This Week in the parish of bourses and market structure:
T+1 = 2 years says DTCC while Fed tech shows the legacy problems in upgrading the US clearing and settlement architecture.
Profits Soar from Hong Kong to Istanbul while DB one could get swept into the Cum-Ex dragnet.
And meanwhile, the European Union threatens banks for seeking to keep their client’s Euros safely cleared.
Is the Euro War Coming?
My name is Patrick Young
Welcome to the bourse business weekly digest, it's the Exchange Invest Weekly Podcast Episode 83.
Good day Ladies and gentlemen, this is a very brief reduction of highlights amongst the key headlines from the week in market structure.
All the analysis of the week’s many events and happenings can be found in Exchange Invest’s daily subscriber newsletter, the unique guide to the bourse business sent daily to your inbox, more details at ExchangeInvest.com.
In settlement land, the DTCC, America's equity settlement monopoly has proposed an approach to shortening the US settlement cycle to T+1 within two years. That of course follows the GameStop Farago, which nearly brought the whole of the US equity clearing system crashing down, thanks to a multiplicity of retail investors who clearly had rather a lot of institutional capital also involved.
That story than some may say antiquated clearing heist and settlement depository that played a role in last month's Reddit-fueled market frenzy is proposing that settlement times for US stocks be cut in half T+1 in T+2 years, masterminded by the DTCC. Well, I would love to see it, but somehow I have a bad feeling about the ability to execute given so many participants and indeed the fact that, in sympathy no sooner did the DTCC make their announcement than the Federal Reserve's own money clearing technology system promptly fell over.
Over in Hong Kong, the Hong Kong exchanges shares: slumped despite spectacular results of which more in a moment because the government has decided to raise the stamp duty on stock trading. It's a worrying trend towards stock trading taxes, which appears to be in an upswing the world over as big government seeks to desperately balance the books post COVID intervention. In the case of Hong Kong, this is looking like a first in a generation rise from 0.1 to 0.13%. Markets understandably reacted badly.
Meanwhile, in London at the Hong Kong exchanges subsidiary there, the fight to save the London metal exchange ring has begun as traders warn on pricing.
Looking to the Middle East via London and the Intercontinental Exchange, Adnoc the Abu Dhabi National Energy Consortium. They're preparing along with ice through the venue of ice futures Abu Dhabi that brand new exchange and the Abu Dhabi Global Market to launch their new oil futures Midland crude coming at the end of March with the first expiry dates being set this week for the crude futures that are soon to launch. That of course came on the back of some record volumes in various businesses including JKM and other oil and gas contracts across the ice and a spectacular number an all-time record and open interest features alone 46.9 million contracts across the ice futures Empire.
Over in Brexit, Is it a phony war?
Or are we on the cusp of all our commercial conflict?
