First Read
Hits & Takes
John Lothian & JLN Staff
Bloomberg is reporting that China is telling brokers to limit exposure to “snowball” derivatives. That is water, right? I mean, what else comes from snow but water, and maybe some pollution?
However, it turns out that Chinese snowballs are a relatively new financial derivative and have been cited as a contributing factor to the recent stock selloff in China. These derivatives, tied to indexes, trigger futures positions to be sold by brokerages when the indexes fall below certain levels. They offer bond-like coupons within a predetermined range but may incur losses if the index breaches these bounds. Popular among Chinese brokers, snowballs are most often linked to small-cap indexes like the CSI 500 or CSI 1000. Estimates suggest outstanding snowball contracts range from 150 billion to 250 billion yuan, with key trigger levels for knock-ins breached amid recent market volatility. While snowball knock-ins primarily impact futures rather than underlying stocks directly, concerns over contagion effects persist. Chinese regulators have taken steps to regulate snowballs, limiting their sale to qualified investors and imposing investment caps.
Back in January, Bloomberg had a Q&A story about “China Snowballs and Their Role in This Year’s Stock Selloff: Q&A.”
Today CFTC Commissioner Christy Goldsmith Romero is participating on a panel at FIA’s Law & Compliance Conference titled “AI and Machine Learning: The Unknown Future Rolls Towards Us.”
Tobias Rank, head of FX product sales at Eurex, is publishing an ongoing series on FX futures in which he discusses in part two the increasing use of exchange-traded FX futures by OTC FX market participants to enhance portfolio optimization in terms of capital and funding. This trend comes amidst regulatory changes such as The Standardized Approach for Counterparty Credit Risk (SA-CCR) and Uncleared Margin Rules (UMR), prompting market participants to explore the integration of FX futures into their execution models. The article examines the evolving role of FX prime brokers in relation to FX futures and how platforms are adapting to incorporate exchange-traded derivatives into existing workflows.
Bloomberg has a story about how the IRS and state and local governments were weaponized against black Americans at the turn of the 20th century. The story is a review of the book, “The Black Tax: 150 Years of Theft, Exploitation, and Dispossession in America (University of Chicago Press, $35, publishing on April 24) which painstakingly outlines how bureaucracies in the US cemented the country’s racial wealth gap through a framework of aggressively unfair municipal and state taxes.” Books like this make you understand why there is such a wealth gap between white and black Americans and why it is important to address this issue.
The latest new swap/binary option contracts from Kalshi, self-certified with the CFTC on April 22, 2024, are: Will Bill Belichick be coach of team before date?; Will the court system uphold a ban against TikTok?; Will there be count presidential debates in 2024?; Will country have a recession before date? and Will rent growth in San Francisco be above/below/between percent in period?
Today is the last day for STAC Fund Scholarship applications to be submitted. This opportunity is open to all Chicago area high school and college students – regardless of STAC affiliation. Apply HERE.
I am driving to the Options Conference, leaving Saturday morning for the drive to Asheville, NC, hoping to arrive on Monday morning. The conference runs mostly Tuesday and Wednesday, which is when we have our video interviews scheduled. Thursday is a tour of the Biltmore Estate as part of the conference. Others are golfing or going on an electric bicycle tour of beautiful Asheville. We will leave Friday morning to head to West Virginia, with videographer Robby Lothian along, to pick up his brother Tim. Then on Saturday morning, Kat Lothian graduates from the West Virginia Institute of Technology with a degree in Adventure Recreation Management. We will depart West Virginia on Sunday and be back in Illinois by Tuesday.
Have a great day and stay safe and treat people the same way you want to be treated: with respect, equality and justice.~JJL
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United Nations Global Compact is hosting a one-hour webinar, “Sustainability TrendsWatch: How will Gen AI change sustainable business?” It’s tomorrow, April 25, at 9:00 AM (CT). Gen AI holds the potential to drive revolutionary change within both business and the pursuit of sustainable development goals (SDGs). It can generate profound insights and significantly enhance decision-making processes. Nevertheless, it is imperative for businesses globally to carefully consider key factors to guarantee that Gen AI benefits all stakeholders while avoiding the perpetuation of biases or exacerbation of existing inequalities. Register for the free webinar HERE. ~SAED
Our most read stories from our previous edition of JLN Options were:
The Secret Trade Was Options in India from Bloomberg.
Ray Dalio’s Famous Trade Is Sputtering, Investors Bailing From Bloomberg.
Oil Options Show Geopolitical Risk Premium Is Fading Fast from Bloomberg. ~JB
Subscribe to the JLN Options Newsletter HERE (it’s free).
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HKEx’s Wilfred Yiu Emphasizes Strategy to Connect China With Global Markets at FIA Futures Conference
JohnLothianNews.com
Hong Kong Exchange and Clearing Deputy Chief Executive Officer, Co-Head of Markets, Co-Chief Operating Officer and Member of Management Committee Wilfred Yiu said its strategy is how to connect China with the rest of the world, noting China accounts for more than 30% of the world’s growth. Yiu was interviewed by John Lothian News at the FIA International Futures Industry Conference in Boca Raton, FL as part of the JLN Industry Leader video series sponsored by Wedbush.
Watch the video »
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Chris Edmonds takes the reins at ICE Fixed Income and Data Services; Edmonds is now leading ICE’s fixed income and data business as the rush to provide better data and analytics in fixed income builds.
Nyela Graham – Waters Technology
Chris Edmonds and Jeffrey Sprecher first met in the late ’90s. Sprecher’s Intercontinental Exchange, or ICE, was in its infancy, aiming to provide a network for over-the-counter energy commodity trading. Edmonds was working his way up the corporate ladder in the energy trading business, where he had started in 1997 as an OTC natural gas broker at ICAP. In essence, the two were competitors. But today, Edmonds says he was impressed with ICE’s ability to see the market not just in terms of dollar signs and math problems, but technology and how it would shape the future. “I would have debated them at the time that they didn’t understand pieces of the market, because I didn’t understand the technology of what they were trying to do,” he says. “But just the success they achieved, having seen them launch and grow this company and what it’s become, it doesn’t take a whole lot of intelligence to know you want to be a part of that.”
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****** This story is from the 19th, but it is a good in-depth look at Chris Edmonds’ career from Waters Technology.~JJL
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A Hedge Fund Billionaire’s Cash Helped Fund a ‘Predatory’ Lender; One man started a cash-advance company. The other was a retired investing legend. A private credit fund had what both were looking for.
Zachary R Mider and Zeke Faux – Bloomberg
The two men come from the opposite ends of Wall Street. David Glass inspired the stock-scam movie Boiler Room, avoided prison in an insider-trading case by wearing a wire, then started a boiler room of his own. His company stands accused of ripping off small businesses on an industrial scale, collecting more than $1 billion of illegal interest over a decade.
/jlne.ws/3xPrxOf
***** You want to do good, you give your money to an investment advisor who puts some money into a fund that gives money to a predatory lender, thus, not doing good. Oops!~JJL
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TradeStation Cares Shined a Spotlight on Its Local Community During Financial Literacy Month; In April, TradeStation Cares emphasized the importance of diversity, equity and financial inclusion by participating in the Miami Film Festival, donating to the Miami Dade College Foundation and sponsoring the Florida Securities Dealers Association’s Industry Outreach Program
TradeStation Group, Inc.
TradeStation Group, Inc. (“TradeStation”), a South Florida-based company whose subsidiary, TradeStation Securities, Inc. (“TradeStation Securities”), provides award-winning,* self-clearing online brokerage services for trading stocks, ETFs, options and futures, that aims to deliver the ultimate trading experience, participated in and supported a series of events during financial literacy month in April. These efforts are part of the TradeStation Cares Committee, a diverse team of group-level and subsidiary employees whose mission is to expand the concept of community by improving financial literacy and the overall health and well-being of the residents in communities where TradeStation maintains a physical or remote presence.
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****** TradeStation doing good works. ~JJL
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Tuesday’s Top Three
Our top clicked story Tuesday was In Silicon Valley, You Can Be Worth Billions and It’s Not Enough, from The New York Times. Second was Heirs Get More Time to Keep Their Money in Inherited Retirement Accounts, from The Wall Street Journal. Third was a tie between the Financial Times’ TikTok fortune of billionaire Republican donor Jeff Yass threatened by Washington and Ex-Citadel exec’s trading firm expanding, moving to revamped Loop tower, from Crain’s Chicago Business.
