trading platform Archives - The Industry Spread

Marex Spectron Acquires Commodity Business of BGC European Holdings, CSC Commodities

January 22, 2019 by Karthik Subramanian Leave a Comment Filed Under: Industry News Tagged: brokerage, Capital Markets, CSC Commodities, derivatives, financial services, foreign exchange, Marex, Marex Spectron, trading platform

The London-headquartered world leading commodity broker, Marex Spectron Group Ltd. has acquired the commodity business of London-based BGC European Holdings, CSC Commodities.

Marex Spectron, which has a global network spanning North America and Asia will allow it to press on with long term plans to develop its business of providing energy market making. CSC Commodities will continue to operate independently within Marex Spectron’s network and expand the group’s offering to a broader client base that deals in the commodity derivatives, including oil-related derivatives and agriculture markets.

CSC Commodities was established five years ago by Bastien Declercq and Alan Newman and has bases at London, New York and Gibraltar. It has 15 employees on its rolls. Marex Spectrom is continuously strengthening its position in the global commodity market including the expansion of its footprint across North America and Asia. It has also signed an agreement to acquire the customer business of futures brokerage Rosenthal Collins Group (RCG) which is expected to get completed in January 2019. The group has also developed new metals products for Singapore and has strengthened its existing European franchise.

Commenting on the news, Ian Lowitt, CEO of Marex Spectron, said:

“Acquiring CSC is an exciting development for Marex Spectron that adds a successful energy market making and trading team with an impressive long-term track record. They are a great fit with our existing businesses in Metals and Agriculture where we have industry leading market making franchises, and there are exciting opportunities to develop the business into new markets.”

Bastien Declercq, Chief Executive of CSC, added:

“We are delighted to be joining Marex Spectron; it’s an excellent fit for our business. As part of a world-leading commodity focused business, we gain access to a new range of products, infrastructure and geographies that will help us expand our business and diversify our operations.”

LMAX Exchange Groups Strengthens its Management Team with Multiple Hirings Across Board

January 22, 2019 by Karthik Subramanian Leave a Comment Filed Under: Industry News Tagged: brokerage, Capital Markets, Cryptocurrencies, Cryptocurrency exchange, David Mercer, FX trading, Himanshu Kher, LMAX, LMAX Exchange, Scott Moffat, trading platform

LMAX Exchange Group, an operator of institutional exchange in the eFX and cryptocurrency sector has made a series of new hirings to strengthen as well as to fill the capacities in the senior level management team.

The group has secured Himanshu Kher as its Group Treasurer. This position has been newly created and Kher is the first one to handle the position. He will report directly to Grant Pomeroy, the Group Chief Financial Officer (CFO) at LMAX.

His role will include providing leadership and management of all the group’s treasury activities and advise senior management on risk management strategies for foreign exchange. Other duties include oversight of bank relationships, optimising cash and working capital management processes, identify opportunities to enhance the revenue contribution of the Treasury Department.

Kher has over 18 years of experience in the in treasury operations, corporate finance, risk management and stakeholder management roles. Mr Kher is joining LMAX Exchange Group from IG Group, where he was Group Treasurer for almost four years. He has also worked with Barclays, Boston Consultancy Group and PwC LLP.

Commenting on the appointment Grant Pomeroy, the Group CFO said:

“The establishment of this new position within the Group’s Treasury function is a clear demonstration of how quickly LMAX Exchange has grown in recent years. Efficient management of our growing cash resources is vital to cementing our position as a profitable, high-growth player in global capital markets.”

Kher also added:

“LMAX Exchange is a recognised leader in institutional FX trading and crypto markets, and I am excited to have joined the firm at such a progressive time in its history. I look forward to bringing my experience to bear in contributing to its future success.”

The group has also strengthened its Asia Pacific team with the appointments of Jason Huang as Head of Sales and Shang Lin as an Institutional Sales Executive. The new appointments will help the group to leverage its liquidity solutions in the key growth markets and further strengthen its presence in the Asia Pacific region, improving accessibility. Both executives will be based in LMAX Exchange’s Singapore office.

