The Treasury Department has told Secretary Steven Mnuchin it has found no evidence China is manipulating the yuan, sources say. The finding, expected to be verified in a semiannual report from the Treasury, might ease US-Chinese trade tensions, although Mnuchin has declined to comment and could ultimately issue a different finding.
A significant top formation seen on the German DAX index could be replicated by a pattern on the S&P 500, says technical analyst Frank Cappelleri, CMT. The S&P 500 has largely followed upward and downward trends on other major indexes this year, he says.
Securities and Exchange Commission member Kara Stein has denounced the regulator's proposal to establish capital and margin requirements for security-based swaps dealers as "shadow rulemaking" that buries policy changes in a 2012 proposal the SEC never adopted. Those changes "could mean that fewer financial resources would be available if problems arise," she said.
Investors will search for indications on trends such as interest-rate direction, stock market movement, lending growth and loan defaults as banks release earnings reports for the third quarter.
S&P Global Ratings might downgrade UK banks in the event of a no-deal Brexit, warning "current ratings and/or outlooks may not prove to be consistent with a disruptive Brexit accompanied by a severe economic shock". Fitch Ratings says that banks are well-capitalised but that any lengthy disruption in wholesale markets could present challenges.
The EU must review transparency thresholds after Brexit, says Robert Ophele, chairman of French regulator Autorite des Marches Financiers. The consistency and quality of Markets in Financial Instruments Directive II data supplied to regulators leave "much to [be] desired", and adjustment of the double volume cap might be necessary because dark pools are prevalent in the UK, Ophele said at the AFME European Compliance and Legal Conference.
National regulators in the EU are taking a hard line with UK proprietary-trading firms wanting to relocate to the bloc to reduce the impact of Brexit. National competent authorities reportedly are watching for so-called letterbox operations, with Dutch regulators in some instances ordering an increase in Dutch workers.
The EU should establish a standard template for banks, insurers and publicly traded companies to use when reporting nonfinancial data, such as environmental, anti-corruption and energy policies, says Ana Maria Martinez-Pina Garcia, who leads a panel of EU watchdogs for corporate reporting. "We think that the main problem we are facing now is that the nonfinancial reporting doesn't have a [single] unique framework," she says.
Risky debt at EU insurers could increase next year when banks are permitted to split issuance between preferred and nonpreferred bonds. Bail-in debt has proved popular with insurers because it offers better yields and Solvency II offers no disincentive to the allocation.
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