G’day All,
Well, pressed for time.
First thing, is time for a rant – it’s been a while.
During TradeTech liquidity this week there were some comments made about CCPs.
I though the comments well off the mark if not irresponsible in the current market situation.
See below (I have already posted the response in my blog).
Other news:
Great that the US gets out of Iraq – they have enough things at home to spend their cash on.
NYSE & Liquidnet link up. Lit and dark will continue to mix.
AIG: This is ridiculous. Nobody works for a dollar per annum. This is just ‘disclosed’ compensation, there are obviously other drivers here. Why would any of us work for a dollar? The pendulum has swung too far the other way. What are the motivators (believe me, self interest is in there somewhere).
Chi-X: news from Asia
Nasdaq: Energy
CDS Clearing: Again, forget when I said it, but we see the call for competition. See: http://clearingandsettlement.blogspot.com
Fidessa: I do like the concept of the fragmentation index. I can’t comment on the formula, but it is a view. Up until now I have relied on the BBG MDM page (Market Depth Monitor). Worth a look for those interested in liquidity shifts: http://fragmentation.fidessa.com/ (Fidessa is now traded on Chi-X and cleared by EMCF)
BHP: If ever there was a time to pull a deal this was a good one.
Hey: Aussie is getting digital radio next year! Cutting edge down here I tell you!
Fortunately we had some rain last weekend so I could watch some sport.
For variety I watch Aust NZ in the rugby league world cup final. We were useless and in my view deserved to lose for being too complacent. Awful and depressing performance.
As for the Aust / France game. We got through by the skin of our teeth. I think both teams were held back by a dreadful ref.
Have a great week end all.
S
The Rant bit:
I read the below remarks from yesterdays TradeTech Liquidity conference with some concern.
Skinner comments ….” I raised heckles a little by asking the dumb question, “as EMCF only has two risk managers and is now run by the Dutch Government, isn’t that bad for business?”
(Well, – I’m taking the bait here).
I’d like to suggest the following points are also worthy of consideration when responding to such, at least in my view, mis-informed questions:
1.
Risk management is a sub second world is not about people watching trades. It is about systems, procedures, rules etc. To date the regulators have proven very effective at supervising all the new CCPs. I recommend any of the national regulatory reports (FSA, DNB etc.) where you can see first hand how CCPs are measured against the CPSS / IOSCO standards. Let the regulators continue with their jobs.
2.
A CCP operates as a closed eco-system. There are layers of protection from participation criteria, margining (remember the focus here) and elements of mutualisation such as a default fund. In between there may be other layers of protection of various degrees. What is important, and what the regulators accesses, is the ability of a CCP to handle default events without recourse to external capital. Neither the capitalisation of the CCP nor its ownership could be relevant in the event of adequate margins being called. When a CCP is stress tested, it is done on this basis. If the overall protection is not sufficient you will see either an increase in margin rates, default fund requirements or other. Again, leave the regulators to carry on doing their supervisory role.
3.
Personally, I don’t think there was any joy in allowing Lehmans to fail. Nor for that matter in any of this market turmoil. That said, EMCF has experienced a default event and within 36 hours all EMCF participants were assured that there would be no recourse to their default fund contributions. This was possible in part due to the focus of the assets serviced and risks monitored. Again, the ownership of EMCF had no bearing on this event (the Lehman event was prior to the Fortis change of control announcements). This was simply a CCP doing what it is created for.
4.
To date we have seen no failure by the regulators in their supervision of CCPs. That is not to say they should not be challenged but let’s do it constructively.
5.
Fragmentation is the cost that allows the benefits of competition to accrue to the market. Embrace the evolving market place and do your bit for all Europeans!
6.
People also want cheaper post trade costs. Remember clearing (risk management and charged per transaction) is different from settlement (change of ownership and charged net per transaction). EMCF has hammered down clearing costs to 5 eurocents and the primary market CCPs have begun to respond. EMCF has identified there is a place for new entrant CCPs and indeed they have come (e.g. EuroCCP).
Iraq boots out the Americans It's official (nearly): Iraq's government wants America's army out by the end of 2011Full article
Worst of financial crisis yet to come: IMF chief economist
The IMF's chief economist has warned that the global financial crisis is set to worsen and that the situation will not improve until 2010, a report said Saturday.
http://news.yahoo.com/s/afp/20081122/bs_afp/financeeconomyimfwarning_081122230427;_ylt=AltDxLTl468j48yo2z2gkXSmOrgF
'The Economy Fell off the Cliff'
George Soros, 78, has made billions as a hedge-fund manager and investor. SPIEGEL spoke with him about the current financial crisis, how he expects President-elect Barack Obama to respond to the economic disaster and the responsibilities borne by speculators.
http://www.spiegel.de/international/business/0,1518,592268,00.html
Saving Citi May Create More Fear
By ERIC DASH
The government’s bailout of Citigroup could lead other banks to take bigger risks.
http://www.nytimes.com/2008/11/25/business/25citi.html?hp
Action on 'Lehman loophole'
By Jean Eaglesham, Chief Political Correspondent
Insolvency law will be reformed to address a serious City concern over the safety of money held with London investment banks following the collapse of Lehman Brothers, the pre-Budget report stated, reports Jean Eaglesham. The government will adopt special powers in the banking bill going through parliament to bolster the protection for client money and assets held in investment companies. A review of the insolvency regime for investment banks will be conducted by next summer, ahead of a full formal consultation.
http://www.ft.com/cms/s/0/9026ada6-ba92-11dd-aecd-0000779fd18c.html?nclick_check=1
Liquidnet and NYSE Arca link up
By Anuj Gangahar in New York
The electronic trading arm of NYSE Euronext, the transatlantic exchange, is to start providing liquidity to customers of Liquidnet in the latest sign of convergence between exchanges and so-called “dark liquidity pools”.
http://www.ft.com/cms/s/0/c93e6c2e-ba55-11dd-92c9-0000779fd18c.html
or
25/11/2008 15:02:00
NYSE ARCA TO PARTNER WITH LIQUIDNET
Nyse Arca is to add liquidity to buy-side block crossing network Liquidnet, as traditional exchanges and dark pools trend towards convergence strategies.
More on this story: http://www.finextra.com/fullstory.asp?id=19337
Citigroup bailout servicing costs double with rescue Citigroup will have to pay an annual cost of nearly $4bn (€3.2bn) in dividend payments to service the securities that it has issued over the past 12 months in order to recapitalise itself, after the bank last night accepted a $20bn bailout from the US Treasury.
AIG freezes executive salaries
By James Langton
American International Group, Inc. announced voluntary restrictions on executive compensation Tuesday. The restrictions include a US$1 salary for its chief executive officer; no 2008 annual bonuses and no salary increases through 2009 for AIG’s top-seven-officer leadership group; and no salary increases through 2009 for the 50 next-highest executives, in addition to other bonus, severance and retention award restrictions.
http://www.investmentexecutive.com/client/en/News/DetailNews.asp?id=47119&IdSection=149&cat=149&BImageCI=1
AIG said it would freeze the pay of its seven most senior executives, and that its chief executive would receive a token salary of $1. The decision was welcomed by those who had criticised the insurance company when executives lavished $440,000 at a resort soon after AIG was bailed out. Separately, Marcel Ospel, a former chairman of UBS, who was ousted in April, agreed to return SFr22m ($18.4m) in pay to the troubled Swiss bank.
Asset managers support bank pay Fund managers have largely voted in favour of UK banks’ remuneration arrangements despite criticism of bankers’ pay since the start of the financial crisis, according to new research, which found that the 81.8% support recorded for HSBC's pay packages in May was the lowest yes-vote for a UK-listed bank since 2006.
New Chi-X Asia-Pacific CEO targets 2009 launches
NASDAQ OMX SELECTED TO ESTABLISH UK POWER MARKET Nasdaq OMX has been chosen by the Futures & Options Association (FOA) to set up a UK spot and cash-settled derivatives power exchange.
