The Johannesburg Stock Exchange is in talks about switching to the London Stock Exchange’s (LSE.LN) MillenniumIT trading platform. The deal would help to cement the existing relationship between the two exchanges and be seen as a boost to the LSE’s efforts at creating a global technology franchise.
Under the deal, the JSE would move from its present equities trading system, also provided by the LSE, onto MillenniumIT, the Sri Lankan platform that was acquired by the LSE in December 2009, according to a source familiar with the situation. Talks are understood to be at an advanced stage. The JSE’s present contract with the LSE expires in 2012.
The source stressed that no agreement has yet been reached. The LSE declined to comment.
The two exchanges have had a close relationship since 2002 when the LSE licensed its old equities trading system, JSE SETs, to the South African exchange. In 2007, Johannesburg signed a further five-year contract with the LSE which saw it move onto the TradElect system.
Problems with TradElect led to speculation that the relationship had gone sour. The TradElect system is accessed via a dedicated communications link between the two cities, meaning the South African exchange went offline when the LSE suffered a major outage in September 2008.
Market watchers had assumed that the JSE would move onto new platform after the LSE acquired MillenniumIT. But the exchange has considered other technology providers, one source said.
Nicky Newton-King, deputy chief executive of the JSE, confirmed that the exchange is looking for a new IT platform but would not be drawn on whether a deal is imminent. A decision to move away from the LSE’s new platform would be embarrassing for the London exchange, market-watchers say.
The MillenniumIT suffered teething problems last November when the LSE’s smaller pan-European market Turquoise suffered a two-hour outage two weeks after migrating to the platform. The incident, which was later attributed to “human error”, saw the LSE postpone the migration of its main market onto MillenniumIT until February 14.
Building a major technology franchise is vital for the LSE if it is to continue to diversify its revenues and compete with the likes of NYSE Euronext (NYX) and Nasdaq OMX (NDAQ), who have extended their brand and influence in several emerging markets through major technology deals, analysts say.
Failure to agree a deal with the JSE would be a major setback: “If the JSE moves away from the LSE to another technology provider it would be a blow for the LSE, as it could cast doubt over the reliability of the MillenniumIT platform,” Simmy Grewal, a trading analyst at Aite Group, said.
Yesterday, the LSE announced its quarterly results for the final three months of last year, which saw revenues from its technology business increase by 11% to ?11.4m, compared to the same period in 2009. This reflected the contribution of “full quarter revenue at MillenniumIT,” according to an LSE statement.

Rebellion in Egypt rose oil price

Brent crude was trading for about $ 100 a barrel in electronic trading on the London Petroleum Exchange today, marking its highest price levels for the last 28 months, transmit Bloomberg.

This gave rise to anti-government protests in Cairo, which raised fears that unrest in Egypt can lead to unrest in oil exporting countries in the Middle East.

The price of Brent for March delivery rose briefly to 99.97 dollars per barrel in today’s e-session in London, after tens of thousands of protesters took part in demonstrations against the leadership of Egyptian President Hosni Mubarak that continued during the past 30 years.

At 9:00 am GMT Brent limited appreciation with 0.1 percent to 99.49 dollars per barrel.

The last price of this variety is Bola oil over 100 dollars a barrel in October 2008

Meanwhile, U.S. light crude rose by 0.5 percent to 89.76 dollars a barrel after the January 28 price rose sharply by 4.3 per cent.

Since the beginning of January the price of U.S. light crude fell by 2%, which is its first drop in monthly basis for the past five months.

Growing doubts that the weakest country in the euro area – Greece will not be able to emerge from financial crisis not to go through the procedure of bankruptcy. They are amplified by approaching international monitoring of the country.

Another factor is the growing pessimism about the outcome of a Bloomberg survey among participants of the forum in Davos. It shows that 59% of those included in the survey expect at least one of the countries in the euro area have been forced to leave the monetary union by 2016. Asked what is the most probable hand, the majority stated our southern neighbor.