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Lead Stories
Employee non-compete agreements barred by US regulator; Federal Trade Commission head says move will help raise wages but business lobby vows to sue
Stefania Palma and Amelia Pollard – Financial Times
The US Federal Trade Commission has voted to ban non-compete agreements, taking aim at contracts that limit employees’ freedom to quit for a new job at a different employer. The regulator’s commissioners voted 3-2 on Tuesday to implement the far-reaching measure first proposed in January 2023 in a bid to avoid wage suppression and protect innovation. But the move sparked immediate legal pushback.
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***** Here is The Wall Street Journal’s version of this story.~JJL
CFTC Approves Final Rules on Swap Confirmation Requirements for SEFs
CFTC
The Commodity Futures Trading Commission (CFTC) approved final rules to amend its swap execution facility (SEF) regulations related to uncleared swap confirmations to address issues which have been addressed in CFTC staff no-action letters, including the most recent CFTC No Action Letter No. 17-17, as well as associated conforming and technical changes. In particular, the final rules amend CFTC Regulation 37.6(b) to enable SEFs to incorporate terms of underlying, previously negotiated agreements between the counterparties by reference in an uncleared swap confirmation without being required to obtain such underlying, previously negotiated agreements.
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SEC in Talks With Firms on Becoming US Treasury Clearinghouses; Agency seeks greater trading resiliency in $27 trillion market; Daily trading in Treasuries, repos seen getting volume boost
Liz Capo McCormick and Lydia Beyoud – Bloomberg
The Securities and Exchange Commission is in talks with firms seeking to become central clearinghouses for US Treasuries and derivatives trading under a new agency rule designed to fortify the world’s largest debt market. “Several market participants have reached out to us and want to sort of enter the business,” said Haoxiang Zhu, director of the SEC’s Division of Trading and Markets, in response to a question during a virtual discussion Tuesday organized by the Institute of International Finance. “Generally we welcome additional interest from clearinghouses engaging to get into this business. Competition is good for the market.”
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LME finds Russian sanctions come with an aluminium twist
Andy Home – Reuters
It didn’t take very long for someone to work out a way of making money from the London Metal Exchange’s (LME) new rules around Russian metals. The U.S. and UK governments announced on Friday April 12 a new sanctions package, which prohibited either the LME or CME exchanges from accepting deliveries of Russian metal produced after that date. The LME duly updated its rule-book, on April 13, suspending deliveries of new Russian metal.
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Ex-Jane Street Trader Pillories Claims He Stole Trade Secrets; Douglas Schadewald defends himself after moving to Millennium; Allegedly secret strategy involves options trading in India
Robert Burnson – Bloomberg
A former Jane Street Group trader who moved to Millennium Management ridiculed his former employer’s claims that he used its secret strategy to make a killing at his new job in India’s options market. Responding to a lawsuit filed by Jane Street this month, Douglas Schadewald said it was “not only wrong, but impossible” that he and a fellow defector, Daniel Spottiswood, cost the company more than $150 million in profits between February and March when they went to work for rival Millennium. Labeling Jane Street’s claim as “reckless speculation,” Schadewald said the amount the duo brought in for Millennium through mid-April was about $4 million.
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China Tells Brokers to Limit Exposure to ‘Snowball’ Derivatives; Clampdown on the high-yield products follows stock rout; Officials conveyed new guidance this week, people say
Bloomberg News
China is moving to curb “snowball” derivatives after brokers hiked returns to near-record levels to attract investors to the risky products following a stock-market selloff, according to people familiar with the matter. Officials this week told some of the biggest brokerages to suspend any increase in their net exposure to over-the-counter derivatives involving domestic A shares, including snowball products which are based on options contracts, said the people. While the restrictions are temporary, the regulators didn’t indicate when they may be lifted or eased, the people said, asking not to be identified as the communications are private.
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Who Can Be Trusted for Retirement Advice? New Rules Strengthen Protections; More investment professionals will be required to act in their customers’ best interest when providing advice about their retirement money.
Tara Siegel Bernard – The New York Times
When you walk into a financial adviser’s office, you expect them to put your best interests above all else – in the same way a doctor would, rather than, say, a car salesman. But many people don’t realize that the rules financial professionals must follow vary, depending on where they work and what products they’re selling. One of those federal regulations, which governs retirement plans, was just tightened: The Biden administration announced new rules on Tuesday that will require more financial professionals to adhere to a higher standard when providing financial advice about your retirement money.
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Big banks face probe over NDAs in swaps, clearing businesses, Bloomberg reports
Reuters
The Commodity Futures Trading Commission (CFTC) has reached out to a number of banks, including JPMorgan Chase, Bank of America and Citigroup to see if they have been preventing would-be whistleblowers from speaking out, Bloomberg News reported on Wednesday. CFTC is asking banks for non-disclosure agreements in their swaps and clearing businesses, and has also sought employment and customer agreements in those businesses, the report added, citing people familiar with the matter.
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Wall Street bosses tested by calls to strip them of power
David Hollerith – Yahoo Finance
Some of Wall Street’s most powerful bosses are facing new proposals this spring that would strip them of power by separating their CEO and chairman seats. Shareholders at Goldman Sachs (GS) and Bank of America (BAC) will decide on such a proposal Wednesday, ruling on whether David Solomon and Brian Moynihan get to keep their dual roles.
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Corporate Political Donations Poised to Spark Shareholder Lawsuits; Legal strategy is new effort to check Citzens United decision; Lawsuit threat could slow pace of corporate political giving
Bill Allison – Bloomberg
Major US companies could face lawsuits from their own shareholders for making political donations, according to a new legal strategy progressives are advocating to reign in corporate influence on elections. Some of the money used for a corporation’s hefty super PAC donation come from shareholders. That gives those investors standing to sue if they don’t approve of how the money is spent, according to the latest Center for American Progress report, which aims to reign in the 2010 Supreme Court Citizens United ruling that allows corporations and other groups to spend unlimited amounts on elections.
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Jamie Dimon Has a Rival in Tech: Silicon Valley Bank; JPMorgan and HSBC are among banks trying to capture the startup market, but the California lender under new ownership is still fighting.
Paul J. Davies – Bloomberg
Since Silicon Valley Bank became the second-biggest failure in US history a year ago, other lenders have been trying to take its place in banking the fast-moving, entrepreneurial world of startups and tech companies. JPMorgan Chase & Co. and HSBC Holdings Plc have jumped into a market focused on small companies that could become the billion-dollar businesses of tomorrow. But these two giant upstarts on the San Francisco scene face stiff competition from a familiar name – Silicon Valley Bank itself, which lives on under the ownership of First Citizens Bancshares Inc.
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Russian court orders seizure of $440mn from JPMorgan; Move follows lawsuit from state-owned bank VTB to ‘recover losses’ from America’s largest lender
Anastasia Stognei and Joshua Franklin – Financial Times
A Russian court has ordered the seizure of JPMorgan Chase funds totalling $439.5mn after state-owned lender VTB filed a lawsuit to “recover losses” from the largest US bank. The funds are in accounts frozen after Russia’s full-scale invasion of Ukraine. The decision was published in the Russian court register on Wednesday.
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The Monaco hedge fund boss tied up with an indebted English town; Lee Robinson’s expertise was ‘like having Lionel Messi on your team’. Now his relationship with Warrington is under scrutiny
Jennifer Williams and Robert Smith and Clara Murray – Financial Times
In March 2021, an official at Warrington Borough Council in the north of England listened to a pitch to invest in a commercial building 75 miles away in Birmingham. Warrington invested £10mn. The stake is now worth £1.3mn. The matchmaker for the troubled deal between the real estate firm behind the scheme M7 Real Estate and the local authority was Lee Robinson, a Monaco-based financier whose interests have become unusually entwined with the Labour-run council.
/jlne.ws/4baPBtc
AI boom to fuel natural gas demand in coming years, report says
Reuters
A spike in power usage from artificial intelligence (AI) data centers could significantly boost natural gas demand in the second half of the decade, analysts at investment banker Tudor Pickering Holt & Co said in a report on Tuesday. As much as 8.5 billion cubic feet per day of natural gas could be required additionally to match the rise in demand, the report added.
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Banks rake in billions as prime broking continues to soar; Goldman Sachs, Morgan Stanley and JPMorgan continue to dominate the field, with revenue rising despite high-profile failures like Archegos
Jeremy Chan – Financial News
Wall Street is raking in record revenue from prime broking as banks look to build deeper ties with their lucrative hedge fund clients. The top 12 prime brokers made $20.4bn in 2023, up more than 25% in a decade, according to analytics firm Coalition Greenwich.
