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’CME’s farmer fund
This looks like a sign of the post-MF Global shift in the futures market…
CME Group has unveiled its own $100m insurance fund for family farmers and ranchers, co-operatives etc who are clients of its clearing members.
MF Global files for bankruptcy
There’s to be no last-minute deal to salvage MF Global: the futures brokerage and sometime European debt specialists filed for bankruptcy on Monday in New York. Click through to access the filing (H/T John Carney):
Who has to act on Treasuries?
Leaving aside the volatility and growth fears, who is really compelled to sell Treasuries as a result of the S&P downgrade?
The answer, when it has all played out, might go some way to explaining just how powerful the ratings agencies are right now.
No, no, no it ain’t CME babe
Here’s some genuinely sad news out of Chicago on Friday.
Courtesy of Reuters:
Friday, July 15, 2011 3:25:13 PM RTRS – CHICAGO MERCANTILE EXCHANGES SAYS CLOSING ICONIC PORK BELLY FUTURES MARKET
FT Alphaville — or at least this reporter — was blithely unaware of this fascinating part of the commodities business.
Who’s been trading natgas futures on the curve?
The natgas mystery continues!
Let’s start first with the following flashes from the CME via Reuters on Friday:
NYMEX PRELIMINARY DATA SHOWS NATGAS FUTURES OPEN INTEREST HIT RECORD HIGH ON JUNE 9–CME WEBSITE
PRELIMINARY DATA ALSO SHOWS NYMEX NATGAS FUTURES VOLUME SET NEW RECORD HIGH THURSDAY–CME WEBSITE
Which means the day after the mysterious mini-flash someone or some people,
The ‘Asia connection’ to the commodity rout
Our colleagues on the paper-side drew attention last week to the fact that silver trading in Asian hours experienced a clear pickup into the lead up to the commodity rout.
Jack Farchy wrote, citing Edel Tully,
Which came first – the margin call or the commods mayhem?
Silver prices rose by over 60 per cent between the start of the year and April 25.
They’ve now fallen by over 30 per cent — unwinding some 80 per cent of the upward move in the space of two weeks, according to Société Générale figures.
Snap news
Breaking pre-market news on Tuesday,
- Microsoft close to deal to buy Skype — report.
- CME increases trading margins for US crude futures by 25 per cent — statement and report.
- Pace warns on profits — statement.
Volatile silver
It turns out that bank holidays can make for interesting silver markets:
As Dow Jones noted, two weeks of gains for the precious metal were erased in only 11 minutes as markets opened for electronic trading in Asia on Monday,
Hedge commodities in euros from Monday
Olivier Jakob, at Petromatrix (who we know we quote a lot, but only because he really does constantly come up with interesting points) alerts us to the fact that from Monday onwards investors will be able to trade euro-denominated contracts on certain Nymex energy products.
Swinging on an oil VaR
Oil price volatility is no doubt producing ample trading opportunities for many in the market, but as of Friday it has become much more expensive to take advantage of them.
The CME on Thursday announced it would be raising margins on trading crude oil by about 20 per cent for both speculators and hedgers,
More on silver backwardation
We promised some comment on the silver backwardation story we did earlier, and now we have some.
The story continues with Friday’s LBMA silver forward rates (SIFO) settling in at negative as far out as 12 months for the second day in a row.
Escalator up, lift down
Time now to look at another precious metal — silver.
It has soared in the wake of the Fed’s QE2 announcement, surpassing $29 an ounce – the highest since 1980 when the Hunt brothers cornered the market and sent prices to $50.
It’s a zero-sum game Mr. Hari
In case you missed it, the Independent’s Johann Hari has done a Matt Taibbi — yes he of Vampire Squid fame.
But this time the author doesn’t just accuse the bank of gross financial manipulation, he accuses the institution of single-handedly starving millions around the world 2006 onwards.
Reuters names e-mini ‘flash crash’ seller
A big exclusive for Reuters, which on Friday afternoon revealed the identity of the mystery trader CFTC chairman Gary Gensler said placed a disproportionately large sell order in CME e-mini S&P futures around the time of Thursday’s ‘flash crash’.
Did futures cause the ‘flash crash’?
The NYT has followed up on the testimony of CFTC chair Gary Gensler before the Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises, which held its first hearing into the ‘flash crash’ of May 6.
S&P euro index arbitrage at work
Here’s one for all those would-be algo traders out there – the euro-denominated e-mini S&P 500 contract, has seen a sudden and unexpected upsurge in trading in the last few days.
Here’s a breakdown of recent activity courtesy of the CME:
CME, banks agree CDS initiative
The CME Group announced on Thursday that a group of dealers will support the exchange’s initiative to clear credit default swaps. The move follows talks between the CME and the main dealers in OTC credit derivatives over the past year.
CME nears deal on CDS clearing
CME Group, the world’s biggest futures exchange, is nearing a breakthrough deal with some of the world’s biggest banks to clear credit default swaps. An agreement could be announced on Thursday, capping more than a year of discussions.
The CME’s sour
Just two days after Saudi Aramco decided to change the way it prices its oil – by abandoning the Platts WTI benchmark in favour of Argus Petroleum’s Sour Crude Index – the CME, owner of the Nymex exchange,
CME in talks with CBOE
CME Group, the world’s largest derivatives exchange, is in talks to take over the Chicago Board Options Exchange in a deal that would value the largest US options market at up to $5bn, according to Crain’s Chicago Business,
Weekend catch-up
In case you missed these stories,
- Rajaratnam, others, charged in insider trade case
Billionaire investor Raj Rajaratnam, founder of the Galleon Group, and present and former executives of Bear Stearns,
CME head backs derivatives reform
A powerful exchange chief has brushed aside concerns over the regulation of OTC derivatives, in comments likely to bolster support for the proposed reforms. US and EU regulators insist that most OTC derivatives be shifted onto formal exchanges and processed through clearing houses,
Getting to the bottom of Comex ETF gold delivery
There have been a number of reports in the gold bug-blogosphere that the CME’s Comex exchange now accepts SPDR GLD exchange-traded-fund units as part of their delivery settlement process.
Par exemple,
CME abandons plan to trade OTC derivatives
In a not entirely unexpected move, CME – the world’s biggest futures exchange by volume – and Citadel abandoned their joint effort to set up a trading platform for credit derivatives.
Still, and optimistically, CME said it would continue to push its CDS clearing effort,
Timber!
Friday’s much better than expected US housing start figures are still feeding through into positive sentiment this Monday. At 582,000, the number reported by the Commerce Department beat analyst expectations of 530,000 by one of the widest margins yet since the crisis.
Nymex takeover wins approval
The CME Group enhanced its position as the world’s largest financial exchange on Monday by winning member approval for its $7.6bn takeover of Nymex, the New York energy exchange, creating a company that will dominate the US derivatives sector with control of 98% of listed futures.
CME to leave NYSE for Nasdaq
Shares in CME Group, the world’s largest futures exchange, will next week cease trading on the New York Stock Exchange and list solely on the Nasdaq, NYSE’s main rival for US listings. Analysts said the move was likely to sour relations between NYSE Euronext,
The London (disorderly) Stock Exchange
We pass this on, for what it’s worth, but without offering any insight as to whether it is true or false: shares in the LSE jumped by almost 15 per cent on Wednesday on intense speculation that CME, the Chicago exchange,
Doubts grow over CME move for Nymex
The CME Group’s attempt to enhance its position as the world’s biggest financial exchange by taking over Nymex is looking increasingly likely to be derailed by shareholder opposition. Any deal must be approved by at least three-quarters of Nymex’s membership,