Full story: http://www.finextra.com/fullstory.asp?id=19349
Gooch and Smith call for CDS clearing competition
Terry Smith and Mickey Gooch, the chief executives of two of the world’s largest interdealer-brokers, have backed plans to introduce clearing of credit derivatives, but demanded regulators ensure competition exists between clearing house providers.
http://www.efinancialnews.com/usedition/tradingandtechnology/content/3452566936/
New US clearers could face frosty reception - Tabb
LSE plans for second 'dark' trading function The London Stock Exchange is preparing to launch a new service that will allow investors to execute large orders "in the dark", following delays at the exchange's proposed dark pool and today's launch of of an anonymous trading function by rival Deutsche Börse.
FIDESSA CLAIMS 20 EUROPEAN CLIENTS FOR INTELLIGENT LIQUIDITY ACCESS STRATEGY
http://www.finextra.com/fullpr.asp?id=24766
http://fragmentation.fidessa.com/
Changes reflect the add-on of Fidessa Group as a cleared stock for the UK segment. As of tomorrow, this stock will be available for trading on all three platforms.
25/11/2008 15:31:00
ASSET MANAGERS CALL FOR CONSOLIDATED TAPE AS MIFID RULE CHANGES HIT DATA QUALITY
The UK Investment Management Association (IMA) says the quality of information relating to best execution in UK equities has deteriorated since the introduction of the Markets in Financial Instruments Directive (MiFID) last year.
More on this story: http://www.finextra.com/fullstory.asp?id=19338
http://www.investmentuk.org/
http://www.investmentuk.org/press/2008/20081125.asp
http://www.thetradenews.com/operations-technology/market-data/2511
SECFINEX SIGNS WITH SIS X-CLEAR FOR SECURITIES LENDING CCP Nyse Euronext subsidiary SecFinex has commissioned SIS x-clear to develop a central counterparty service for stock borrowing and lending across the SecFinex Order Market.
Full story: http://www.finextra.com/fullstory.asp?id=19335
EUROCLEAR TO ACQUIRE XTRACKTER
European depository Euroclear is to acquire Xtrakter, the capital markets services division of trade association ICMA.
Full story: http://www.finextra.com/fullstory.asp?id=19312
Tokyo Stock Exchange Decides Detail Contents And Pricing Of Co-Location Service
Tokyo Stock Exchange, Inc. (TSE) has announced its decision today on detail contents and pricing of its "Co-Location Service" at TSE Primary Site. Co-Location Service is designed to further enhance market convenience for investors and trading participants.
http://www.mondovisione.com/index.cfm?section=news&action=detail&id=79104
BHP advisers lose millions as collapsed deal breaks records Eight investment banks hired to advise Anglo-Australian miner’s BHP Billiton $66bn (€51bn) hostile takeover bid for Rio Tinto today lost over a $100m in potential fees in the largest transaction ever to be withdrawn.
Digital radio comes late to the party was meant to be the Christmas present on everyone's list this year but we will now have to wait until Mother's Day to experience free-to-air digital radio.
Friday, November 28, 2008
Tuesday, November 25, 2008
One year after MiFID, where is liquidity going?
This morning I read the following:
Chris Skinner posted the following comment on one of his blogs based on a panel he moderated at trade tech liquidity:
"I .... ask(ed) a dumb question, “as EMCF only has two risk managers and is now run by the Dutch Government, isn’t that bad for business?”.
Well, I'm going to take the bait:
(Please note: Since the equinox study EMCF reduced their fees to 5 euro cents - the Equinox study gives some context as to where we came from in 2006.)
1.
Chi-X is a price discovery platform for blue chip and second line equities. EMCF likewise is a CCP focused purely on a single asset class over a T+3 settlement period (T+2 for Germany).
2.
Let's consider a parallel with another industry. Many of us use public transport to get to work – are we suggesting that each and every rail commuter have a guard with them for health and safety? What is the ratio of staff at banks per transaction processed? We are talking in a technological age where we use technology to perform ‘peak transaction’ processing.
Let's consider a parallel with another industry. Many of us use public transport to get to work – are we suggesting that each and every rail commuter have a guard with them for health and safety? What is the ratio of staff at banks per transaction processed? We are talking in a technological age where we use technology to perform ‘peak transaction’ processing.
3.
Risk management is a sub second world is not about people watching trades. It is about systems, procedures, rules etc. To date the regulators have proven very effective at supervising all the new CCPs. I recommend any of the national regulatory reports (FSA, DNB etc.) where you can see first hand how CCPs are measured against the CPSS / IOSCO standards. Let the regulators continue with their jobs.
Risk management is a sub second world is not about people watching trades. It is about systems, procedures, rules etc. To date the regulators have proven very effective at supervising all the new CCPs. I recommend any of the national regulatory reports (FSA, DNB etc.) where you can see first hand how CCPs are measured against the CPSS / IOSCO standards. Let the regulators continue with their jobs.
4.
A CCP operates as a closed eco-system. There are layers of protection from participation criteria, margining (remember the focus here) and elements of mutualisation such as a default fund. In between there may be other layers of protection of various degrees. What is important, and what the regulators accesses, is the ability of a CCP to handle default events without recourse to external capital. Neither the capitalisation of the CCP nor its ownership could be relevant in the event of adequate margins being called. When a CCP is stress tested, it is done on this basis. If the overall protection is not sufficient you will see either an increase in margin rates, default fund requirements or other. Again, leave the regulators to carry on doing their supervisory role.
A CCP operates as a closed eco-system. There are layers of protection from participation criteria, margining (remember the focus here) and elements of mutualisation such as a default fund. In between there may be other layers of protection of various degrees. What is important, and what the regulators accesses, is the ability of a CCP to handle default events without recourse to external capital. Neither the capitalisation of the CCP nor its ownership could be relevant in the event of adequate margins being called. When a CCP is stress tested, it is done on this basis. If the overall protection is not sufficient you will see either an increase in margin rates, default fund requirements or other. Again, leave the regulators to carry on doing their supervisory role.
5.
Personally, like many of us, I don’t think there was any joy in allowing Lehmans to fail. Nor for that matter in any of this market turmoil. That said, EMCF has experienced a default event and within 36 hours all EMCF participants were assured that there would be no recourse to their default fund contributions. This was possible in part due to the focus of the assets serviced and risks monitored. Again, the ownership of EMCF had no bearing on this event. This was simply a CCP doing what it is created for.
Personally, like many of us, I don’t think there was any joy in allowing Lehmans to fail. Nor for that matter in any of this market turmoil. That said, EMCF has experienced a default event and within 36 hours all EMCF participants were assured that there would be no recourse to their default fund contributions. This was possible in part due to the focus of the assets serviced and risks monitored. Again, the ownership of EMCF had no bearing on this event. This was simply a CCP doing what it is created for.
6.
To date we have seen no failure by the regulators in their supervision of CCPs. That is not to say they should not be challenged but let’s do it constructively.
To date we have seen no failure by the regulators in their supervision of CCPs. That is not to say they should not be challenged but let’s do it constructively.
7.
As evidenced by the industry, there is a demand for competition. Lets support that. Fragmentation is the cost that allows the benefits of competition to accrue to the market. Embrace the evolving market place and do your bit for all Europeans!
As evidenced by the industry, there is a demand for competition. Lets support that. Fragmentation is the cost that allows the benefits of competition to accrue to the market. Embrace the evolving market place and do your bit for all Europeans!
8.
People also want cheaper post trade costs. Remember clearing (risk management and charged per transaction) is different from settlement (change of ownership and charged net per transaction). EMCF has hammered down clearing costs to 5 eurocents and the primary market CCPs have begun to respond. EMCF has identified there is a place for new entrant CCPs and indeed they have come (e.g. EuroCCP).
People also want cheaper post trade costs. Remember clearing (risk management and charged per transaction) is different from settlement (change of ownership and charged net per transaction). EMCF has hammered down clearing costs to 5 eurocents and the primary market CCPs have begun to respond. EMCF has identified there is a place for new entrant CCPs and indeed they have come (e.g. EuroCCP).
9.
If anyone wants some slides on how EMCF has driven down fees I’ll post these on my blog: http://clearingandsettlement.blogspot.com/
Finally, please note, these views are my own. I make these as an individual that believes in a better deal for European Capital markets.
