Global ETF News Older than One Year
Shanghai forges bourse link with Brazil
February 16, 2011--The Shanghai Stock Exchange and BM&F Bovespa, Latin America’s biggest exchange operator, are set to sign an agreement on Monday that is expected to lead to the cross-listings of stocks
Cross-listings, which would give benchmark Brazilian stocks access to liquidity in China and would increase trading of them during the Asian day, will add another element to one of the world’s most important emerging bilateral trade relationships.
Source: FT.com
Deutsche Börse AG And NYSE Euronext Agree To Combine To Create The Premier Global Exchange Group
Creates a world leader in derivatives and risk management and the premier global venue for capital raising
Combined group to offer clients global scale, product innovation, operational and capital efficiencies, and an enhanced range of technology and market information solutions
New group, incorporated in the Netherlands to be dual headquartered in New York and Frankfurt
Combined group to have key businesses, infrastructure and executives located in Paris, London, Luxembourg and other locations
Expected cost synergies of EUR 300 million/US$ 400 million and substantial opportunities for incremental revenues
Ownership: 60% by Deutsche Boerse shareholders, 40% by NYSE Euronext shareholders on a fully diluted basis
Each share of Deutsche Boerse stock will be exchanged for 1 share of the new company stock and each share of NYSE Euronext stock will be exchanged for 0.4700 shares of the new company stock
February 15, 2011--Deutsche Boerse AG (XETRA:DB1) and NYSE Euronext (NYSE:NYX) today announced that they have entered into a business combination agreement following approval from both companies’ Boards.
Under the agreement, the companies will combine to create the world’s premier global exchange group, creating the world leader in derivatives trading and risk management, and the largest, most well known venue for capital raising and equities trading. The combined group will offer clients global scale, product innovation, operational and capital efficiencies, and an enhanced range of technology and market information solutions.
The transaction will strengthen Frankfurt and New York as key financial centers, while benefiting Paris and London as well as Luxembourg. Each of the group’s national exchanges, including those in Amsterdam, Brussels, and Lisbon, will keep its name in its local market and all exchanges will continue to operate under local regulatory frameworks and supervision. The combined group will work closely with regulators in all markets to facilitate transparency and standardization of capital markets globally.
The combined group will have 2010 combined net revenues of EUR*1) 4.1 billion/US$ 5.4 billion, and 2010 EBITDA of EUR 2.1 billion /US$ 2.7 billion, thus becoming the world’s largest exchange group by revenues and EBITDA. Based on 2010 net revenues, the combined group will earn approximately 37% of total revenues in derivatives trading & clearing, 29% in cash listings, trading & clearing, 20% in settlement & custody, and 14% in market data, index & technology services.
Source: Deutsche Börse
LME-SGX metals futures successfully launched
February 15, 2011--Singapore Exchange (SGX) and the London Metal Exchange (LME) successfully launched LME-SGX copper, aluminium and zinc futures today at 8.00am Singapore time to provide retail investors in Asia and beyond easy access to global metals markets.
The new futures contracts have already attracted strong interest with three market makers and 20 active traders signed up to the initiative. The market markers are GS Energy Partners LLC (from USA), Susquehanna Pacific Pty Ltd (from Sydney) and a market maker from Asia Pacific (confidentiality requested).
The futures will have 12 consecutive contract months listed for trading and will be cash settled at expiry based on the LME Official Cash Settlement Price for the relevant metal. The trading hours for the new contracts will cover the Asian trading day (T-session) from 8:00am to 3:20pm Singapore time and the European trading day (T+1 session) from 4:00pm to 2:00am the following day, Singapore time. The contracts are traded and cleared exclusively on SGX.
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Source: London Metal Exchange
Infrastructure investments lag significantly behind population growth trend
As governments struggle to make ends meet, private investors are filling in the gaps for these projects, and the implications for environmental, social and governance (ESG) factors on the sector are intensifying. This sector report is the 12th in a series. Dexia Asset Management provided the research and a steering committee composed of representatives from CDC Climat, CM-CIC Asset Management and Threadneedle oversaw the project. view the Infrastructure Sector Report
Source: Eurosif
Fitch Ratings Scenario: Euro Dollar Parity
Cost Mismatches Common Impact Greatest on Manufacturers But Effects Vary
Source: Fitch Ratings
Chief Financial Officer and Executive Vice President, Corporate Strategy to Depart NASDAQ OMX
Adena has been a valued and trusted partner of mine since I joined as CEO," said Bob Greifeld, Chief Executive Officer of NASDAQ OMX. "She has played a tremendous role in the growth and success of NASDAQ OMX over her 18 years with the company. Her leadership skills, outstanding business acumen and entrepreneurial spirit have driven a number of game changing transactions for NASDAQ OMX. I have great respect for Adena personally and professionally and wish her much success at Carlyle."