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US DOJ seeks 36 months’ imprisonment for Binance founder Changpeng Zhao
Timmy Shen and Danny Park – The Block
U.S. prosecutors are seeking 36 months of imprisonment for Changpeng Zhao, founder and former chief executive of Binance, according to a Tuesday filing. “Zhao’s willful violation of U.S. law was no accident or oversight,” the Department of Justice said in the filing. “He made a business decision that violating U.S. law was the best way to attract users, build his company, and line his pockets.”
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Specialism ‘just as important’ as standardisation when considering multi-asset goals; Standardisation has notable benefits, despite drawbacks said pannellists at TradeTech 2024 who acknowledged the need for specialism to meet multi-asset needs.
Wesley Bray – The Trade
Firms must walk the fine line between specialism and standardisation in order to access aggregate benefits across multi-asset trading, panellists argued at TradeTech Europe 2024. “Specialism is there because it gives you an edge. Standardisation is there because it allows you to scale well, run a larger footprint in terms of trading with less people, and make changes much easier,” noted one panellist.
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When it comes to liquidity, transparency does not necessarily equate to efficacy, say experts; The key to addressing the key challenges around liquidity sourcing is for everyone to know where each player stands and the context behind the numbers, experts at TradeTech Europe’s liquidity sourcing panel agreed.
Claudia Preece – The Trade
Jeremy Smart, global head of distribution at XTX Markets, addressed some of the key drivers which are changing the market’s approach to liquidity sourcing in Europe, suggesting that there exists a “permanent misunderstanding” between transparency and efficiency across the market. “When people talk about transparency, they talk about transparency as if it is one single thing, but transparency of price discovery is actually different to transparency of liquidity discovery. “They are two different elements.”
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Ukraine Invasion
What US taxpayers will get for another $61 billion to Ukraine; Stopping Putin sooner will be far cheaper than stopping him later.
Rick Newman – Yahoo Finance
Drop the sports metaphors. One thing we should know more than two years after Russia invaded Ukraine is that the entrenched war is not likely to end like a baseball or basketball game, with one winner and one loser. Nor is a tie likely, with each side getting credit for half a win and heading home. Instead, there’s a matrix of possible outcomes and an unpredictable timetable that will probably frustrate anybody hoping for a decisive ending. All of this should temper expectations now that the United States is finally providing another tranche of aid Ukraine desperately needs to keep Russia from overrunning its territory. But it also underscores that US aid to Ukraine is money well spent – and there’s likely to be a need for more.
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Senate Passes $95 Billion Package to Help Ukraine and Israel; Measure, which also includes forced sale of TikTok, now heads to Biden’s desk
Katy Stech Ferek and Lindsay Wise – The Wall Street Journal
The Senate passed a long-delayed $95.3 billion foreign-aid package sending much-needed ammunition and military equipment to beleaguered Ukrainian soldiers and fortifying Israel’s missile defense systems, while also forcing the sale of Chinese-controlled TikTok in the U.S. The 79-to-18 vote brought to a close months of wrenching debate over Ukraine that sharply split the Republican Party, with rank-and-file members openly rebelling against their leaders. The fight also called into question both how far the U.S. would go to defend the country, now in the third year of trying to repel Russia’s invasion, as well as America’s leadership role in the world.
/jlne.ws/3xXYJTG
Switzerland Has Frozen $14 Billion in Total of Russia Assets; Switzerland has so far mirrored EU sanctions against Russia; Decision was controversial in historically neutral country
Bastian Benrath – Bloomberg
Switzerland has blocked 13 billion francs ($14.3 billion) in Russian assets held in the country, including more than 7 billion francs in reserves and assets of Russia’s central bank. In 2023, Swiss authorities froze a further 580 million francs in financial assets and two more properties, following its own investigations and detailed clarifications by banks, the State Secretariat of Economic Affairs, or SECO, said Tuesday. In total, it’s frozen 17 properties as well as luxury cars, works of art and furniture.
/jlne.ws/4b0QpRG
Israel/Palestine Conflict
Iran threatens to annihilate Israel should it launch a major attack
Reuters
An Israeli attack on Iranian territory could radically change dynamics and result in there being nothing left of the “Zionist regime”, Iran’s President Ebrahim Raisi was quoted as saying on Tuesday by the official IRNA news agency. Raisi began a three day visit to Pakistan on Monday and has vowed to boost trade between the neighbouring nations to $10 billion a year. The two Muslim neighbours are seeking to mend ties after unprecedented tit-for-tat military strikes this year.
/jlne.ws/49VeIiG
Exchanges, OTC and Clearing
Hong Kong Stock Exchange leads with new climate disclosure standards
FinTech Global
The Stock Exchange of Hong Kong, a subsidiary of HKEX has unveiled its new climate-related disclosure requirements. These requirements are part of the Exchange’s updated environmental, social, and governance (ESG) framework. The decision comes after a consultation phase where the Exchange received 115 responses from a diverse group of stakeholders. The feedback overwhelmingly supported the introduction of enhanced disclosure mandates.
/jlne.ws/44hsqvk
CME US Credit Futures to Begin Trading On June 17; New contracts based on Bloomberg corporate bond indexes will bring greater flexibility for risk management
MarketsMedia
CME Group, the world’s leading derivatives marketplace, announced that its new credit futures are scheduled to begin trading on Monday, June 17, 2024, pending regulatory review. Launching alongside the company’s leading U.S. Treasury complex, CME Group credit futures will be the first futures contracts to help market participants manage duration risk through an intercommodity spread with U.S. Treasury futures. In addition, for the first time ever, investors can gain exposure to and manage credit component risk through futures on Bloomberg’s duration-hedged index.
/jlne.ws/3QisSDx
CME Group Inc. Reports First-Quarter 2024 Financial Results
CME Group
CME Group Inc. (NASDAQ: CME) today reported financial results for the first quarter of 2024. The company reported revenue of $1.5 billion and operating income of $960 million for the first quarter of 2024. Net income was $855 million and diluted earnings per common share were $2.35. On an adjusted basis, net income was $911 million and diluted earnings per common share were $2.50. Financial results presented on an adjusted basis for the first quarter of 2024 and 2023 exclude certain items, which are detailed in the reconciliation of non-GAAP results.1
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Deutsche Boerse Group begins the 2024 financial year as planned with further significant growth
Deutsche Boerse Group
Deutsche Boerse Group has just published its quarterly statement Q1/2024. You can find the link to the entire report at the bottom of the page.
/jlne.ws/4bbMaT1
Poll Results Of 2024 Annual General Meeting, Appointment Of Chairman And New Appointments To HKEX Board
Hong Kong Exchanges and Clearing
Hong Kong Exchanges and Clearing Limited (HKEX) today (Wednesday) hosted its 2024 Annual General Meeting (AGM). All proposed resolutions as set out in the notice of AGM dated 20 March 2024 were passed. Please refer to the regulatory announcement issued today for the results by resolution. The Board today appointed Carlson Tong as HKEX’s Chairman, subject to the written approval of the Chief Executive of the Hong Kong Special Administrative Region. Please refer to the regulatory announcement issued today for the appointment of HKEX’s Chairman.
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HKEX 2024 First Quarter Results – Quarterly Results For The Three Months Ended 31 March 2024
Hong Kong Exchanges and Clearing
Bonnie Y CHAN, Chief Executive Officer said: HKEX demonstrated its strength and resilience in the first quarter of the year. Despite a fragile global backdrop, the Group’s derivatives and commodities business performed strongly – the former achieving record quarterly volumes. Whilst the cash market reflected broader macro sentiment and remained soft, there was a notable uptick in Headline ADT in March and April, indicating growing investor confidence. The Connect programmes, including Northbound Stock Connect and Bond Connect, saw significant growth in trading volumes, with Bond Connect reaching a fresh record for the quarter.
/jlne.ws/3WkpLyG
USD and CNH London Mini Futures Contracts Daily Maximum Fluctuation Price Band Reference Price
Hong Kong Exchanges and Clearing
Due to the difference between the HKFE T-session Close of the following USD London Mini Futures Contract and the Closing Price published by the London Metal Exchange (LME) for the corresponding LME contract is greater than 5%, LME Closing Price is used as the reference price to determine the Maximum Fluctuation price band today for below markets.
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MCX YoY’24 operations revenue up 33.11%; Final dividend recommended – Rs. 7.64 per share
MCX
The Multi Commodity Exchange of India Ltd. (MCX), India’s largest Exchange in the Commodity Derivatives Market segment, announced its unaudited financial results for the 4th Quarter and year ended March 31, 2024.
