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NYSE Lists 2 leveraged long-dated Treasury ETNs
July 2, 2010--On June 29, 2010, 2 leveraged long-dated Treasury ETNs began trading on the NYSE Euronext. The ETNs are
The PowerShares DB 3X Long 25+ Year Treasury Bond Exchange Traded Note
Ticker Symbol:LBND
and PowerShares DB 3X Short 25+ Year Treasury Bond Exchange Traded Note
Ticker Symbol: SBND
Source: Online News
SEC and Japan Financial Services Agency Hold Meeting of the SEC-JFSA Strategic Dialogue
July 2, 2010--Securities and Exchange Commission Chairman Mary Schapiro and Japan Financial Services Agency (JFSA) Commissioner Katsunori Mikuniya met in Washington, D.C., this week as part of the annual SEC-JFSA Bilateral High-level Dialogue. The purpose of the Dialogue, established in 2006, is to provide a forum whereby the senior officials of the two agencies can meet to identify and discuss issues of common concern affecting the U.S. and Japanese capital markets and promote areas of future collaboration.
In addition to the meeting between the heads of the two agencies, the Dialogue included a full day of meetings between senior staff from the SEC and the JFSA for discussions on a variety of important topics. These meetings were chaired by SEC Commissioner Kathleen Casey, JFSA Commissioner Mikuniya and JFSA Vice Commissioner for International Affairs Masamichi Kono. Following the Dialogue, SEC and JFSA staff also held discussions.
Some of the areas of mutual interest discussed during the Dialogue included:
Recent Regulatory Reforms in the U.S. and Japan
Corporate governance and executive compensation
Market supervision
Accounting, auditing and disclosure
Cooperation on cross-border market supervision and enforcement
Issues related to the regulation of credit rating agencies, hedge funds, OTC derivatives and short selling
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Source: SEC.gov
CME Group Volume Averaged 12.2 Million Contracts per Day in June 2010, Up 8 Percent, and 13.5 Million Contracts Per Day in Second Quarter, Up 31 Percent
July 2, 2010-- Double digit monthly year-over-year growth in equities, foreign exchange, energy and metals
- Second highest quarterly average daily volume ever
- Record quarterly FX average daily volume of 1.0 million contracts, up 82 percent
- Record quarterly energy average daily volume of 1.8 million contracts, up 29 percent
- Record quarter for WTI and refined products, up 52 and 36 percent, respectively
CME Group, the world's leading and most diverse derivatives marketplace, today announced that June volume averaged 12.2 million contracts per day, up 8 percent from June 2009. Total volume was 268 million contracts for June, of which 84 percent was traded electronically.
In June 2010, CME Group interest rate volume averaged 4.7 million contracts per day, down 8 percent compared with the prior June. Treasury futures volume averaged 2.0 million contracts per day, up 31 percent compared with the same period in 2009, and Treasury options volume averaged 245,000 contracts per day, down 13 percent. Eurodollar futures volume averaged 1.7 million contracts per day, down 28 percent versus June 2009, while Eurodollar options volume averaged 644,000 contracts per day, down 24 percent.
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Source: CME Group
BNY Mellon Closes USD2.31bn PNC GIS Acquisition
July 2, 2010--BNY Mellon has completed its acquisition of PNC's global investment servicing (GIS) business. The GIS transaction doubles the number of funds serviced by BNY Mellon with accounting and administration.
It also makes BNY Mellon the second largest provider of fund accounting, administration and transfer agency services globally. The purchase price was USD2.31bn.
Source: globalcustodynet.com
Fast ETF growth worries regulators
Exchange-traded funds in America held around $792b in assets by the end of May
July 2, 2010--Even the best financial innovations have a nasty habit of spinning out of control. No surprise, then, that regulatory antennae are twitching at the rapid growth of exchange-traded funds (ETFs), investment pools that are listed on stockmarkets. ETFs have plenty of attractions, giving retail investors a relatively cheap way to diversify their holdings. But their dangers are also becoming more apparent.
