NO 229 – MARCH 2012
Investing in long term growth of SMEs

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WFE Focus January 2012
Inter-market links

BRICS exchanges to cross-list benchmark equity index derivatives
The five founding members of the BRICS Exchanges Alliance (BM&FBOVESPA, Open Joint Stock Company MICEX-RTS, Bombay Stock Exchange, Hong Kong Exchanges and Clearing, and Johannesburg Stock Exchange) began cross-listing benchmark equity index derivatives on each other’s trading platforms on 30 March 2012. In this initial stage of implementation, the exchanges aim to expand their product offerings beyond their home markets and give investors of each exchange exposure to the dynamic, emerging, and increasingly important BRICS economies. The derivatives to be cross-listed and offered in the local currency and local trading hours of each of the exchanges will include: Brazil’s IBOVESPA futures; Russia’s MICEX Index futures; India’s Sensex Index futures; Hong Kong’s Hang Seng Index futures and Hang Seng China Enterprises Index futures; and South Africa’s FTSE/JSE Top40 futures.

CME Group and BM&FBOVESPA agree on cross-listing of equity index, commodity and energy futures
CME Group and BM&FBOVESPA announced a cross-listing and cross-licensing agreement involving the S&P 500 index and Bovespa index (IBOVESPA) futures. BVMF will also license CME Group’s Chicago Board of Trade mini-sized soybean and NYMEX light sweet crude oil futures settlement prices. The agreement also provides the companies the opportunity to license additional products in the future. Under the cross-listing arrangements, the IBOVESPA will be listed on Chicago Mercantile Exchange and cleared through CME Clearing as US dollar denominated Ibovespa futures. BVMF will launch US dollar denominated S&P 500 Index futures to be settled in Brazilian real, the CBOT listed Mini-sized Soybean futures and the NYMEX listed Light Sweet Crude Oil (WTI) futures.  The S&P 500 is being made available to BVMF via sublicense from CME Group and S&P Indices.

CME Group and Bank of China sign MOU
CME Group and Bank of China have signed a Memorandum of Understanding to explore and potentially collaborate in a long term business relationship that will harness the strengths of both organizations to provide mutual benefits as both parties grow their global businesses. The areement provides for the establishment of information-sharing links which cover education, training and marketing; in addition, the companies will focus on future business opportunities facilitating cross-border trading in commodities futures and options, subject to the applicable regulations.

Hong Kong Exchanges and Shanghai Futures Exchange sign MOU
Hong Kong Exchanges and Clearing and Shanghai Futures Exchange have signed a Memorandum of Understanding on cooperation and the exchange of information.

Irish Stock Exchange and Malta Stock Exchange launch European wholesale securities market
The Irish Stock Exchange has created a joint venture with the Malta Stock Exchange to launch the European Wholesale Securities Market (EWSM), a new market for wholesale fixed-income debt securities. The ISE will own 80% of the new market with the MSE having a 20% shareholding. The new market will offer issuers and market participants access to an EU regulated market, supported by the expertise of a dedicated listing agency service. It will complement the existing market offerings from each exchange. The ISE will provide primary market infrastructure, listing and other corporate services while the MSE will act as the market operator and will provide secondary market services. In addition, the ISE has set up a new entity, ISE Listing Services (ISELS), which will leverage the ISE’s established expertise in structured debt by providing listing agency services on a commercial basis to issuers interested in gaining admission to the new market.

NASDAQ OMX to deliver OTC clearing and risk-management system to Poland’s clearing house
The NASDAQ OMX Group will deliver a risk management solution to KDPW_CCP, Poland’s primary securities clearing house and CCP. Under the contract, NASDAQ OMX will supply KDPW_CCP with its OTC clearing and Sentinel risk manager product in order to support trade lifecycle and risk management requirements for clearing of OTC traded instruments.

Singapore Exchange and Eurex team up to enhance market access
The Singapore Exchange and Eurex announced a partnership to deliver convenient market access and cost efficiencies to members of both exchanges. Both companies plan to link their co-location facilities/data centers to provide market participants easy connectivity to each other’s markets in Singapore and Frankfurt/Main respectively. As part of this partnership, Eurex will be moving its existing access point in Singapore into the SGX co-location data centre. In return, Eurex will act as a network service provider to SGX’s customers in Europe. This initiative is expected to be implemented mid-2012.

Wiener Börse and Eurex enter into license agreement
Wiener Börse and Eurex Group have entered into a license agreement by which Eurex acquires the license to issue financial products on the RDX, the Russian Depositary Index. The RDX tracks the price trends of the most liquid depositary receipts of Russian stocks listed on the London Stock Exchange and is one of the most widely recognized indices for Russia worldwide. Wiener Börse has been active as a regional expert for indices for Eastern Europe and Russia.

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