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Morgan Stanley-US ETF Weekly Update
May 18, 2011--Weekly Flows: $4.7 Billion Net Inflows
ETF Assets Stand at $1.1 Trillion, Up 9% YTD
ETFs Traded $354 Billion Last Week
Launches: 3 New ETFs
US-Listed ETFs: Estimated Flows by Market Segment
ETFs rebounded last week, posting net inflows of $4.7 billion
US Large-Cap ETFs took in the most new money last week, but primarily driven by one fund (SPY)
ETF assets stand at $1.1 trillion, up 9% YTD; combination of market appreciation and net new money
13-week flows were mostly positive among asset classes, commodities being the outlier
$36.4 billion net inflows into ETFs over past 13 weeks (International Equity took in $14.1 billion)
We estimate ETFs have generated net inflows 13 out of 19 weeks YTD
US-Listed ETFs: Estimated Largest Flows by Individual ETF
SPDR S&P 500 ETF (SPY) generated net inflows of $3.4 billion last week, the most of any ETF
Despite last week’s positive flows, SPY is in the red for year, exhibiting net outflows of $973 million YTD
SPDR Gold Trust (GLD) exhibited the largest net outflows last week ($612 million) and for the year has now
posted net outflows 12 out of 19 weeks (net outflows of $3.9 billion YTD)
request report
Source: Morgan Stanley
US investors pile into exchange-traded funds
May 18, 2011--US investors are piling into exchange-traded stock funds, even as they become more bearish and pull back from actively managed funds.
Investors pumped a net $14.2bn into equity ETFs by the middle of the second quarter, nearly double the pace of investment in the first quarter, when net inflows for the entire period were $12.9bn, according to data from brokerage ConvergEx Group.
read more
Source: FT.com
Speech by SEC Chairman: Opening Statement at SEC Open Meeting by Chairman Mary Schapiro
May 18, 2011--Good morning. This is an Open Meeting of the Securities and Exchange Commission on May 18, 2011. Today, we will consider proposing rules that are intended to strengthen the integrity and improve the transparency of credit ratings.
These proposals arise from provisions of Title IX of the Dodd-Frank Wall Street Reform and Consumer Protection Act – which substantially augmented the Commission’s oversight of credit rating agencies that are registered as Nationally Recognized Statistical Rating Organizations (NRSROs).
The rules would establish new requirements for credit rating agencies, providers of third-party due diligence services with respect to asset-backed securities (ABS), and issuers and underwriters of asset-backed securities.
Proposals to Bolster the Integrity of Ratings In passing the Dodd-Frank Act, Congress noted the systemic importance of credit ratings. It also noted that ratings that were applied to structured financial products proved inaccurate – and contributed significantly to the mismanagement of risks by financial institutions and investors.
read more
Source: SEC.gov
SEC Proposes Rules to Increase Transparency and Improve Integrity of Credit Ratings
May 18, 2011--The Securities and Exchange Commission today voted unanimously to propose new rules and amendments intended to increase transparency and improve the integrity of credit ratings.
The proposed rules would implement certain provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act and enhance the SEC’s existing rules governing credit ratings and Nationally Recognized Statistical Rating Organizations (NRSROs).
“In passing the Dodd-Frank Act, Congress noted that credit ratings applied to structured financial products proved inaccurate and contributed significantly to the mismanagement of risks by financial institutions and investors,” said SEC Chairman Mary L. Schapiro. “Our proposed rules are intended to strengthen the integrity and improve the transparency of credit ratings.”
view the Proposed Rules for Nationally Recognized Statistical Rating Organizations
Source: SEC.gov
Standard & Poor's Announces Changes In The S&P/TSX Venture Composite Index
May 18, 2011--Standard & Poor's will make the following changes in the S&P/TSX Venture Composite Index after the close of trading on Thursday, May 19, 2011:
Explorator Resources Inc. (TSXVN:EXO) will be removed from the index.
The company will be delisted from the TSX Venture Exchange.
Company additions to and deletions from an S&P equity index do not in any way reflect an opinion on the investment merits of the company.
Source: Standard & Poors
Securitisation shake-up dubbed ‘death by 1,000 cuts’
May 18, 2011--Hundreds of pages of rules proposed by US regulators to render safer battered securitisation markets, from commercial real estate to car loans, instead threaten to make them "unviable" and suffer
"death by 1,000 cuts", lawmakers were warned on Wednesday.
Many billions of dollars of losses on securities backed by risky US mortgages were at the heart of the financial crisis, as mortgage-backed bonds with triple A ratings proved much riskier than expected and defaults soared.
read more
Source: FT.com
Fed seeks annual US bank stress tests
May 18, 2011--The Federal Reserve wants to subject US banks to annual capital tests, reserving the right to veto dividend pay-outs if they do not pass.
A draft of the new rule is set to be approved by the Federal Reserve Board and put out for public comment within weeks. Bank executives told the Financial Times that they have begun discussing the proposal with Fed officials, who remain wary of a return to the over-generous shareholder pay-outs that left financial institutions under-capitalised during the crisis.
read more
Source: FT.com
Minutes of the Federal Open Market Committee, April 26-27, 2011
May 18, 2011--The Federal Reserve Board and the Federal Open Market Committee on Wednesday released the attached minutes of the Committee meeting held on April 26-27, 2011. A summary of economic projections made by Federal Reserve Board members and Reserve Bank presidents for the April 26-27, 2011 meeting is also included as an addendum to these minutes.
The minutes for each regularly scheduled meeting of the Committee ordinarily are made available three weeks after the day of the policy decision and subsequently are published in the Board's Annual Report. Summaries of economic projections are released on an approximately quarterly schedule. The descriptions of economic and financial conditions contained in these minutes and in the Summary of Economic Projections are based solely on the information that was available to the Committee at the time of the meeting.
view the Minutes of the Federal Open Market Committee, April 26-27, 2011
Source: Federal Reserve
SEC probing electronic platform failures
May 18, 2011--The Securities and Exchange Commission (SEC) is investigating computer system failures at electronic marketplaces including Nasdaq to determine whether internal controls are sufficient, the Financial Times reported, citing people familiar with the matter.
The investigation is being handled by the enforcement division's market abuse unit, the paper reported, and is part of a broader regulatory review of stock exchanges following last year's "flash crash,"' recent hacking attempts and trading glitches.
read more
Source: Reuters
US investors pile into exchange-traded funds
May 18, 2011--US investors are piling into exchange-traded stock funds, even as they become more bearish and pull back from actively managed funds.
Investors pumped a net $14.2bn into equity ETFs by the middle of the second quarter, nearly double the pace of investment in the first quarter, when net inflows for the entire period were $12.9bn, according to data from brokerage ConvergEx Group
read more
Source: FT.com