/jlne.ws/3wdIhhC
Trader Alert 24-26: MEMX Options Released Version 1.7A of Its MEMO SBE and Risk Specifications
MEMX
On Tuesday, April 23, 2024, MEMX Options released a new version of its MEMO SBE and Risk Specifications. Version 1.7A can be found here using the “upcoming version” link. Release dates for the MEMX Options Development Environment (MODE) and Production to follow. Updates are listed below and in the specification Errata included in the download:
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Replacement in indices
National Stock Exchange of India
The Index Maintenance Sub-Committee (Equity) of NSE Indices Limited has decided to make the following replacements in various indices on account of scheme of amalgamation of Ujjivan Financial Services Ltd. with Ujjivan Small Finance Bank Ltd. These changes shall become effective from May 03, 2024 (close of May 02, 2024).
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Diapason Partners with SIX to Integrate Market Data into Its myDiapason Solution
SIX
Diapason, the leading provider of treasury and market risk management solutions, teams up with SIX, the leading provider of financial data to offer Diapason’s customers a solution integrating the provision of quality market data. SIX, the global provider of financial information, offers a complete range of data delivery solutions: from bulk-based repository feeds to on-demand flat files, cloud solutions and APIs.
/jlne.ws/4b8zOLu
Switzerland Cements Itself as a Life Sciences Hub
SIX
In addition to the favourable conditions that biotech companies find on SIX Swiss Exchange, they can also receive support to help them meet global sustainability goals, as Fabian Gerber, Senior Relationship Manager, SIX Swiss Exchange, explains. Healthcare companies, comprising of pharmaceuticals, biotech, and med-tech, account for one third of the total market capitalisation of all SIX Swiss Exchange-listed businesses. It is not a coincidence why so many biotech businesses have chosen to be listed in Switzerland.
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SGX RegCo wants boards to help enable shareholder-requisitioned meetings
SGX Group
To improve board-shareholder engagements, Singapore Exchange Regulation (SGX RegCo) is proposing a rule change to require listed issuers to assist shareholders who have requisitioned a general meeting so that the meeting can take place as soon as practicable. Issuers are to commence facilitative efforts within 21 days of deposit of the requisition notice. An issuer who disputes the validity of the requisition notice must apply for a court ruling within the same timeline.
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NZX Revenue & Shareholder Metrics – 1Q24 24/4/2024, 8:32 am MKTUPDTE
NZX
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The number of corporate clients on the Moscow Exchange money market has quadrupled
Moscow Exchange
The Moscow Exchange records an increase in the activity of legal entities in the money market using brokerage services and direct access to the market. At the end of the first quarter of 2024, the number of corporate clients making repo transactions through brokers on the Moscow Exchange exceeded 3,100 legal entities – this is four times more than in the first quarter of last year. Their total trading volume during this period amounted to 19 trillion rubles, and the average daily volume of transactions for the year doubled, to 311 billion rubles.
/jlne.ws/3JvcXOu
Fintech
Liquidnet sees electronic future for gray bond trading; TP Icap’s gray market bond trading unit has more than doubled transactions in the first quarter of 2024.
Bernard Goyder – Waters Technology
TP Icap’s Liquidnet is electronifying one of the last bastions of voice trading in European fixed income: the gray market. Trading ‘in the gray’ refers to the act of buying or selling a bond before it has been formally issued. Portfolio managers have long traded bonds among themselves in the days after an offering has been announced, but before the securities have been issued. The gray market can help investors manage both an over- or under-allocation from the banks bookrunning a bond offering.
/jlne.ws/4b5WvjB
Google Delays Cookie Phase-Out Following Regulatory Pushback; Move by search giant has major ramifications for $600 billion online ad industry
Miles Kruppa and Patience Haggin – The Wall Street Journal
Google will miss its end-of-year target for changing the way advertising is delivered in its dominant Chrome web browser, a setback in its yearslong effort to improve consumer privacy on the internet. Google said Tuesday it would no longer be able to eliminate third-party cookies on its original timeline, citing “ongoing challenges related to reconciling divergent feedback from the industry, regulators and developers.” The changes have been eagerly anticipated by advertisers because almost two-thirds of internet traffic flows through Chrome, making it an important gateway for reaching consumers.
/jlne.ws/3Qk1hlE
AI Search Startup Perplexity Valued at $1 Billion in Funding Round; Perplexity’s valuation has doubled in three months in a clear sign of investor enthusiasm for the company’s artificial intelligence chatbot.
Shirin Ghaffary – Bloomberg
Perplexity AI, a startup using artificial intelligence to build a search engine to compete with Alphabet Inc.’s Google, has raised about $63 million in a new funding round that values the company at more than $1 billion. The financing, set to be announced on Tuesday, doubles Perplexity’s valuation from just three months ago. Investor Daniel Gross led the round with participation from billionaire Stanley Druckenmiller, Y Combinator Chief Executive Officer Garry Tan and Figma Inc. CEO Dylan Field. Several earlier Perplexity backers, including Amazon.com Inc. founder Jeff Bezos and Nvidia Corp. also joined the round. The Wall Street Journal previously reported Perplexity was in funding talks.
/jlne.ws/4daor7G
Meta’s A.I. Assistant Is Fun to Use, but It Can’t Be Trusted; Despite Mark Zuckerberg’s hope for the chatbot to be the smartest, it struggles with facts, numbers and web search.
Brian X. Chen – The New York Times
In the last few days, you may have noticed something new inside Meta’s apps, including Instagram, Messenger and WhatsApp: an artificially intelligent chatbot. Within those apps, you can chat with Meta AI and type in questions and requests like “What’s the weather this week in New York?” or “Write a poem about two dogs living in San Francisco.” The assistant will come up with responses immediately, such as “The corgi was short, with a butt so wide, the lab was tall, with a tongue that would glide.” You can also instruct Meta AI to produce pictures – like an illustration of a family watching fireworks.
/jlne.ws/3WeObtI
Top tech companies seek more cash for the lab keeping AI safe
Cat Zakrzewski
Leading AI companies, universities and civil society groups on Tuesday called Congress to expand funding for the National Institute of Standards and Technology, the decaying federal agency at the heart of the Biden administration’s ambitious plans to evaluate a new generation of artificial intelligence models.
/jlne.ws/3wgjCZM
Artificial Intelligence Offers an Opportunity to Improve EV Batteries; Startup Chemix says its AI platform can speed up battery development, ensuring EVs are more efficient and can stay on the road longer.
Michelle Ma – Bloomberg
/jlne.ws/3Uccl5o
Why the AI Industry’s Thirst for New Data Centers Can’t Be Satisfied; Supply bottlenecks slow the scramble to build bigger, more powerful facilities
Tom Dotan and Asa Fitch – The Wall Street Journal
/jlne.ws/3WekdGi
Duco Appoints Josh Monroe As Chief Revenue Officer
Mondovisione
Duco, the leading enterprise platform for data automation, today announces the appointment of Josh Monroe as Chief Revenue Officer. Based in New York, Josh brings a wealth of experience to the role and reports directly to Michael Chin, Duco’s Chief Executive Officer. Josh will lead Duco’s Revenue organization, overseeing global sales, account management, marketing, customer success, solution engineering, and partnerships as the company continues to outperform competitors and accelerate growth.
/jlne.ws/4b8LNIX
Cybersecurity
Justice Department Charges Four Iranian Nationals for Multi-Year Cyber Campaign Targeting U.S. Companies; During the Course of the Conspiracy, One Defendant Also Worked for an IRGC Electronic Warfare and Cyber Defense Unit
Department of Justice
An indictment was unsealed today in Manhattan federal court charging Iranian nationals Hossein Harooni, Reza Kazemifar, Komeil Baradaran Salmani, and Alireza Shafie Nasab for their involvement in a cyber-enabled campaign to compromise U.S. government and private entities, including the U.S. Departments of Treasury and State, defense contractors, and two New York-based companies. Nasab was charged for the same conduct in a previous indictment that was unsealed on Feb. 29. The defendants remain at large.
/jlne.ws/3UwKHBy
Licensed to Bill? Nations Mandate Certification & Licensure of Cybersecurity Pros; Malaysia, Singapore, and Ghana are among the first countries to pass laws that require cybersecurity firms – and in some cases, individual consultants – to obtain licenses to do business, but concerns remain.
