Analysts Confounded (Again) by Economic Data
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Analysts Confounded (Again) by Economic Data – Profit & Loss
Today’s Australian inflation data surprised to the downside, rousing a sleepy Asia FX market from its pre-FOMC slumber.
US Election 2016: Trump Sweeps all Five US States – BBC
Donald Trump has won presidential primaries in all five US states that voted on Tuesday, while Hillary Clinton triumphed in four out of five.
Malaysia Names Zeti’s Deputy as New Central Bank Governor – Bloomberg
Malaysia named central bank deputy governor Muhammad Ibrahim as successor to Governor Zeti Akhtar Aziz when she steps down at the end of the month after 16 years at the helm. The ringgit gained and stocks pared losses.
Plans for Thursday Eurogroup Dropped, Tsipras Set to Ask for Special EU Summit – Kathimerini
Greece and its lenders were unable on Tuesday to reach an agreement on how to line up 3.6 billion euros in contingent austerity measures, leading to plans for an extra meeting of eurozone finance ministers on Thursday being dropped.
New Spain Elections Loom as Coalition Talks Fail – BBC
Spain is set for fresh elections after King Felipe VI announced the failure of the latest round of coalition talks.
Fed Set to Keep Rates Unchanged, May Nod to Ebbing Risks – Reuters
The US Federal Reserve is expected to keep interest rates unchanged on Wednesday as it continues to monitor the impact from weakening global growth but may seek to signal to markets it is determined to resume policy tightening this year.
Regulatory News
Buy Side Voices Concerns Over Impact of Regulation on FX – Profit & Loss
US regulations have failed to improve the FX market in the short-term, according to the buy side representative at a discussion hosted by the Commodity Futures Trading Commission (CFTC) today.
Japan’s FSA Establishes “Panel of Experts on FinTech Start-ups”
Company News
Barclays Misses Forecasts, Speeds up French Business Sales – fastFT (subscription)
Barclays is speeding up the sale of some of its French businesses after missing earnings forecasts for the first quarter of the year.
Apple Suffers First Quarterly Revenue Fall in 13 years – FT (subscription)
A growing preference among consumers for lower-priced iPhones contributed to a significant shortfall for Apple in its latest quarterly earnings compared with Wall Street expectations, according to figures released on Tuesday.
Warning Shot Fired at Citigroup – Bloomberg
Citigroup shareholders had their say on Tuesday, and not surprisingly the attempts by a few insurrectionists to shake things up failed.
Nomura Reports Surprise Quarterly Loss on Slump in Trading – Bloomberg
Nomura Holdings Inc. unexpectedly posted a loss for the first time in more than four years last quarter, as trading income and brokerage commissions dropped and it lost money abroad.
Santander Profit Hit by Slump at Home, Currency Weakness Abroad – Bloomberg
Banco Santander SA, Spain’s biggest bank, reported lower first-quarter profit as revenue slumped in its home market and operations aboard were hit by currency effects.
Market Savvy
Shocker as Pound Rallies – Profit & Loss
For much of this year, the market commentary about Sterling (GBP) has been a good reflection of the debate about whether or not the UK would vote to leave the European Union. In other words, it has been very ‘shouty’ and not particularly that well informed.
Oil prices jump on weak dollar, strong investor appetite – Reuters
Crude oil futures rose around half a dollar on Wednesday and remained near 2016 highs on the back of strong investor sentiment and a weak dollar, although analysts warned this month’s bull-run could soon run out of steam.
Alarm Over Corporate Debt and Stalled Earnings – FT (subscription)
Corporate America is swimming in cash. There is no great news about this, and no great mystery about where it came from. Seven years of historically low interest rates will prompt companies to borrow.
Yen Too Strong at 110 to Dollar, Former Economy Minister Says – Bloomberg
Japan’s former deputy economy minister said the yen was too strong at current levels of around 110 to the dollar, indicating dissatisfaction with the currency’s 8% rise this year amid global economic anxiety.
Traders 2 Banks 0
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Traders 2 Banks 0 – Profit & Loss
The past 10 days has seen two FX traders successfully win their cases for unfair dismissal against their former employers. As reported exclusively by Profit & Loss…
The Tokyo Whale Is Quietly Buying Up Huge Stakes in Japan Inc – Bloomberg
They may not realize it yet, but Japan Inc’s executives are increasingly working for a shareholder unlike any other: the nation’s money-printing central bank.
Cartel Members Still Under Threat – Profit & Loss
Although the UK’s Serious Fraud Office has declined to lay formal charges against members of the “Cartel” Bloomberg chat room, reports suggest the US Department of Justice has raised the stakes.