Commenting on the appointments, Scott Moffat, LMAX’s Managing Director of Asia Pacific said:

“We have identified a genuine need among institutional market participants for order-driven firm liquidity and a growing focus on transparency, precision and consistency in execution. Crucially, both Jason and Shang possess extensive experience servicing institutional clients and have a deep understanding of the Asia Pacific FX market. I believe that their industry knowledge and expertise will help us accelerate our regional growth in the years to come.”

LMAX Exchange CEO David Mercer also noted:

“Asia’s contribution to our global business continues to grow at a tremendous rate. In 2018, our Asia Pacific franchise doubled volumes and delivered 28% growth in execution revenue. Among institutional clients, we saw even steeper levels of growth.”

Senior Level Strategic Appointments at Society Financial and Offshore Broker IX Securities

January 21, 2019 by Karthik Subramanian Leave a Comment Filed Under: Industry News Tagged: Bitcoin, Blockchain, Brokers, Capital Markets, Cryptocurrencies, Cryptocurrency exchange, Fixi PLC, IX Security, Perfect Money, Retail Fx, Society Financial, trading platform, Western Union

Society Financial Appoints Veteran FX Executive Tom Tragett as its New Chief Market Analyst

UK-FCA regulated agency, Society Financial has appointed veteran FX executive Tom Tragett as its new Chief Market Analyst. Mr. Tragett will help the company to augment the broker’s market information capabilities specifically in relation to clients while helping to generate a diverse blend of market reports, updates and analysis of overall company clientele.

Mr. Tragett has over three decades of experience in the FX brokerage space and in other financial services sector. He has spent a major part of his career as a currency strategist, consultant, and premier researcher. He traded FX, commodities, futures, options, and indices for own account as well as advised private and retail clients on FX trading strategies.

He has joined Society Financial from Fixi Plc in December 2018 which ceased its operation following consultation with the FCA. Earlier, he has worked with Fleet Street Publications for almost ten years and most recently he has served as the group’s editor of ‘Currency Wars Alert’ where he was advising retail customers on G10 FX trading strategies. Other companies where he held roles are ODL Securities, RZB London. In the earlier part of his career, Mr. Tragett has worked as Chief FX Trader at Asahi Bank London from 1998 to 2001, managing a small team of six traders and was also tasked with overseeing FX sales function.

Peter Karsten has been Appointed CEO of Offshore Broker IX Securities

A new FX and CFD broker called IX Securities has appointed Peter Karsten as its CEO. IX Securities is based in the Bahamas and is regulated by the Securities Commission of The Bahamas. The brokerage is registered in Nassau and is a part of the growing number of new brokerage operations that entered offshore.

The change was reflected in Mr. Karsten’s LinkedIn profile. Mr. Karsten has a deep experience of managing the FX brokerage affairs and was CEO of BDSwiss between February 2014 and November 2015. He then joined Infinox Capital as Commercial Director and London Capital Group as a Sales Consultant.

Offshore brokers mainly face the challenges of payments, and IX Security is currently managing its affairs with bank wires, 2pay4you, Western Union, Vload, Bitcoin, Fasapay and Perfect Money.

Asian Indices Higher on Renewed Hopes about US-China Trade Relations

January 21, 2019 by Nikolas Papas Leave a Comment Filed Under: Market News - European Open Tagged: Asian stocks, banks, Brexit, brokerage, Capital Markets, China-US trade, ECB, economy, EUR-USD, monetary policy, Theresa May, trading platform

China revealed a bunch of economic data. On an annual basis, fourth-quarter GDP was 6.4%, and the consensus was 6.4%. Analysts were expecting retail sales to be 8.2%, and they came in at 8.2%. Industrial output was 5.7%, while traders were anticipating 5.3%. Fixed asset investment was 5.9%, and economists were expecting 6%. China’s economy grew by 6.6% in 2018, its slowest pace since 1990. Brexit will remain in focus this week. Theresa May will outline her plan B later today, and reports suggest that it won’t be too different from the agreement that was overwhelmingly voted against last week, so hopes aren’t high.

The encouraging start to 2019 is continuing for Asian equities with Japan’s Nikkei225 index 0.26% higher, while the Shanghai Composite Index added 0.7%. The Aussie ASX 200 was 0.2 higher, hitting two-month highs and making it five straight days of gains. The index has jumped by more than 4% in January so far.