Robert Lemos – Dark Reading
Malaysia has joined at least two other nations – Singapore and Ghana – in passing laws that require cybersecurity professionals or their firms to be certified and licensed to provide some cybersecurity services in their country. On April 3, the upper house of the Malaysian Parliament, known as the Dewan Negara, passed the Cyber Security Bill 2024, following its passage in the lower house the previous month. The bill, which will become law following its signing by the King and its publication in the Government Gazette, is structured as umbrella legislation and will act as a framework for future government activity securing critical infrastructure and improving the national state of cybersecurity.
/jlne.ws/4dcZuIF
Cryptocurrencies
Mt. Gox’s $9 Billion Bitcoin Repayments Could Rattle the Market, Warn K33 Analysts
Hope C – CoinMarketCap
Market analysts at K33 Research are cautioning that the potential return of over $9 billion worth of Bitcoin from the Mt. Gox era could have a negative impact on the cryptocurrency’s price. According to Anders Helseth and Vetle Lunde, researchers at K33, the recent updates provided to Mt. Gox creditors, revealing the amount of cryptocurrency and fiat owed to them along with repayment dates, suggest that Bitcoin repayments could commence as early as next month.
/jlne.ws/3w6CZod
Institutional Digital Assets: The Future of Finance Is Here
Annelise Osborne – CoinDesk
A “crypto year” is often said to pack one year of innovation into a time span that would normally take seven. Like dog years. That said, institutions don’t move in crypto years when adopting innovation. They test and slowly build behind the scenes and those projects are starting to bloom just like spring flowers and cherry blossoms.
/jlne.ws/3UbJ4HR
Bitcoin Miners May Shift Focus to AI After Halving, CoinShares Says
Will Canny – CoinDesk
Crypto miners may shift towards artificial intelligence (AI) in energy-secure locations following the bitcoin {{BTC}} halving due to the potential for higher revenue, CoinShares (CS) said in a report on Friday. The quadrennial halving, which slows the rate of growth in bitcoin supply by 50%, occurred on Friday evening. Coinshares notes that mining companies like BitDigital (BTBT), Hive (HIVE) and Hut 8 (HUT) are already generating income from AI. At the same time, TeraWulf (WULF) and Core Scientific (CORZ) have existing AI operations or plans to grow in the space.
/jlne.ws/3w7k6l2
Grayscale Files to Launch Smaller Fund Tied to Its Ethereum Trust
Vicky Ge Huang – The Wall Street Journal
Grayscale Investments filed on Tuesday to launch a smaller fund tied to its ethereum trust, which the crypto asset manager is also trying to convert into an exchange-traded fund. The Grayscale Ethereum Mini Trust would trade under the ticker ETH and would be seeded through a spinoff from the main Grayscale Ethereum Trust, according to regulatory filings.
/jlne.ws/49TrONB
Politics
Biden is asking Congress to kill the American Bitcoin mining industry
CoinTelegraph
The fact that the United States has taken an aggressive approach to cryptocurrency regulations – despite giving the green light for Bitcoin ETFs – is basically undeniable. This is particularly true of the Bitcoin mining complex, which has a long history dating back to the earliest days of Bitcoin. Nevertheless, the feds seem hellbent on destroying the industry, even though it operates on a cleaner energy grid than you will find in most countries.
/jlne.ws/3JwC1EJ
McCormick Wins GOP Primary for Pennsylvania Senate Seat
Airielle Lowe – Bloomberg
Trump-backed former Bridgewater Associates chief executive officer Dave McCormick won the Republican Primary for the US Senate seat in Pennsylvania, AP projected. McCormick had no challengers in the primary and will face incumbent Democrat Bob Casey in November.
/jlne.ws/3Wat4bO
RFK Jr.’s quintessential campaign position: The blockchain budget
Philip Bump – The Washington Post
If you are curious how the government spends its money – about half of which comes from income taxes – there are lots of ways to investigate. The White House Office of Management and Budget (OMB) posts data on receipts (incoming money) and expenditures (outgoing money) broken down by government agency and over time. There are 58 different spreadsheets over there, so dive in.
/jlne.ws/4d8qLw2
Xi’s Armada Is Winning the Battle for Energy in the South China Sea
Philip Heijmans – Bloomberg
This was supposed to be the year that Vietnam reaped the benefits from one of its largest natural gas discoveries. An estimated 150 billion cubic meters of the fuel, enough to power a city the size of Hanoi for decades, was discovered 50 miles (80 kilometers) from Vietnam’s central coast in 2011. If all had gone to plan, the “Blue Whale” project led by Exxon Mobil Corp. would have gone online late last year.
/jlne.ws/3Jwy9DF
Australia’s prime minister calls Elon Musk an ‘arrogant billionaire’
Adela Suliman – The Washington Post
Australian Prime Minister Anthony Albanese lashed out at tech mogul Elon Musk on Tuesday, labeling him an “arrogant billionaire” over an ongoing dispute about whether videos from a church stabbing in Sydney should be shown on Musk’s social media platform, X, formerly Twitter. Albanese in an interview with the Australian Broadcasting Corporation said his country would “do what’s necessary to take on this arrogant billionaire, who thinks he’s above the law but also above common decency.”
/jlne.ws/4aO3Xjv
Regulation
FTC Issues Worker Non-Compete Ban as Chamber Lawsuit Looms; Final rule bars nearly all worker non-compete agreements; Business lobby pledged legal challenge as soon as Wednesday
Leah Nylen and Emily Birnbaum – Bloomberg
The US Federal Trade Commission voted Tuesday to adopt a near-total ban on non-compete provisions that prohibit workers from switching jobs within an industry, a rule the Chamber of Commerce vowed to immediately challenge in court. The high-stakes legal showdown comes three years after President Joseph Biden signed an executive order encouraging the FTC to limit non-compete agreements, which affect roughly one in five Americans.
/jlne.ws/3UbBzRs
UK Firms Told to ‘Urgently Review’ Green Claims Amid Crackdown; Companies have been given until the end of May to comply; EY warns of far-reaching implications of FCA’s regulation
Greg Ritchie – Bloomberg
Firms operating in the UK are being advised to go through any products and services around which some sort of sustainability claim has been made, to ensure they’re not in the crosshairs of a regulatory crackdown that’s due to take effect at the end of next month. The Financial Conduct Authority’s plan to move ahead with anti-greenwashing rules has far-reaching implications for British businesses, and leaves them with only limited time to shield themselves from potential regulatory action, according to industry associations and consultants advising businesses.
/jlne.ws/3JRjgfH
Florida Man Sentenced for Laundering Proceeds of Nigerian Romance Scams and Business Email Compromises
Department of Justice
A Florida man was sentenced today in federal court to 48 months in prison for his role in laundering the proceeds of scams against American consumers and businesses to co-conspirators located in Nigeria. According to court documents, Niselio Barros Garcia Jr., 50, of Winter Garden, was part of a network of individuals who laundered proceeds of fraud from romance scams, business email compromises and other fraud schemes. Garcia supplied bank accounts to his co-conspirators for the purpose of receiving proceeds from the scams. After he received the proceeds, Garcia used a cryptocurrency exchange to conceal and transfer the funds in Bitcoin to co-conspirators in Nigeria.
/jlne.ws/4aR1wwO
BlackRock Executive Highlights Basel III Issues
Anna Lyudvig – Traders Magazine
When we think about the Basel III implications, we are concerned about the implications for our underlying clients, said Michael Winnike, Director, Market Structure, BlackRock. Speaking at the SIFMA’s Basel III Endgame Roundtable on April 18, Winnike highlighted two categories of issues. One is the overall impact of excessive capital levels on the price and capacity for intermediation, he said.
/jlne.ws/3U9BoWN
Lenders flying blind on private equity risk, Bank of England warns; Regulator says sector needs a consolidated view to avoid a repeat of Archegos fiasco
Will Louch and Ortenca Aliaj – Financial Times
Some banks are unable to quantify their exposure to private equity, the Bank of England has found, in the latest warning that the $8tn industry could threaten the wider financial system. BoE regulator Rebecca Jackson said on Tuesday that lenders should routinely stress test their exposure, but “hardly any banks do it well”.
/jlne.ws/4bdpKkF
UK regulator examines Microsoft and Amazon’s AI dealmaking; Request for comments into Big Tech’s alliances with artificial intelligence start-ups follows CMA study into fast-growing market
Tim Bradshaw – Financial Times
The UK competition regulator has taken the first steps towards three more probes into alliances between Big Tech companies and artificial intelligence start-ups, after the agency said its concerns about dealmaking in the fast-growing sector were increasing. The Competition and Markets Authority on Wednesday invited comments on Microsoft’s hiring of key talent from Inflection AI and its minority investment in French start-up Mistral, as well as Amazon’s $4bn investment in US-based Anthropic, a leading rival to OpenAI.
