July 27, 2005
Lead Stories
Hedge funds continued to see inflows of new money in the second quarter, defying concerns that lacklustre investment returns from the asset class might trigger a rush of redemptions.
http://news.ft.com/cms/s/b709a2c4-febc-11d9-94b4-00000e2511c8.html
Merc's Rally May Spur Rivals to Test IPO Waters
**** Online subscription required.
Morgan Stanley reportedly to poach, not train, new brokers
Morgan Stanley (MWD) will soon stop training new stockbrokers and rely solely on poaching pros from its Wall Street rivals, The New York Post reported in its Wednesday editions.
http://www.marketwatch.com/tools/quotes/newsarticle.asp?guid=%7BF8E7C5FC-0CCE-476B-A07F-479BB522F27C%7D&dist=rss&siteid=mktw
Eurex AG is unlikely to make much of a dent into the Chicago Mercantile Exchange's (CME.N: Quote, Profile, Research) market share for foreign exchange futures, CME officials said on Tuesday.
http://today.reuters.com/investing/financeArticle.aspx?type=marketsNews&storyID=2005-07-26T132807Z_01_CHB000065_RTRIDST_0_FINANCIAL-CME-CALL-URGENT.XML
Heat Drops
Despite rains around the Midwest last week, extreme heat in the Plains and the central
http://www.cbot.com/cbot/pub/cont_detail/0,3206,1027+29573,00.html
http://www.optionsclearing.com/press/rel_2005/press_rel_7_26.jsp
**** There was an error in this press release as the products traded by CBOE Futures Exchange are not security futures products.
http://www.euronext.com/file/view/0,4245,1626_53424_624671569,00.pdf
The UK Competition Commission may set minimal conditions for approval of a mooted by by Euronext NV for London Stock Exchange PLC, L'Agefi newspaper reported, without naming a source.
http://www.iii.co.uk/news/?type=afxnews&articleid=5363439&format=reformatted&subject=companies&action=article
Dollar pushes past key levels against euro
The dollar broke key technical levels as it gained on the euro ahead of the latest
http://news.ft.com/cms/s/25f658f8-fe86-11d9-94b4-00000e2511c8.html
Standard & Poor's Corp. on Tuesday said it will add Vornado Realty Trust to its flagship S&P 500 Index to replace SunGard Data Systems Inc., which is being acquired by a private equity consortium.
http://biz.yahoo.com/ap/050726/vornado_s_p_500.html?.v=2
Acquisitions and international investment holds the key to high wages, job growth, and productivity -- all crucial to domestic tranquility
http://www.businessweek.com/technology/content/jul2005/tc20050727_9341_tc024.htm
Environmental Trading News
The world’s top polluter, the
http://www.tiscali.co.uk/news/newswire.php/news/reuters/2005/07/27/world/ustoannouncersquobeyondkyotorsquogreenhousepact.html&template=/news/templates/newswire/news_story_reuters.html
Exchange & ECN News
The Central Japan Commodity Exchange said it will list iron scrap for the first time in the world and begin futures trading on it Oct. 11.
http://www.recyclingtoday.com/news/news.asp?ID=8093
CBOT Strike Price Notice July 27, 2005
http://www.cbot.com/cbot/pub/cont_detail/0,3206,1032+29580,00.html
http://www.cbot.com/cbot/pub/cont_detail/0,3206,1032+29578,00.html
http://www.cbot.com/cbot/pub/cont_detail/0,3206,1032+29581,00.html
http://www.cbot.com/cbot/pub/cont_detail/0,3206,1032+29577,00.html
http://www.cbot.com/cbot/pub/cont_detail/0,3206,1032+29579,00.html
CME, the largest
http://www.cme.com/about/press/cn/05-95GSCI14496.html
CME, the largest futures exchange in the U.S., and Fifth Third Bank announced today that the bank is working jointly with the CME Clearing House, the largest futures clearing organization in the world, to offer clearing members of CME an additional investment alternative known as the CME Cash with Interest Program, which is part of the highly successful CME IEF®5 Program. IEF5, originally launched by CME in partnership with JP Morgan Chase, is a highly flexible collateral management program that allows clearing firms utilizing the program to earn a “hard dollar” benefit on 100 percent liquid cash accounts.
