The Commodity Futures Trading Commission has said that firms, including futures commission merchants and swaps dealers, will not have to register as commodity trading advisers when they receive a separate payment for research. The CFTC said that registration as a CTA is required only if advice is not "solely incidental" to a firm's business.
The position limits required by Europe's revised Markets in Financial Instruments Directive are not needed because existing rules already cover "systemically risks products," Shearman & Sterling's Barney Reynolds said.
Europe's revised Markets in Financial Instruments Directive could reduce volatility in the first few months, though competition, execution models and opportunities will be created, panelists said at a conference. One big concern is that regulatory changes might mean "things will get more expensive and liquidity will be spread out," said Julian O'Leary of G.H. Financials.
As part of finalizing regulatory reform, the Basel Committee on Banking Supervision says it will "monitor the impact of the Basel III leverage ratio's treatment of client-cleared derivative transactions."
The Basel Committee on Banking Supervision has released a quantitative impact study of Basel III capital requirements, which shows a diversity of additional financial burden placed on banks, particularly in Europe. The average requirement is expected to fall by 1.4%, but some entities will see a 27.8% decline, while others will face a 43.4% increase, according to the study.
More commodity firms and traders, including BP, ABN AMRO, Mercuria Energy Group, Natixis and Trafigura, are adopting blockchain technology to increase efficiency, changing the way they do business. "Once you've established blockchain and it's working, you will see faster changes, because then the transformation of the value chain becomes an option," said Rabobank analyst Harry Smit.
The oil and natural gas industry is expected to continue on its growth trajectory next year even though production increases will likely keep oil prices in the $40-to-$60-per-barrel range through 2019, according to the Moody's oil outlook for 2018. Exploration and production companies and oilfield service firms could see earnings rise by 10% to 12% in 2018, with the North American onshore market providing the best opportunities for growth.
Noble Group reportedly plans to cancel the sale of its South Bend Ethanol plant to Zeeland Farm Services in favor of a better deal with Mercuria Investments. The new purchase agreement means Noble will receive $3 million more for the sale.
China's Dalian Commodity Exchange will open iron-ore futures trading to international investors using the renminbi for quotation and settlement, says Chen Wei, director of industrial products. Foreign participants must open dedicated accounts at a designated Chinese depository bank and trade in US dollars and offshore renminbi.
The Interior Department will expedite the permitting process in Alaska's Arctic National Wildlife Refuge if lawmakers decide to open the area to oil and natural gas drilling, according to energy adviser Vincent DeVito. He also said the oil industry is showing interest in exploring the area.
A pronounced circular pattern is evident in the relationship between the Credit Suisse High Yield Bond Fund and its option-adjusted spread over US Treasuries of similar maturity. CME Group Senior Economist Erik Norland explains what it all implies in relation to Federal Reserve rate policy.