Axis Bank Introduces their New Forex Service

Axis Bank, the market leader in travel currency cards, have recently announced their new service which is the “Axis Forex Online” — the first comprehensive online forex solution in India that empowers their clients and customers to transfer money online in over 100 currencies across 150 countries. Aside from fast online money transfer, Axis Forex Online also offers door step delivery services of forex card and foreign currency cash.

Axis Forex Online Services

Axis Bank will be offering a complete package of forex services through Axis Forex Online, including Forex Card, Foreign Currency Cash, and Online Outward Remittances to both customers and non-customers as well. Existing customers can make use of the outward remittance services available online through Internet Banking, as well as utilize mone transfer from any Bank in India to another Bank across the globe.

The Axis Forex Online feature will allow the customers to remit up to 25,000 USD in one transaction or limit outward remittance to 250,000 every year.

“The launch of the new card further reinforces our commitment to improving customer experience by deploying cutting-edge technology solutions that provide security and convenience,” syas Mr. Sidharth Rath, the President and Head, Treasury, Corporate and Transaction Banking.

Axis Bank now features end to end online outward remittance services to clients and customers and allow them a hassle-free travel without bringing cash on hand anywhere in the world.

About Axis Bank

Axis Bank is the 3rd largest private bank in India. It offers a wide variety of services to various customers in large and mid-corporates, SME, retail businesses, as well as agriculture. They have about 2,805 branches across India, including their extension counters, across India. They also have 9 offices overseas (Dubai, Hong Kong, Singapore, Shanghai, and Colombo); representative offices at Abu Dhabi, Dubai, and Dhaka; as well as overseas subsidiary at London.

Why Starting Live Account Trading Early is a Good Idea

Kunle Adeyeri is a trainee of the recent online trading training. During one of his classes, he was taught about going live rather than using the demo/paper trading platform; and gladly, he took the advice of his trainer. He learned that demos and live accounts are the same. However now that his money is involved, he has just started to understand the market better with confidence and discipline.

Live Account versus Demo Platform

An active live account trader for one month is actually better than a demo tiger trader for three years. Not that demo trading is all bad, but it should only be used for only a short while as a means to hone your skills and perfect your strategies. The truth is you will neither grow nor be successful if you don’t involve your money into forex trading. With demo account trading, you can do trials and experiments; however, with live or real account trading, you need to be trained and skilled psychologically. It allows you to learn faster from your mistakes and grow from them — get matured and disciplined in the forex market.

Being a beginner in a trading live account, you’ll be working with money on the table. Thus, you’ll have this fear of losing and you’ll just sit down, wait, and watch as the market moves in the trend that you might have foreseen or analyzed. If it were a demo account, you’d go for anything. You’d normally take risks that you wouldn’t dare of doing in a live account; you’d make money, yes. But it’s another story when we talk about trading with a live account.

Although a demo account is almost a perfect simulation of what happens in live trading, the emotions and fears of traders are completely different. It has been the tradition for new traders to start with demo trading first after training; however, it is highly recommendable for you to go directly to live account trading. It is important to note that most successful traders succeeded because they’ve lost in the market; with loss came realizations of how and where you made a mistake.

Unsuccessful Forex Traders

Per experience, most traders who lost their money through forex trading (and therefore hate it) are those who spent too much time dwelling in demo trading without really preparing themselves psychologically for the real or live forex trading. Aside from that, those who lost their money initially to improper and inadequate education of the forex market trading are a herculean task. Their initial losses easily discouraged them and they’ve never gone too far beyond overcoming the trauma and their fears to look for the right answers; rather, they blamed much of their experience on the market itself. If you analyze their account history, it will definitely show where they went wrong.

In conclusion, ensuring that you get proper market education and having a fearless attitude early on during your entry to the forex market are just two of the sure ways to becoming successful and having a profitable trading.

How Brussels Attacks Affected the Movement of the Dollar

Underpinned by comments from US Federal Reserve Officials on Wednesday, the dollar steadied as investors from Asia reacted to the recent attacks in Brussels.

