Exit, Bernstein; enter, Genpact; bond upgrade; insider-trading history lesson

By: Ray Pellecchia

File Under: Bonds, NYSE

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Another brokerage goes electronic at the NYSE: Sanford C. Bernstein, the brokerage owned by the money manager AllianceBernstein Holding, has eliminated its trading staff on the floor of the New York Stock Exchange. All its trading is now done electronically.... John Thain, the chief executive of NYSE Euronext, said earlier this month that traders at the NYSE handled enough shares to merit the floor's current size, even as investors increasingly rely on automated markets.
"The exchange already is almost all electronic, but a lot of the electronic trading is the specialists and the brokers on the floor," Thain said at a conference at Baruch College in New York. "They will continue to add value, which means there will continue to be a floor." (Bloomberg)

Listings for Genpact, Chinese Firms Mark a Victory for the Big Board: The Big Board scored three listings from overseas Friday. Genpact Ltd. filed an initial public offering with the U.S. Securities and Exchange Commission to sell up to $600 million in common shares and list them on the New York Stock Exchange. Genpact is registered in Bermuda but has roots in India, from where the company derives most of its revenue. Genpact, which provides business-process outsourcing services, gets much of its business from General Electric Co. Yingli Green Energy Holding Co. and LDK Solar Co., China-based makers of solar-energy products, also filed offering documents with the SEC and said they planned to list on the NYSE. The decisions to list in the U.S. are a victory for the Big Board, a unit of NYSE Euronext, as American exchanges face questions about their ability to remain competitive while capital markets go global. (WSJ.com/subscription)

Giving Bonds an Electronic Upgrade : During June, the NYSE will launch a bond-information site at http://www.nyse.com/bonds that will provide 20-minute delayed bond-price quotes as well as a look at the market for individual bonds. The site will contain listings of all available bonds and give users the ability to search the inventory, based on criteria such as maturity date, coupon, and industry sector. What will this mean to individual investors? The NYSE's goal, according to John Holman, vice president and head of fixed income for the exchange, is to open up the bond market, increasing the visibility of pricing and adding liquidity. Holman says that the NYSE is making it simpler for liquidity providers, such as brokerage houses, to link into the platform. "Having centralized information always drives the cost of execution down, which is an advantage to the retail investor," adds Holman. The new platform started with 1,000 bonds and is adding about 500 new issues every few days with the eventual goal of 5,000 to 6,000. Government bonds will eventually be available. (Barron's.com/subscription)

Suspicious Trading On the Rise : "Everything is going global, even insider trading," said Robert A. Marchman, executive vice president and head of market surveillance at NYSE Regulation. But unlike the scandals in the 1980s, when Wall Street stars like Ivan F. Boesky were caught in insider trading investigations, the recent flurry of cases have chiefly involved young bit players. And the schemes, as outlined by regulators, are predictably similar. Wives team up with husbands; investment bankers call friends; research executives pay off old debts with valuable tips. Mr. Marchman cut his teeth on the Boesky scandal, an event he says may have receded too far into the past to scare the young guns on Wall Street today. ''You are dealing with people who don't have a recollection of what took place in that scandal and think they are above the law, that the regulators don't have the technology to detect this activity. As evidenced by the number of recent cases, they are flat-out wrong.'' (NYTimes. com)

Happy Monday, folks. A little historical and musical trivia to start the week:

Today in NYSE History: 1929 -- A new Bond Room opened, adding approximately 6,000 square feet to the trading floor. [Kinda ironic, given the electronic fixed-income expansion referenced above, no? -- RP]

Born On This Day: Jack Bruce, 64; and David Byrne, 55. Also born today, Otto Klemperer (1885-1973), one of the greatest conductors of the 20th century; his obit alone is an amazing glimpse into an amazing life. Incredible though his career was, I knew him best as Col. Klink's dad -- Otto Klemperer was the father of Werner, the accomplished screen and TV actor best known for "Hogan's Heroes."

Mr. Klemperer, in a life that spanned the waning days of 19th-century Romanticism and the most severe of 20th-century atonalities, had two distinct careers in music.

In his first career in Germany, before the Nazis came to power in 1933, he was one of the best-known and most vigorous interpreters of his generation, a gaunt giant of a man who presided over his orchestras like a soaring eagle.

Then there came a period of exile, illness and severe mental strain. An operation for a brain tumor in 1939 left him partly paralyzed and unsure of gait, and other accidents followed. His infrequent appearances were with second-flight orchestras, his career in eclipse.

In the middle 1950's, in the seventh decade of his life, he again began to make heralded appearances, being hailed as Arturo Toscanini's heir as the world's leading conductor of the German Romantics. Through a fierce effort of will, the old man, his aquiline face twisted into a mask, his massive stature bowed, had found a new place at the top.

In his last years, Mr. Klemperer, at the head of his Philharmonia Orchestra, was known as a rock of integrity and moral authority in his conducting. His measured tempos and inspired literalness, his iron insistence on correct performance, brought new meanings to his readings of Beethoven, Mahler and others.

Tags: New York Stock Exchange, Hybrid Market, NYSE, NYSE Euronext, NYX, trading, stock market, bonds