http://www.cme.com/about/press/cn/05-83cme5314472.html
Southwest Commodity Warehouses, Inc. ("SCW") operates an Exchange Licensed Warehouse located at
http://www.nymex.com/notice_to_member.aspx?id=ntm306&archive=2005
The Exchange has complied with regulatory requirements by filing with the Commodity Futures Trading Commission notification of an approved amendment to Supplement No. 1, "Official List of Approved Brands and Markings" of the Grade 1 Copper Futures Contract. The approved amendment adds the copper brand "RT" produced by Corporacion Nacional del Cobre de
http://www.nymex.com/notice_to_member.aspx?id=ntm305&archive=2005
Please be reminded that Friday, July 29, 2005, is the First Notice Day, for the Gold, Silver, Copper and Aluminum futures delivery month of August 2005 (the new spot month).
http://www.nymex.com/notice_to_member.aspx?id=ntm301&archive=2005
http://www.amex.com/atamex/news/press/sn_LBN.B_072705.htm
Amex Lists Bank of
http://www.amex.com/?href=/atamex/news/press/sn_BOA.V_072705.htm
Amex Lists Morgan Stanley Strategic Total Return Securities Exchangeable for a cash Amount Based on the CBOE Dow Jones Industrial Average Buy Write Index
http://www.amex.com/?href=/atamex/news/press/sn_DBZ_072505.htm
Amex Lists Citigroup Funding Inc. Currency Linked Principal Protected Notes Based Upon a Group of Five Asian Currencies
http://www.amex.com/?href=/atamex/news/press/sn_CZJ_072605.htm
Standard & Poor's Announces the S&P/TSX Canadian Bond Index Rebalancing Report for July 2005
Standard & Poor's has completed the monthly rebalancing of the S&P/TSX Canadian Bond Index. According to index methodology, the universe of Canadian bonds is exhaustively reviewed to reflect changes in par amount and term to existing index constituents. Qualifying new issues are added to the index and existing constituents that no longer meet the criteria for inclusion are removed.
http://www.tse.com/en/mediaNews/newsreleases/7-25-2005_TSX-IndexNoticeBondIndexRebalancing.html
Standard & Poor's Announces GICS Changes to the S&P/TSX Capped Indices
Following consultation with market participants, Standard & Poor's today announced that the Global Industry Classification Standard (GICS(R)) for two of the S&P/TSX Capped Sector Indices will be revised.
http://www.tse.com/en/mediaNews/newsreleases/7-25-2005_TSX-IndexNoticeCappedIndices.html
The NASDAQ Stock Market Announces Open Short-Interest Positions In NASDAQ Stocks For July 2005
As of mid-July, short interest in 2,747 NASDAQ National Market® securities totaled 5,597,700,084 shares compared with 5,688,818,084 shares in 2,730 National Market issues for the month of June.
http://www.nasdaq.com/newsroom/news/pr2005/ne_section05_070.stm
NASDAQ Enhances Indexing Platform and Creates Two New Indexes
The NASDAQ Stock Market® (NASDAQ: NDAQ) today announced it has enhanced its longstanding capabilities as an index provider by launching a state-of-the-art indexing platform and two new indexes that are calculated on the platform. The new indexes are the NASDAQ-100 Equal Weighted IndexSM (Symbol: NDXE) and the NASDAQ Healthcare IndexSM (Symbol: IXHC).
http://www.nasdaq.com/newsroom/news/pr2005/ne_section05_071.stm
Merc's profit jumps on surge in volume; Tellabs beats Street
http://www.chicagotribune.com/business/chi-0507270031jul27,1,7145423.story?coll=chi-business-hed
*Free registration required
Filings by Designated Contract Markets (DCMS) Current Month
http://www.cftc.gov/dea/deaosrulechangesfiledunderself.htm
Version 6.0 to be operative in October
MEFF will introduce a new version of its system for Members next October that will update Clearing functions. This new version allows the management of Give-ups by international standards, and also simplifies the handling and use of existing functions.
http://www.meff.com
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/dig072605.txt
Of the $35,000 that civil engineer Richard Croy lost investing with the currency-trading firm First Lexington Group LLC, he parted with the biggest chunk of that money -- $20,000 -- in a March 2003 wire transfer.
http://www.post-gazette.com/pg/05207/543934.stm
*Free version of yesterday's WSJ article
NASD announced today it will file rule amendments to clarify and expand the scope of relief from NASD rules provided to securities industry professionals actively serving in the Armed Forces of the
http://www.nasd.com/web/idcplg?IdcService=SS_GET_PAGE&ssDocName=NASDW_014764&ssSourceNodeId=5
The Central Bank of
http://www.marhedge.com/news/Cover.Hedge.asp?s=HedgeH-2005-07-26-12-04-30p1.htm
Barclays Global Investors (BGI) has launched 16 new pooled liability driven investment (LDI) funds aimed at
http://www.ipe.com/article_default.asp?article=19158
Before this current commodity up-cycle retail investors had to be content with very indirect exposure to the actual natural resources rather than the companies that mined, traded or manufactured them.
