Chinese financial exchanges are preparing to suspend their data feed activity in the coming days after being instructed to do so by Chinese regulators on Tuesday due to data security concerns, sources familiar with the matter told Reuters.
The brokers, which include local joint ventures Tullett Prebon and NEX International, currently supply price quotes to data providers such as Wind Information and Sumscope Information, and the move could slow trading in the country’s money and bond markets.
The move comes after China announced plans to form a national agency to manage its data, as well as a new regulatory body consolidating oversight of the financial sector.
Five sources said the exchanges were instructed by regulators to suspend their data feed business due to information security concerns. A sixth source said regulators had told financial intermediaries that carrying out data-feeding operations was beyond the scope of their authorized business.
Five of China’s six financial intermediaries, which also include BGC Partners’ joint ventures Central Tanshi and Compagnie Financiere Tradition, received the warning from regulators, according to sources.
It is unclear whether the sixth broker, Ueda Yagi Money Broking (China), has also received instructions.
Neither brokers nor the China Banking and Insurance Regulatory Commission immediately responded to requests for comment.
The ban will force brokers to receive price quotes via social media tools such as QQ and WeChat rather than popular financial terminals, potentially affecting trading efficiency and hurting turnover.
“We didn’t do much trading this afternoon. All hands were in private chat groups,” said one trader who asked not to be identified. “It feels like we are all going back to 10 years ago when trading was very manual.”
Source: Terra
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