May 26, 2005

 

Lead Stories

 

New Issue of Futures Industry Magazine

May/June issue featuring:

Crazy About Commodities: An Interview with Jim Rogers

China: The fall and rise of Chinese futures, 1990-2005

India: The crouching tiger

Japan: the big bang: finally

http://www.futuresindustry.org/fimagazi-1929.asp

 

Ex-trader gets 9-year term, will appeal

A former Chicago Board Options Exchange trader on Wednesday was sentenced to more than nine years in prison and ordered to pay $21 million in restitution for using money and securities from investors to subsidize his trading and expenses.  Edward Thomas Jung was convicted of fraud in February 2004 for falsely promising to invest his hedge fund customers' money in stock options.

http://www.chicagotribune.com/business/chi-0505260306may26,1,5310412.story?coll=chi-business-hed

 

Senate committee pumps up ethanol

Action on measure likely next month

WASHINGTON -- In a victory for Midwestern farmers, a Senate committee on Wednesday turned aside strong objections from oil companies and approved a requirement that refiners must use more corn-based ethanol and other renewable fuels in gasoline.

http://www.chicagotribune.com/business/chi-0505260304may26,1,4523978.story?coll=chi-business-hed

 

Russell to Launch New Microcap Index

Benchmark reflects a four-year return of 73.6%, versus 43.8% for small caps

TACOMA, Wash. – Russell Investment Group will launch the Russell Microcap™ Index, a new benchmark for microcap stocks, when it reconstitutes its family of U.S. stock indexes on June 24.  The new investment tool will track the performance of 2,000 of the smallest companies in the U.S. equity market.  “Our research confirms there is a real need for a truly representative benchmark for microcap managers,” said Lori Richards, senior product manager for Russell Indexes. “This new index offers managers and other investors a comprehensive, unbiased barometer to compare their performance against the genuine microcap marketplace of stocks.”

http://biz.yahoo.com/bw/050526/265386.html?.v=1

 

The Dinosaur at Wall and Broad

http://www.forbes.com/columnists/columnists/forbes/2005/0606/180.html

 

Treasury Secretary Snow Says China Must Change Currency Policies

http://www.nytimes.com/aponline/business/AP-US-China-Trade.html

 

D.Boerse meeting leaves investors in the dark

FRANKFURT (Reuters) - Deutsche Boerse (DB1Gn.DE: Quote, Profile, Research) on Wednesday failed to calm investor concerns about the future of the German exchanges firm, leaving shareholders in the dark about future management or the intentions of its leading owners.

http://today.reuters.co.uk/news/newsArticle.aspx?type=businessNews&storyID=2005-05-25T174909Z_01_MOL556677_RTRUKOC_0_FINANCIAL-DEUTSCHEBOERSE-BOARD.xml

 

Hedge Funds Nip at Wall Street

Financing Role in Recent Deals Challenges the Core Business Of Investment-Banking Firms

http://online.wsj.com/public/article/0%2C%2CSB111706954663143697-jnBG291Gqjc63A5mCdrdMiuFpO0_20060525%2C00.html?mod=tff_main_tff_top

 

Owner losing patience with Eurex U.S.'s performance

BY DAVID ROEDER Business Reporter

The clock is ticking on Eurex U.S., the Chicago-based trading venture of the largest futures exchange in the world.

Barely more than a year old, Eurex U.S. has failed to make a dent in the market for trading U.S. Treasury futures. And with the operation's losses mounting, one of its owners served notice Wednesday that it is losing patience.

http://www.suntimes.com/output/business/cst-fin-eurex26.html

 

**** Hometown newspaper taking the narrow view and missing the bigger picture.  But hey, it sells newspapers.  Where does this story talk about the growth that Eurex AG’s Euro-denominated products have experienced since the Eurex US effort began?  This article cites “industry sources.”   Perhaps a broader selection of sources would be useful, including the entire text of the question and answer session yesterday rather than just selective parts that pander to local interests.   This is sloppy or at best incomplete/hometown journalism.

 

Icap talks up electronic broking

http://www.futuresindustry.org/tools/linktrack.asp?lid=9337

 

Is This the End of the Floor?

