Tuesday 27th January 2015
NEWS TICKER: TUESDAY JANUARY 27TH 2015: According to Luc Luyet, CIIA – senior market analyst at Swissquote: “The 4Q Australian inflation release on 28 January will likely be critical in the decision of the RBA to cut rates or not. Indeed, given the weakening commodity outlook and the relative attractiveness of Australian yields, a lower inflation reading would favour a rate cut from the RAB during its next monetary policy meeting on 3 February to support the recovery. Given the strong disinflationary forces at play due to lower oil prices, the short-term path of AUD/USD is likely on the downside.” Today traders are watching: Spanish December PPI m/m & y/y, IFO Business Climate, Current Assessment and Expectations in Germany in January, UK December BBA Loans for House Purchase and Dallas Fed’s January Manufacturing Activity Index. - Markitt in its review of how short sellers are positioning themselves in companies due to announce results in the coming week.points out Carbo Ceramics’ stock price falls 28% while short interest jumps by 78%. Short sellers have also covered 17% of positions as Kone’s stock continues to rise while Casio and Wacom face competition despite weakening yen’s improving prospects - The Financial Services Compensation Scheme (FSCS) has declared 10 financial advice firms in default. The FSCS has started paying compensation in respect of 13 firms, including seven investment advice firms and three life and pension advice firms that have gone into default. The financial advice firms which have entered default, according to the scheme are: Barry Norris & Associates, Premier Financial Advice, The Financial Consultancy (UK), True Financial Management (formerly HNL Financial Services), Unleash Advice Partnership, and AJ Buckley Financial Management formerly AJ Buckley Overseas, City Insurance Consultants. Last week, the FSCS published its plan and budget for the coming year, which revealed investment advisers would be paying £125m towards the FSCS annual levy for 2015/16. Life and pension intermediaries are paying a £57m levy, an increase of £24m compared to the £33m the FSCS levied against the funding sub-class for 2014/15. Since it was set up in 2001, the FSCS has paid out more than£975 million in compensation to customers of defaulted advice firms. In November 2014, the FSCS said it had dealt with the default of 2,391 independent advice firms since it was set up. - Retail Sales in the United Kingdom unexpectedly increased in December, as the drop in oil prices boosted the country’s spending power. The increase came from a 5.2% gain in computers, telecoms, toys, and sporting goods sales, while food sales alone contributed 1.3%. There was a decline in sales of some items, such as clothing and household goods, reflecting a boost from Black Friday discounts the previous month - The Source Goldman Sachs Equity Factor Index Europe UCITS ETF has been launched, the second Source ETF to be launched that provides access to Goldman Sachs’ multi-factor indices. “Smart beta funds have proven successful in certain markets, providing investors with the potential to generate better returns than the more common market-cap weighted benchmarks, particularly on a risk-adjusted basis,” says Michael John Lytle, chief development officer at Source. “The Goldman Sachs series of factor-based indices offer exposure to multiple factors, rather than just the one or two that are applied to many other funds on the market.” – Mixed news from the US over the weekend. Housing starts in the US surged, as builders broke ground in December on the most houses in almost seven years. Work began on 728,000 houses at an annual rate, a 7.2% increase from November and the most since March 2008. On the other hand, building permits, a representation for future construction declined 1.9% in December to a 1.03m pace, however more Americans filed applications for unemployment benefits last week, signaling that the holiday employment turnover is taking its toll on the jobs market. Jobless claims dropped by 10,000 to 307,000 in the week ending January 17th down from a revised rate of 317,000 in the prior week, a Labor department report shows. Applications for jobless benefits were expected to decline to 300,000, according to market surveys by economists - German ZEW Center for European Economic Research in Mannheim said its index of investor and analyst expectations, which aims to predict economic developments six months in advance, climbed for a third consecutive month in January to 48.4 from 34.9 in December. Economists forecast an increase to 40, according to the median of 37 estimates in a Bloomberg News survey. The sentiment index jumped to the highest level in 11 months - Singapore Exchange is partnering Clearbridge Accelerator to address financing gaps small and medium-sized enterprises (SMEs) and entrepreneurs face by providing the investing community with greater transparency. SGX said on Monday (Jan 26) it signed a Memorandum of Understanding (MoU) with CBA, a Singapore venture capital and incubation firm specialising in early-stage investments. Under the agreement, both parties will form a joint-venture (JV) company to develop the fund-raising platform, which aims to address financing gaps SMEs and entrepreneurs face by providing the investing community with greater transparency. The JV will identify and form a strategic equity partnership with an experienced platform operator and industry stakeholders such as financial institutions to operate the new capital-raising platform. It will also identify other partners and collaborators to create demand among investors for the offerings on the platform, according to the press release. The move to help smaller firms raise funding marks the entry of SGX into a new business area. Besides operating the stock market, which caters to the equity needs of more to established firms, SGX also offers a platform for bonds as well as derivatives and commodities. Enterprise development agency SPRING Singapore will play a supporting role in the formation of the JV, as part of its ongoing efforts to make the financing environment more conducive to SMEs and entrepreneurs, the statement added. - Hedge funds swung to betting on price falls in cotton, soybeans and wheat, amid ideas of easier supplies, as they cut bullish positioning in agricultural commodities to the weakest in three months Managed money, a proxy for speculators, cut its net long position in futures and options in the top 13 US-traded agricultural commodities, from coffee to cattle, by more than 43,000 contracts in the week to last Tuesday, according to data from the Commodity Futures Trading Commission regulator - Richard Bruton TD, Minister for Jobs, Enterprise and Innovation, today announced that the Viagogo Group, which operates www.viagogo.com, the ticket marketplace, intends to double its workforce in Ireland over the next three years, taking it from 100 to over 200 employees. The jobs are supported by the Department of Jobs, Enterprise and Innovation through IDA Ireland -

