097 Exchange Invest Weekly Podcast June 5th, 2021

Transcript:

This Week in the parish of bourses and market structure:

NASDAQ makes a Puro Carbon play while London looks very much game on, not “Game Over” as the media might prefer to suggest.

My name is Patrick L. Young,

Welcome to the bourse business weekly digest.

It's the Exchange Invest Weekly Podcast Episode 097.

Good day ladies and gentlemen, this is a very brief production of highlights amongst the key headlines from the weekend market structure. All the analysis of the week's many events and happenings can be found in Exchange Invest daily subscriber newsletter - the unique guide to the bourse business sent daily to your inbox.

More details are ExchangeInvest.com

Reuters have postponed their website paywall amid a dispute with Refinitiv that as you can recall we discussed in the last podcast.

PLY: Whether the London Stock Exchange Group can save itself from the Refinitiv folly is one entirely separate thing, but at least it appears Paternoster square is saving Reuters management from their imbecilic decision to kill their brand through a subscription fee. Thus pushing web savvy readers to the generic licenced feeds already widely available from the interweb of Reuters news.

Elsewhere FESE (Federation of European Securities Exchanges), issued a genuine cri de coeur as they hosted their virtual annual conference on June 1st. Europe must foster transparent markets to remain competitive, went the simple but efficient headline.

The tragic truth is that after a wasted decade, the European Union isn't serious about a capital market union, it's more a kind of financial services abyss than anything coherent, which is a huge letdown for the ever-diligent FESE folks.

Over in the Philippines, the president of the Philippine Stock Exchange, Ramon Manzano is hyper optimistic. His exchange saw the largest Philippine Stock Exchange IPO in history launched successfully this week (despite a little bit of soggy pricing on day one) the mega noodle concern Monde Nissin came to market successfully.

Meanwhile, back in the European Union, Brexit remains a concern for the panjandrums of Brussels and indeed Frankfurt - albeit they may wish to concern themselves more with a myriad of the other EU problems it's facing. However, the fact that London has crept back to within an inch of Amsterdam and equity trading only months after the Brexit trade arrangements came into force has clearly unnerved both the European Commission in Brussels and indeed the European Central Bank in Frankfurt. The central bank boffins of the Eurozone are minded to crack down on ‘Desk Mapping’ in London to drive more bankers and capital to the European Union. That amounts to a perfect Horse-Bolt repo with a side order of definitely trying to push the jack back into the box while wearing large industrial scale gloves.

The European Union's determination to commit economic suicide writ large reflects the realpolitik of what we've reported for years. ESMA has failed to bully companies to be more substantive in the positioning of staff who actually don't want to live in the high tax, heavily regulated European Union, but prefer London's cosmopolitan delights.

The European Union refuses to accept this so has begun more high handed tactics, as for instance, Amsterdam's recent stock trading ‘success’, which actually remained fueled by M25 commuters around the London stockbroker belt.

In results:

It was a busy week for results in the parish, all the deals of course in Exchange Invest daily, the newsletter no person can afford to be without in capital markets and market structure. For the sake of this podcast, let's look at some edited highlights.

GPW the Warsaw Stock Exchange excellent quarterly report EBITDA up 23% year on year revenues only in inverted commas up 13% year on year but very strong bottom line results.

Also this week the Warsaw Stock Exchange effortlessly oversold the 23 billion Zloty that's a $6.3 billion listing of Pepco (Pepco, of course being perhaps most famous as Poundland on the high streets of Britain and elsewhere).

Over in Sofia, the Bulgarian Stock Exchange net profit was rising healthily to net profit up to 1.9 million levs, that's $1.2 million from what was one year ago, just 1.3 million levs.

It was also a very busy week for deals in the parish and again, all of the deals were in Exchange Invest- the daily bourse business water cooler, the highlights of this week:

One major deal, first of all, NASDAQ has acquired an emerging carbon removal platform Puro.earth. What a very interesting deal, the finished startup in which NASDAQ has bought a majority stake is already operative.
It's got a fast growing carbon market and announcing this deal NASDAQ came just one week after Singapore's much trumpeted startup venture Climate Impact X, which itself hopes to be running by the end of the year.

With clients like Microsoft already on board, Puro.earth has a firm claim on that very dot-com era concept of “first-mover advantage”. It's a fascinating purchase by the Bjorn Sibbern led European arm of NASDAQ.