Ms. Friedman assumed the role of CFO in 2009 in addition to overseeing corporate strategy. She directed NASDAQ's acquisition of OMX AB, through which NASDAQ OMX acquired the Nordic and Baltic markets and a global exchange technology business. She also managed NASDAQ OMX's acquisition of the Philadelphia Stock Exchange, now one of the largest options exchanges in the U.S. In 2005, Friedman directed NASDAQ in its acquisition of the INET ECN, which enhanced NASDAQ's technology infrastructure and further improved its trading capabilities. Before assuming her role as CFO, Ms. Friedman served as head of Global Data Products, a $250M business unit within The NASDAQ OMX Group. She joined NASDAQ in 1993.
Source: NASDAQ OMX
Statistics : Composite leading indicators point to continued expansion
The CLIs for Germany, Japan and the United States point to relatively robust expansion relative to trend, while in Canada, France and the United Kingdom the CLIs point to continued moderate expansion. There are nevertheless signs of a downturn emerging in Italy.
Source: OECD
BlackRock * New Report * ETF Landscape: Industry Highlights - January 2011
The ETF Landscape industry highlights, as of the end of January 2011, are as follows: United States ETF industry: The United States ETF industry had 913 ETFs and assets of US$907.3 Bn, from 28 providers on two exchanges. This compares to 791 ETFs and assets of US$665.4 Bn, from 28 providers on two exchanges at the end of January 2010. US$10.3 Bn of net new assets went into United States listed ETFs/ETPs in January 2011. US$8.6 Bn net inflows went into equity ETFs/ETPs, of which US$10.6 Bn went into ETFs/ETPs tracking North American indices, while ETFs/ETPs tracking emerging market indices saw net outflows of US$3.8 Bn. Fixed income ETFs/ETPs saw net inflows of US$2.8 Bn, of which US$1.1 Bn went into high yield bond ETFs/ETPs and US$0.8 Bn into government bond ETFs/ETPs. Commodity ETFs/ETPs experienced US$1.7 Bn net outflows, of which precious metals ETFs/ETPs saw net outflows of US$3.5 Bn, while US$1.1 Bn net inflows went into agricultural commodity ETFs/ETPs in January 2011. Of the US$12.1 Bn of net new assets in United States listed ETFs in January 2011, State Street Global Advisors gathered the largest net inflows with
US$5.1 Bn, followed by Vanguard with US$4.2 Bn net inflows, while iShares saw US$2.3 Bn net outflows. Global ETF and ETP industry: The global ETF industry had 2,501 ETFs with 5,701 listings and assets of US$1,334.6 Bn, from 138 providers on 47 exchanges around the world. This compares to 2,055 ETFs with 3,941 listings and assets of US$984.0 Bn from 114 providers on 40 exchanges at the end of January 2010. The global ETF and ETP industry combined had 3,574 products with 7,487 listings, assets of US$1,498.9 Bn from 172 providers on 51 exchanges around the world. This compares to 2,675 products with 4,852 listings, assets of US$1,132.8 Bn from 137 providers on 43 exchanges at the end of January 2010.
European ETF industry: The European ETF industry had 1,085 ETFs with 3,808 listings and assets of US$291.9 Bn, from 40 providers on 23 exchanges. This compares to 896 ETFs with 2,468 listings and assets of US$217.9 Bn from 34 providers on 18 exchanges at the end of January 2010. US$3.8 Bn of net new assets went into European listed ETFs/ETPs in January 2011. US$4.7 Bn net inflows went into equity ETFs/ETPs, of which US$1.8 Bn went into ETFs/ETPs tracking European indices and US$0.7 Bn into ETFs/ETPs tracking emerging market indices. Fixed income ETFs/ETPs saw net outflows of US$0.4 Bn, of which government bond ETFs/ETPs saw net outflows of US$0.8 Bn while US$0.3 Bn went into money market ETFs/ETPs. Commodity ETFs/ETPs saw net outflows of US$0.3 Bn, of which ETFs/ETPs providing precious metals exposure saw US$0.6 net outflows while US$0.3 Bn went into broad commodity exposure.