http://www.resourceinvestor.com/pebble.asp?relid=11639
Which brokerage firms do hedge funds believe provide the best Asian equity research? To find out, Alpha retabulated the results of Institutional Investor's 2005 All-Asia Research Team, counting only those votes cast by hedge fund managers. The voting, by representatives of funds with an estimated aggregate gross exposure to Asian equities of almost $55 billion, turned up winners in 17 of the 29 industry, country and macro research categories in the complete All-Asia Research Team.
http://au.news.yahoo.com/050727/3/v90z.html
MFDA seeking advisors for new contigency fund
The Mutual Fund Dealers Association is seeking nominations for a working group to advise its newly created contingency fund, the MFDA Investor Protection Corp.
http://www.investmentexecutive.com/client/en/News/DetailNews.asp?Id=29804&IdSection=8&cat=8
Reports
Deutsche Bank AG,
http://www.bloomberg.com/apps/news?pid=10000100&sid=a5wAPgT.PLO0
Food and farm products conglomerate Cargill Inc. has obtained exclusive rights to market technology that allows candles to be made from wax derived from soybeans.
http://www.indystar.com/apps/pbcs.dll/article?AID=/20050726/BUSINESS/507260365/1003
Online securities firm ETrade Securities Co. said Wednesday it will be renamed SBI ETrade Securities Co. next year with the aim of improving its brand value.
http://asia.news.yahoo.com/050727/kyodo/d8bjprq80.html
MSCI Barra says that it plans to consult with the investment community about whether income trusts should be part of the MSCI Canada universe, and, if so, to what extent.
http://www.investmentexecutive.com/client/en/News/DetailNews.asp?Id=29808&IdSection=15&cat=15
JupiterResearch Ranks Ameritrade the Top Online Brokerage and Sees Mixed Impact of Merger with TD Waterhouse
JupiterResearch, a division of Jupitermedia Corporation (Nasdaq: JUPM - News), today announced that a newly published report ranking online brokerages places Ameritrade ahead of all others analyzed.
http://biz.yahoo.com/bw/050726/265579.html?.v=1
Operational Risk - Currency Revaluation May Change Long-Term Operating Environment for Chinese Banks
S&P said that
http://www.garp.com/risknews/newsfeed.asp?Category=6&MyFile=2005-07-27-11220.html
http://www.gltrade.fr/gltcom/jsp/index.jsp
John's Comments
I am leaving town tomorrow morning and will be camping in the Upper Peninsula of Michigan. My nephew, Ryan Lothian, will be editing the newsletter tomorrow and Friday. If you have news for him, you can contact him at rlothian@pricegroup.com.
Before I leave though, here are some random thoughts from my shiny noggin to mull over:
- Exchange consolidation is not “inevitable,” especially in
- Battles at the CBOT are won and lost, but they are never finished.
- The longer “merger” talk is in the air, the harder it will be for the participant exchanges to hire good new people.
- Monopoly is not just a board game, it is a business strategy.
- Trading with discipline is harder than you think.
- Match engine electronic trading allocation algorithms can be a competitive advantage and some exchanges have figured this out.
- Kate Ryan of Crain’s might be
- Change is all you are left with when you drink Starbuck’s coffee.
- Bill Brodsky still has one of the most difficult jobs in
- The CBOE put the Hybrid in hybrid.
- OneChicago is opportunistic, innovative, creative and finally making my prognostications about security futures look less crazy.
- One million security futures contracts of open interest is a significant achievement for a contract written off by so many and should remove ‘nebulous” from news stories about it.
- When your 18 month plan is 36 months old, is it time for a new plan?
- “Lothian has an infallible sense of self-promotion,” or so I was told by someone who did not know they were talking to John Lothian.
- Greed is not good.
- Richard Sandor is a snappy dresser and gives environmental trading a noble champion.
- The Jen Justice Band Rocks.
- Emission trading deserves all of our support, while we can still breathe.
- I am glad the peach coloring of the FT does not rub off on my hands when I read it.
- Euro FX should trade a million contracts a day and will soon.
- Adding an Eagle to E-Livestock could make e-pigs fly.
- Three out of four statistics are made up, except mine.
- The Chicago Board of Trade is a great brand name.
- Cross margining is coming to a Russell futures index near you very soon.
Regards,
Publisher
John Lothian Newsletter
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.
Futures and options trading involve risk. Past results are no indication of future performance.
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