The NYSE-Archipelago merger is a stroke of genius - it spells diversification with a capital D. The deal provides the NYSE with an entry into the Nasdaq, Fixed Income and Options markets, which typically are higher margin businesses than its current listed business. The NYSE also acquired some very good technology and another equity exchange business model. These new businesses and the ability to become a public enterprise in a much shorter-than-normal time frame are big pluses for the NYSE.

http://www.wallstreetandtech.com/showArticle.jhtml%3Bjsessionid%3DVPLLAYENRQDASQSNDBCSKHSCJUMEKJVN?articleID=163701183

 

EU needs strong exchanges for start-ups - McCreevy

BRUSSELS, May 26 (Reuters) - Europe lacks an efficient cross-border stock market for start-up companies, and the European Commission is studying what changes could be made, Internal Market Commissioner Charlie McCreevy said on Thursday.

http://www.reuters.com/financeNewsArticle.jhtml?type=bondsNews&storyID=8614222

 

LME embraces plastics, caution over early take-up

LONDON, May 26 (Reuters) - A new era starts for the London Metal Exchange (LME) on Friday when plastics futures make their debut, but would-be players such as packagers and investment funds will take their time before trading significantly.

http://asia.news.yahoo.com/050526/3/21juv.html

 

**** One has to wonder when prices of plastic drop suddenly, will the market be “breaking” or just “bending.”  I fear whole new set of clichés coming on from our headline writing friends.

 

Gasparino: Don't Count Out Ken Langone

http://www.msnbc.msn.com/id/7968931/site/newsweek/

 

Environmental Trading News

 

Chicago Climate Futures Exchange SO2 Allowance Cash and Futures Market Prices Survey Report                  Thursday, May 26, 2005 11:45 a.m. Central Time Report

SO2 Allowance Cash Market Survey -As of May 25, 2005

Vintage               Bid       Offer    Last

2005 (or earlier)   $780           $795      $780 ( May 25 )

2006                    $775          $790

Cash Market Price Survey Overview The SO2 cash market price information provided above reflects central values of price ranges gathered from randomly selected market participants from energy, brokerage and financial firms. The 9:30 a.m. Central Time report is based on information gathered between 9:10 and 9:25 a.m. Central Time. The 11:45 a.m. Central Time report is based on information gathered between 11:25 and 11:40 a.m. Central Time.

 

www.chicagoclimateexchange.com

 

Exchange & ECN News

 

U.S. Spring Progress Picks Up, But W. Wheat Ratings Drop

Hot Conditions and below-normal temperature railed prices before Monday’s U.S. crop report. 05.25.2005

http://www.cbot.com/cbot/pub/cont_detail/0,3206,1027+28528,00.html

 

Notice to CBOT Holdings Shareholders

Notice to CBOT Holdings Shareholders on Class A share holdings and Series B membership holdings. 05.25.2005

http://www.cbot.com/cbot/pub/cont_detail/0,3206,1027+28530,00.html

 

Notice to CBOT Members/Shareholders on Second Approval

http://www.cbot.com/cbot/pub/cont_detail/0,3206,1027+28532,00.html

 

CBOT Trader Newsletter: May 24, 2005

http://www.cbot.com/cbot/pub/cont_detail/0,3206,1027+28502,00.html

 

CBOT Strike Price Notice, May 26, 2005

http://www.cbot.com/cbot/pub/cont_detail/0,3206,1032+28544,00.html

 

Spot Month Procedures on the Eve of First Notice Day

http://www.nymex.com/jsp/shareholder/notice_to_member.jsp?id=ntm213&archive=2005

 

NYSE Seat Sells for $2,220,000

http://www.nyse.com/press/1117017507922.html

 

NYBOT Announces Two New Contract Months For Pulp Contract

http://www.nybot.com/releases/pressRelease.asp?releaseID=880

 

**** NYBOT adding bulk to pulp.

 

Standard & Poor’s Announces Changes In S&P/TSX Canadian Indices

http://www.tse.com/en/mediaNews/newsreleases/news8934.html

 

AtosEuronext To Provide Trading, Clearing And Settlement Systems To The Teheran Stock Exchange - The Tehran Stock Exchange And AtosEuronext Have Signed An Information Systems Agreement Whereby AtosEuronext Will Provide TSE With A Full Range Of Electronic Marketplace Solutions

http://www.exchange-handbook.co.uk/news_story.cfm?id=53091

 

Regulatory News

 

The SEC News Digest

The SEC News Digest provides daily information on recent Commission actions, including enforcement proceedings, rule filings, policy statements, and upcoming Commission meetings.

http://www.sec.gov/news/digest/dig052505.txt

 

Three Florida Men & Two Companies Charged with $3 Million Forex Options Fraud, Defrauding Over 125 Customers 

Melvin Webman, Larry Webman, Lyle Wexler, International Forex Advisory Group, and Worldwide Currencies Corp. Charged with Defrauding Over 125 Customers

http://www.cftc.gov/opa/enf05/opa5079-05.htm

 

Regulators Key To Open China Oil Futures Mkt -Nymex Exec

SINGAPORE (Dow Jones)--China remains a major challenge for oil-futures exchanges looking to break into the world's fastest growing major energy market, which is largely closed to outsiders.