European equities on Monday started the session in red with Germany DAX 0.35% lower at 11,166, CAC40 is giving up 0.20% at 4,866, and London FTSE is 0.16% lower.

On the Lookout: Next on traders’ radar is UK Prime Minister Theresa May’s revised plan for exiting the European Union, with her original proposal left in tatters after being roundly rejected by MPs last week. Bank of Japan will conclude its two-day monetary policy meeting on Wednesday and is widely anticipated to keep its stimulus program unchanged. European Central Bank also has the first rate-policy meets for the year on Thursday.

The New York Stock Exchange will be closed today as the US celebrates Martin Luther King Jr Day.

Trading Perspective: EURUSD started the week with small gains (+0.16%) after last week decline to 1.1353. Traders are waiting for Mario Draghi’s comments on Thursday to be more dovish, but I don’t expect any significant changes at the ECB meeting. The pair is holding the 50-day moving average today at 1.1380, giving buyers a breath and an upside target to Friday’s high at 1.1412. A failure at the 50-day moving average will drive prices down to 1.1353 Friday’s close, and then to 1.13 round figure. Open interest in EUR futures markets dropped around 2.3K contracts on Friday from Thursday’s final 526,080 contracts, according to preliminary data from CME Group. The volume, as well, decreased by more than 7.5K contracts and prolonged the choppy performance.

EURUSD Daily Chart

USDJPY is trading down 0.13% to 109.64 today but keeps the positive short term positive as the pair is trading above the 200-hour moving average. The 50-hour moving average at 109.33 provides solid support, while further support can be found at 109 level. On the flipside, 110 figure is the first resistance for the pair, and further supply will be met at the 200-day moving average around 111.16.

GBPUSD There are no material economic stats scheduled for release through the day, leaving the Sterling in the hands of Theresa May’s, Brexit Plan B, or lack of and chatter from Parliament. Today the pair is down 0.15% at 1.2852; the outlook turns negative after the pair rejected at 1.30 last week. The first short-term support will be found at the 200 hours moving average in 1.2842 area while a break below can drive prices down to 50day moving average at 1.2757. On the upside, the first resistance will be met at the 100-hour moving average at 1.2886. CME Group’s advanced data for GBP futures markets investors scaled back their open interest positions by around 1K contracts on Friday vs. Thursday’s final 214,787 contracts. In the same line, volume dropped by nearly 12.1K contracts.

GBPUSD Hourly Chart

CFTC has Surprising Spoofing Rules

January 21, 2019 by Michael Volpe Leave a Comment Filed Under: Feature Articles Tagged: brokerage, CFTC, CFTC Regulations, commodities broker, derivatives, economy, Financial markets, risk management, SEC, trading platform

The Commodities Futures Trading Commission (CFTC) can charge a firm with violating spoofing related statutes even if no spoofing occurred.

The Futures Industry Association held its latest webinar entitled: “Spoofing, Surveillance, & Supervision.”

Attorneys from the law firm Drinker Biddle & Reath LLP made the presentation and noted that CFTC’s statute states that a firm can be charged with a spoofing violation if the firm did not properly supervise its traders, even if none engaged in spoofing.

The CFTC rule states, “Evidence of violations that ‘should be detected by a diligent system of supervision, either because of the nature of the violations or because the violations have occurred repeatedly’ is probative of a failure to supervise,” according to a slide in the webinar.

The rule departs from that of the Securities and Exchange Commission (SEC), which requires spoofing to occur before a firm can also be charged with a failure to supervise.

“Unlike the SEC’s rule on failure to supervise, which requires an underlying substantive violation in order to establish a failure to supervise,” the slide continued.

Spoofing occurs when a trader places orders which are not executed but are placed simply to drive the price of a security in a certain direction.

The anti-spoofing statute was part of the Dodd/Frank bill passed in 2010.

Furthermore, the exchanges followed with their own anti-spoofing rules, which the attorneys said largely mirrored that of the CFTC’s anti-spoofing statute.

The CME rule states, “Prohibits (among other actions) entering an order with the intent at the time of order entry, to cancel the order before execution or to modify the order to avoid execution,” according to another slide.

