Thursday's Headlines: Layoffs Loom As July Trading Profits Extend Slide
July trading activity for U.S. bulge-bracket banks slumped further from last quarter's already anemic pace, prompting some banks to consider laying off traders. Many banks missed monthly targets for both fixed income and equities trading revenue, and one senior banker called layoffs inevitable if activity doesn't rebound "sharply" in August and September.
The collapse of U.S. climate change legislation led Intercontinental Exchange to cut staff at its Chicago Climate Exchange division. ICE Chief Executive Jeff Sprecher said the U.S. emissions-trading exchange is losing money and will be scaled back as the business focuses on its profitable European operation.
Barclays Capital posted softer second-quarter investment banking results, in line with other leading global banks. But its top executive Bob Diamond says activity picked up in the second half of July. If that continues, it could help avert threatened industry-wide layoffs.
Goldman Sachs to Shift Principal Strategies Into a Fund [Bloomberg News]
Goldman Sachs reportedly has decided to spin off its Principal Strategies Group proprietary trading business into a fund and seek assets from outside investors, to comply with the Dodd-Frank Act's Volcker Rule provision.
Opportunities are opening up for energy and commodities traders in Japan. Nomura Holdings plans to step up trading in energy and commodities derivatives there fivefold to meet demand from producers to hedge against price movements.
New York's governor expects state lawmakers to repeal a $50 million tax on out-of-state hedge fund executives, as the state seeks to fend off stepped-up efforts by Connecticut to induce New York-based funds to move there.
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