I’m sorry to have taken the bait on this one, but I think it would be irresponsible not to.
Scott Riley
s.riley.mail@googlemail.com
If anyone wants some slides on how EMCF has driven down fees I’ll post these on my blog: http://clearingandsettlement.blogspot.com/
Finally, please note, these views are my own. I make these as an individual that believes in a better deal for European Capital markets.
I’m sorry to have taken the bait on this one, but I think it would be irresponsible not to.
Scott Riley
s.riley.mail@googlemail.com
Friday, November 14, 2008
LSE, SWX, Alpha, ASEAN, ICAP
G’day All,
Well, another busy week and as a result I have not kept up with the headlines.
LSE: STG 350 mill for investment opportunities. Italian firms migrated to TradElect.
SWX: As always, sorry to hear of job losses.
Nasdaq: Continuing rationalisations. I agree with breaking the defacto reference data monopolies.
NYSE.EN: Delays the octopus
Exchanges generally feeling the pinch of monopoly habits. Index fall hints at stock exchange consolidation
Liquidnet: Busy in Asia
SGX: Thinks ASEAN
Alpha: in Canada: Interesting what industry syndicates can achieve: Alpha Group was established in May 2007 by BMO Capital Markets, Canaccord Capital Corporation, CIBC World Markets, CPP Investment Board, Desjardins Securities, National Bank Financial, RBC Capital Markets, Scotia Capital and TD Securities.
Regulation:
Industry associations flag MiFID faults in EC survey: If someone can find this report on the EC web site (drove me nuts) or anywhere I’d be interested in reading a copy.
Other reading:
Icap publishes OTC markets white paper
http://www.finextra.com/fullpr.asp?id=24492
and the report is available from their home page:
www.icap.com
When Madonna first moved to England she said she wanted to feel more English.
She is now an unmarried, single mother with three kids from different fathers, one of them black.
Job done
I’ll be in Singapore next week for TradeTech Asia so if anyone wants to meet up, just let me know.
Have a wonderful weekend all.
Rugby will have to wait till I get home!
S
LONDON STOCK EXCHANGE TAKES LEHMAN CHARGE AND SETS BACK BAIKAL LAUNCH Shares in the London Stock Exchange dropped by more than ten per cent after the UK market operator cancelled its share buy-back programme and warned of "extraordinarily difficult" market conditions.
Full story: http://www.finextra.com/fullstory.asp?id=19283
LSE BRINGS ITALIAN EQUITIES ONTO TRADELECT
The London Stock Exchange has completed the migration of Italian equities onto the TradElect platform, creating Europe's deepest pool of liquidity.
More on this story: http://www.finextra.com/fullstory.asp?id=19270
SWISS EXCHANGE TO CLOSE SWX EUROPE WITH THE LOSS OF 40 JOBS
In a move that marks the end of a seven-year presence as a recognised investment exchange in London for the Swiss group, SIX Swiss Exchange will close SWX Europe and reunify share trading in Zurich by mid-2009 in an effort to streamline operations and cut costs.
More on this story: http://www.finextra.com/fullstory.asp?id=19263
SWISS EXCHANGE PULLS LONDON TRADING BACK TO ZURICH -- November 11, 2008
SWX closes London business amid competitionSwiss Exchange, Europe’s fifth largest stock market, has become the first European exchange to succumb to the increasing pressure on the region's main equity markets from new trading rivals, announcing its decision to shut a London-based operation and move it to Zurich.
NASDAQ BACKS SEC ON SECURITIES SYMBOL SELECTION PLAN
http://www.finextra.com/fullpr.asp?id=24446
NASDAQ OMX REORGANISES NORDIC OPERATIONS AFTER NORD POOL ACQUISITION
http://www.finextra.com/fullpr.asp?id=24457
Liquidnet responds to crossing demand in Singapore
SGX wants Asian clearing links for ASEAN exchange initiative
Market turmoil delays NYSE Euronext MTFs
Alpha trading platform snatches 36% share in Canadian blue chips
BATS Europe would be “disappointed” with 5% market share
Industry associations flag MiFID faults in EC survey
Call for evidence on the impact of MiFID on secondary markets functioning
Closing date : 09 Jan. 2009
http://www.cesr-eu.org/index.php?page=consultation_details&id=125
TRADEWEB DEVELOPS ONLINE MARKETPLACES FOR CDS INDEX TRADING IN US AND EUROPE
http://www.finextra.com/fullpr.asp?id=24439
FSA probes new equities trading platforms for transparencyThe Financial Services Authority has launched an investigation into at least two of Europe’s new equities trading platforms, in a move that signals the financial turbulence has led market regulators to question the transparency of their operations. (Financial Times)
Index fall hints at stock exchange consolidationAn index tracking the share price performance of the world's top listed exchanges fell more steeply in October than in any other month this year, suggesting the sector may be facing a wave of consolidation next year.
THE TRADE NEWS: SGX Wants Asian Clearing Links for ASEAN Exchange InitiativeBy Staff11/10/08Hsieh Fu Hua, CEO of the Singapore Exchange (SGX), has outlined provisional clearing and settlement arrangements for a pan-Asian stock exchange.At the 12th general meeting of the Asia-Pacific Central Securities Depository Group on Monday, Hsieh proposed that any Asian cross-border trading initiative should be accompanied by clearing and depository links between the countries involved.The Association of Southeast Asian Nations (ASEAN) has been exploring the idea of an electronic cross-border trading platform, in keeping with the association’s desire to establish closer links between its member’s capital markets by 2015. The exchanges involved are SGX, Indonesia Stock Exchange, Vietnam’s Ho Chi Minh City Stock Exchange, Bursa Malaysia, the Philippine Stock Exchange and the Stock Exchange of Thailand. The exchanges in Korea and Tokyo have also been invited to share their thoughts. At present, it is proposed that an ASEAN trading board would consist of the 30 “best” or most liquid stocks from each exchange involved in the project. It is intended that investors will be able to trade ASEAN stocks through their own local brokers, who will then use a corresponding broker in the home market where the stock is listed. Trading of stocks will continue to be subject to the rules of their own individual markets.“SGX has proposed that the trading board be accompanied by clearing and depository links, which will enable better management of risks and settlement failures,” said Hsieh. “This will also reduce costs for overseas brokers, who will only need to build back-office structures in their home markets. The creation of multilateral clearing links is a natural precursor to the integration of trading platforms, paving the way for a more liquid, lower risk and cost-efficient pan-Asian market.”Talks between ASEAN members are ongoing. A statement issued by SGX to The Trade read, “SGX continues to work closely with the ASEAN exchanges to pursue possibilities and work out the feasibility of the project. As such, the details and time frame have yet to be established.”
THE TRADE NEWS: Alpha Trading Platform Snatches 36 Percent in Canadian Blue ChipsBy Staff11/11/08Alpha, the alternative trading system (ATS) launched last Friday by a consortium of Canadian brokers, grabbed 36.24% of overall volume in ten blue-chip Canadian stocks on its second day of trading.Alpha achieved 10% of total volume across the ten securities in which it offers trading on its first day. The ATS is backed by nine brokers, but approximately 30 market participants were connected at launch. “Volume and value traded are key success indicators but what struck us most today was liquidity,” said Jos Schmitt, CEO of Alpha Group. “Throughout the day, Alpha was often showing the greatest liquidity at equivalent or better bid and ask spreads than other market places, despite the fact that many dealers are still ramping up their capabilities to trade on Alpha. This gives us a glimpse about what is to come and tells us where investors will need to look for price discovery and efficient execution.”Alpha Group was established in May 2007 by BMO Capital Markets, Canaccord Capital Corporation, CIBC World Markets, CPP Investment Board, Desjardins Securities, National Bank Financial, RBC Capital Markets, Scotia Capital and TD Securities.
Well, another busy week and as a result I have not kept up with the headlines.
LSE: STG 350 mill for investment opportunities. Italian firms migrated to TradElect.
SWX: As always, sorry to hear of job losses.