Of the US$4.4 Bn of net new assets in European listed ETFs in January 2011, iShares gathered the largest net inflows with US$1.9 Bn, followed by Source Markets with US$0.9 Bn net inflows, while Lyxor Asset Management had the largest net outflows with US$0.2 Bn. Asia Pacific (ex-Japan) ETF industry: The Asia Pacific (ex-Japan) ETF industry had 211 ETFs with 318 listings and assets of US$54.5 Bn, from 60 providers on 13 exchanges. This compares to 134 ETFs with 218 listings and assets of US$36.9 Bn, from 47 providers on 13 exchanges at the end of January 2010. Japan ETF industry: The Japanese ETF Industry had 80 ETFs with 83 listings and assets of US$31.2 Bn, from seven providers on two exchanges. This compares to 69 ETFs with 72 listings and assets of US$24.2 Bn from six providers on two exchanges at the end of January 2010. There are 178 ETFs which have filed notifications in Japan. Latin America ETF industry:
The Latin American ETF industry had 26 ETFs, with 365 listings and assets of US$9.7 Bn, from four providers on three exchanges. This compares to 17 ETFs, with 220 listings and assets of US$9.5 Bn from three providers on three exchanges at the end of January 2010. Canada ETF industry:
The Canadian ETF industry had 157 ETFs and assets of US$38.0 Bn, from four providers on one exchange. This compares to 125 ETFs and assets of
US$28.4 Bn from four providers on one exchange at the end of January 2010.
Source: Deutsche Bank Global Equity Index & ETF Research
DB Global Markets Research-Fundamental Index Views-Equities: S&P500 (Buy) "Go with the flow"
Further, bottom-up
aggregated fundamentals of S&P 500 companies (ex Financials) look strong where EBIT margins have recovered above pre-crisis levels, reasonable deleveraging is accompanied by a comfortable cash position and high net interest cover ratios.
Also, strong positive momentum in earnings revisions is building up. We estimate 96$ in 2011E and a fair value multiple of 16.4x which brings us to our YE target of 1,550. We estimate 2011E sales growth of 8.8% and EPS growth of 12.4%.
…and a strong Q4’10 reporting so far (see pages 6, 7)
In a nutshell, 16 out of 19 sectors have beaten on an earnings level and only Construction & Materials as well as Utilities disappointed so far. Fund flows supportive for DM and our case for US Equities (see page 5)
A key theme since Nov 2010 has been investors’ move from ‘nominal’ to ‘real’
assets with major flows out of US Bonds into Equities (with Japan, EMEA and the
US as key beneficiaries) and Corporate High Yield Bonds. Moreover, inflows into
Emerging market (EM) equities have continuously faded since Nov 2010 and have finally turned into record outflows of 1.0% of total assets over the last week (a 3-year record) while Developed market (DM) equity funds and particularly the US continued to see inflows with an improving trend. US equities have seen inflows
of 0.2% of total assets last week (inflows in 8 out of the last 9 weeks). The stronger than expected US January ISM may also have been supportive. To request a copy of the report
Source: Deutsche Bank Global Markets Research
BlackRock * New Report * ETF Landscape: Industry Review - Year End 2010
Demand for ETFs globally has surged as professional and retail investors alike have discovered their unique combination of benefits, such as versatility, transparency and significant cost advantages. The availability of cost effective, flexible, liquid, and diversified investment products that enable rapid implementation of a comprehensive range of investment strategies has struck a chord with investors – during both bull and bear markets. Factors driving expanding use of the vehicle include the number and types of equity, fixed income, commodity and other indices covered, more fund platforms embracing ETFs, more active marketing of ETFs by online brokers, greater involvement by fee based advisors, the growing number of exchanges planning to launch new ETF trading segments, and regulatory changes in the United States, Europe and many emerging markets that allow funds to make larger allocations
to ETFs. We expect global AUM in ETFs and ETPs to increase by 20-30% annually over the next three years, taking the global ETF/ETP industry to approximately US$2 trillion in AUM by early 2012. Considering ETFs separately, AUM should reach US$2 trillion globally by the end of 2012, US$1 trillion in the United States in 2011 and US$500 billion in Europe in 2013.