/jlne.ws/3JxvNEF
US regulator seeks $5bn penalty against Do Kwon and Terraform Labs; Collapsed crypto firm and co-founder were found liable for fraud
Scott Chipolina – Financial Times
The US Securities and Exchange Commission is pushing for collapsed cryptocurrency firm Terraform Labs and its co-founder Do Kwon to pay more than $5bn in fines and interest, after both were found liable for fraud earlier this month. The regulator has requested a penalty of just under $4.2bn, alongside an additional $545mn in prejudgement interest, according to a recent filing to the Southern District of New York. It also wants Terraform Labs and Kwon to pay $420mn and $100mn respectively in civil penalties.
/jlne.ws/4ddJje6
Do Kwon, Terraform Labs Should Get $5.3B Fine, SEC Tells Court; The massive sum is a “conservative measure” of Terraform Labs and Do Kwon’s ill-gotten gains, according to the SEC.
Cheyenne Ligon – CoinDesk
The U.S. Securities and Exchange Commission (SEC) has asked a New York court to impose $5.3 billion in fines on Terraform Labs and co-founder Do Kwon for their role in the $40 billion implosion of the Terra ecosystem in 2022. Terraform Labs and Kwon were found liable on civil fraud charges earlier this month, when a Manhattan jury concluded that they had misled investors about the stability of their so-called “algorithmic” native stablecoin, Terra USD (UST), and the use cases for the Terra blockchain.
/jlne.ws/3Qjn9xj
Statement of Commissioner Kristin N. Johnson Regarding Final Rulemaking on Swap Confirmation Requirements for Swap Execution Facilities
CFTC
An essential component of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) is its framework for the regulation of swaps, including central clearing and trade execution requirements, registration and comprehensive regulation of swap dealers, and recordkeeping and reporting requirements. I vote to approve today’s final rule on Swap Confirmation Requirements for Swap Execution Facilities (Final Rule), which facilitates predictability and consistency in swaps markets by codifying long-standing no-action relief into regulation, while maintaining a robust regulatory regime for swaps and swap execution facilities (SEFs).
/jlne.ws/3QiKq2C
Statement of Commissioner Summer K. Mersinger In Support of Final Rulemaking on Confirmation Requirements for Swap Execution Facilities
CFTC
Workable rules are essential to maintain the confidence of the American public in the integrity of our derivatives markets. So, when we become aware that our rules are not as workable as we thought, or impose substantial operational burdens with little corresponding regulatory benefit, we should address these shortcomings promptly. Unfortunately, though, the Commission sometimes chooses to “kick the can down the road” by relying on staff no-action letters instead – often for many years – without tackling the root cause of the problem in the rule itself.
/jlne.ws/3Qf81Bh
Statement of Commissioner Caroline D. Pham in Support of Swap Execution Facilities (SEF) Confirmation Requirements Final Rule
CFTC
I support the Final Rule on Swap Confirmation Requirements for Swap Execution Facilities (SEF Confirmation Final Rule) because it resolves the temporal impossibility of requiring SEF confirmations at the time of execution for block trades, which are in fact executed away from the SEF and then submitted to the SEF afterwards. I would like to thank Roger Smith, Nora Flood, and Vince McGonagle in the Division of Market Oversight for their work on the SEF Confirmation Final Rule.
/jlne.ws/49V7r2q
Statement of Chairman Rostin Behnam Regarding the CFTC’s Final Rule on Swap Confirmation Requirements for SEFs
CFTC
I am very pleased that the Commission voted to finalize necessary amendments to the Commission’s regulations addressing longstanding issues with the uncleared swap confirmation requirements under Rule 37.6(b). During the initial implementation of part 37, SEFs informed the CFTC that the confirmation requirement for uncleared swaps was operationally and technologically difficult and impractical to implement. In light of these challenges, the Division of Market Oversight provided targeted no-action positions for SEFs with respect to certain provisions of Commission regulations throughout the last decade.[1]
/jlne.ws/3UspGYE
Statement of Commissioner Kristin N. Johnson Regarding Final Rulemaking on Swap Confirmation Requirements for Swap Execution Facilities
CFTC
An essential component of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) is its framework for the regulation of swaps, including central clearing and trade execution requirements, registration and comprehensive regulation of swap dealers, and recordkeeping and reporting requirements. I vote to approve today’s final rule on Swap Confirmation Requirements for Swap Execution Facilities (Final Rule), which facilitates predictability and consistency in swaps markets by codifying long-standing no-action relief into regulation, while maintaining a robust regulatory regime for swaps and swap execution facilities (SEFs).
/jlne.ws/49Pkm5O
CFTC Approves Final Rules on Swap Confirmation Requirements for SEFs
CFTC
The Commodity Futures Trading Commission (CFTC) approved final rules to amend its swap execution facility (SEF) regulations related to uncleared swap confirmations to address issues which have been addressed in CFTC staff no-action letters, including the most recent CFTC No Action Letter No. 17-17, as well as associated conforming and technical changes.
/jlne.ws/4b8oZZV
Individual charged with investment fraud over unauthorised multimillion pound ‘Kube Trading’ scheme
UK FCA
The Financial Conduct Authority (FCA) has launched criminal proceedings against Lee Steven Maggs of Sittingbourne, Kent, for 2 counts of fraud and 1 count of breaching the Financial Services and Markets Act 2000 (FSMA). Mr Maggs is alleged to have operated an unauthorised investment scheme called ‘Kube Trading’ which received around £2.67m from investors between 1 March 2019 and 22 January 2021. The FCA alleges the scheme involved trading contracts for differences in foreign exchange (FX), which is a regulated activity, and that Mr Maggs concealed significant losses from investors.
/jlne.ws/49QM0jd
FCA secures £533,000 to return to investors
UK FCA
The FCA has recovered funds from an unauthorised deposit-taking scheme operated by Bright Managment Solution Limited [sic] and others. Investors will receive money back totalling £533,000 after the High Court granted a distribution order to the FCA. The FCA recovered the money from Bright, Soccer League International Limited, and three individual defendants, Mohammed Zakir Hussain, Mohammed Abdul Kahhar and Kayes Miah – all of whom accepted the FCA’s claim against them.
/jlne.ws/3UeqZco
FCA confirms anti-greenwashing guidance and proposes extending sustainability framework
UK FCA
Ahead of the anti-greenwashing rule coming into force on 31 May, the FCA is supporting industry with guidance to help them meet the standard. The new rule is designed to protect consumers by ensuring sustainable products and services they are sold are accurately described. Results from the latest Financial Lives survey shows significant consumer interest in sustainable finance as 81% of adults surveyed would like their investments to do some good as well as provide a financial return. This work supports the long-term growth and competitiveness of the sector by helping businesses meet this demand and ensuring consumers who invest in sustainability-related financial products can make informed decisions.
/jlne.ws/3xIZRui
SFC cautions public against bogus calls purportedly from SFC
SFC
The Securities and Futures Commission (SFC) today urges the public to beware of bogus calls claiming to come from a financial regulator. In a recent case, which the SFC has reported to the Police, a member of the public received a bogus voice message call claiming the regulator had found irregularities in the recipient’s stock trading and requiring input of more information through the phone system.
/jlne.ws/3UvhfeW
SIFMA Statement on FTC Non-Compete Rule Finalized Today
SIFMA
SIFMA today issued the following statement from president and CEO Kenneth E. Bentsen, Jr. regarding the final Federal Trade Commission (FTC) non-compete rule: “We are carefully reviewing the final rule released today and appreciate that the FTC carved out the sale of businesses and the existing agreements for senior executives. We however, remain concerned that the near-categorical prohibition on non-compete clauses would hurt competition and the economy by terminating long-established practices of using non-compete clauses to protect a business’s sensitive information. The proposal also greatly underestimated its compliance costs, while failing to establish a clear record on its benefits or necessity.”
/jlne.ws/3Qixc5J
Prosecutors Allege Scheme to Supply Venezuelan Oil Company With Aircraft Parts; U.S. prosecutors unseal indictment charging 10 individuals with a scheme to illegally procure aircraft parts for Venezuela’s state-controlled oil company
Dylan Tokar – The Wall Street Journal
Federal prosecutors unsealed a years-old indictment charging 10 people with operating a scheme to evade U.S. restrictions on Venezuela’s state-controlled oil company Petróleos de Venezuela through the illegal supply of aircraft parts. The indictment, unsealed Monday, follows the arrest of one of the defendants, George Clemente Semerene Quintero, on Friday at the Miami International Airport, according to the U.S. Attorney’s Office for the Southern District of Florida.
