Category: Industry

IBM Manager Martin Jetter becomes the new Chief Controller of Deutsche Börse. The Supervisory Board nominated the 60-year-old Jetter as successor to Joachim Faber. Faber had announced that he would retire after the Annual General Meeting in May 2020.

Jetter has been on the supervisory board of the stock exchange operator since 2018 and was considered a favorite for Faber succession. Investors are pleased that the stock market has chosen a technology expert, after all, IT and new technologies are of paramount importance to the Group.

Faber is also satisfied that his successor has been clarified. "Martin Jetter is an internationally experienced personage who has a deep understanding of technology and market infrastructure," he said.

Ex-Allianz CEO Faber has been a member of the Supervisory Board of the Stock Exchange since 2009, and has been Chairman since 2012. In 2017 he came under pressure because of the collapsed merger with the London Stock Exchange and a preliminary investigation against ex-chief Carsten Kengeter. 

“I welcome the fact that the Supervisory Board has so quickly found a candidate for my succession. Martin Jetter is an internationally experienced personality with a deep understanding of technology and market infrastructure. With Deutsche Börse, he finds a company that is in excellent shape and that has all the prerequisites to continue to be successful in global competition,” explained Faber.

You may check the list of the Regulated Brokers here.

On Tuesday 8 October 2019, the Court appointed Mark Ford, Adam Stephens and Henry Shinners, all of Smith & Williamson LLP, as Joint Special Administrators of Reyker Securities Plc, following an application by the directors. 

The Special Administrators will work with the Financial Services Compensation Scheme to determine the position and will provide further updates. For eligible clients, the FSCS will cover custody assets and client money shortfalls up to £85,000 including the costs associated with their distribution back to clients.

On 4 October 2019, following an application by Reyker, the FCA has imposed certain regulatory requirements on Reyker. These requirements placed restrictions on Reyker effectively stopping all movement of client money or assets. Apart from a few specific circumstances (such as receipt of dividend payments), the firm was not permitted to either receive any new client money or custody assets or to pay away client money or custody assets. Following the restrictions coming into force, Reyker decided not to conduct any further business or any other regulated activities.

Reyker’s Directors had been pursuing a sale of the business, however they were unable to complete this sale. Due to the firm’s financial difficulties the Directors resolved that it was cash flow insolvent, and in discussion with us, took steps to place the firm into Special Administration.

The Special Administrators will carry out an assessment of the client money and custody assets held by the firm to confirm the current position. Following the assessment, the Special Administrators will work to return as much client money and custody assets to customers as possible, as quickly as possible.

Reyker is still authorised by the FCA and remains subject to supervisory oversight and the FCA’s rules. The Special Administrators are officers of the Court and need to comply with all insolvency law.

The greenback continued to outperform the euro on Monday, pushing the most-traded pair in the world, the EURUSD, below the 1.14 level for the first time since July 2020.

Earlier on Monday, European Centra Bank (ECB) Governor Cristine Lagarde undermined the euro when she repeated that conditions for a rate hike are very unlikely to be met in 2022. Furthermore, she said that any tightening measure now would cause more harm than good.

On the other hand, the market now expects the Federal Reserve (Fed) to hike rates nearly three times in 2022, with the first-rate hike priced in at July’s meeting. Inflation expectations continue to soar in the US, pushing bond prices down and yields higher.

At the time of writing, the two-year yield stands at 0.5%, unmoved on the day, while the 10-year yield rose above 1.6%, steepening the yield curve. 

Chatter is growing among market participants that the Fed will need to accelerate the pace of Quantitative Easing tapering in Q1 2022 and bring on rate hikes as inflation shows no signs of stopping.

Therefore, the significant divergence in monetary policies – the Fed tightening and the ECB not doing anything – should keep the EURUSD pair pressured in the long-term.

“The uptrend [in the USD] that has been in place since June remains in place, and we expect the USD to remain on the front foot as we advance into 2022. We expect the cautiousness of the ECB on policy to limit recovery prospects for the EUR vs. USD in the coming months.” Analysts at Rabobank said Monday.

Technically speaking, the euro has dropped below the supporting line, killing all the stop losses of long positions below it. Therefore, the resistance now stands at the broken trend line, at around 1.1430. As long as the euro trades below it, the short-term outlook remains bearish. Additionally, as long as the pair trades below 1.1520, the medium-term trend also seems bearish. As a result, rallies are expected to be sold.  

The next target in this bearish wave is expected at the psychological threshold of 1.10 – the lowest level since May 2020.

The Central Bank has announced that it will ban the sale of binary options to retail investors and restrict the sale of contracts for difference (CFDs) to retail investors. This will be the first time that the Central Bank uses its product intervention powers introduced in 2018, which allow it to prohibit or restrict the sale of certain products. These interventions reflect the Central Banks’s significant concerns relating to the sale of CFDs and binary options to retail investors and will take effect immediately after the European Securities and Markets Authority (ESMA) intervention measures lapse.

