| News on the global financial markets |  |
| Morning Bell |  |  |
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- Spanish regulator permits short selling again
The market regulator in Spain says it has ended a short-selling ban, which had been in place since July. The ban aimed to protect stocks and bonds from speculators, who were forcing prices down during the sovereign-debt crisis. Reuters
(31 Jan.)      
| Industry News | | |
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- Merkel adviser suggests court might not back ECB pledge
Lars Feld, an adviser of German Chancellor Angela Merkel, says "buying bonds without differentiation and without limits would be very problematic". The German Federal Constitutional Court might rule that the European Central Bank's pledge to make such purchases constitutes financing government, which the court has ruled unconstitutional. Bloomberg
(31 Jan.)
| Regulatory Roundup | | |
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- Barnier warns against blocking OTC derivatives rules
EU Internal Market Commissioner Michel Barnier has written European Parliament members to urge them not to block over-the-counter derivatives rules. Lawmakers have said they are hesitant to adopt such rules, saying they could hurt businesses. Barnier says rejecting the rules could harm the EU's credibility and competitiveness. Bloomberg Businessweek
(31 Jan.)
- Barnier emphasises importance of global Basel III adoption
Michel Barnier, the EU's internal-market commissioner, has reiterated a need for the US, Russia and other nations to adopt Basel III rules. The US delayed Basel II and did not pass it into law until years after Europe had introduced it. As it stands, 11 of the Group of 20 countries have introduced Basel III. Reuters
(31 Jan.)
- EU might accelerate timetable for "bailing in" plan
Germany has proposed a plan to shield governments and taxpayers from costly bank rescues by forcing losses on unsecured bondholders. The plan is designed to start in 2018, but the EU might change it to 2015. Critics fear the plan will scare investors away from parts of the bond market. Reuters
(31 Jan.)
- Basel Committee's RWA findings worry banks
The Basel Committee on Banking Supervision has finished a risk-weighted-asset evaluation of trading-book positions, finding a huge variation among banks' valuation methods. Risk-weighted assets are a major factor in determining how much capital banks are required to keep on hand. Banks fear the large discrepancy in their methods will result in a call for significant reform, which would force them to keep even more cash on hand. Bloomberg
(31 Jan.), Risk.net (subscription required)
(31 Jan.)
| Spotlight on China | | |
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- S&P: Chinese investment poses "highest risk" of correction
China's high ratio of investment to gross domestic product points to the possibility of a correction, according to a report by Standard & Poor's. "What we found is that China has the highest risk of an economic correction because of low investment productivity over recent years," credit analyst Terry Chan said. "We believe the level of a country's investment overhang can be a leading indicator of a potential economic correction." China Daily (Beijing)
(31 Jan.)
| AFME News | | |
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- IOSCO Secretary General David Wright and ECB Executive Board member Peter Praet will deliver keynote speeches at AFME's 2013 European Market Liquidity Conference
The European Market Liquidity Conference is a high-profile, unique event on the European trading community's calendar that attracts 400-plus delegates from the buy and sell sides, fixed income and foreign exchange. The conference is scheduled on 13 February at Grange St Paul's Hotel in London. The content is designed and driven by market participants and therefore ensures that debates consist of genuine, in-depth discussion led by experienced, senior speakers.
The conference programme will explore key topics on funding economic growth; structural changes of fixed income, currencies and commodities; and the impact of regulation on liquidity. Peter Praet, a member of the European Central Bank Executive Board, and David Wright, secretary general of the International Organisation of Securities Commissions, have confirmed that they will deliver keynote speeches at the conference.
View the full programme and register.
- AFME inaugural flagship conference is announced: "Financing Growth"
AFME is pleased to announce its inaugural flagship conference, "Financing Growth: What the new world of regulation means for banks, capital markets and their users", scheduled on 24 September in London. The invitation-only conference will bring together as many as 500 senior decision-makers from Europe's financial industry, along with regulators and politicians, to discuss what needs to be done to enable capital markets to support growth and investment. Further details will be announced in February, including VIP speakers and the historic conference venue.
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