Galouchko – Bloomberg
Many funds were overweight Russian assets: AllianceBernstein; Emerging-Market ETF that holds Russian debt suffers outflow
Russia’s ruble extended its slump and credit risk climbed as foreign investors cut their holdings amid a wave of uncertainty created by the latest round of U.S. sanctions.
/goo.gl/jc1kK9

Hong Kong’s currency to remain pegged to the US dollar in the near future, IMF’s Lagarde says; The Hong Kong dollar, the biggest loser among a dozen Asian currencies against the euro last year, weakened to 7.8499 per US dollar on Wednesday, the weakest level since 1983
Eugene Tang, Karen Yeung – South China Morning Post
Hong Kong’s currency should remain pegged to the US dollar, said the International Monetary Fund’s Managing Director Christine Lagarde, even if it has weakened to the lowest level in 35 years, barely 0.01 cent from touching a red line that triggers an intervention by the city’s monetary authority.
/goo.gl/9RivrM

Brexit

UK businesses call for post-Brexit alignment with EU regulations; CBI presents report on 23 sectors of the UK economy
George Parker – FT
Large swaths of the economy will be damaged if the UK deviates too far from EU regulations after Brexit, according to a new report from the CBI business lobby.
/goo.gl/azsTQF

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About Author

Bergstrom is chief information officer of John J. Lothian & Co. He edits MarketsWiki and JLN Options.