/jlne.ws/3JyVaGg
Investing and Trading
Chevron-Exxon Faceoff Hinges on Growth Ambitions; Darren Woods’ oil titan has opened up a market-value lead of $178 billion, and it’s all down to low-cost production.
Kevin Crowley – Bloomberg
Chevron Corp. will look to bounce back from a tough year when it reports first-quarter earnings Friday. But for the stock, arguably more important is what happens 15 minutes later, when Exxon Mobil Corp. publishes its own results. The two US behemoths are always highly competitive, but the rivalry has ratcheted up to an unprecedented degree this year, with Exxon taking Chevron to arbitration over the latter’s acquisition of Hess Corp. and its entry into a massive project off Guyana.
/jlne.ws/3Uba4aI
Cocoa Price Swings Are the Craziest Since the 1970s; A measure of price volatility hits the highest since 1977; Traders exiting the market leaves prices vulnerable to swings
Pratik Parija – Bloomberg
Cocoa resumed gains in New York, with prices the most volatile in almost five decades amid uncertainty over a historic crunch and as traders pull out of the market. Futures have soared about 160% already this year as poor West African harvests leave the world desperately short of beans. But the rally has made it more expensive to maintain positions, prompting investors to close out trades, draining liquidity and making the market more vulnerable to large price swings.
/jlne.ws/4aLwiXN
Environmental, Social and Corporate Governance
Climate Change Poses a Child Labor ‘Threat Multiplier’; Global warming is exacerbating the conditions that lead to the workplace exploitation of minors. Now there’s a new way to measure it.
Gautam Naik – Bloomberg
Child labor is a sensitive and hard-to-measure risk that typically stays hidden in the far reaches of corporate supply chains-and climate change is only making it worse. Now, a newly developed quantitative approach may help raise its prominence as an environmental, social and governance issue. The AI-driven tool, known as the Child Labor Index, scores companies in three areas: disclosure levels, public perception and the commodity-level exposure of the supply chain to child labor. Fund managers can use the scores to pinpoint high-risk companies and identify others that need to confront the issue.
/jlne.ws/3xIaE83
Biodiversity poised to be part of international sustainability reporting standards for businesses after ‘milestone’ vote
Martin Choi – South China Morning Post
Biodiversity is set to become a key part of mandatory nature-related financial disclosures around the world after a vote on Tuesday by the International Sustainability Standards Board (ISSB). The ISSB, a body set up during the COP26 global climate summit in 2021 to consolidate various reporting standards, will vote on April 23 on the research and standard-setting projects it aims to add to its two-year work plan, including the sustainability-related risks and opportunities associated with biodiversity.
/jlne.ws/3Qcac8n
ESG Watch: Why climate change is leaving mining firms between a rock and a hard place
Mike Scott – Reuters
Summary; Demand for metals and minerals for energy transition need to increase nearly 500% by 2050. But mines bring increased risks to nature and biodiversity as well as conflict with communities. Sector vulnerable to climate; 30%-50% of copper, gold, iron and zinc mines in high water stress areas. Global Investor Commission on Mining 2030 launched to address key systemic risks in sector. Schneider Electric’s Materialize offers sector platform to share best practice and track emissions. For most of us, when we think about mining and the environment, it tends to be about water and air pollution, disasters such as the fatal collapse of tailings dams, or the global warming consequences of coal mining. But the extraction of metals such as copper, nickel and cobalt will be increasingly important as we urgently seek ways to cut emissions from other building blocks of the global economy such as steel, cement and aluminium.
/jlne.ws/4dpH5c3
Florida’s Home Insurance Industry May Be Worse Than Anyone Realizes; A rash of failures of A-rated insurers points to a hidden weakness in the market, researchers say.
Leslie Kaufman – Bloomberg
Seven property insurers in Florida went bankrupt in 2021 and 2022. The bankruptcies left thousands of homeowners scrambling to get new coverage, which often came with a big increase in cost. Worse, many had outstanding claims for hurricane damage that had not been addressed. Jacqueline Ravelo, a Miami homeowner, was among them. Her roof was damaged by Hurricane Irma in 2017. Her insurance company, Avatar Property and Casualty, covered the cost of some repairs. But the roof continued to leak and mold grew inside the house, she said. Ravelo sued Avatar to compensate her for further repairs, which she said came to $50,000. When they were on the verge of settling, she said, the company went out of business.
/jlne.ws/3xKETLA
Biden Advances Plan to Make US Freight Shipping Carbon-Free; Sector-wide policy would standardize charging for EV trucks; Transportation industry is major source of US greenhouse gases
Jennifer A Dlouhy – Bloomberg
The Biden administration is laying out more of its vision for decarbonizing the nation’s freight industry, including plans for standardizing charging infrastructure for electric trucks and accelerating the adoption of emission-free big rigs. The multi-pronged initiative takes aim at a major source of US greenhouse gas emissions – as well as a thorny challenge for companies trying to meet sustainability targets and cut carbon across their own supply chains. The transportation sector generates about 29% of US greenhouse gas emissions, and the shipment of freight – whether on ships, trucks or rail – is responsible for about a third of that.
/jlne.ws/3Ugj7Hc
Asian region reels from heat and floods as WMO warns of climate change effects; More than 100,000 evacuated in Chinese floods, schools close in India and Bangladesh, warnings in Thailand and Philippines
Attracta Mooney – Financial Times
/jlne.ws/3xIJEFs
Pressure on gas and LNG prices to help switch from coal, says J.P. Morgan
Ron Bousso – Reuters
/jlne.ws/4b5JEOj
IEA bullish on electric vehicle sales in 2024; Energy watchdog’s forecast runs counter to sentiment among many carmakers struggling to sell battery-run vehicles
Peter Campbell – Financial Times
/jlne.ws/44ht0cu
Beware the pragmatism of the nonchalant ‘hot earthers’; Defending the environmental status quo in the name of ‘pragmatism’ is indefensible
/jlne.ws/3JzAMF6
EU Parliament adopts new rules to improve air quality by 2030
Reuters
/jlne.ws/4daAEt6
EU Parliament backs clampdown on single-use plastic packaging
Kate Abnett – Reuters
/jlne.ws/44e7uVS
EU parliament approves new business supply chain audit law
Reuters
/jlne.ws/44g74hH
EU Parliament approves plan to quit energy charter treaty
Kate Abnett – Financial Times
/jlne.ws/3Wg3HW2
Hong Kong accounting industry grows as ESG, Greater Bay Area opportunities draw young professionals: HKICPA president
Enoch Yiu – South China Morning Post
/jlne.ws/49Tq9Yn
Institutions
MetroTrade eyes opportunity in US retail futures broking
Luke Jeffs – FOW
The US futures brokerage market has been contracting for decades with that business becoming increasingly concentrated among fewer and fewer firms but there have been recently some signs of new entrants buoyed by higher interest rates and the opportunity of new technology. On the institutional side of the business, Clear Street launched this month a US equities and options clearing service while Hidden Road extended in January its offering to include futures and options through its US futures commission merchant (FCM).
/jlne.ws/4b84jBd
Schroders CEO Peter Harrison to Retire, Search On for Successor
Loukia Gyftopoulou – Bloomberg
Schroders Plc Chief Executive Officer Peter Harrison is planning to step down in 2025 and the money manager is soon set to kick off a search for his successor. The board of the London-based firm expects an orderly transition next year and Harrison will remain as a director of the company throughout this period, according to a filing on Wednesday. The firm has hired Russell Reynolds to look for a new CEO.
/jlne.ws/3QjoFzv
UBS flags ‘serious’ concern about new Swiss capital requirements
Noele Illien – Reuters
UBS executives on Wednesday told shareholders that the bank has major concerns about the Swiss government’s recently announced plan to hit the country’s largest lender with tougher capital requirements. Switzerland’s government laid out plans two weeks ago for how to police banks deemed “too big to fail” to shield the country from a repeat of the collapse of Credit Suisse. “We are seriously concerned about some of the discussions related to additional capital requirements,” UBS Chairman Colm Kelleher said at the bank’s annual general meeting in Basel.
/jlne.ws/4aM3JJS
Russian court orders seizure of JPMorgan Chase funds in VTB lawsuit
Reuters
A Russian court has ordered the seizure of funds in JPMorgan Chase bank accounts in Russia, court filings showed on Wednesday, in a lawsuit filed by state-owned bank VTB as it seeks to regain funds blocked abroad. JP Morgan Chase last week sued VTB in New York to halt its efforts to recover $439.5 million from an account that was blocked after Russia despatched its army to Ukraine in 2022 and VTB was hit with sanctions.
