CME and Nymex in Preliminary Merger Talks

CME Group, operator of Chicago Mercantile Exchange, and Nymex Holdings Inc, operator of New York Mercantile Exchange, are in preliminary talks to merge.

Nymex is shareholders may receive $36 in cash and 0.1323 of share in CME in exchange of each NYMEX shares.

CME Group expects to maintain trading floors in the New York City metropolitan area. The potential transaction also contemplates that NYMEX will repurchase the 816 New York Mercantile Exchange memberships upon closing of the potential acquisition for an aggregate purchase price not to exceed $500 million.


5:00AM New York, 7:00PM Tokyo- Subprime fears and comments from IMF Chief led Tokyo stocks down 3.97%.

Stocks in Japan dropped as exporters declined on a strengthening yen and on observations by the IMF that global economic conditions will worsen.

In Tokyo trading Nikkei 225 fell 3.97% or 541.25 to 13,087.91, while the broader Topix Index slumped 51.74 to 1,293.03. Market sold-off after comments from IMF Chief in Switzerland, worsening economic indicators, and worries that the U.S. stimulus package will not be enough to avert a recession in the U.S.

In first section of the Tokyo Stock Exchange 8.3 billion shares valued at 989 billion yen were traded and in the second section 493 million shares valued at 4.7 billion yen changed hands.

Of the Nikkei 225 shares 5 rose, 216 declined, and 4 were unchanged. Dainippon Sumitomo led advancers with a rise of 3.17% followed by Meiji Seika climbing 1.12%.

IMF Managing Director Dominique Strauss-Kahn said at the weekend during a public debate on the global economy at the World Economic Forum in Davos, Switzerland that there was no doubt that “there will be a serious slowdown that will require a serious response”, adding that governments cannot rely on monetary instruments alone to forestall a global economic slowdown.

Just months ago he had said that monetary stimulus will be sufficient and had urged the U.S. to restrain from any fiscal stimulus. His reversal of stance is partly from the worsening credit crisis in the U.S., spreading of American contagion to UK, and persisten choppiness in the global financial markets.

Bloomberg news reported today that Goldman Sachs chief economist in Japan Tetsufumi Yamakawa reported in a research note published today that declining domestic demand and wages, and falling industrial output will lead Japan into a recession.

Tetsufumi added that export shipments to China in the fourth quarter, though expected to offset a shrinking U.S. market, were growing at a much slower pace in volume terms than in the previous quarters.

Japan’s Financial Services Agency announced on its website yesterday that Kanto Local Bureau issued an administrative order against Teramento Corporation requiring it to submit correction of shareholdings reports submitted Friday on securities filings worth 20 trillion yen.

In the filings Teramento Corporation claimed majority shareholdings in Astellas Pharmaceutical Company, Sony Corporation, Mitsubishi Heavy Industry, Toyota Motor Corporation, Fuji Television Network Incorporated, Nippon Telegraph and Telephone Corporation.

Japan’s National Tourist Organization announced today that foreign tourists visiting Japan rose 13.8% from previous year to 8.3 million in 2007 on increasing number of tourists from Asian countries spurred by robust economic growth in the region.

About 2.6 million visitors were from South Korea, 1.3 million were from Taiwan and visitors from China jumped 16.2% from a year earlier to 943,400.

JNTO also added that the number of Japanese traveling abroad fell the most in five years by 1.3% year-on-year to 17 million.

Of the Nikkei 225 index shares Dainippon Sumitomo led advancers with a rise of 3.17% followed by rises in Meiji Seika of 1.12%, in Tokyo Dome Corporation of 0.87%, in Comsys Holdings of 0.36%, and in KDDI Corporation of 0.28%.