|Bid||755.20 x 0|
|Ask||757.20 x 0|
|Day's Range||745.80 - 763.60|
|52 Week Range||399.70 - 1,668.00|
|Beta (3Y Monthly)||-0.64|
|PE Ratio (TTM)||5.10|
|Forward Dividend & Yield||0.72 (9.77%)|
|1y Target Est||N/A|
(Bloomberg) -- The U.K.’s financial services regulator is proposing a ban on retail sales of derivatives tied to some crypto assets, as it seeks to clamp down on risky financial products.The Financial Conduct Authority said cryptocurrencies have no reliable basis for valuation, while market abuse and financial crime are prevalent in the secondary market for digital assets. The watchdog estimates that a ban on retail trading could prevent between 75 million pounds ($94 million) and 234.3 million pounds in losses a year, according to a statement on Wednesday.Retail investors in the U.K. are able to speculate on cryptocurrencies through complex derivatives known as contracts for difference, or CFDs. Largely banned in the U.S. and under increasing scrutiny in Europe, these instruments allow amateur traders to make risky bets on assets without owning them.“Most consumers cannot reliably value derivatives based on unregulated crypto assets,” said Christopher Woolard, Executive Director of Strategy & Competition at the FCA. “Prices are extremely volatile and as we have seen globally, financial crime in crypto-asset markets can lead to sudden and unexpected losses.”Scams involving cryptocurrencies and foreign exchange boomed last year, losing British investors more than 27 million pounds, according to the FCA, which told consumers in May to watch out for online trading platforms offering get-rich-quick schemes.Companies that currently offer CFDs tied to cryptocurrencies include CMC Markets Plc, Plus500 Ltd. and IG Group Holdings Plc, according to their websites. The shares of all three companies briefly declined on the news.“This is further mood music that the regulatory environment for these kinds of business continues to be tough,” said Portia Patel, analyst at Canaccord Genuity. “Expect retail CFD companies to lobby hard against this.”(Updates with CFD providers’ share price moves in fifth paragraph.)\--With assistance from Viren Vaghela.To contact the reporters on this story: Alastair Marsh in London at email@example.com;Donal Griffin in London at firstname.lastname@example.orgTo contact the editors responsible for this story: Ambereen Choudhury at email@example.com, Marion Dakers, Keith CampbellFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
The FTSE 100 was up 0.3 percent and the FTSE 250 rose 0.5 percent to cling to a six-month high hit in the previous session to cap off a third straight week of gains. Plus500 slumped more than 31 percent on its worst day in almost four years after its quarterly revenue plummeted to below a fifth of a year earlier. It took a hit from less market volatility creating fewer trading opportunities and new rules affecting retail clients.
New rules reducing leverage and protecting amateur retail investors from heavy losses have been in place for a year but are only beginning to show up more dramatically in results of Plus500 and peers like IG and CMC Markets. A cryptocurrency boom that was in full swing at the start of 2018 has also collapsed, with bitcoin trading at around $5,000 from highs near $20,000, adding to the platforms' problems. Plus500's revenue sank to $53.9 million in the first quarter from $297.3 million a year ago, sending shares down 43 percent to a two-year low of 399.7 pence and dragging IG and CMC around 5 percent lower.
The statement came just hours after Britain's Financial Conduct Authority said the European Securities and Markets Authority's temporary curbs on contracts-for-difference (CFD) will become part of the UK domestic law when it leaves the EU on March 29. CMC expects its quarterly CFD and spreadbet revenue to fall 25-35 percent compared with a prior forecast of a 20 percent drop, it said in an unscheduled trading update on Friday. Shares of CMC touched a two-year low, falling over 20 percent to 93.2 pence by 1457 GMT after the company called the first two of 2019 "challenging".
"In 2017, as in 2016 and 2015, the company did not generate net revenues or losses from market P&L." The words "or losses" were wrongly included due to the "drafting" error, it said. "This error does not impact previously reported revenues, profits or the balance sheet of the company," Plus500 said. Plus500 has already said this week that revenue and profit would fall short of analysts' expectations in the current year, erasing a third of its market value.
The FTSE index increased 0.8 percent after touching its highest level since Oct. 10, handily outperforming its European peers, while the midcaps were also up 0.8 percent. British lawmakers will face a choice between Prime Minister Theresa May's divorce deal or a long extension to the March 29 deadline for leaving the European bloc, May's chief Brexit negotiator Olly Robbins was overheard saying in a Brussels bar.