According launched by participants at the Economic Forum in Davos scenario is likely to be proposed purchase of Greek debt for a considerable discount. Here is what the scheme: it will be an opportunity for Greece to buy their debt securities currently held by the European Central Bank, 75% of their face value, and money for the purchase will grant the European Pact for financial stability. Thus can neutralize about two-thirds of total debt, which amounts to ? 330 billion

Until now, Greece received $ 110 billion from the European Union, International Monetary Fund and European Central Bank. There is an idea they extend the maturity of this loan by an additional 30 years. This would give more than a breath of Greece and would have a positive effect on the price at which international markets are willing to fund it.

LONDON (Dow Jones)–Tata Steel Ltd. (500470.BY) said Friday it is raising U.K. sections prices due to higher costs for materials such as coal and iron ore.
For all deliveries from Mar. 6, U.K. sections prices will rise by GBP95 a metric ton.
“The recent extreme flooding in Queensland has led to spot prices in coal and other raw materials markets, which were already suffering from chronic structural supply side constraints, to rise beyond anticipated levels,” said Tata Steel Commercial Manager Mick Maloney.
“The steel supply chain has no choice but to take robust action to recover these rapid increases in raw materials costs,” he said.
Tata Steel said steel prices are rising. Global output hit a new record high in 2010 and as a result raw material supply has tightened.

U.K. banks’ net mortgage lending fell to its lowest in more than a decade in December, data from the banks showed Wednesday, the latest reflection of weak demand and tight financing conditions in the housing market.

Net mortgage lending rose by just GBP0.9 billion in December, the lowest figure since June 1999, the British Bankers’ Association said. The figure was a decline from November’s GBP1.2 billion increase, itself downwardly revised.

The outlook for the market seems similarly weak. Mortgage approvals, a good forward-looking indicator of activity and prices, slipped further to 28,726 in December from 29,696 the previous month.

High-frequency trading now accounts for more than 75% of trading on the UK’s regulated stock markets, suggesting that "genuine investors" are being squeezed out of the market, according to the first known research on the subject.
U.S.-headquartered research company Tabb Group found that 77% of turnover in the U.K.’s markets is accounted for by high-frequency trading, a sophisticated form of super-fast trading that seeks to benefit from imbalances across the market or short-term pricing inefficiencies.
Tabb’s research covers what it describes as "continuous," or regulated, markets where trading occurs electronically. This includes the London Stock Exchange’s main order book, growing alternative share-trading platforms such as Chi-X Europe and other types of share-trading platforms where orders are not displayed, known as "dark pools," such as NYSE Euronext’s SmartPool.
The calculation does not include over-the-counter trading that occurs within broker-dealers or on other broker-run dark pools.
High-frequency trading has attracted severe criticism from regulators and market-watchers who claim the phenomenon undermines the orderly functioning of the market and exploits retail investors. Defenders of high-frequency trading say it provides liquidity that helps to narrow share-price spreads.
The full extent of high-frequency trading in Europe is a subject of intense debate. In May last year, the LSE reported that 33% of trades by volume on its cash equities and structured products platforms in the first quarter of the year were high-frequency transactions.
Using the same methodology across all the regulated markets, combined with interviews with the trading firms, Tabb arrived at its figure as an average for trading of UK equities on regulated markets for 2010.
The paucity of non-high-frequency order flow, at just 23%, suggests that genuine institutional investors are being squeezed out of the regulated markets and reinforces the importance of OTC trading as a means for pension funds to interact in the market without getting burned, according to Will Rhode, research analyst at Tabb and co-author of the report.
Source: DJ Financial News

Gold continues to slide down, thanks to restore confidence in economic recovery and revaluation of the precious metal as an effective tool for hedging risk. Currently ounce of gold buys about U.S. $ 1331.9, delivery in three months. Since the early Asian trade gold lost 6.12 dollars from its value, which equals 0.95 percent.

