Under the forthcoming rules of Europe's revised Markets in Financial Instruments Directive, buy-side traders' reporting standards will face scrutiny and possible fines from the European Securities and Markets Authority if found lacking, reporting experts warn. While the rules apply to all sectors, buy-side traders are especially likely to face censure if they do not have adequate reporting systems in place, the experts say.
Top banks are calling for a pause in the introduction of capital requirements by the Basel Committee on Banking Supervision, such as the net stable funding ratio and the Fundamental Review of the Trading Book, allowing time for a review of their effects so far before they are passed into legislation. Meanwhile, doubts have arisen on whether the Trump administration will observe the new rules, as its direction on economic policy remains undefined.
The European Commission says in a draft policy paper that it will propose legislation establishing centralized oversight of all capital markets in the EU. The legislation would give the European Securities and Markets Authority the power to enforce uniform rules across the EU and overrule national supervisors when necessary.
European regulators are considering changes to the profit-and-loss attribution test. Banks have been calling for a review of the test and a possible lowering of its criteria, and one bank spokesman said the Basel Committee on Banking Supervision working group, which drew up the rules, has admitted there are flaws.
Moody's Investors Service lowered its rating for China's government debt to A1 from Aa3, responding to the likelihood that the debt load will increase. It is the first time the ratings firm has downgraded China's bonds since 1989.
Westinghouse Electric has said in US bankruptcy court it is borrowing $800 million to finance its business plan and to help the company emerge from bankruptcy protection. The company, owned by Japan's Toshiba, filed for bankruptcy in response to billions of dollars in cost overruns from nuclear power projects in Georgia and South Carolina.
Bitcoin is gaining acceptance in Japan as businesses conclude that it saves time and money and that built-in safeguards protect them from fraudulent transactions. About 300,000 stores are expected to accept bitcoin by year-end, says Midori Kanemitsu of bitFlyer.
The US Justice Department has sued Fiat Chrysler, accusing the automaker of manipulating software to let some vehicles with diesel engines pass emissions tests. The Environmental Protection Agency had alleged software allowing excessive nitric oxide had been installed on about 104,000 Ram pickups and Jeep Grand Cherokee SUVs.
Asian-Pacific stock markets except India advanced Wednesday after Moody's Investors Service lowered China's credit rating. Japan's Nikkei 225 gained 0.7%; Hong Kong's Hang Seng Index and China's Shanghai Composite each edged up 0.1%; Australia's S&P/ASX 200 and South Korea's Kospi each rose 0.2%; and India's Sensex was down 0.2%
Political turmoil might trigger a downgrade in the rating of Brazil's sovereign debt, S&P Global Ratings said. Uncertainty surrounding President Michel Temer, who has been accused of corruption, raises doubt about his ability to implement economic and fiscal reform, the credit rating agency said.