The ICE exchange “does not require the intent at the time of order entry only entering an order with the intent to cancel it,” according to the same slide.

The exchanges, the CFTC, ICE, and others, are also referred to as self-regulatory organizations (SRO).

This is because it is required by the SEC and the CFTC that all approved exchanges have a separate regulatory arm.

As such, a trader engaged in spoofing can face penalties not only from the exchange where the trades occurred but also with the regulatory body.

This occurred with 3 Red Trading, which was covered in the webinar.

Their principal, Igor Oystacher, was not only fined by the CEM but also by the CFTC, for his spoofing activities.

The attorneys also noted that the CFTC has been touting their non-prosecution agreements, as a means of encouraging traders involved in spoofing to come forward and expose their firms.

For instance, in July 2017, the CFTC entered into a non-prosecution agreement with three traders from Citigroup Global Markets; while the traders were named, they were spared punishment while the firm was fined $25 million.

“The message sent appears to perhaps incentivize traders being investigated for spoofing to point at their firm for failing to train and supervise them regarding spoofing.” Another slide noted.

While that is one way to look at it, this incentive can also be viewed as encouraging criminal behavior.

Law enforcement has a long history of making deals with criminals whose crimes are forgiven for their cooperation against another criminal.

In one notorious case, Sammy “The Bull” Gravano served only five years in jail despite admitting to involvement in nineteen murders in exchange for testifying against John Gotti.

While spoofing is not nearly as serious as murders, traders who rat on their firms in exchange for leniency do have their criminal activity wiped out as well.

cTrader Platform to Feature Crypto on New White Label Solution

January 19, 2019 by Ricardo Esteves Leave a Comment Filed Under: Company News, Industry News Tagged: CFD brokers, crypto, cryptocurrency, cTrader Platform, forex brokerage, James Glyde, Match-Trade Technologies, Michał Karczewski, Retail Fx, spot forex, Spotware Systems, trading platform, white label

The cTrader platform will feature additional tools such as extended Client office or cryptocurrency features on the white label solution.

Spotware Systems, the creator of leading retail FX trading platform cTrader, has partnered with FX and Crypto technology provider Match-Trade Technologies to launch a new breed of turnkey White Label solutions.

Forex and Crypto trading brokers everywhere will benefit from the alignment between Spotware’s cTrader platform and Match-Trade’s complementary high-tech services and technical support in the trading realm. The trading platform for Forex and CFD brokers, which is already packed with a full range of features, will feature additional tools such as extended Client office or cryptocurrency features on the white label solution.

James Glyde, Chief Commercial Officer at Spotware Systems

Match-Trade is a California-based forex and cryptocurrency technology provider that delivers turnkey matching engine solutions to all forex market participants looking to access the retail and institutional spot forex markets. The firm targets forex providers, such as Brokers, Prime Brokers, and other Liquidity Providers who wish to enter the independent ECN and Crypto market.

Optimal for brokers looking for intelligent technology that does not require a large investment, the solution offered by the partnership between Spotware and Match-Trade will feature integrated Client Office (expanded with CRM feature) appreciated by many brokers, crypto payment gateway or ultra-fast data feeds as well as seamless integration with any Liquidity Provider.

The solution is being marketed as a high-quality service for a relatively low entry threshold, affordable even for start-up brokers. Spotware and Match-Trade will also ensure that the entire set up process will run seamlessly so that brokers can focus on business development.

James Glyde, Chief Commercial Officer at Spotware Systems, commented:

Michał Karczewski, Head of Business Operations at Match-Trade Technologies

”Spotware has been integrated with Match-Trade’s technology for years. We are pleased that they have decided to extend our cooperation and include cTrader in their product offering alongside other well-known trading platforms. We see Match-Trade as an important sales support for us because of its high-quality complementary services that further enrich our core-offering. Also, their experts provide invaluable support for clients, both in a technical and consulting capacity to help them choose the optimal solution tailored to their needs. I believe we have chosen a trusted partner who will not only provide the best experience of the cTrader platform but also support the business development of their clients, just as we do.”