Nasdaq: Continuing rationalisations. I agree with breaking the defacto reference data monopolies.
NYSE.EN: Delays the octopus
Exchanges generally feeling the pinch of monopoly habits. Index fall hints at stock exchange consolidation
Liquidnet: Busy in Asia
SGX: Thinks ASEAN
Alpha: in Canada: Interesting what industry syndicates can achieve: Alpha Group was established in May 2007 by BMO Capital Markets, Canaccord Capital Corporation, CIBC World Markets, CPP Investment Board, Desjardins Securities, National Bank Financial, RBC Capital Markets, Scotia Capital and TD Securities.
Regulation:
Industry associations flag MiFID faults in EC survey: If someone can find this report on the EC web site (drove me nuts) or anywhere I’d be interested in reading a copy.
Other reading:
Icap publishes OTC markets white paper
http://www.finextra.com/fullpr.asp?id=24492
and the report is available from their home page:
www.icap.com
When Madonna first moved to England she said she wanted to feel more English.
She is now an unmarried, single mother with three kids from different fathers, one of them black.
Job done
I’ll be in Singapore next week for TradeTech Asia so if anyone wants to meet up, just let me know.
Have a wonderful weekend all.
Rugby will have to wait till I get home!
S
LONDON STOCK EXCHANGE TAKES LEHMAN CHARGE AND SETS BACK BAIKAL LAUNCH Shares in the London Stock Exchange dropped by more than ten per cent after the UK market operator cancelled its share buy-back programme and warned of "extraordinarily difficult" market conditions.
Full story: http://www.finextra.com/fullstory.asp?id=19283
LSE BRINGS ITALIAN EQUITIES ONTO TRADELECT
The London Stock Exchange has completed the migration of Italian equities onto the TradElect platform, creating Europe's deepest pool of liquidity.
More on this story: http://www.finextra.com/fullstory.asp?id=19270
SWISS EXCHANGE TO CLOSE SWX EUROPE WITH THE LOSS OF 40 JOBS
In a move that marks the end of a seven-year presence as a recognised investment exchange in London for the Swiss group, SIX Swiss Exchange will close SWX Europe and reunify share trading in Zurich by mid-2009 in an effort to streamline operations and cut costs.
More on this story: http://www.finextra.com/fullstory.asp?id=19263
SWISS EXCHANGE PULLS LONDON TRADING BACK TO ZURICH -- November 11, 2008
SWX closes London business amid competitionSwiss Exchange, Europe’s fifth largest stock market, has become the first European exchange to succumb to the increasing pressure on the region's main equity markets from new trading rivals, announcing its decision to shut a London-based operation and move it to Zurich.
NASDAQ BACKS SEC ON SECURITIES SYMBOL SELECTION PLAN
http://www.finextra.com/fullpr.asp?id=24446
NASDAQ OMX REORGANISES NORDIC OPERATIONS AFTER NORD POOL ACQUISITION
http://www.finextra.com/fullpr.asp?id=24457
Liquidnet responds to crossing demand in Singapore
SGX wants Asian clearing links for ASEAN exchange initiative
Market turmoil delays NYSE Euronext MTFs
Alpha trading platform snatches 36% share in Canadian blue chips
BATS Europe would be “disappointed” with 5% market share
Industry associations flag MiFID faults in EC survey
Call for evidence on the impact of MiFID on secondary markets functioning
Closing date : 09 Jan. 2009
http://www.cesr-eu.org/index.php?page=consultation_details&id=125
TRADEWEB DEVELOPS ONLINE MARKETPLACES FOR CDS INDEX TRADING IN US AND EUROPE
http://www.finextra.com/fullpr.asp?id=24439
FSA probes new equities trading platforms for transparencyThe Financial Services Authority has launched an investigation into at least two of Europe’s new equities trading platforms, in a move that signals the financial turbulence has led market regulators to question the transparency of their operations. (Financial Times)
Index fall hints at stock exchange consolidationAn index tracking the share price performance of the world's top listed exchanges fell more steeply in October than in any other month this year, suggesting the sector may be facing a wave of consolidation next year.
THE TRADE NEWS: SGX Wants Asian Clearing Links for ASEAN Exchange InitiativeBy Staff11/10/08Hsieh Fu Hua, CEO of the Singapore Exchange (SGX), has outlined provisional clearing and settlement arrangements for a pan-Asian stock exchange.At the 12th general meeting of the Asia-Pacific Central Securities Depository Group on Monday, Hsieh proposed that any Asian cross-border trading initiative should be accompanied by clearing and depository links between the countries involved.The Association of Southeast Asian Nations (ASEAN) has been exploring the idea of an electronic cross-border trading platform, in keeping with the association’s desire to establish closer links between its member’s capital markets by 2015. The exchanges involved are SGX, Indonesia Stock Exchange, Vietnam’s Ho Chi Minh City Stock Exchange, Bursa Malaysia, the Philippine Stock Exchange and the Stock Exchange of Thailand. The exchanges in Korea and Tokyo have also been invited to share their thoughts. At present, it is proposed that an ASEAN trading board would consist of the 30 “best” or most liquid stocks from each exchange involved in the project. It is intended that investors will be able to trade ASEAN stocks through their own local brokers, who will then use a corresponding broker in the home market where the stock is listed. Trading of stocks will continue to be subject to the rules of their own individual markets.“SGX has proposed that the trading board be accompanied by clearing and depository links, which will enable better management of risks and settlement failures,” said Hsieh. “This will also reduce costs for overseas brokers, who will only need to build back-office structures in their home markets. The creation of multilateral clearing links is a natural precursor to the integration of trading platforms, paving the way for a more liquid, lower risk and cost-efficient pan-Asian market.”Talks between ASEAN members are ongoing. A statement issued by SGX to The Trade read, “SGX continues to work closely with the ASEAN exchanges to pursue possibilities and work out the feasibility of the project. As such, the details and time frame have yet to be established.”
THE TRADE NEWS: Alpha Trading Platform Snatches 36 Percent in Canadian Blue ChipsBy Staff11/11/08Alpha, the alternative trading system (ATS) launched last Friday by a consortium of Canadian brokers, grabbed 36.24% of overall volume in ten blue-chip Canadian stocks on its second day of trading.Alpha achieved 10% of total volume across the ten securities in which it offers trading on its first day. The ATS is backed by nine brokers, but approximately 30 market participants were connected at launch. “Volume and value traded are key success indicators but what struck us most today was liquidity,” said Jos Schmitt, CEO of Alpha Group. “Throughout the day, Alpha was often showing the greatest liquidity at equivalent or better bid and ask spreads than other market places, despite the fact that many dealers are still ramping up their capabilities to trade on Alpha. This gives us a glimpse about what is to come and tells us where investors will need to look for price discovery and efficient execution.”Alpha Group was established in May 2007 by BMO Capital Markets, Canaccord Capital Corporation, CIBC World Markets, CPP Investment Board, Desjardins Securities, National Bank Financial, RBC Capital Markets, Scotia Capital and TD Securities.
Friday, November 7, 2008
Blogspot, NYSE, Liffe Clear, Consolidation, CDS.
G’day All,
Once again, a rush due to other commitments.
I will circulate this and update my remarks on the blogspot: http://clearingandsettlement.blogspot.com when I get home. (he, he, weekend starts early down under).
NYSE.EN: (NYX) has become such a large animal / conglomerate that it is hard to read between the lines. The disposals of GL and the LCH.CN stakes are both signs in my view of ‘cleaning up’ or at least understanding the beast. As a monopoly, the myriad investments / tentacles of the octopus could be sustained and cross-subsidised. I suspect there will be a lot more demarcation and accountability of business lines.
Liffe Clear: Wow, I wrote the above, then I read this. I can understand Liffe wanting to do this. One angle for me, is why should Liffe members pay for the DTCC to buy LCH.CN? I guess they now have EUR 260 myn of the required EUR 739 myn. ICE members have flown…hmm, don’t expect LME members to get a fee cut, that leaves equity clear and repo clear to pick up the tab of EUR 500 myn odd.
