Top Headlines

TP Icap Sues over Soured £1.3bn Deal with Nex Group – The Times

The broking giant TP Icap has launched legal action against Nex Group, the trading business built up by the Tory donor Michael Spencer, accusing it of breaching the terms of a £1.3bn deal.

FX Swaps to Avoid Year-End Basis Blowout, Banks Say – Risk.net (subscription)

Bankers are confident that as the year-end nears, financial markets won’t experience the turbulence of previous fourth quarters when the cross-currency basis widened and repo rates spiked amid a US dollar funding squeeze.

Deutsche Bank, Commerzbank Test Frankfurt Swaps Move – Bloomberg

Deutsche Bank and 16 other lenders recently tested moving interest rate swap positions from London to Frankfurt, a signal that financial firms are pushing ahead with preparations for a no-deal Brexit. The banks made dummy trades on Dec. 3 in the first known dry run of a service that could move trillions of dollars of derivatives from LCH in London to Eurex Clearing in Frankfurt.

2018: Mergers, Name Changes and Having One’s Day in Court – FX Week (subscription)

The trend of company acquisitions persisted over the course of the year and began with March’s announcement, and subsequent approval, of CME’s acquisition of Nex Group.

Regulatory News

SEC Chief Urges Action to Prevent No-Deal Brexit Causing Havoc – Financial Times

Jay Clayton, the head of the US Securities and Exchange Commission, has called on the UK and EU to take action to ensure a no-deal Brexit would not cause havoc to global markets.

• EU to Rule Out ‘Managed No-Deal’ as Bloc Boosts Brexit Planning – Bloomberg

Post-Crisis Reforms Need Recalibration for Repo Markets – GFMA, ICMA – Regulation Asia

A new report calls on the FSB and BCBS to review and recalibrate post-crisis prudential standards in relation to their impacts on repo and securities lending markets.

• The GFMA and ICMA Repo Market Study: Post-Crisis Reforms and the Evolution of the Repo and Broader SFT Markets – GFMA

Wall Street Preps for Rule 606 Redux – MarketsMedia

In approximately five months, US-based broker-dealers will need to issue new and more detailed versions of their Rule 606 order-routing reports, which has them looking to the Securities and Exchange Commission for guidance.

Fund Manager Sector M&A to Increase Post-Brexit, Says New Research – Institutional Asset Manager

More than one-third of survey respondents (34 per cent) believe there will be an increase in merger and acquisition activity within the fund management sector, driven by European fund managers looking to acquire UK-based firms to give them a presence in the local market post-Brexit.

Crypto News

Ex-CurveGlobal Executive Joins Crypto Exchange Archax as Head of Regulation – The Trade Crypto

Former chief operating officer at CurveGlobal joins crypto exchange which is due to launch in mid-2019.

Former Goldman Electronic Trading Head Sees Parallels in Crypto – Bloomberg

Greg Tusar, the former global head of electronic trading at Goldman Sachs, is excited about digital assets despite the horrific year for cryptocurrencies.

Crypto-Mystery Clues Suggest Tether Has the Billions It Promised – Bloomberg

As Tether grew into a multibillion-dollar engine of the cryptocurrency market, skeptics kept warning that the digital coin, whose main selling point is that it’s pegged to the dollar, wasn’t actually backed by an enormous pile of cash. Bank statements reviewed by Bloomberg News suggest those fears may be unfounded.

Company News

P&L Talk Series with Ensemble Capital’s Damien Loh – Profit & Loss

Damien Loh, CIO of Ensemble Capital, discusses how AI tools can be applied to FX trading.

Backstop to Acquire BarclayHedge – Profit & Loss

Backstop Solutions Group, a cloud-based CRM provider for institutional and alternative investors, is set to acquire BarclayHedge, which produces alternative investment data and indices. 

Nasdaq Significantly Improves Acquisition Offer for Cinnober Amid CMA Probe – The Trade

Nasdaq Technologies has confirmed that it has made a revised acquisition offer for Swedish technology provider Cinnober after its original bid failed to secure the required level of shareholder approval.

PointGroup Launches Online FX Platform – Profit & Loss

Consultancy firm, Point Group, has launched an online foreign currency exchange and international payments platform, called edgeFX.

Tradeweb to Extend Derivs Tools Beyond Mifid II – Global Investor (subscription)

The trading venue also seeks to make it easier for investors to gain exposure to the China Interbank Bond Market.

Market Savvy

Dollar on Edge Before Fed Meet, All Eyes on Policy Outlook – Reuters

The dollar was fragile in Asian trade on Tuesday as markets speculated growth worries will prompt the Federal Reserve to signal a pause to its monetary tightening cycle at this week’s meeting.

• Fed Faces Communication Challenge on Rates – The Wall Street Journal (subscription)
• Trump Renews Attack on Federal Reserve over Interest Rates – Financial Times

Sterling Rises as May Battles to Win Support for Her Brexit Deal – Reuters

The British pound rose further away from 20-month lows on Tuesday, helped by a weaker dollar and confirmation Prime Minister Theresa May will seek parliamentary approval for her much-criticised Brexit deal in mid-January.

Euro Rises as Dollar Wilts Before Expected Fed Caution – Reuters

The euro rose on Tuesday as the dollar weakened, with investors betting that growth concerns will prompt the Federal Reserve to slow its pace of interest rate hikes at this week’s meeting.

‘Under-Owned’ EMs Begin to Tempt Investors Once More – Financial Times

Fund managers looking for top picks in 2019 are increasingly gravitating to what has been an unloved asset class: emerging markets.