Russia's new trading infrastructure takes shape

Friday, 03 February 2012
Russia's new trading infrastructure takes shape The Russian trading market is in flux as its key institutions reform and work to improve market efficiencies. In late January MICEX-RTS stock exchange reported that it intends to amend the procedure for delisting of securities, while late last year, President Dmitry Medvedev enacted the Central Securities Depository law, which had been approved by the Duma in mid-November 2011. The signing of the law was a watershed in the evolution of the Russian securities market and helps describe the country’s re-emerging trading infrastructure. http://www.ftseglobalmarkets.com/

The Russian trading market is in flux as its key institutions reform and work to improve market efficiencies. In late January MICEX-RTS stock exchange reported that it intends to amend the procedure for delisting of securities, while late last year, President Dmitry Medvedev enacted the Central Securities Depository law, which had been approved by the Duma in mid-November 2011. The signing of the law was a watershed in the evolution of the Russian securities market and helps describe the country’s re-emerging trading infrastructure.

Russia’s president Dmitry Medvedev signed the country’s so-called CSD law into being in early December last year. The law establishes the particular legal status of the central securities depositary. According to the law the CSD may be any joint stock company which is a non-banking credit organisation appropriately authorised to conduct depositary activities in the securities market and has been acting as a settlement depositary for at least three years. Any entity wishing to become a CSD in the country will have to submit an application to the ministry of finance, a process which is expected to take approximately four months. Interestingly however, it is also prescribed in law that there can only be one CSD in the country. It is expected that there will be at least a full year transition period before the new CSD is fully operational and active.
The next Russian government is expected to adopt a much more proactive strategy to try and attract greater international corporate involvement and more investment in the economy.  As well, it looks likely to continue with internal reforms to encourage the evolution of Moscow as an international financial centre. While reform is high on the government’s agenda right now, anti-Putin demonstrations late last year will ensure that for the first half of 2012 at least, politics and the pace of economic liberalisation will remain at the forefront of assessments of the attractiveness of the Russian equity markets.
Many local brokers view the prospect with optimism. According to a broker the government's response to the recent protests offers encouragement that there will be political reform, while WTO membership at least provides a timeline for companies to become more efficient and competitive”.
Among the plethora of rules in the CSD law, it seems accounts can be opened at the registrars either by the CSD or by beneficial owners. Additionally mandatory reconciliation of the CSD’s records with those of the registrar should be undertaken each time that securities transactions are conducted over the nominee holder account of the CSD; to ensure finality of settlement at the CSD.
The nominee concept for foreign entities is also part of the CSD law and will come into force from the beginning of July this year. ICSDs and foreign CSDs will be able to open accounts directly with the national CSD. Other foreign entities wishing to be nominees will be able to do so via their accounts with local custodians.  
The president also signed another mouthwateringly titled law, Amending Certain Legislative Acts of the Russian Federation in Connection with the Adoption of the Federal Law on the Central Securities Depository.  In more straightforward parlance, this is now referred to as The Satellite Law. This particular law regulates the activities of the professional securities market and ensures compliance with the CSD Law. It covers the types of accounts that can be opened by local depositaries and registrars as well describing some record-keeping features for the safe-keeping of securities of foreign companies operating on behalf of third parties.
This was followed in late January as the newly-merged MICEX-RTS stock exchange reported that it intends to amend its procedures for the delisting of securities. Currently, the removal of securities from the exchange may be initiated by the issuer. Going forward, it looks like the stock exchange will be able to suspend or even forbid a delisting procedure during meetings of its securities markets committee. If a suspension is recommended, investors will be able to leverage a special trading window, for as much as three months, to sell off their securities.  Up to now investors had no such protection.
Additionally a working group on the establishment of the country’s so-called International Financial Centre (IFC) is reportedly considering a number of draft amendments to local regulations covering the listing of securities and additional requirements for delisting.  According to a release issued by Deutsche Bank.:“  The amendments envisage that the delisting of securities undertaken by a stock exchange due to violations by an issuer or issuer’s agent will result in the introduction of a special six month trading window for these securities and their admission to a ‘non-listed’ securities list.  Significantly for investors, shareholders will be able to claim against the issuer’s management team for losses resulting from the de-listing.

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