"The key to China is Beijing - the regulators," Thomas J. McMahon, Director for Asia at the New York Mercantile Exchange, told Dow Jones Newswires.

http://sg.biz.yahoo.com/050526/15/3spuu.html

 

FSA sets out a good practice model for stress testing and invites comment

http://www.fsa.gov.uk/pages/Library/Communication/PR/2005/057.shtml

 

Chinese immigrants gain access to online investor education

http://www.bcsc.bc.ca/release.asp?id=2468

 

FICC Launches Real-Time Interactive Messaging Link to NASD for Corporate Bond Price Reporting

Helping to satisfy an industry goal to combine real-time trade matching and price reporting into one seamless process, Fixed Income Clearing Corporation recently enhanced its Real-Time Trade Matching service to support regulatory price reporting for over-the-counter corporate bond trades.

http://biz.yahoo.com/bw/050525/255691.html?.v=1

 

Broker's defense rests

Lawyers for ex-Bank of America Corp. broker Theodore Sihpol III rested their defense yesterday without calling any witnesses in his trial in Manhattan on charges of late-trading in mutual funds, after seven counts were dismissed from the case.

http://www.newsday.com/business/ny-bzfillq4276029may26,0,1759033.story?coll=ny-business-headlines

 

Managed Futures - Managed Funds

 

Man Says Hedge Fund inflows are slowing 

http://www.futuresindustry.org/tools/linktrack.asp?lid=9345

 

Commodity funds can diversify portfolio

NEW YORK (AP) - If you own both stock and bond funds, you probably consider yourself well-diversified. But research by Lipper Inc. suggests broad exposure to commodities like gold, oil and copper can go a long way toward rounding out a mutual fund portfolio, as long as you understand the risks.

http://newsobserver.com/24hour/business/story/2429909p-10726199c.html

 

Hedge fund manager Man jumps on profit, outlook

LONDON (MarketWatch) -- Shares of the world's largest publicly-traded hedge fund manager, Man Group, jumped over 5% Thursday after posting a stronger profit than forecast and giving an optimistic outlook.

http://www.investors.com/breakingnews.asp?journalid=27856570&brk=1

 

Bailey Coates remains 'incredibly liquid'

May-25-2005 - Redemptions won't plunge Bailey Coates Asset Management LLP into a liquidity crisis, a knowledgeable source says

http://www.marhedge.com/news/Cover.Hedge.asp?s=HedgeH-2005-05-25-14-20-58p1.htm

 

Reports

 

Bond Talk Today's Events

http://www.bondtalk.com/global.cfm?S=todaysevents

 

USDA Today

http://www.usda.gov/nass/PUBS/TODAYRPT/TODAY.HTM

 

Miscellaneous News

 

Discounted Market Data Services Now Available To SIA Member Firms

http://www.sia.com/press/2005_press_releases/03913176.html

 

Murder Charges Dropped Against Marine

Thursday, May 26, 2005 10:36 a.m. ET RALEIGH, N.C. (AP) -- A former Wall Street trader who rejoined the Marines after the Sept. 11 attacks will not be tried on murder charges for killing two suspected Iraqi insurgents, a Marine general decided Thursday.

http://news.lycos.com/wired/story.asp?section=Breaking&storyId=1039907

 

Local institutions shun derivatives

Local institutions are shunning Bursa Malaysia derivatives due to their lack of indepth knowledge on the products and their perception of derivatives being too "speculative", says Bursa Malaysia Bhd chief executive officer Yusli Mohamed Yusoff.

http://www.theedgedaily.com/cms/content.jsp?id=com.tms.cms.article.Article_18c519ef-cb73c03a-6279d000-43b26dc9

 

Bursa Malaysia Wants To Grow Its Derivatives Business

KUALA LUMPUR, May 26 (Bernama) -- Bursa Malaysia Bhd wants to grow its derivative products business further, its chief executive officer, Yusli Mohamed Yusoff, said Thursday.

http://www.bernama.com/bernama/v3/news_lite.php?id=136294

 

Schwab Enhances Trading Platform and Lowers Options Fees as Interest in Options Trading Surges

In the midst of a surge of interest in options by active traders, Charles Schwab & Co., Inc. today announced upgrades to its popular StreetSmart Pro trading platform and further reductions in its fees for qualified options traders.

http://biz.yahoo.com/prnews/050526/sfth016.html?.v=12

 

Charles Schwab To Pay Unit CEO At Least $2.5 Million

WASHINGTON -(Dow Jones)- Charles Schwab Corp. (SCH) said Wednesday that Peter K. Scaturro, the newly appointed chief executive of its U.S. Trust unit, is guaranteed to get $2.5 million in salary and bonus for the first 12 months of his employment.

http://money.iwon.com/jsp/nw/nwdt_rt.jsp?cat=USMARKET&src=704&feed=dji&section=news&news_id=dji-00114620050525&date=20050525&alias=/alias/money/cm/nw