China Debt Load Reaches Record High as Risk to Economy Mounts – FT (subscription)
China’s total debt rose to a record 237% of gross domestic product in the first quarter, far above emerging-market counterparts, raising the risk of a financial crisis or a prolonged slowdown in growth, economists warn.
Yellen’s Scope for Summer Rate Hike Widens as ECB Signals a Hold – Bloomberg
Mario Draghi has opened a door. Janet Yellen has to decide whether she wants to walk through.
Speculators have net dollar short positions for first time since May – Reuters
Speculators turned negative on the US dollar this week, with more investors in the global currency market taking short positions against the dollar than long positions, for the first time in nearly a year.
Far-Right Wins First Round of Austrian Presidential Election – The Daily Telegraph
The far-Right moved a step closer to seizing the Austrian presidency on Sunday night, in an election result that will send shockwaves through Europe.
Regulatory News
FCA Issues Warnings on Four Clone Firms – FT Adviser
The Financial Conduct Authority has issued a number of warnings about firms it believes are providing financial services without authorisation. RBS Bourse, Capital Trust Ventures, Andersen Consulting (UK) and Beckett & Cromwell are all firms named by the FCA
Company News
Reval and Swift Team Up – Profit & Loss
Technology provider Reval has reached an agreement with payments system provider Swift to allow corporate treasury teams using the Reval Cloud Platform for automated cash and liquidity management, to join the Swift messaging network.
Citi Poaches Davison to Head EMEA Financial Institutions Group – fastFT (subscription)4 hours ago
Citigroup has hired Piers Davison, an experienced financial institutions banker based in London, from JPMorgan Chase as part of push to capture more business in the UK and across Europe.
UK’s BHS Expects to Enter Administration, Risking 11,000 Jobs – Bloomberg
BHS Group Ltd. expects to enter administration Monday, a company representative said, putting 11,000 jobs at risk in what would be the biggest U.K. retail collapse since Woolworths Group Plc in 2008.
Market Savvy
Fed Seen Holding Rates this Week with Hike Still on Horizon – Reuters
US Federal Reserve policymakers are expected to hold interest rates steady when they meet this week, but may tweak their description of the economic outlook to reflect more benign conditions, leaving the path open for future rate rises.
The Yen’s Big Week – fastFT (subscription)
Ahead of what could be an interesting few days for the yen, it might be worth reflecting on just how big a week the Japanese currency has just had.
Sterling Hovers Near 6-week high after Obama Intervention – fastFT (subscription)
Sterling has been hovering near a six-week high today after an intervention by US president Barack Obama in the Brexit debate on the weekend caused betting markets to swing towards the UK voting to remain within the European Union.
The Things Economists Know. . . and Don’t Know about Brexit – The Daily Telegraph
Last week we were treated to a fine exhibition of the economist’s art.
Press Releases
Citi Loses Second Unfair Dismissal Case
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Citi Loses Second Unfair Dismissal Case – Profit & Loss
Profit & Loss understands that former Citi FX trader Carly McWilliams has won her unfair dismissal claim against the bank.
Bats Global Markets, Inc. Announces Pricing of Its Initial Public Offering
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Bats Global Markets, Inc. Announces Pricing of Its Initial Public Offering
Bats Global Markets, Inc. (“Bats”), a leading global operator of exchanges and services for financial markets, today announced the pricing of its initial public offering at a price to the public of $19.00 per share. The size of the offering has been increased from the initially announced 11,200,000 shares of common stock to 13,300,000 shares of common stock.
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CME Group to Close New York Trading Floor at Year-End
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CME Group to Close New York Trading Floor at Year-End
As declining open outcry options volume on CME Group’s New York trading floor now represents just 0.3 percent of the company’s overall energy and metals trading volumes, CME Group will close its New York trading floor at year-end, subject to CFTC review.
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Two Fed Officials Point to Possibility of April Rate Hike
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Two Fed Officials Point to Possibility of April Rate Hike – Bloomberg
Two Federal Reserve officials said interest-rate increases may be warranted as soon as the central bank’s meeting next month, citing solid readings on the U.S. economy despite headwinds from abroad.
Draghi’s Stimulus Effect Fizzles as Euro Rallies to Reverse Drop
Draghi’s Stimulus Effect Fizzles as Euro Rallies to Reverse Drop – Bloomberg
It took less than 90 minutes for the euro to reverse all of the decline sparked by the European Central Bank’s package of monetary stimulus.
Chinese Securities Regulator Is Out, but Little May Change
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Top Banks Join London Blockchain Working Group
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EC to Launch Sweeping Review of Post-Crisis Regulation
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