Chi-X: October Volumes – published on http://clearingandsettlement.blogspot.com
DTCC merger / LCH.CN
Also need to consider this piece of context
http://www.tcs.com/news_events/press_releases/Pages/LCHClearnet-adopts-TCS-BaNCS-MarketInfrastructure.aspx
& sunk investments by member firms (I recall the C21 migration issues)
I also want to jump on this story:
Consolidation of Clearing Houses good or bad?
The DTCC buying LCH.Clearnet looks a no brainer deal for both companies with both increasing their business potential and both able to rationalise their cost structures.
If this was indeed the case, why is the ECB saying…
3 November 2008 - ECB hosts meeting on establishing central counterparties for credit default swaps
And what about competition as a force to drive down costs?
Did this consolidation just happen one morning – no, we needed competition as one of the catalysts for change.
Is one CCP really such a good idea?
If this was the case, why is there demand for NCC in the US?
I think there are some sweeping generalizations and assumptions being made here.
Enough for now,
9, yep, nine games of rugby this week end and a rugby league world cup too.
I’ll not be watching half of ‘em.
Have a lovely w/end all,
S
BATS EUROPE LAUNCHES
Former US ECN operator Bats Trading, now a registered US exchange, says its European multilateral trading facility (MTF) has gone live, initially offering trading in 10 UK-listed securities, with a complete roll out slated to be complete by 19 November.
More on this story: http://www.finextra.com/fullstory.asp?id=19212
NYSE Euronext plans to axe 200 European jobsNYSE Euronext has posted a 33% drop in third-quarter profit and announced plans to eliminate 15% of its workforce in Europe over the coming year, as the transatlantic exchange group comes under increasing pressure from low-cost rivals.
And Then There Was One (Platform) The head of NYSE Euronext’s Universal Trading Platform on how consolidating trading systems will alter the trading landscape.
Earlier this year, NYSE Euronext embarked on a plan to create a single platform for all its products and markets. Dubbed the Universal Trading Platform (UTP), it will consolidate the various systems brought under one umbrella by last year's merger of Euronext and the New York Stock Exchange's parent company.
The transition of the NYSE and NYSE Arca systems in the U.S. and the European platforms NSC and Liffe Connect is slated to start at year-end, said Anthony Attia, executive director and head of the UTP program, beginning with the European cash markets--set to be completed by the second quarter of next year. Arca, whose technology will form the base of UTP, is expected to finish its transition in the third quarter, and NYSE before the end of 2009. The derivatives migration is still being assessed, said Attia, but should get under way in 2009.
LIFFE TO SELF-CLEAR FROM Q1 NEXT YEAR
To terminate its LCH.Clearnet clearing contract the London-based derivatives exchange owned by Nyse Euronext will make a one-time payment of EUR260 million.
More on this story: http://www.finextra.com/fullstory.asp?id=19214
TOKYO STOCK EXCHANGE TO FIRE 'ARROWHEAD' IN 2010 The Tokyo Stock Exchange is to delay the launch of its next generation trading system from late 2009 to the first business day of 2010 following consultation with CIOs from major trading firms on the Exchange.
Full story: http://www.finextra.com/fullstory.asp?id=19232
DOW JONES NEWSWIRES: NYSE Euronext Delays European MTF Launch Until Jan. '09By Doug Cameron 10/31/08NYSE Euronext (NYX) said Friday it will delay the launch of a new European share-trading platform until January. Duncan Niederauer, chief executive, said on a conference call that the launch of the NYSE Arca Europe unit had been pushed back "in deference" to the wishes of clients. The unit aims to defend the position of the transatlantic exchange operator amid intensifying competition in European equity trading. Bats Trading, a rival exchange that has already claimed 12% of U.S. equity trading, said Friday it had brought forward the launch of its own European platform to Nov. 19. NYSE Arca Europe and Bats Europe will join the flurry of new platforms targeting high-frequency traders in the region that are challenging established operators, including the four bourses controlled by NYSE Euronext. Nasdaq OMX Group Inc. (NDAQ) and the bank-owned Turquoise platform have already launched, competing with Chi-X, the first of a new breed of so-called multilateral trading facilities.
FINANCIAL TIMES: Mifid Opens Door for US Platforms in EuropeBy Jeremy Grant
Mifid, which came into effect a year ago Saturday, kicked off that revolution by breaking the monopoly the region’s stock exchanges had long enjoyed on where a share is traded – and thus on how tariffs were charged to traders. The directive required brokers and other intermediaries to ensure that they were achieving “best execution” when they carried out a trade for a client, which opened the way for other trading platforms to challenge the exchanges.Best execution means not only getting the best price for a share for your client, but ensuring that the trade is cleared and settled in the most efficient and cost-effective way.
Euro Millennium to use BNP’s new MTF post-trade service
LSE discloses details of onward routing fee
Trading on LSE now cheaper via Nasdaq OMX Europe
NASDAQ OMX ACQUIRES MARKET INTELLIGENCE FIRM BLOOM PARTNERS
Nasdaq OMX has acquired Chicago-based Bloom Partners, a supplier of market intelligence services to public companies. Terms of the deal were not disclosed.
More on this story: http://www.finextra.com/fullstory.asp?id=19228
EUROCLEAR COMPLETES NORDIC CENTRAL SECURITIES DEPOSITORY ACQUISITION
http://www.finextra.com/fullpr.asp?id=24333
NZX POURS SCORN ON JSE VALUATION OF SOUTH AFRICAN BOND EXCHANGE
The New Zealand Stock Exchange, the largest shareholder in the Bond Exchange of South Africa (Besa), has poured cold water over the Johannesburg Stock Exchange's proposed R173 million takeover of its compatriot.
More on this story: http://www.finextra.com/fullstory.asp?id=19224
DUTCH REGULATOR AFM SIGNS FOR ACTIMIZE MARKET ABUSE SYSTEM The Netherlands Authority for the Financial Markets (AFM) is rolling out market abuse technology from Actimize to improve its surveillance and supervision of the Dutch market.
Full story: http://www.finextra.com/fullstory.asp?id=19222
3 November 2008 - ECB hosts meeting on establishing central counterparties for credit default swaps
The European Central Bank (ECB) today hosted a meeting with European stakeholders concerning the establishment of central counterparties (CCPs) for credit default swaps. Participants included the potential providers of such CCPs, their regulators and the main users (dealers and buy-side). The meeting complemented initiatives by the Federal Reserve Bank of New York and the European Commission in this field.
The Eurosystem shares the views of the Financial Stability Forum and of the European Commission on the importance of reducing counterparty risk and of enhancing transparency in OTC derivatives markets, especially in those parts of the market that are of systemic importance (e.g. credit derivatives, including credit default swaps). There are a number of initiatives aiming to achieve these goals through the introduction of centralised clearing solutions for OTC derivatives. The Eurosystem sees the introduction of CCPs for OTC derivatives as an appropriate solution to tackle the aforementioned issues because CCPs, by virtue of concentrating outstanding positions in one place, (i) reduce the counterparty risk to which market participants are exposed; (ii) increase market integrity, transparency and the availability of information; (iii) standardise the criteria for evaluation of exposures; and (iv) free up collateral.
Participants at the meeting underlined the merits of multiple solutions in general and of at least one European solution.
The Eurosystem stands ready, in cooperation with the other authorities, to facilitate the effective collective action of the private sector in this regard.
http://www.ecb.int/press/pr/date/2008/html/pr081103.en.html
EUROPEAN COMMISSION SETS YEAR-END DEADLINE FOR CREATION OF CDS CLEARING COUNTERPARTY The European Commission has set an end-year deadline for financial market participants to draw up a blueprint for the clearing of credit default swaps.
Full story: http://www.finextra.com/fullstory.asp?id=19239
ICE in clearing head searchThe Intercontinental Exchange, which is setting up a new US-based credit derivatives clearing house, is searching for a chief executive to head up the venture, Financial News has learnt.
Watchdog eyes government bond and repo clearingEurope's competition watchdog is to expand its study of European government bond trading to include clearing and settlement of repos and cash bonds, Financial News has learnt.