The attacks on Brussels airport and the rush-hour metro train in the Belgian capital, which happened in Tuesday’s Asian session, killed many people and prompted security alerts all over Western Europe.

The dollar index, which keeps track of the US currency and its 6 major rivals, increased about 0.1 percent higher to 95.758. Meanwhile, the euro increased by about 0.1 percent to $1.1207 from the post-attack low of $1.1188.

The dollar was almost flat against the “safe haven” yen at 112.43. It is above 111.38 yen on Tuesday after the 17-month low of 110.67 yen last Thursday when Fed Chair Janet Yellen warned against the timing of the interest hikes this year.

“The market learned Fed officials can support the dollar, overall, and market is focusing on what they say, after what Yellen said last week pushed it lower,” says Kaneo Ogino, the director of Global-info Co, a foreign exchange research company in Tokyo.

According to Philadelphia Fed President Patrick Harker, the central bank should take into consideration another hike in interest rates as early as next month if the economy of the US continues to show signs of improvement. He also added that he prefers at least 3 hikes before the year-end.

Chicago Fed president Charles Evans, on the other hand, expects additional two interest rate hikes in 2016, unless the economy shows more strength than expected or if inflation would pick up faster than what was predicted. Although Evans doesn’t have a vote on the policy this year, he is known for being among the active policymakers in the US central bank. His remarks were followed by comments from several other officials that suggested implementation of interest hikes sooner rather than later.

“Evans normally leans towards lower rates so it is interesting that he is happy to talk about two hikes this year, with markets only priced for one,” says Sean Callow, a senior currency strategist for Westpac.

Sterling also increased by 0.1 percent to $1.4195 after declining by over 1 percent to one-week lows against the dollar after the Brussels attack. Three-month sterling options have increased to their highest levels as investors are hedging to a downward move for the upcoming Brexit.

Meanwhile, the Australian dollar, which usually sells off when there are high risk aversions, edged down to about 0.1 percent to $0.7613.

Armenia Stock Exchange Taking Measures to Boost Currency

Because of economic downturn, the stock exchange of Armenia is planning to boost their currency operations through attracting back commercial banks. Aside from that, they will also be introducing their new online platform, as well as mechanisms for deferred settlements, according to its boss who told Reuters on Monday.

NASDAQ OMX Armenia, the only active stock exchange in this former Soviet country, is part of the NASDAQ OMX Group, Inc. Its stocks saw a decrease in the volume of currency transactions by 58 percent year-on-year to $313 million of last year.

What does the Decline in Volume Currency Transactions Mean?

“We are concerned that there are no currency operations in the stock exchange and we are trying to change our business model,” says Director General Konstantin Saroyan.

According to Saroyan, the demand for dollars had dropped and commercial banks were purchasing foreign currencies from other providers — the interbank market, via over the counter deals and other central bank interventions.

“We are also planning to launch a Tom Next (Tomorrow Next) mechanism of deferred settlements,” said Saroyan. Currently, they are requiring upfront deposits if you are transacting for forex.

Saroyan added that, “Analysing the situation in the economy, I feel that demand for dollars has declined due to a decline in remittances and a decline in imports.”

Brief Overview of Armenia

Armenia is a country of only 3.2 million people. The country depends mostly on aids and investments from its former Soviet overlord, Russia, which is currently experiencing an economic recession. This greatly affected the Armenian exports and remittances from Armenians working in Russia.

Aside from that, the imports to Armenia have also decreased to $3.264 billion from $4.424 billion in 2014. Moreover, remittances from Armenians working abroad dropped from $1.2 billion two years ago to $857 million in 2015.

The IHS and Markit Merger Deal

According to the US information and analytics provider IHS Inc. and UK market-data company Markit Ltd., they will be merging to establish a $13-billion company, which will be based in London.