The sheer size of the industry is one cause of concern. At the end of May ETFs in America held around $792.6 billion (Dh2.91 trillion) in assets, according to Morningstar, a research firm. The worldwide total passed $1 trillion at the end of 2009. Morgan Stanley predicts the industry will grow by 20 per cent to 30 per cent in 2010. The market has rapidly evolved to meet demand for more exotic products, particularly in commodities, where many worry about the impact of the appetite for ETFs on prices.
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Source: gulfnews.com
U.S. Department of the Treasury Economic Statistics - Monthly Data Update
July 2, 2010--The U.S. Department of the Treasury Economic Statistics - Monthly Data has been updated and is now available.
view report
Source: U.S. Department of the Treasury
Direxion shares executes reverse share split of four ETFs
July 2, 2010--Direxion, a pioneer in providing alternative investment strategies to sophisticated investors, will execute a 1-for-5 reverse split of the shares of the Direxion Daily Energy Bear 3x Shares (ERY), Direxion Daily Real Estate Bear 3x Shares (DRV), Direxion Daily Small Cap Bear 3x Shares (TZA) and Direxion Daily Technology Bear 3x Shares (TYP) for shareholders of record after the close of the markets on July 7th.
The reverse split for the four ETFs was previously announced on June 17, 2010.
Source: Direxion
Next Agricultural Advisory Committee Meeting to Examine Wheat Convergence and Other Topics
July 2, 2010--Commissioner Michael V. Dunn, Chairman of the Commodity Futures Trading Commission’s Agriculture Advisory Committee (AAC) and Commissioner Jill Sommers visited the Kansas City Board of Trade (DCBT) this week to meet with representatives of the exchange to discuss convergence issues related to KCBT wheat futures contract.
Wheat convergence will again be a topic at the next AAC meeting set to be held on August 5, 2010 at the CFTC’s headquarters in Washington along with the ICE Futures US Cotton futures contract and price reporting issues in livestock futures contracts.
Regarding convergence, the AAC will discuss the effects of the recently implemented variable storage rates on the Chicago Board of Trade’s wheat futures contract, and convergence issues in other wheat contracts, including KCBT’s. Commissioner Dunn has asked the AAC Subcommittee on Convergence to meet prior to the August 5, 2010 meeting date to discuss convergence issues.
Source: CFTC.gov
CFTC.gov Commitments of Traders Reports Update
July 2, 2010--The CFTC.gov Commitments of Traders Reports has been updated for the week of June 29, 2010 and are now available.
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Source: CFTC.gov
Testimony Before the Financial Crisis Inquiry Commission
Testimony of Chairman Gary Gensler Before the Financial Crisis Inquiry Commission
July 1, 2010--Good afternoon Chairman Angelides, Vice Chairman Thomas and members of the Commission. I thank you for inviting me to today’s hearing to discuss the history of derivatives regulation and the role that over-the-counter derivatives played in the financial crisis. I also will address the historic legislation currently being debated in Congress that for the first time will bring much-needed comprehensive regulation to the over-the-counter (OTC) derivatives market.
In 2008, the financial system failed. The financial regulatory system failed. Though there were many causes of the 2008 financial crisis, derivatives played a central role. I know that this Commission is considering many contributing factors to the crisis. For example, to what extent did macroeconomic factors and monetary policy play a role in the crisis? What impact did the housing bubble and lax mortgage origination and underwriting practices have in the lead-up to the crisis?
Though these questions are critical, today’s hearing is on unregulated over-the-counter derivatives. As Chairman of the Commodity Futures Trading Commission (CFTC), a Commission established decades ago to regulate on-exchange derivatives, I have focused my testimony on the role the over-the-counter swaps market played in the financial crisis. These products have a net notional value of approximately $300 trillion in the United States. That is roughly 20 times the size of the American economy.
Past Justifications for Leaving Derivatives out of Regulation
Over-the-counter derivatives, which started to be transacted in the 1980s, have not been regulated in Europe, Asia or North America. Until the reforms being debated this year, I am not aware of any major country that had directly regulated these markets over a nearly 30-year period. I will touch upon five reasons that some have articulated in the past for such a lack of regulation in the over-the-counter derivatives marketplace.
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Source: CFTC.gov