Consolidation of Clearing Houses good or bad?
The DTCC buying LCH.Clearnet looks a no brainer deal for both companies with both increasing their business potential and both able to rationalise their cost structures. This is certainly the case at LCH.Clearnet where it has been common knowledge that they need to modify their systems.We will not know if the deal will be concluded for some months until due diligence is completed but as far as the market is concerned it will surely be welcomed.The many new trading venues that have emerged after MiFID will also be keen to see this deal completed, as it clearly benefits their cost structures as it will the users. The Stock Exchanges will see the merger of the two businesses as attractive because it increases the overall attraction of companies listing and the operational efficiencies and costs in financial services firms. The investors should also benefit with reduced risks and costs.In the minority of those that may not see this deal as good for them might be OM NASDAQ who stated a little while ago that they will compete with the DTCC. This deal makes this less likely. Could they look towards Deutsch Börse and Clearstream for a merger? This would be an aggressive move and offer the European markets good competition.With the markets in turmoil and needing to recover lost confidence of the investors this type of deal is exactly what's required. It could spark a new round of mega changes to the infra stricture of the markets on the way to building a better, more secure and cost efficient financial industry.
LIQUIDNET TO OPEN SINGAPORE OFFICE
http://www.finextra.com/fullpr.asp?id=24423
THE TRADE NEWS: Trading on LSE Now Cheaper Via Nasdaq OMX EuropeBy Staff11/4/08Nasdaq OMX Europe, the exchange backed multilateral trading facility (MTF), has said it will not pass on to clients the onward routing charge imposed by the London Stock Exchange (LSE).The LSE announced a revised pricing structure yesterday, which included a one-basis-point charge for orders routed to it via other displayed markets. In addition, MTF routed orders will not qualify for the value-based discounts that apply to brokers’ orders from other sources.Nasdaq OMX Europe is the only MTF with onward routing at present, having teamed up with Citi to provide the service on its behalf. The charge for routing orders to the LSE is 0.25bps.“We are not passing on the LSE charge to our members,” confirmed a Nasdaq OMX Europe spokesman. “The 0.25bps all-inclusive pricing promotion is on as planned as we will continue to offer fast and cost-efficient trading in European blue chips.”As a result, trading on the LSE will be cheaper through Nasdaq OMX Europe rather than directly on the exchange itself. "The least expensive way to trade aggressively on the LSE – i.e. for removing liquidity – is via Nasdaq OMX Europe during our current price promotion,” Todd Golub, head of markets development, Nasdaq OMX Europe, told theTRADEnews.com.The cheapest charge for an aggressive execution on the LSE is 0.45 basis points, but a firm would need to be trading more than £30 billion a month on the exchange to qualify for this. Those trading £7.5 billion or less on the LSE pay 0.75 basis points for an aggressive execution.The LSE has denied that the tariff is anti-competitive. “It is fair and right to distinguish between client business and our competitors,” LSE spokesperson John Wallace told theTRADEnews.com, when the plans were first revealed. “Nasdaq OMX Europe remains free to compete with us in equity trading, as others are doing.”
1. How do you define optimism? A banker who irons five shirts on a Sunday. 2. What's the difference between an investment banker and a large pizza? The pizza can still feed a family of four. 3. What do you call five hedge fund managers at the bottom of the ocean? - A good start. 4. The credit crunch has helped me get back on my feet. The cars been repossessed. 5. The bank returned a cheque to me this morning, stamped: 'insufficient funds.' Is it them or me? 6. A man went to his bank manager and said: 'I'd like to start a small business. How do I go about it?' 'Simple,' said the bank manager. 'Buy a big one and wait.' 7. Everyone Says Money talks. Trouble is, mine knows only one word: 'Goodbye.' 8. What have an Icelandic bank and an Icelandic streaker got in common? They both have frozen assets. 9. A director decided to award a prize of $50 for the best idea of saving the company money during the credit crunch. It was won by a young executive who suggested reducing the prize money to $10.
9/11/2008
INT
Italy v Australia
Padova
1.00am
9/11/2008
INT
England v Pacific Islands
London
1.30am
9/11/2008
INT
Wales v South Africa
Cardiff
1.30am
9/11/2008
INT
Ireland v Canada
Limerick
4.15am
9/11/2008
INT
Scotland v New Zealand
Edinburgh
4.15am
9/11/2008
INT
France v Argentina
Marseille
7.00am
9/11/2008
INT
USA v Uruguay
Salt Lake City
9.00am
Once again, a rush due to other commitments.
I will circulate this and update my remarks on the blogspot: http://clearingandsettlement.blogspot.com when I get home. (he, he, weekend starts early down under).
NYSE.EN: (NYX) has become such a large animal / conglomerate that it is hard to read between the lines. The disposals of GL and the LCH.CN stakes are both signs in my view of ‘cleaning up’ or at least understanding the beast. As a monopoly, the myriad investments / tentacles of the octopus could be sustained and cross-subsidised. I suspect there will be a lot more demarcation and accountability of business lines.
Liffe Clear: Wow, I wrote the above, then I read this. I can understand Liffe wanting to do this. One angle for me, is why should Liffe members pay for the DTCC to buy LCH.CN? I guess they now have EUR 260 myn of the required EUR 739 myn. ICE members have flown…hmm, don’t expect LME members to get a fee cut, that leaves equity clear and repo clear to pick up the tab of EUR 500 myn odd.
Chi-X: October Volumes – published on http://clearingandsettlement.blogspot.com
DTCC merger / LCH.CN
Also need to consider this piece of context
http://www.tcs.com/news_events/press_releases/Pages/LCHClearnet-adopts-TCS-BaNCS-MarketInfrastructure.aspx
& sunk investments by member firms (I recall the C21 migration issues)
I also want to jump on this story:
Consolidation of Clearing Houses good or bad?
The DTCC buying LCH.Clearnet looks a no brainer deal for both companies with both increasing their business potential and both able to rationalise their cost structures.
If this was indeed the case, why is the ECB saying…
3 November 2008 - ECB hosts meeting on establishing central counterparties for credit default swaps
And what about competition as a force to drive down costs?
Did this consolidation just happen one morning – no, we needed competition as one of the catalysts for change.
Is one CCP really such a good idea?
If this was the case, why is there demand for NCC in the US?
I think there are some sweeping generalizations and assumptions being made here.
Enough for now,
9, yep, nine games of rugby this week end and a rugby league world cup too.
I’ll not be watching half of ‘em.
Have a lovely w/end all,
S
BATS EUROPE LAUNCHES
Former US ECN operator Bats Trading, now a registered US exchange, says its European multilateral trading facility (MTF) has gone live, initially offering trading in 10 UK-listed securities, with a complete roll out slated to be complete by 19 November.
More on this story: http://www.finextra.com/fullstory.asp?id=19212
NYSE Euronext plans to axe 200 European jobsNYSE Euronext has posted a 33% drop in third-quarter profit and announced plans to eliminate 15% of its workforce in Europe over the coming year, as the transatlantic exchange group comes under increasing pressure from low-cost rivals.
And Then There Was One (Platform) The head of NYSE Euronext’s Universal Trading Platform on how consolidating trading systems will alter the trading landscape.
Earlier this year, NYSE Euronext embarked on a plan to create a single platform for all its products and markets. Dubbed the Universal Trading Platform (UTP), it will consolidate the various systems brought under one umbrella by last year's merger of Euronext and the New York Stock Exchange's parent company.
The transition of the NYSE and NYSE Arca systems in the U.S. and the European platforms NSC and Liffe Connect is slated to start at year-end, said Anthony Attia, executive director and head of the UTP program, beginning with the European cash markets--set to be completed by the second quarter of next year. Arca, whose technology will form the base of UTP, is expected to finish its transition in the third quarter, and NYSE before the end of 2009. The derivatives migration is still being assessed, said Attia, but should get under way in 2009.
LIFFE TO SELF-CLEAR FROM Q1 NEXT YEAR
To terminate its LCH.Clearnet clearing contract the London-based derivatives exchange owned by Nyse Euronext will make a one-time payment of EUR260 million.