With their decision to move to the UK, IHS is taking advantage of their lower corporate tax rate through tax inversion — which is a way for US companies to avoid getting taxed at home. The IHS Markit (new name of the company) expects a corporate tax that is low- to mid- 20 percent range, in comparison to the 35% corporate tax in the US.

The IHS-Markit Deal

The deal struck on Monday was worth approximately $5.8 billion, or $3.13 per share, a 5.6% premium to the closing stock price last Friday.

Soon after the deal was made (which has been expected in the last half of 2016), shareholders of IHS, having a market value of $7.5 billion as of Friday, will own approximately 57 percent of the merged company. Meanwhile, shareholders of UK-based Markit will own about 43 percent of the firm. Although it will be based now in London, the new company will still have some of its key operations at Englewood, Colorado, where IHS is based.

About Markit and IHS

Markit, which started in a bard over 10 years ago by ex-credit trading executive of TD Securities Lance Uggla, collects data from several major bond dealers that are used for trading, valuation, research, and reporting about bonds, currencies, derivatives, and loans. Hence, they have become an important part of Wall Street as they provide pertinent data to them. They were initially backed by several other lenders like Bank of America Corporation, Deutsche Bank AG, Goldman Sachs Group Inc., and J.P. Morgan Chase & Company.

The CEO and the chairman of the merged Firm will be Jerre Stead, the chief executive of IHS, up until his planned retirement by the end of next year (December 31, 2017). Mr. Uggla, on the other hand, will be taking over as CEO after Mr. Stead’s retirement.

The two executives have been part of over 100 mergers and acquisitions for more than 10 years already. They said, they’ve discussed their merger over breakfast in December after being associated by investors in both companies. In early January, the deal had progressed with 21st of March as the deadline for the announcement of their merger.

Markit and IHS
Markit and IHS to Merge in All-Stock Deal. Photo by

According to Stead and Uggla, the deal was excellent since their customer bases won’t overlap and it represents an opportunity to merge corporate and financial data. While IHS targets more corporate clients, Markit provides information to asset managers and banks in Wall Street.

“We use content in slightly different ways,” says Mr. Uggla.

IHS offers analytics for governments and businesses in over 140 countries around the world. The company was founded in 1959; however it went public only in 2005 and has approximately 9,000 employees in 32 countries. In the recent years, they have been known for their acquisition deals as they’ve pursued a growth strategy by snapping up information providers and other analytics firms.

What Does the Biggest Current Account Deficit Imply to the US Economy?

In seven years, the highest level of deficit in the broadest measure of US trade has been recorded in the last three months of 2015. The deficit of the U.S. current account has been narrowed to $125.3 billion in the last quarter, down by 3.5 percent from a deficit of $129.9 in the 3rd quarter, according to reports made by the Commerce Department on Thursday.

The deficit for 2015 rose to $484.1 billion, up 24.3 percent from 2014’s $389.5 billion. It was regarded as the biggest annual deficit recorded since 2007 when the deficit equaled $690.8 billion.

What does this mean?

This big deficit actually implies that the U.S. companies are struggling in their sales as they are experiencing a weakness in major economies around the world; because of stronger dollar, export sales have declined.

The current account is actually the broadest measure of U.S. trade primarily because it covers merchandise trades, as well as trades in services like legal fees and airline fares. Aside from that, it also covers the flows of investment between countries.

The increasing trade benefit have cut the overall economic growth by 0.6 percentage point in 2015, a critical reduction for an economy that reached a modest 2.4 percent growth last year, per measurement of the gross domestic product.

According to several analysts, the trading industry will definitely affect the economy’s growth this year as companies and other exporters, including farmers, are still struggling to sell and market their products in other countries worldwide.

Trade Deficit Becomes a Trending Topic

The trade deficit records have become a major trending topic in this year’s elections as Republican Donald Trump and Democrat Bernie Sanders are both arguing that the US has been affected by the failure of the U.S. government to negotiate and land deals that protect American jobs from being lost to other countries that use unfair trading practices.

