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Trump adviser says Powell, Mnuchin will keep jobs; Visa buying Earthport in UK

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Street Talk Episode 76: Record pace of fintech M&A, funding in Q1'21 has legs

Street Talk – Episode 76: Record pace of fintech M&A, funding in Q1'21 has legs

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Trump adviser says Powell, Mnuchin will keep jobs; Visa buying Earthport in UK

A senior economic adviser of President Donald Trump has said Federal Reserve Chairman Jerome Powell and Treasury Secretary Steven Mnuchin will keep their jobs.

In an interview with NBC News, Kevin Hassett, chairman of the Council of Economic Advisers, dismissed speculation that Mnuchin's job was under threat after Mnuchin's calls with top U.S. banks about their lending abilities reportedly caused confusion and stoked fears on Wall Street. Hassett also said that Powell's job is safe.

In regulatory news, JPMorgan Chase Bank NA agreed to pay more than $135 million to settle the Securities and Exchange Commission's claims that it improperly handled transactions involving American depositary receipts. The Financial Industry Regulatory Authority has levied a fine of $10 million on Morgan Stanley Smith Barney LLC over allegations that the broker/dealer did not have adequate compliance rules to detect and prevent money laundering.

During the past 24 months, the SEC and state regulators have launched probes into more than 90 digital currency cases in which investors have suffered losses, The Wall Street Journal noted, adding that the regulators have so far recovered only about $36 million. BitConnect, a cryptocurrency company that closed its operations earlier this year, is also under the SEC probe, unnamed sources told the Journal.

Two activist investors have separately increased their holdings in publicly traded banks. Lawrence Seidman, along with investment affiliates, raised their stakes in Paoli, Pa.-based Malvern Bancorp Inc. to 7.93% from 6.91%. The PL Capital Group bought 39,500 common shares of Old Point Financial Corp., bringing its ownership of the Hampton, Va.-based bank to 7.2%.

In deal news, Visa Inc. is buying U.K.-based payment processor Earthport PLC for £198 million. Earthport provides cross-border payment services to banks and businesses.

The recent decline in net inflows for U.S. mutual and exchange-traded funds could be a harbinger of difficult times ahead for the financial markets, according to the Journal. U.S. mutual and exchange-traded funds pulled in $237 billion in the first 11 months of 2018, down 62% from the year-ago period, the publication said, citing Morningstar data. These trends may spell trouble for smaller asset managers that do not have the scale to weather the market volatility and pricing reductions in the industry.

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In other parts of the world

Asia-Pacific: Mizuho to launch cryptocurrency in 2019; Allahabad Bank to raise 8B rupees

Middle East & Africa: NCB, Riyad Bank in merger talks; Rwanda ups capital requirements for banks

Europe: BBVA selling €1.49B of bad loans; Visa to acquire UK's Earthport

The day ahead

Early morning futures indicators pointed to a lower opening for the U.S. market.

In Asia, Nikkei 225 increased 3.88% to 20,077.62, while Hang Seng fell 0.67% to 25,478.88.

In Europe as of midday, FTSE 100 was down 0.92% to 6,624.73 and Euronext 100 fell 0.15% to 896.32.

Click here to read about today's financial markets, setting out the factors driving stocks, bonds and currencies around the world ahead of the New York open.

On the macro front

The jobless claims report, the Federal Housing Finance Agency House Price index, the consumer confidence report, the farm prices report, the Fed balance sheet and the money supply report are due out today.

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