More on this story: http://www.finextra.com/fullstory.asp?id=19214
TOKYO STOCK EXCHANGE TO FIRE 'ARROWHEAD' IN 2010 The Tokyo Stock Exchange is to delay the launch of its next generation trading system from late 2009 to the first business day of 2010 following consultation with CIOs from major trading firms on the Exchange.
Full story: http://www.finextra.com/fullstory.asp?id=19232
DOW JONES NEWSWIRES: NYSE Euronext Delays European MTF Launch Until Jan. '09By Doug Cameron 10/31/08NYSE Euronext (NYX) said Friday it will delay the launch of a new European share-trading platform until January. Duncan Niederauer, chief executive, said on a conference call that the launch of the NYSE Arca Europe unit had been pushed back "in deference" to the wishes of clients. The unit aims to defend the position of the transatlantic exchange operator amid intensifying competition in European equity trading. Bats Trading, a rival exchange that has already claimed 12% of U.S. equity trading, said Friday it had brought forward the launch of its own European platform to Nov. 19. NYSE Arca Europe and Bats Europe will join the flurry of new platforms targeting high-frequency traders in the region that are challenging established operators, including the four bourses controlled by NYSE Euronext. Nasdaq OMX Group Inc. (NDAQ) and the bank-owned Turquoise platform have already launched, competing with Chi-X, the first of a new breed of so-called multilateral trading facilities.
FINANCIAL TIMES: Mifid Opens Door for US Platforms in EuropeBy Jeremy Grant
Mifid, which came into effect a year ago Saturday, kicked off that revolution by breaking the monopoly the region’s stock exchanges had long enjoyed on where a share is traded – and thus on how tariffs were charged to traders. The directive required brokers and other intermediaries to ensure that they were achieving “best execution” when they carried out a trade for a client, which opened the way for other trading platforms to challenge the exchanges.Best execution means not only getting the best price for a share for your client, but ensuring that the trade is cleared and settled in the most efficient and cost-effective way.
Euro Millennium to use BNP’s new MTF post-trade service
LSE discloses details of onward routing fee
Trading on LSE now cheaper via Nasdaq OMX Europe
NASDAQ OMX ACQUIRES MARKET INTELLIGENCE FIRM BLOOM PARTNERS
Nasdaq OMX has acquired Chicago-based Bloom Partners, a supplier of market intelligence services to public companies. Terms of the deal were not disclosed.
More on this story: http://www.finextra.com/fullstory.asp?id=19228
EUROCLEAR COMPLETES NORDIC CENTRAL SECURITIES DEPOSITORY ACQUISITION
http://www.finextra.com/fullpr.asp?id=24333
NZX POURS SCORN ON JSE VALUATION OF SOUTH AFRICAN BOND EXCHANGE
The New Zealand Stock Exchange, the largest shareholder in the Bond Exchange of South Africa (Besa), has poured cold water over the Johannesburg Stock Exchange's proposed R173 million takeover of its compatriot.
More on this story: http://www.finextra.com/fullstory.asp?id=19224
DUTCH REGULATOR AFM SIGNS FOR ACTIMIZE MARKET ABUSE SYSTEM The Netherlands Authority for the Financial Markets (AFM) is rolling out market abuse technology from Actimize to improve its surveillance and supervision of the Dutch market.
Full story: http://www.finextra.com/fullstory.asp?id=19222
3 November 2008 - ECB hosts meeting on establishing central counterparties for credit default swaps
The European Central Bank (ECB) today hosted a meeting with European stakeholders concerning the establishment of central counterparties (CCPs) for credit default swaps. Participants included the potential providers of such CCPs, their regulators and the main users (dealers and buy-side). The meeting complemented initiatives by the Federal Reserve Bank of New York and the European Commission in this field.
The Eurosystem shares the views of the Financial Stability Forum and of the European Commission on the importance of reducing counterparty risk and of enhancing transparency in OTC derivatives markets, especially in those parts of the market that are of systemic importance (e.g. credit derivatives, including credit default swaps). There are a number of initiatives aiming to achieve these goals through the introduction of centralised clearing solutions for OTC derivatives. The Eurosystem sees the introduction of CCPs for OTC derivatives as an appropriate solution to tackle the aforementioned issues because CCPs, by virtue of concentrating outstanding positions in one place, (i) reduce the counterparty risk to which market participants are exposed; (ii) increase market integrity, transparency and the availability of information; (iii) standardise the criteria for evaluation of exposures; and (iv) free up collateral.
Participants at the meeting underlined the merits of multiple solutions in general and of at least one European solution.
The Eurosystem stands ready, in cooperation with the other authorities, to facilitate the effective collective action of the private sector in this regard.
http://www.ecb.int/press/pr/date/2008/html/pr081103.en.html
EUROPEAN COMMISSION SETS YEAR-END DEADLINE FOR CREATION OF CDS CLEARING COUNTERPARTY The European Commission has set an end-year deadline for financial market participants to draw up a blueprint for the clearing of credit default swaps.
Full story: http://www.finextra.com/fullstory.asp?id=19239
ICE in clearing head searchThe Intercontinental Exchange, which is setting up a new US-based credit derivatives clearing house, is searching for a chief executive to head up the venture, Financial News has learnt.
Watchdog eyes government bond and repo clearingEurope's competition watchdog is to expand its study of European government bond trading to include clearing and settlement of repos and cash bonds, Financial News has learnt.
Consolidation of Clearing Houses good or bad?
The DTCC buying LCH.Clearnet looks a no brainer deal for both companies with both increasing their business potential and both able to rationalise their cost structures. This is certainly the case at LCH.Clearnet where it has been common knowledge that they need to modify their systems.We will not know if the deal will be concluded for some months until due diligence is completed but as far as the market is concerned it will surely be welcomed.The many new trading venues that have emerged after MiFID will also be keen to see this deal completed, as it clearly benefits their cost structures as it will the users. The Stock Exchanges will see the merger of the two businesses as attractive because it increases the overall attraction of companies listing and the operational efficiencies and costs in financial services firms. The investors should also benefit with reduced risks and costs.In the minority of those that may not see this deal as good for them might be OM NASDAQ who stated a little while ago that they will compete with the DTCC. This deal makes this less likely. Could they look towards Deutsch Börse and Clearstream for a merger? This would be an aggressive move and offer the European markets good competition.With the markets in turmoil and needing to recover lost confidence of the investors this type of deal is exactly what's required. It could spark a new round of mega changes to the infra stricture of the markets on the way to building a better, more secure and cost efficient financial industry.
LIQUIDNET TO OPEN SINGAPORE OFFICE
http://www.finextra.com/fullpr.asp?id=24423
THE TRADE NEWS: Trading on LSE Now Cheaper Via Nasdaq OMX EuropeBy Staff11/4/08Nasdaq OMX Europe, the exchange backed multilateral trading facility (MTF), has said it will not pass on to clients the onward routing charge imposed by the London Stock Exchange (LSE).The LSE announced a revised pricing structure yesterday, which included a one-basis-point charge for orders routed to it via other displayed markets. In addition, MTF routed orders will not qualify for the value-based discounts that apply to brokers’ orders from other sources.Nasdaq OMX Europe is the only MTF with onward routing at present, having teamed up with Citi to provide the service on its behalf. The charge for routing orders to the LSE is 0.25bps.“We are not passing on the LSE charge to our members,” confirmed a Nasdaq OMX Europe spokesman. “The 0.25bps all-inclusive pricing promotion is on as planned as we will continue to offer fast and cost-efficient trading in European blue chips.”As a result, trading on the LSE will be cheaper through Nasdaq OMX Europe rather than directly on the exchange itself. "The least expensive way to trade aggressively on the LSE – i.e. for removing liquidity – is via Nasdaq OMX Europe during our current price promotion,” Todd Golub, head of markets development, Nasdaq OMX Europe, told theTRADEnews.com.The cheapest charge for an aggressive execution on the LSE is 0.45 basis points, but a firm would need to be trading more than £30 billion a month on the exchange to qualify for this. Those trading £7.5 billion or less on the LSE pay 0.75 basis points for an aggressive execution.The LSE has denied that the tariff is anti-competitive. “It is fair and right to distinguish between client business and our competitors,” LSE spokesperson John Wallace told theTRADEnews.com, when the plans were first revealed. “Nasdaq OMX Europe remains free to compete with us in equity trading, as others are doing.”