The deficit in 2015 has been 2.7 percent of the total output of the U.S. economy, which is up from 2.2 percent of the gross domestic product in 2014.

This increase in the total deficit only tells us that there is a 2.4 percent rise in the deficit in merchandise. Meanwhile, the U.S. goods exports has declined by about 7.2 percent, which is the first yearly decline in goods exports since 2009, the year when the global economy has been struggling to come out from a deep recession.

SunEdison, TerraForm Postpones Filing Annual Reports

On Wednesday morning, SunEdison filed a statement at the U.S. Security & Exchange Commission (SEC) that they will be delaying their filing for the Form 1-K annual report for 2015 beyond their due date on March 15.

What’s worse is that this further postponement is “due to the identification by management of material weaknesses in its internal controls over financial reporting.” According to them, the identified weaknesses have caused implementation of additional procedures for the management for the preparation of their financial statements.

Moreover, an investigation conducted by the Audit committee previously disclosed by SunEdison on Form 12b-25 filed with the SEC last 29th of February which concerns the accuracy of their financial position has not yet been finalized.

The Good News

But there’s good news though. According to SunEdison, additional procedures haven’t resulted to misstatements or re-statements of their “audited or unaudited consolidated financial statements or disclosures for any period previously reported.”

TerraForm Delay

TerraForm Power Inc. (NASDAQ: TERP), which is controlled by SunEdison, also announced on Wednesday that they will also delay filing of the 2015 Form 10-K which is due on March 15. According to them, the reason for the delay is due to their need for completing the steps and tasks necessary to finalize their financial statements and other documents.

TerraForm claims that their delay is associated with that of SunEdison, saying in a statement, “Due to our management services arrangement with SunEdison under Management Services Agreement, our financial reporting and control processes rely to a significant extent on SunEdison systems and personnel. As a result, if there are control deficiencies at SunEdison, including with respect to the systems we utilize, it is necessary for us to assess whether those deficiencies could affect our financial reporting and, if so, address them to the extent necessary and appropriate prior to filing our Form 10-K.”

They also said that they currently identified material weaknesses in their internal control systems over financial reporting, which is primarily due to ineffective controls associated with their Enterprise Resource Planning (ERP) systems and the validation processes for revenue recognition.

Because of this, TerraForm received a notice from Nasdaq on delisting, of which the company shall reply by 16th of May to regain compliance.

The SunEdison stock, however, bounced a little last week as they settled a lawsuit that was associated with the incomplete acquisition and after the termination of their purchase of Vivint Solar Inc. (NYSE: VSLR).

Gold Rises Before Policy Meetings

After its drop last Friday, gold rose on Monday ahead of the critical policy meetings to be conducted this week by major central banks, which can affect the movements of the precious yellow metal.

This precious yellow metal hit its high of $1,257.17 per ounce; while currently lower around $1,255.02. It dropped sharply last Friday after having a 13-month rally high of $1,283.17, as investors placed their bets on equities.

The U.S. benchmark Standard & Poor’s 500 index increased by 1.64 percent on Friday, finishing at about 2,022.19 — which is the highest level recorded for this year.

The European Central Bank

The European Central Bank (ECB) shocked markets by implementing zero interest rates. They also announced that they will be expanding the asset purchases program of the central bank in addition to several other measures. These “other” measures gave more support to the equities of ECB; thereby causing the gold to lock their weekly loss last week.

The U.S. Dollar

Meanwhile, the USD traded a little bit higher today at about 96.35 based on the dollar index, after recording the two-week loss last week.

Policy Meetings

Investors may be paying more particular attention to the policy meeting next week by the Federal Reserve, amidst the expectations that policymakers will not be implementing hike rates in the near future.

Another two-day policy meeting will also be conducted by the Bank of Japan (BOJ). This event may also catch the attention of investors because there might be a probability that policymakers will exempt $90 billion in the short-term funds from the newly implemented negative interest rates, according to several experts and analysts that are quite familiar with the case.