Along with gold and observed release of steam from the oil price. Barrel Brent crude traded for 96.33 dollars and 87.50 dollars for WTI. Both varieties cheaper today, by 0.3 and 0.4%. Bloomberg agency attributes this to the promise of the Saudi oil minister to increase production in response to increased demand.

Yesterday’s trading on Wall Street was marked with good dynamics, on the eve of a meeting of world economic leaders in Davos. Technology companies rose most significantly by an increased dividend of Intel and the technology leader’s intention to repurchase its own shares led to over 2% increase in price. Accordingly, the Dow Jones rose 0.95 percent to 11,980 points, traders saw no attack on the border 12 000. Nasdaq rose by 1.04% to 2717 points and S & P500 to 1290 points by 0.58%.

Asian markets are forward recovery of the U.S. trade last night. We Nikkei was 10,465 points, an increase of 1.16%. In Hong Kong Hang Seng rose by 0.48 percent to 23,916 points and CSI300 in Shanghai is 2,928 points, down by 0.88%. Reduction of the leading index of mainland China is due to speculation by tightening government control, which will have a negative effect on the market of real estate and commodities. However, in terms of China’s economy smaller companies are judged as more risky now and share price fall.

Indicative of the mood of the stock market now is that the leaders of leading companies from Wall Street traveling to Davos with two main intentions: to attract new customers after it learned that politicians do not consider major changes to the regulatory framework. Second, there is reason to party – after last year, some investment companies reported record profits and the banks had paid its obligations to the state.

On currency markets the euro has stabilized to 1.3652 dollars. The pound continues to struggle with the $ 1.60 barrier, having now bought 1.5997 dollars. The yen rose to 82,395 yen per dollar, but even that failed to break investors’ optimism. Dollar Index, which measures the weight of the dollar in the basket of six major currencies, was 77.938 points, today fell by 0.1%.

Gold continues to slide down, thanks to restore confidence in economic recovery and revaluation of the precious metal as an effective tool for hedging risk. Currently ounce of gold buys about U.S. $ 1331.9, delivery in three months. Since the early Asian trade gold lost 6.12 dollars from its value, which equals 0.95 percent. Along with gold and observed release of steam from the oil price. Barrel Brent crude traded for 96.33 dollars and 87.50 dollars for WTI. Both varieties cheaper today, by 0.3 and 0.4%. Bloomberg agency attributes this to the promise of the Saudi oil minister to increase production in response to increased demand. Yesterday’s trading on Wall Street was marked with good dynamics, on the eve of a meeting of world economic leaders in Davos. Technology companies rose most significantly by an increased dividend of Intel and the technology leader’s intention to repurchase its own shares led to over 2% increase in price. Accordingly, the Dow Jones rose 0.95 percent to 11,980 points, traders saw no attack on the border 12 000. Nasdaq rose by 1.04% to 2717 points and S & P500 to 1290 points by 0.58%. Asian markets are forward recovery of the U.S. trade last night. We Nikkei was 10,465 points, an increase of 1.16%. In Hong Kong Hang Seng rose by 0.48 percent to 23,916 points and CSI300 in Shanghai is 2,928 points, down by 0.88%. Reduction of the leading index of mainland China is due to speculation by tightening government control, which will have a negative effect on the market of real estate and commodities. However, in terms of China’s economy smaller companies are judged as more risky now and share price fall. Indicative of the mood of the stock market now is that the leaders of leading companies from Wall Street traveling to Davos with two main intentions: to attract new customers after it learned that politicians do not consider major changes to the regulatory framework. Second, there is reason to party – after last year, some investment companies reported record profits and the banks had paid its obligations to the state. On currency markets the euro has stabilized to 1.3652 dollars. The pound continues to struggle with the $ 1.60 barrier, having now bought 1.5997 dollars. The yen rose to 82,395 yen per dollar, but even that failed to break investors’ optimism. Dollar Index, which measures the weight of the dollar in the basket of six major currencies, was 77.938 points, today fell by 0.1%.