Source: Global ETF Research & Implementation Strategy Team, BlackRock
Febryary 15, 2011--According to Eurosif’s Infrastructure Report, the major issues affecting the infrastructure sector include a growing population, under financing, security and climate change. Demand for infrastructure and public utilities is increasing, putting pressure on governments, infrastructure assets and resources. The OECD predicts that about €1.5 trillion will be required annually to finance world infrastructure by 2030.
Picking Winners (and Losers) in EMEA
February 15, 2011--Summary: Positive for Minority of European Issuers
The effect of a hypothetical 30% depreciation of the euro, bringing it broadly to parity with the USD, would on average be positive for the profitability of European
corporate issuers. However, the global nature of most of these companies implies a considerable variety of outcomes, with only a minority likely to benefit materially.
Euro/dollar parity brings into focus often significant currency mismatches in
European issuers’ cost and revenue bases. While they are used to dealing with exchange rate fluctuations — through hedging, pricing and sourcing — currency has a greater positive or negative impact on some sectors and issuers than others.
A weakening euro is generally positive for manufacturers (including some
technology companies), as expected. Fitch Ratings estimates that most European manufacturers have a larger proportion of EUR?denominated costs than revenue, which makes a falling euro profit?enhancing.
February 14, 2011--The NASDAQ OMX Group, Inc. (Nasdaq:NDAQ) announces that Adena Friedman, Chief Financial Officer and Executive Vice President, Corporate Strategy will be leaving the company, effective March 4, 2011. Ms. Friedman will be joining The Carlyle Group as Managing Director, Chief Financial Officer and Member of the Operating Committee, based in Washington, D.C. Former NASDAQ OMX CFO David Warren has been appointed special advisor to the CEO and Ronald Hassen, Senior Vice President, Controller and Principal Accounting Officer will become interim CFO, while a permanent replacement is sought.
February 14, 2011-- Composite leading indicators (CLIs) for December 2010, designed to anticipate turning points in economic activity relative to trend, continue to point to expansion in most major OECD countries.
February 11, 2011--This report highlights the Exchange Traded Funds (ETFs) and Exchange Traded Products (ETPs) industry as of the end of January 2011.
We expect global AUM in ETFs and ETPs to increase by 20–30% annually over the next three years, taking the global ETF/ETP industry to approximately US$2 trillion in AUM by early 2012. Considering ETFs separately, AUM should reach US$2 trillion globally by the end of 2012, US$1 trillion in the United States in 2011 and US$500 billion in Europe in 2013.
February 2011--S&P 500’s +ive momentum backed by strong fundamentals
Our US economists have raised their 2011 GDP forecast from 3.3% to 4.3% on
the back of an improved outlook on the unemployment rate (2011 YE forecast
lowered to 7.8% from 8.8% previously) and rising output due to the combination
of strengthening demand and negligible inventory (should result in inventory
accumulation which is likely to propel output up to +4.5%).
Out of 245 S&P 500 companies, 71% have reported sales above expectations
(strongly ahead of Q3 2010) and 71% above earnings expectations (as of 4 Feb
2011). In contrast, out of 68 Stoxx 600 companies in Europe, only 56% have
reported earnings above expectations and 61% came in with sales surprises. On
the sector level, Technology (largest sector weighting in the S&P 500 of ~19%,
see middle chart on the right) stands out positively with 81% out of 37 companies having positively surprised on the earnings level and even 84% on the sales level.
February 11, 2011--The industry grew in all major dimensions during 2010 and we expect this to continue in 2011. With products and assets both growing by 26.6%, the global ETF industry had 2,459 ETFs with 5,554 listings and assets of US$1,311.3 Bn, from 136 providers on 46 exchanges around the world, at year end 2010. This is up significantly on 2009's year end of 1,943 ETFs with 3,827 listings and assets of US$1,036.1 Bn, from 108 providers on 41 exchanges.
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