While the physical demand for top Asian buyers, such as China and India, was weak in the recent week; the gold metal has gained about 18% this year.

Sebi Penalizes Classic Global Finance & Capital

Securities and Exchange Board of India (SEBI) imposed Rs 1 crore fines on Classic Global Finance & Capital after they failed to re-dress the complaints of investors within the required time period.

According to Sebi, a total of 4 complaints were made against the firm and none of them were resolved. They also said that despite the opportSebi, unity to the company for personal hearing, they didn’t respond and the firm didn’t disprove the complaints as well.

The company has been registered with the online complaint redressal system, SCORES, of Sebi, according to the order.

According to section 15C of the Sebi Act, when the act is violated, the entity will be penalized with Rs 1 lakh per day as such penalties continue or Rs 1 crore, whichever is less. The violation was charged by Sebi on Classic Global Finance & Capital.

The penalty needs to pay within 45 days from the time the order was received, says Sebi.

Sebi has launched SCORES in June 2011. The system serves as a centralized database for complaints. Online processing of complaints to the companies listed in the system and uploading of ATRs by the involved companies are made and completed with the use of this system.

Aside from that, SCORES also serves as a medium for investors to view, monitor, track, and follow up certain actions that are taken on their complaints and grievances. This online redressal system is a big help in reducing the amount of time it takes to process the complaints.

In another order, adjudication proceedings were disposed by Sebi in the case of Modern Steels Ltd, where there was also a complaint pending for action. And since the firm have SCORES authentication and the complaint isn’t under Sebi, the regulator then disposed the adjudication proceedings.

Deutsche Borse and LSE Merger: Will this Work?

Any time now, Deutsche Borse will be launching their merger with the London Stock Exchange (LSE). Yet we didn’t hear anything from the politicians about what could be damaging to London.

For many years, Italian companies have been listed under the market owned by London. A great concern nowadays is the future of the clearing houses and the fact that a German company is taking over the LSE which may result to clearing ends up in Frankfurt.

London Stock Exchange
LSE boss Xavier Rolet backs the merger with Germany’s Deutsche Börse Facundo Arrizabalaga/EPA

Why Clearing Houses Matter

Clearing houses allow trading from equities to interests which can happen when either one of the parties involved defaults. They fuel financial markets. Aside from that, it is also the core of action of the G20 nations to make sure that the world’s financial system is stable enough by reducing the risks. On top of that, cross margin clearing can be seen in the huge interest-rate markets. Majority of the interest-rate swap market happens on the over-the-counter markets with a simpler clearing system.

Cross-Margin Clearing

With cross-margin clearing, banks are allowed to net all their interest-rate derivatives held in a single clearing house, thereby decreasing their capital they need to meet the margin.

Interest swaps, on the other hand, involve sovereign and corporate bonds that dates 30 to 100 years; the margin needed by these clearing houses may change quickly and significantly. Therefore, netting them out would benefit the banks, as well as the entire financial system.

Interest-Rate Derivatives Market

There are 3 clearing houses that operate in the interest-rate derivatives market; and these are the LSE’s LCH.Clearnet, Deutsche Borse’s Eurex, and ICE, which operates exclusively in the US. However, if Deutsche Borse incorporates with LCH.Clearnet, there will only be one clearing house in Europe — and that is in Frankfurt.

Technologically speaking, Eurex is superior to LCH.Clearnet. In fact, its business model can drive the synergies the merger requires. According to German politicians, they won’t let trillions of euros of interest-rate swaps be traded in German Bund.

Xavier Rolet, the chief executive officer of LSE, has emphasized last week that clearing plays a highly significant role behind the merger talks with Deutsche Borse. Although he won the fig leaf of the merged entity, he may be losing the fight for the business to be taken away from Frankfurt.

Both Deutsche and LSE have less than two weeks to reach an agreement; but they could still buy themselves sometime.