 

Poor Lazard IPO Hurts Goldman Sachs Group

Investors weren't the only ones hurt by the poor performance of Lazard Ltd.'s initial public offering earlier this month: underwriter Goldman Sachs Group Inc. got stuck with a large chunk of the stock when it tried to support the floundering new issue.

http://news.yahoo.com/news?tmpl=story&u=/ap/20050526/ap_on_bi_ge/goldman_lazard_ipo_1

 

HedgeStreet's New Housing Price Contracts Designed to Mitigate Real-Estate Risk, Depreciation

HedgeStreet Inc. today announced that its market participants may now hedge or speculate on the direction of home values in major U.S. real estate markets, as well as the domestic supply of crude oil and natural gas.

http://biz.yahoo.com/bw/050526/265018.html?.v=1

 

***** Up next is a contract based on the number of fleas on your dog.

 

DISTRICT ATTORNEY - NEW YORK COUNTY

Manhattan District Attorney Robert M. Morgenthau announced today the indictment of a former high ranking Salomon Smith Barney/Citigroup employee on charges of accepting hundreds of thousands of dollars in bribes from two vendors involved in construction projects at the firm.

http://www.manhattanda.org/whatsnew/press/2005-05-26.htm

 

John's Comments

 

Futures Magazine June 2005 Preview

 

Futures Magazine features in its June issue: a look at how agricultural market fundamentals are shaping up as we enter the growing season, the escalating battle between Trading Technologies and Refco, the influence of certain hedge funds in the ouster of Deutsche Boerse CEO Werner Seifert, a look at how to trade the unemployment number and a conversation with Joe Nicosia, president and CEO of Allenberg, the largest cotton merchandiser in the world.  For a complete list of articles, and links to some of those listed here, go to http://www.futuresmag.com/library/contents.html

 

 

*********

 

Brent Crude Watch

 

IPE Brent Volume: 148,966

NYMEX Brent Crude Volume: 16,352

NYMEX Percent of Total Volume: 9.89%

 

********

 

Chicago Electronic Trading Scorecard for May 25, 2005

 

Percent Electronic

 

CBOT: 64.60%

CME: 65.81%

CME Eurodollars: 85.36%

CME Live Cattle: .54%

CME Currency Products: 82.59%

CBOT Soybeans: 2.30%

 

CBOT Options: 5.53%

CME Options: 5.09%

 

Volume 

 

OneChicago Volume: 20,942

Eurex US Volume: 6136

Euronext.liffe Eurodollar Volume: 41,885

CBOE Futures Exchange Volume: 372

 

Market Share

 

CBOT 100 oz. Gold Volume: 2590

NYMEX 100 oz. Gold Volume: 137,065

CBOT Share: 1.85%

 

CBOT 5000 oz. Silver Volume: 146

NYMEX 5000 oz. Silver Volume: 19,485

CBOT Share: .74%

 

CBOT Mini Gold Volume: 1618

CBOT Mini Silver Volume: 419

 

CME Emini Russell 1000 (100X) Volume: 2724

Eurex US Mini Russell 1000 (100X) Volume: 1235

NYBOT Mini Russell 1000 (50X) Volume: 114

CFE Mini Russell 1000 (100X) Volume: 0

 

CME Emini Russell 2000 Volume: 80,813

Eurex US Mini Russell 2000 Volume: 2396

CFE Mini Russell 2000 Volume: 58

 

Notes: The CBOT’s South American Soybeans traded 120 contracts yesterday.

 

Liffe Eurodollar Over-Under

 

Liffe/Globex: 2.36%

Liffe/CME: 2.03%

 

Regards,

 

John J. Lothian

Publisher

John Lothian Newsletter 

www.johnlothiannewsletter.com

 

Futures Brokerage - Business Intelligence   John J. Lothian President- Electronic Trading Division The Price Futures Group, Inc. 141 West Jackson Blvd., Suite 1340A Chicago, IL 60604 jlothian@pricegroup.com johnlothian@johnlothian.com IM: LothianJohnJ http://www.pricegroupetd.com tel: tel2: fax: mobile: +1 312-264-4350 +1 800-713-0215 +1 312-264-4399 +1 312-203-5515

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Disclaimer: The John Lothian Newsletter is a product of John J. Lothian & Company, Inc.  The opinions expressed are strictly the opinion of John Lothian, and not necessarily those of his employer, The Price Group and its management, and is intended solely for informative purposes and is not to be construed, under any circumstances, by implication or otherwise, as an offer to sell or a solicitation to buy or trade in any commodities or securities herein named. Information is obtained from sources believed to be reliable, but is in no way guaranteed.  No guarantee of any kind is implied or possible where projections of future conditions are attempted.  Security futures are not suitable for all customers.

 

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