The binary options measure will prohibit the marketing, distribution or sale of binary options to retail investors. The CFD measure will restrict the marketing, distribution or sale of CFDs to retail investors. This restriction consists of limits on leverage, a margin close requirement, a requirement that retail investors cannot lose more money than they put into their CFD account, a prohibition on the use of incentives by a CFD provider and a standardised risk warning.

On 27 March 2018, the Central Bank issued a warning to investors on CFDs and binary options. EU competent authorities had undertaken reviews over previous years, which revealed that between 74% and 87% of retail clients incurred losses when investing in binary options. On CFDs, a Central Bank inspection published in 2015 found that 75% of retail CFD clients made a loss, of which the average loss was €6,900. 

The Central Bank has worked closely with ESMA on this investor protection issue. In 2018 ESMA imposed temporary product intervention measures in relation to the sale of CFDs and binary options to retail investors, measures for which the Central Bank had advocated. Once these temporary measures expire, the Central Bank’s national product intervention measures will immediately take effect in order to ensure ongoing protection of retail investors.

Argentex , a foreign currency exchange service provider has teamed up with Professional Cricketers Association. PCA is the representative body of past and present-day first-class cricketers in England and Wales. English cricket is going to have a busy schedule for this summer with ICC World Cup 2019 and Ashes Series coming up.

The partnership will allow the cricketers to have access to the foreign exchange service of Argentex. For a number of occasions like conversion of prize money, transfer and exchange of lump sum sponsorship deals its services may come handy to the members of association.

The Co-CEO of the group, Harry Adams said in a statement, “members of the PCA and current players are still adjusting to some of the more lucrative aspect of the sport. This summer we want the England team to focus their performance on the pitch, rather than the performance of the pound. Instead, they can trust that the Argentex understand the unique FX requirements of professional sportspeople who are performing on the global stage, having worked with sports management firm for years.”

Jofra Archer, England and Sussex Cricketer and Argentex Client commented, “Since my first overseas contract, Argentex have helped me move foreign currency around the world. The global nature of the tournament cricket means that as a player you need support and assistance around the clock. Having the expertise of Argentex means that I am free to concentrate on my cricket, whilst they work in the background to ensure that my foreign currency earnings are managed in the most effective and timely manner.”

Argentex LLP provides foreign exchange services to clients across the globe. It offers voice broking, online, and consultancy services for corporate, institutional, and private clients. Argentex LLP was founded in 2011 and is based in London, United Kingdom with an additional office in Dubai, United Arab Emirates.

The Financial Sector Conduct Authority (FSCA) has temporarily suspended the financial service provider (FSP) licence of a forex trader, JP Markets. The regulator investigates the trader’s alleged breach of certain laws in the financial sector. During the period of JP Markets provisional suspension, it is also not permitted to take on any new business. 

According to the official statement, there was a conflict situation between the trader and its clients. It has allegedly been tampering trading conditions to minimise some high-level clients’ earnings and instead maximising its own. The trader has also amassed a huge number of complaints from its clients for the past year. The clients mostly complain about company’s failure to honour client withdrawal requests and losses due to not having a constant access to the trading platform. Due to these events, the FSCA stated that there is reasonable belief that substantial prejudice to clients or the general public may occur if they continue rendering financial services.

The regulator is now moving to have the trader liquidated, and has filed papers to this effect with the High Court in Johannesburg. While on suspension, JP Markets are not permitted to take on any new business or clients or render any services; however, it is not prohibited from processing client withdrawals. The firm had to inform all affected clients of the recent events. The FSCA’s investigation is currently on-going and any new findings will be made public.

The public is further warned that JP Markets is not authorised as an OTC derivative provider and therefore is not permitted, as a regular feature of its business and acting as principal to; originate, issue, sell or make a market in OTC derivatives. The investigation in respect of JP Markets is currently on-going.

The head of the FSCA business supervision division, Kedibone Dikokwe, explained the nature of the investigations. According to her, JP Markets allowed its clients to access a platform to trade in contracts for difference (CFDs), and to deposit their funds into its bank accounts. These deposits would then seemingly allow the clients to trade in forex CFDs, enter transactions, and make profits or losses depending on how the underlying forex exchange rose or fell. However, it transpired these clients were not trading on an online decentralised global financial market, but merely on a software application that the firm acquired ready-made and pre-programmed, that recorded these trades. According to Dikokwe, these clients were in fact purchasing CFDs issued by JP Markets, for which the trader by law required an OTC derivative provider licence. Without one, the trader is not permitted, even under regular features of its business, to originate, issue, sell or make a market in OTC derivatives.

FSCA warns the public against Tradehedges 

In another case, the FSCA also warned the public against entering in any financial business with Tradehedges. It received information by concerned members of the public that this trader claimed to be an authorised FSP, operating under a false FSP number and licence, and allegedly displayed a certificate claimed to have been issued by the FSCA back in 2017 when it was still the FSB (Financial Services Board). According to FSCA, it researched its records, and subsequently found that Tradehedges is not an authorised FSP nor a juristic representative, and no records of any applications for such exist, or of the licence number in question.

The FSCA again strongly advised members of the public to check that a trader is registered with it and to verify which categories it is permitted to trade and advise in, before entering any business or trade agreements, or depositing any funds to into any bank accounts these traders proffer.