Michał Karczewski, Head of Business Operations at Match-Trade Technologies, said:

“To address the needs of the clients seeking a solution designed for web access we have decided to extend our portfolio of services with the cTrader White Label solution. Spotware is a reputable company that offers proven solutions of the highest quality and the industry recognizes cTrader as one of the best trading platforms available on the market. For those who are looking to start their Forex brokerage, we have created a unique and complex trading infrastructure with optimal start-up costs.”

Crypto Exchange Platform, ErisX Adds Ethereum Co-Founder, Joseph Lubin and Tech Entreprenuer Cris Conde to its Board of Directors

January 19, 2019 by Karthik Subramanian Leave a Comment Filed Under: Industry News Tagged: Bitcoin, Blockchain, Coindesk, Cryptocurrencies, Cryptocurrency exchange, economy, ErisX, investment, trading platform

Chicago-based crypto futures platform, ErisX has expanded its Board of Directors and has onboarded Ethereum co-founder Joseph Lubin alongside technology entrepreneur Cris Conde. The hiring comes ahead of the launch of spot and derivatives markets for the derivatives asset.

They will serve alongside DRW CEO Don Wilson Valor Equity Partners managing partner Antonio Gracias and ErisX CEO Thomas Chippas. Lubin, 53 is a CEO of blockchain platform ConsenSys and also owns a majority stake in the company. He has helped many crypto startups to grow. In a press release by ErisX, it said that Lubin’s experience in working in the digital asset space and familiarity in working with the Ethereum network had helped his inclusion in the Board.

ErisX Head of Marketing, Jessica Darmoni has told Coindesk that, their primary objectives remain launching Ether products but refused to further reveal if the company is planning to announce the launch of Ether products in the near future. Adding: “As a general rule, we don’t comment on engagement with regulators while we are still in process with them,”

Commenting on Joseph Lubin’s addition to the Board, Darmoni said, “However, we can say that Mr. Lubin and his team bring extensive knowledge and background on Ethereum, the crypto space as well as the token space to ErisX.”

ErisX CEO Tom Chippas added:

“As two leaders in the digital asset space, ErisX will benefit from the unique perspectives they offer and the enthusiasm they bring to the space. We also want to thank Cliff for the significant guidance and support he has provided, including helping shape the digital asset spot and regulated futures market.”

Joseph Lubin also added:

“ErisX has a unique position in the market with support from a wide range of investors as well as experienced leaders at the helm. I look forward to bringing my experience with decentralized technologies and digital assets to a model that will further democratize access to digital assets. 2019 is likely to be a breakthrough year for digital assets, and the exceptional ErisX team is poised to lead.”

Monex Group Announces Series of Organisational and Personnel Changes and Eurex Clearing Appoints Dmitrij Senko as its Next CRO

January 19, 2019 by Karthik Subramanian Leave a Comment Filed Under: Industry News Tagged: Eurex, financial services, foreign exchange, FX trading, investment, Monex, Monex Group, TradeStation, trading platform

Tokyo-based Monex Group has announced a series of changes in organisational and management structure this Thursday. Monex Group operates retail fx brokerages TradeStation, Monex, Boom Hong Kong, and Coincheck.
Effective Feb. 1st, 2019, the firm will do away with its investment business office, and it has not provided any reason, why it is doing so. From removing the investment business office, the firm has also made some series of managerial changes, that includes the addition of Akira Inoue as an Executive Director. Her appointment is made effective from the 22nd Jan 2019. She will also be appointed as General Manager of Financial Control Department from 1st Feb. 2019.
From 1st Feb. 2019, its current CFO and Executive Officer Satoshi Hasuo will also handle the role of General Manager of the Finance Department.
The group has also made personnel changes in its subsidiary, Monex Inc. and has appointed Hiroshi Aikawa as an Executive Director. Aikawa has not held any positions with the firm previously.
The managerial and organisational changes were made just days after Monex Group’s US subsidiary TradeStation announced its plan to launch cryptocurrency services later this year under the brand name, TradeStation Crypto.