/jlne.ws/49TrH4D
BNP Paribas appoints John Fox as US Head of Market and Financing Services
BNP Paribas
BNP Paribas’ Securities Services business is pleased to announce the appointment of John Fox as Head of Market and Financing Services (MFS) for the United States effective May 1, 2024. In his new role, John will be responsible for strengthening the MFS offering in the US, including securities lending, triparty collateral management and financing. He will play a crucial role in driving innovation and delivering tailored solutions to clients, further strengthening BNP Paribas’ position as a trusted provider in the US.
/jlne.ws/3U4nIfq
Russia Pushes Its Largest Private Bank to Redomicile at Home; Finance Ministry seeks order on foreign holders in Alfa Bank; Government named bank among ‘economically significant’ firms
Bloomberg News
/jlne.ws/3UdvOmj
Hedge Funds Are Succumbing to Mind-Boggling Returns of Memecoins; Seen as the first cycle where funds are jumping into memes; Dogwifhat’s rally attracts the attention of crypto hedge funds
Olga Kharif – Bloomberg
/jlne.ws/4d4miKV
Work & Management
Oracle to Move Headquarters Again, This Time to Nashville; CEO Ellison said the relocation will help the company better integrate with the healthcare industry
Tom Dotan – The Wall Street Journal
Oracle has unveiled plans to move its headquarters again, this time to Nashville, Tenn., to be closer to companies in the healthcare industry. In a livestreamed interview put on by Oracle’s health division, Chief Executive Larry Ellison said Tuesday that the enterprise software company is moving a huge campus to the Southern city, and it will “ultimately be our world headquarters.” “We want to be in a community where our people want to live,” he said in the interview that was with former Tennessee Sen. Bill Frist.
/jlne.ws/4baLwFo
Deloitte’s Women @ Work report shows stagnating progress in and outside the workplace for women
Cision PR Newswire
Now in its fourth year, Deloitte’s Women @ Work: A Global Outlook, a survey of 5,000 women in workplaces across 10 countries, explores some of the critical workplace and societal factors impacting women’s careers. Rising stress levels and poor mental health persist. And fewer women report feeling supported by their employers to balance work responsibilities with their commitments outside of work-a trend that is leading some women to switch employers. Although women working in a hybrid model are reporting better experiences this year than last, many have recently been asked to return to the office and are reporting adverse effects on their mental health and productivity.
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Wellness Exchange
Opinion Why we shouldn’t panic if bird flu becomes the next pandemic
Leana S. Wen – The Washington Post
It’s true that the recent spread of bird flu among dairy cows is an “enormous concern,” as Jeremy Farrar, the World Health Organization’s chief scientist, described it last week. While only two people in the United States have contracted this H5N1 strain of the avian flu (one last year and one this month), wider spread could be catastrophic, given that, in past outbreaks, the disease has killed one of every two people who are infected.
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Pharma Startup Uses AI to Test Old Drugs to Treat Rare Diseases; Transcripta Bio’s AI software analyzes rare diseases to see if existing pharmaceuticals can help.
Ashlee Vance – Bloomberg
For the past six years, Carrie Rich has been on a journey no parent wants to take. Her daughter has a form of autism caused by a rare genetic condition, and Rich is desperate to help her combat the effects of the genetic anomaly. They’ve left the girl unable to speak and blunted her ability to move and interact like her 7-year-old peers. “I’ve spoken with researchers, scientists, academics, entrepreneurs, philanthropists, investors and parents across the planet,” Rich says. “I mean, truly anyone who would speak with me. I was really hoping to find someone who could lead me in a positive direction forward.” Rich mostly encountered bad news. She found families in similar circ*mstances who’d been bankrupted or torn apart by false hopes. There were painfully few signs that some kind of therapy for her daughter might one day be available. But last year a group of scientists in California who’d developed a new drug-screening program hit upon a pill they thought might help Rich’s daughter. The child began taking the pill in December, and the early indications are that it’s working.
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At Moderna, OpenAI’s GPTs Are Changing Almost Everything; ‘People literally talk about how AI is going to cure diseases someday, and I think this is a very meaningful first step,’ said OpenAI CEO Sam Altman
Isabelle Bousquette – The Wall Street Journal
Moderna is expected to announce a partnership Wednesday with artificial-intelligence heavyweight OpenAI, a deal that aims to automate nearly every business process at the biotechnology company and boost the ChatGPT maker’s reach into the enterprise. As part of the transaction, some 3,000 Moderna employees will have access to ChatGPT Enterprise, built on OpenAI’s most advanced language model, GPT-4, by the end of this week. Further integration of AI into more of its processes could help Moderna outpace its plan to roll out 15 new products within the next five years, the Cambridge, Mass., company said.
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Could Eating Less Help You Live Longer? Calorie restriction and intermittent fasting both increase longevity in animals, aging experts say. Here’s what that means for you.
Dana G. Smith – The New York Times
If you put a lab mouse on a diet, cutting the animal’s caloric intake by 30 to 40 percent, it will live, on average, about 30 percent longer. The calorie restriction, as the intervention is technically called, can’t be so extreme that the animal is malnourished, but it should be aggressive enough to trigger some key biological changes.
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Regions
Chinese speculators super-charge gold rally; Huge bullish bets on Shanghai exchanges show growing clout of Asian traders in market for precious metal
Harry Dempsey and Cheng Leng – Financial Times
Huge bets by Chinese speculators on rising gold prices have helped super-charge the precious metal’s rally to an all-time high this month, in a sign that Asian traders are beginning to eclipse their western counterparts in their influence on the bullion market. Long gold positions held by futures traders on the Shanghai Futures Exchange (SHFE) climbed to 295,233 contracts, equivalent to 295 tonnes of gold. That marks a rise of almost 50 per cent since late September before geopolitical tensions flared up in the Middle East.
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Is There Light at the End of the Tunnel for Hong Kong? The city’s equity market jumped this week, registering its best performance this year, in the wake of proposed regulatory changes
Jacky Wong – The Wall Street Journal
Hong Kong’s stock market used to be the world’s top equity fundraising venue. Not anymore: In the number one spot as recently as 2019, it didn’t even break the top five in 2023 according to Dealogic. But the market is up 6% this week, its best performance this year, in the wake of proposed regulatory changes. In particular, comments from China’s security regulator suggesting that more big Chinese companies may be greenlighted to list in Hong Kong.
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Japan issues strongest warning yet on readiness to intervene in currency market
Leika Kihara and Makiko Yamazaki – Reuters
Japanese Finance Minister Shunichi Suzuki said last week’s meeting with his U.S. and South Korean counterparts has laid the groundwork for Tokyo to act against excessive yen moves, issuing the strongest warning to date on the chance of intervention. “I voiced strong concern on how a weak yen pushes up import costs. Our view was shared not just in a meeting with my South Korean counterpart, but at the trilateral meeting that included the United States,” Suzuki told parliament on Tuesday.
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Florida’s Home Insurance Industry May Be Worse Than Anyone Realizes; A rash of failures of A-rated insurers points to a hidden weakness in the market, researchers say.
Leslie Kaufman – Bloomberg
Seven property insurers in Florida went bankrupt in 2021 and 2022. The bankruptcies left thousands of homeowners scrambling to get new coverage, which often came with a big increase in cost. Worse, many had outstanding claims for hurricane damage that had not been addressed. Jacqueline Ravelo, a Miami homeowner, was among them. Her roof was damaged by Hurricane Irma in 2017. Her insurance company, Avatar Property and Casualty, covered the cost of some repairs. But the roof continued to leak and mold grew inside the house, she said. Ravelo sued Avatar to compensate her for further repairs, which she said came to $50,000. When they were on the verge of settling, she said, the company went out of business.
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Miscellaneous
How the US Tax System Stole $600 Billion From Black Americans; A new book by University of Virginia professor Andrew W. Kahrl argues that the country has weaponized tax collection against its citizens for more than a century.
Kelsey Butler – Bloomberg
At the turn of the 20th century, Anthony Fleming and J.R. Rooks, two Black men who had been driven off their farmland by White supremacist mobs, founded a town with the aim of giving Black Americans access to land ownership. By 1911, Edmonson, Arkansas, covered 30 square miles and had stores and a bank, hotel and post office. One historian called it a “destination for Black migrants at a time when Jim Crow laws and disenfranchisem*nt had stymied opportunities for Blacks elsewhere.”
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