Elsewhere, NSX (National Stock Exchange of Australia) admitted, they're pleased to announce that they successfully concluded a capital raise of around $3.5 million at a share price of $0.14 cents, they also celebrated a new IPO listing this week (Azure Health Technology) to boot. The funding round has seen controlling shareholders iSignThis increase their stake in NSX to some 20.018% of the NSX exchange itself.

iSignThis also controls the Delivery versus Payment company, ClearPay, Pty Ltd with the National Stock Exchange of Australia holding a 41% interest, and iSignThis the majority 59%.

And a final splash of technology driven daily news this week, ION group has completed their acquisition of DASH financial technologies.

Don't forget ladies and gentlemen, there's still time to buy “Victory or Death” - Blockchain, Cryptocurrency and the FinTech World, my most recent book to try and help you understand how technology is affecting life and markets that come 20 years old from the excitement of the original FinTech best seller by yours truly Patrick L. Young “Capital Market Revolution”.

“Victory or Death” - Blockchain, Cryptocurrency and the FinTech World is an easy read, explaining the differing and diverging roles of banks and exchanges, the winning business models of the new world order and placing in perspective just what Bitcoin, Blockchain and cryptocurrency mean for markets.

“Victory or Death” is published by DV books and is distributed by Ingram worldwide. While you're waiting for your copy of “Victory or Death” to arrive, don't forget to check out our Livestream. That's on Tuesdays at 6 pm London, coming this week we have the inimitable New York Stock Exchange floor trading personality Kenny Polcari, who's going to be discussing stock trading, the history of the NYSE, and much much more.

In the meantime, don't forget you can catch the back episodes on YouTube via IPO-vid. And the Livestream comes to you weekly via Facebook, LinkedIn, and of course, YouTube.

In crypto land:

Coinbase has cut fees on stablecoin pairs, as their market in the products has grown 10x in six months.

PLY: That sounds remarkably cheap for crypto-land but on second reflection, they're charging a basis point for what amounts to a fiat money proxy token. Now that strikes me as tantamount to larceny akin to those boots at airports where the staff wear white short sleeved shirts, but the channel swarthy men on horseback wearing tricorn hat brandishing flintlock pistols.

Russian Central Bank has blacklisted major FX brokers and crypto exchanges. An extensive list of some 1800 FX brokers and crypto exchanges have been blacklisted in a Central Bank document which raises some eyebrows. Anybody not explicitly regulated or registered in Russia has been blacklisted, thus that includes the likes of industry brokerage Titans like Interactive Brokers.

Back in crypto land, the SEC's Chairman Gary Gensler is moving more cautiously than hoped for on Bitcoin ETFs.

Some insiders are disappointed that the SEC Chairman Gensler is moving more cautiously on permitting Bitcoin ETFs, whereas Exchange Invest has noted repeatedly that the crypto kiddies are at best naive and at worst utterly delusional about what Gary Gensler is going to do to the market - “50 shades of Gensler” is coming to crypto (and beyond).

Product news this week:

China has launched the first options that are open to foreign investors at the same time as new Eurex Derivatives will help facilitate exposure to the Chinese equity market.

Vanguard the megafund manager they're swapping benchmark providers on to index funds with combined assets of $75 billion dropping NASDAQ in favour of S&P Dow Jones.

And finally and product news this week SPIMEX (St. Petersburg International Mercantile Exchange) may launch natural gas futures trading by the end of the year.

Technology news this week:

A mixture of hitches, hassles and some interesting developments in India, NSX (National Stock Exchange) and the Bombay Stock Exchange, both conducted a full day's live trading from their Disaster Recovery (DR) sites on Friday the 28th of May.

At least their systems worked. First Vietnam's Ho Chi Minh Exchange went down last Monday morning and then Tuesday afternoon too - as the Vietnamese hajiman market was struggling to cope with 50% volume growth in the month of May alone. A 20 year old tech stack may not be conducive to reliability either.

Then Saudi Arabia's Tadawul lost two hours trading on Wednesday due to an unspecified error in their trading system. Let's hope it's just a one-off.

In a more interesting development, Google Cloud has launched data share for Financial Services, helping the capital markets industry share market data more securely and easily.

PLY: Gosh, here we are up in the clouds in a fascinating and potentially seismic move, Google Cloud have launched their data share and financial services that they claim ought to help the capital market industry share market data more securely and easily. The only question being whether the incumbent data warehouses really want easier transmission of data? I suspect not as it threatens their cosy monopolies.

