FXCM's Stock Plunges Toward Record Low, While Gain Capital's Surges

By Tomi Kilgore Markets MarketWatch Pulse

FXCM Inc.'s stock plunged 32% in premarket trade Tuesday toward a record low, after the currency broker was banned from operating in the U.S. after an investigation by the Commodity Futures Trading Commission found FXCM was effectively taking positions opposite its retail customers. The stock was on track to open at $4.00, below its previous record low close of $5.30 on Dec. 11, 2015. As part of FXCM's settlement with the CFTC, the company will sell its U.S. customer accounts, which had generated about $48 million in revenue in 2016, to Gain Capital Holdings Inc. for an undisclosed amount. Keefe, Bruyette & Woods analyst Kyle Voigt said he believed this "forced sale" was a positive for Gain's stock, as it would likely significantly add to earnings in the first year. Gain's stock shot up 5.9% in light premarket trade, putting it on track to open at the highest level since Dec. 31, 2015.

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