1. How do you define optimism? A banker who irons five shirts on a Sunday. 2. What's the difference between an investment banker and a large pizza? The pizza can still feed a family of four. 3. What do you call five hedge fund managers at the bottom of the ocean? - A good start. 4. The credit crunch has helped me get back on my feet. The cars been repossessed. 5. The bank returned a cheque to me this morning, stamped: 'insufficient funds.' Is it them or me? 6. A man went to his bank manager and said: 'I'd like to start a small business. How do I go about it?' 'Simple,' said the bank manager. 'Buy a big one and wait.' 7. Everyone Says Money talks. Trouble is, mine knows only one word: 'Goodbye.' 8. What have an Icelandic bank and an Icelandic streaker got in common? They both have frozen assets. 9. A director decided to award a prize of $50 for the best idea of saving the company money during the credit crunch. It was won by a young executive who suggested reducing the prize money to $10.
9/11/2008
INT
Italy v Australia
Padova
1.00am
9/11/2008
INT
England v Pacific Islands
London
1.30am
9/11/2008
INT
Wales v South Africa
Cardiff
1.30am
9/11/2008
INT
Ireland v Canada
Limerick
4.15am
9/11/2008
INT
Scotland v New Zealand
Edinburgh
4.15am
9/11/2008
INT
France v Argentina
Marseille
7.00am
9/11/2008
INT
USA v Uruguay
Salt Lake City
9.00am
Sunday, November 2, 2008
Chi-X Turnover
Chi-X Total Consideration Traded (Nov):
November 2008: EUR 57,044,981,870
October 2008: EUR 109,157,247,286
That’s a decline of EUR 52,112,265,416 or 47.74%
November 2008: EUR 57,044,981,870
October 2008: EUR 109,157,247,286
That’s a decline of EUR 52,112,265,416 or 47.74%
Chi-X Turnover (Oct):
October 2008= EUR 109,162,573,053
September 2008= EUR 104,835,510,053
That’s an increase of EUR 4,327,063,307 or 4.13%
October 2008= EUR 109,162,573,053
September 2008= EUR 104,835,510,053
That’s an increase of EUR 4,327,063,307 or 4.13%
>
2008-11 57,044,981,870
2008-10 109,162,573,360
2008-09 104,835,510,053
2008-08 67,971,488,272
2008-07 73,593,684,141
2008-06 52,978,483,099
2008-05 38,922,976,001
2008-04 40,667,003,585
2008-03 33,414,519,682
2008-02 19,492,816,559
2008-01 21,283,498,209
2007-12 8,032,415,496
2007-11 12,723,133,525
2007-10 13,858,603,849
2007-09 10,918,269,828
2007-08 4,779,588,106
2007-07 4,510,071,743
2008-09 104,835,510,053
2008-08 67,971,488,272
2008-07 73,593,684,141
2008-06 52,978,483,099
2008-05 38,922,976,001
2008-04 40,667,003,585
2008-03 33,414,519,682
2008-02 19,492,816,559
2008-01 21,283,498,209
2007-12 8,032,415,496
2007-11 12,723,133,525
2007-10 13,858,603,849
2007-09 10,918,269,828
2007-08 4,779,588,106
2007-07 4,510,071,743
Liquidity Shift, LSE & Symbology
Further to my remarks:
2 things happened on that Monday (8th Sept) of the LSE outage.
One. Many of the brokers that were connected to Chi-X with smart order routers (SORT) had them referencing against the primary market LSE.
When the reference field ‘disappeared’ the SORTs did not onward route as they were effectively frozen (like a dog pausing sniffing for a bone before it runs).
Many brokers were disgusted with this single point of failure in their systems. If there was another such outage, I expect all the SORTs will have been re-calibrated by now. There was a lesser issue with some brokers in simply switching everything to Chi-X as the primary market. Brokers wanted it to be more of a collective shift, they didn’t want to be the ‘first’ (for fear of being picked off).
Two. Not sure how much weight to put behind this. Many brokers had confused instructions from their clients. Due to the nature of the LSE outage some people were unsure of the status of their fills – how much had been completed – what was the balance they could / should trade on Chi-X? The information coming out of LSE on the day was by some accounts poor hence people did not know what balance of an order they had to work.
Anyway, once bitten twice shy. Since then, Chi-X membership has continued to grow. All Chi-X could do on the 8th was remain open and reliable. That we did. In fact, the 8th, which started off looking like a record day, was actually not that great for us.
From the Chi-X sales team:
We have been busy on the development front - led primarily by your feedback, the most recent announcements being on sponsored access and on common symbology which we feel is a key component to further evolutionary development in Europe. http://www.chi-x.com/news/Joint%20Symbology%20PR.pdf. In the fallout from the LSE outage the question most commonly asked of us on why we did not materially benefit from this outage. It is now clear that at the time, the primary Exchanges remained the reference price for many systems - rendering a large proportion of the market unable to trade on the MTF platforms. This in itself has changed, as many brokers have now decoupled this dependency, however there is a need to push for a consolidated feed. Common symbology is an important step; with MTF's using standard symbology, it will make it easier to move to a consolidated tape in Europe and for the vendors and the users of the market to make more informed trading decisions, thus able to ignore platforms who have experienced technical difficulties. It will also mount pressure on the last bastion of Exchange pricing control - market data. If the MTF's collectively trade a meaningful proportion of European trading - lets say 50% for the sake of argument - what justification do the incumbents have to continue to charge you 100% of their current market data charges? We hope that others will join us, BATS and Neuro in pushing this initiative forward.
2 things happened on that Monday (8th Sept) of the LSE outage.
One. Many of the brokers that were connected to Chi-X with smart order routers (SORT) had them referencing against the primary market LSE.
When the reference field ‘disappeared’ the SORTs did not onward route as they were effectively frozen (like a dog pausing sniffing for a bone before it runs).
Many brokers were disgusted with this single point of failure in their systems. If there was another such outage, I expect all the SORTs will have been re-calibrated by now. There was a lesser issue with some brokers in simply switching everything to Chi-X as the primary market. Brokers wanted it to be more of a collective shift, they didn’t want to be the ‘first’ (for fear of being picked off).
Two. Not sure how much weight to put behind this. Many brokers had confused instructions from their clients. Due to the nature of the LSE outage some people were unsure of the status of their fills – how much had been completed – what was the balance they could / should trade on Chi-X? The information coming out of LSE on the day was by some accounts poor hence people did not know what balance of an order they had to work.
Anyway, once bitten twice shy. Since then, Chi-X membership has continued to grow. All Chi-X could do on the 8th was remain open and reliable. That we did. In fact, the 8th, which started off looking like a record day, was actually not that great for us.
From the Chi-X sales team:
We have been busy on the development front - led primarily by your feedback, the most recent announcements being on sponsored access and on common symbology which we feel is a key component to further evolutionary development in Europe. http://www.chi-x.com/news/Joint%20Symbology%20PR.pdf. In the fallout from the LSE outage the question most commonly asked of us on why we did not materially benefit from this outage. It is now clear that at the time, the primary Exchanges remained the reference price for many systems - rendering a large proportion of the market unable to trade on the MTF platforms. This in itself has changed, as many brokers have now decoupled this dependency, however there is a need to push for a consolidated feed. Common symbology is an important step; with MTF's using standard symbology, it will make it easier to move to a consolidated tape in Europe and for the vendors and the users of the market to make more informed trading decisions, thus able to ignore platforms who have experienced technical difficulties. It will also mount pressure on the last bastion of Exchange pricing control - market data. If the MTF's collectively trade a meaningful proportion of European trading - lets say 50% for the sake of argument - what justification do the incumbents have to continue to charge you 100% of their current market data charges? We hope that others will join us, BATS and Neuro in pushing this initiative forward.
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