Meanwhile, in a report by Celent and NASDAQ about future technology deployment for financial market infrastructures, I was surprised to read that some 65% of market infrastructure CIOs see cloud technology as a fundamental and expanding part of their software development. Researchers are estimating a 27% increase in cloud-ready applications between 2021-2025.

PLY: I am not really sure of why this is not 100%, instead of just 65%... at least in the stack apart from those Ultra Low Latency high frequency trading elements. Why is cloud use not increasingly THE way to go?

Elsewhere BMLL’s 15-petabyte lake of equity data is being linked up to TickSmith and Flextrade.

In regulation news this week:

We had a classic example of all that ails the European Union with a Reuters story: “Wirecard ‘Wake Up Call’ prompts EU company Reporting Reform”.

Germany's regulators manifestly failed to regulate Wirecard (the payments company) the summary sacking of BaFin’s (German regulators) top bosses was a good starter reaction, but the attitude of national protectionism and parochialism remains a blight on Germany's regulatory landscape. Then again, in the era of the sublimely inept Angela Merkel, the regulators probably felt badly treated at being found culpable and fired given Merkel's object and capabilities, and yet she still clings to her office.

Now, on the broader EU canvas, we have the usual dog tail wag rumba of ever-increasing bureaucratic remit driven by the insanity of the European Union's perverse, guiding ‘precautionary principle. As the German regulators failed, therefore the EU wants company reporting reform - thus extending the sclerosis of enterprise which Brussels represents and actively promotes, leading to the inevitability of descent into economic stasis.

Elsewhere this week, a survey of leading “startups” - albeit truly beyond scaleups one and all, with many of them even unicorns, found 53% hampered and complaining about European Union bureaucracy - the other 47% were presumably too busy trying to understand the EU's anti-enterprise protectionist approach to actually reply?

Career paths news of this weekend:

People news another little coup for the perma-incredible Doc Richard Sandor, as BlackRock co-founder Barbara G. Novick has joined the board of the American Financial Exchange.

To the East of Chicago, Ian Narine has been elected Chairman of the board of the Trinidad and Tobago Stock Exchange (TTSE) replacing Ray A. Sumairsingh.

There was an amazing scene this week when a prodigal son's repo moment took place with a campanological centerpiece in Budapest.

Interactive Brokers have added a new market to their cornucopia of exchange memberships - an empire upon which the trading sun never sets... actually equity trading members since 2017. Interactive Brokers has now upscale and opened their new CEE SEE trading hub in Budapest, marking a great leap forward for the Budapest financial centre.

The ceremony this week marks the return to his birthplace for IBKR’s founder Thomas Peterffy - who fled the strictures of Communism for the then progressive (as opposed to today's progressively regressive) climes of the United States of America. Peterffy rang the bell of the Budapest Stock Exchange in celebration of IBKR becoming full members of the exchange and boasting a significant local office space.

And on that mysterious and magnificent note ladies and gentlemen.

My name is Patrick L. Young,

Thank you for joining this 97th Exchange Invest Weekly Podcast.

We'll be back again with the podcast next week. Don't forget, in the meantime, you could be reading all the bourse business water cooler news daily in Exchange Invest. If you'd like to sign up drop by ExchangeInvest.com and let us know we'll give you a free 30 days trial to get you started.

And of course on Tuesday evening, don't forget to drop by IPO Vid, the Livestream which you can catch on LinkedIn, Facebook, and YouTube.

Once again, my name is Patrick L. Young, have a great week in life and markets.

LINKS:

Reuters Postpones Website Paywall Amid Refinitiv Dispute
Reuters.com

Europe Must Foster Transparent Markets To Remain Competitive
FESE

PSE President Says 2021 'Fantastic Year' For Capital Raising
ABS-CBN News

Brexit: ECB To Crack Down On ‘Desk Mapping’ In London To Drive More Bankers And Capital To The EU

City A.M.

London Regains Ground After Early Brexit Trading Win For Amsterdam
Financial Times

Quarterly Report Of The GPW Group For Q1 2021
GPW

Bulgarian Stock Exchange's Net Profit Rises In Q1
SeeNews

Nasdaq Acquires Emerging Carbon Removal Market Puro.Earth
GlobeNewswire