Against the background of relatively poor economic news from the calendar on Wednesday, two events in Britain have contributed to easing the major currency crosses, in particular – those involving pounds.Undoubtedly the most interesting event for the forex market from a fundamental point in the last Session disclosure of unprecedented measures taken by the British government, which aimed at limiting the budget deficit by cutting almost half a million jobs in the public sector.The actions of management are aimed at reducing the “hole” in the budget within the next few years, is expected to fall to 2.1 percent of GDP in 2015 to the current 10.1 percent. Thus the government hopes to keep the top credit rating, which will help her to take cheaper loans from foreign investors.Along with the plan of Finance Minister George Osborne found himself the focus of traders on the report of the Bank of England of its last meeting, which also contribute to the diverse trade in the British pound against its other major competitors. Unexpected in this case was that for the first time in almost a year now heads the Bank of England split three different views, suggesting that even when they can not accurately assess the situation in the country.Although the majority of representatives of the Monetary Committee of the bank were in favor of keeping rates at their current level of 0.50 percent and the amount of program buying securities amounting to 200 billion pounds, two of its members voted in favor of lifting respectively the base rate and increased financial incentives for the economy.The mere fact that there is disagreement among the representatives of the central bank may have some pressure on the pound especially against more stable currencies like the dollar as commodity, and the unknown about the next meeting of the monetary institution becoming larger.Against the background of relatively poor economic news from the calendar on Wednesday, two events in Britain have contributed to easing the major currency crosses, in particular – those involving pounds. Undoubtedly the most interesting event for the forex market from a fundamental point in the last Session disclosure of unprecedented measures taken by the British government, which aimed at limiting the budget deficit by cutting almost half a million jobs in the public sector. The actions of management are aimed at reducing the “hole” in the budget within the next few years, is expected to fall to 2.1 percent of GDP in 2015 to the current 10.1 percent. Thus the government hopes to keep the top credit rating, which will help her to take cheaper loans from foreign investors. Along with the plan of Finance Minister George Osborne found himself the focus of traders on the report of the Bank of England of its last meeting, which also contribute to the diverse trade in the British pound against its other major competitors. Unexpected in this case was that for the first time in almost a year now heads the Bank of England split three different views, suggesting that even when they can not accurately assess the situation in the country. Although the majority of representatives of the Monetary Committee of the bank were in favor of keeping rates at their current level of 0.50 percent and the amount of program buying securities amounting to 200 billion pounds, two of its members voted in favor of lifting respectively the base rate and increased financial incentives for the economy. The mere fact that there is disagreement among the representatives of the central bank may have some pressure on the pound especially against more stable currencies like the dollar as commodity, and the unknown about the next meeting of the monetary institution becoming larger.

U.S. bank Wells Fargo said profit growth for the fourth quarter of 2010 amounted to 21 per cent annually. With the main merit of this is cheaper to raise capital, indicated by the financial institution.

For the last three months of last year the bank has achieved record quarterly profit of 3.4 billion dollars, or 61 cents a share. In the fourth quarter 2009 financial result was positive 2.8 billion, or 8 cents a share, recalls AR.

The result obtained fully coincides with the expectations of market analysts. However, before the start of today’s session, shares of the fourth-largest U.S. bank lost some percentage of its value.

Income of the Bank decreased by 5 percent to 21.5 billion dollars. This is also close to expectations which were for revenue of 21 billion dollars.

In the last quarter of 2010 of mortgage finance has achieved a profit of 2.8 billion dollars, down from 19 per cent over the same period of 2009. The total loan portfolio rose by even less than the percentage of the third quarter of 2010 to 757.3 billion dollars.

Finance ministers of the eurozone countries have agreed to undertake new, more stringent tests for resistance to European banks at the latest by the end of May. It reported sources told Reuters the European Union.
Their words became clear that the results of stress tests will be published in the second half of this year, and they will include the same 91 banks that were assessed in 2010.
European finance ministers also decided to postpone the expansion of powers and increasing the funds in the Fund for financial stability. They discussed options for improving the financial condition of the currency unit yesterday, but their meeting was not reached a specific agreement.