Eurex Clearing Secure Dmitrij Senko as its Next Chief Risk Officer

Eurex Clearing, the subsidiary of Deutsche Bourse has announced that Dmitrij Senko will be joining the firm as its next Chief Risk Officer (CRO). Senko will take up the role from July this year and will replace departing CRO, Thomas Laux.
Senko has been working with Eurex Clearing’s risk department for almost a decade. He joined the firm in 2010 and was promoted to Head of Risk Analytics and Model Validation in the risk department in 2013 and reported directly to Thomas Laux. For Senko, the role for CRO will not be that much challenging as he has been working with Laux for quite some time and knows the nature of work.
Erik Müller, Chief Executive Officer (CEO) of Eurex Clearing said:
“It’s great news that Dmitrij has agreed to join the board. Risk management is at the core of our business and is of special importance to Eurex Clearing. Dmitrij has been with us for many years, and I am very happy that we will benefit from his expertise and deep knowledge in the years to come.”

On departing CRO Thomas Laux, Eurex Exchange CEO Thomas Book said:

“Thomas Laux is an outstanding risk expert, and I thank him for his work and commitment over the last years,” said Book. “He has played a major role in making Eurex Clearing what it is today. The most prominent example of his achievements is our industry-leading risk engine Prisma.”

Trade Optimism Lifts Asian Markets

January 18, 2019 by Nikolas Papas Leave a Comment Filed Under: Market News - European Open Tagged: Asian Markets, banks, Brexit, brokerage, Chinese imports, economy, EUR-USD, foreign exchange, investment, Sino-US trade war, trading platform

Steven Mnuchin, US Treasury Secretary

US Treasury Secretary, Steve Mnuchin, was considering easing trade tariffs on Chinese imports as the two economic superpowers continue trade negotiations. The signs of possible progress in negotiations over the Sino-US trade war boosted equities in Asia with the Shanghai Composite Index advanced 0.8 percent to 2,579.76, and Tokyo’s Nikkei 225 added 1.2 percent to 20,655.08. Australian stocks closing higher for a fourth straight day with the ASX 200 adding 30 points or 0.5% to 5879.6 points. Over the week, the top 200 index rose 1.8% while the broader All Ordinaries also rose 1.8%. U.S. crude oil rose 54 cents to $52.61 per barrel while Brent crude oil, adding 47 cents to $61.65 per barrel in London.

Equities in Europe are on bulls playground with DAX trading 0.94 higher at 110,020 Cac40 adding 0.97% to 4840 and FTSE in London gaining 0.45%.

On the Lookout: US-China trade talks headlines after The Wall Street Journal’s story, that the US administration is considering reduce tariffs on Chinese imports will set the tone today in the markets. The economic calendar includes UK retail sales where analysts expect to drop 0.8% m/m in December, following a 1.4% rebound seen in November. Total retail sales are seen arriving at 3.6% over the year, same as that booked previously. In the US, industrial production and consumer sentiment data will be released later today.

Trading Perspective: Forex markets still appear to be taking a positive view on all of the political turmoil coming out of the UK Brexit story as the sterling continues to edge higher against the US Dollar. Increasing talk around the prospect of an article 50 extension and a second vote appears to be encouraging some short covering in the pair. GBPUSD has continued to advance higher after this week’s dip to 1.2670; the sterling has managed to push through the 1.30 area after it broke above the 100-day moving average. Today GBPUSD is trading 0.25% lower at 1.2951 as the pair hit overbought conditions at the 1.30 area. The momentum has turned positive for the pair, and an attempt for the 200-day moving average at 1.3102 can’t be ruled out. Traders should wait for a convincing break above 1.30 to initiate new long positions. On the flipside 1.2930 is the immediate resistance while more demand will come at the 100-day moving average in the 1.2893 area.

GBP futures markets from CME Group noted open interest dropped by nearly 2K contracts on Thursday from Wednesday’s final 216, 613 contracts. Volume followed suit, shrinking by almost 16.2K contracts and clinching the second drop in a row.

The Aussie dollar has rallied its way back to 71.9 US cents after hitting lows around 71.5 US cents yesterday. The pair is trading around the crucial 100-day moving average facing resistance at 0.7236 weekly high and support at 0.7146 previous daily low.

EURUSD is trading in a narrow range as it tested yesterday with success the 50-day moving average at 1.1365 and rebounded just to get another rejection at 1.14. Investors are cautious at current levels as macro data are coming softly from the old continent. Other than Brexit, France economy is a source of risk after disappointing figures and the” yellow vest” movement. Italy is off the headlines for the week, but the budget and banking crisis in the country is far from over. Greece came up in the headlines again after political turmoil in Athens, and we should not forget that during the Grexit issue, the EURUSD hit multiyear lows at 1.06. As of writing the pair is trading 0.05% higher at 1.1396, with the first supply zone at the 100-hour moving average (1.1429) and immediate support at yesterdays low at 1.1365.

CME Group’s flash data for EUR futures markets showed traders added around 1.1K contracts to their open interest positions on Thursday vs. Wednesday’s final 525,546 contracts. In the same line, volume rose by more than 8.3K contracts following the previous sharp drop.

Asian Stocks Ended Neutral as UK Government Survives No-Confidence Vote

January 17, 2019 by Nikolas Papas Leave a Comment Filed Under: Market News - European Open Tagged: Asian stocks, AUD/USD, banks, Brexit, Capital Markets, china, economy, EUR-USD, HSBC, monetary policy, Sino-US trade war, Theresa May, trading platform

Asian stocks have ended the session neutral as concerns emerged by proposed US laws targeting Chinese telcos, including Huawei, could be damaging the Sino-US trade relations, while in Europe U.K. government survived a vote of no confidence in Parliament, Prime Minister May said she had begun holding talks with leaders of opposition parties on how to progress with Brexit efforts.

Japan’s Nikkei 225 is -0.13% down on the day, with the Tokyo Topix index up 0.35%. The Australian stock market edged higher for a third straight day with the ASX 200 gaining 15 points or 0.26% to 5850.1 on a choppy trading day. Hong Kong’s Hang Seng gained 0.4%, while South Korea’s Kospi finished 0.2% higher.

European markets started in green the day after Prime Minister Theresa May’s government yesterday won a no-confidence vote, as widely expected by investors. The DAX in Frankfurt is trading at 10,931 up 0.36% and CAC40 is adding 0.51% to 4779, while shares in FTSE give up 0.35%.

On the Lookout: In Greece Prime Minister Alexis Tsipras has survived one more confidence vote, which was called last Sunday after his coalition ally resigned. The Fed’s Beige Book report (which covers the period from late November to January 7), said economic fundamentals remain strong. Some districts reported growth had slowed. Meantime the partial government shutdown continues. The US weekly jobless claims, Philly Fed manufacturing index and Canadian ADP employment change data, all of which will be released parallelly at 1330 GMT. The G20 meeting begins today in Tokyo with BOJ Governor Haruhiko Kuroda delivering the opening remarks. The meetings go on for today and tomorrow.

Trading Perspective: Trade war fears were set to undermine sentiment in forex markets following reports that the US is investigating Chinese tech giant Huawei for stealing trade secrets from US business partners. GBPUSD is down 0.19% at 1.2855 after yesterday failed to hold above 1.29. Today the pair found support at 1.2850 figure during early European session. The hourly chart offers a positive stance, with strong resistance for GBPUSD at 1.29 where the 100-day moving average crosses and is also yesterdays high. A convincing break above can lead prices to 1.2942 and then 1.2985. On the flipside, the first support is at 1.2815 and on further losses looked for strong support at the 50-day moving average around 1.2765. Open interest in GBP futures markets decreased by almost 5K contracts on Wednesday vs. Tuesday’s final 221,098 contracts, the first drop following three consecutive builds. Volume followed suit and dropped by around 44.5K contracts, prolonging the choppy performance.

HSBC forecasts that a hard Brexit could drive GBP/USD at 1.1000 while if the UK stays in the European Union, GBP/USD will rise to 1.5500.

The Aussie dollar has weakened against a stronger USD while November’s housing finance data was again disappointing, and a potential warning for further softness in housing prices. The AUDUSD could remain under pressure on heightened trade tensions. The pair is trading close to daily high at 0.7164, and only a break above the 100-day moving average can give bulls the upper hand. Bears are targeting the support at 0.71.

EURUSD has found strong support the last 24 hours at the 50-day moving average even short term technical indicators are bearish. At the time of writing, the pair is making one more attempt to 1.24, a level that I am closely watching. If the pair manages to break above the 1.24, bulls will take control. A failure to do so will drive prices down to a yearly low from January 3, 2019, at 1.1306.