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Emerging Markets Week in Review-12/13/2010 - 12/17/2010
December 20, 2010--The Dow Jones Emerging Markets Sector Titans Composite Index climbed 0.38% last week as U.S. economic data indicated that the recovery could strenghten in 2011. Materials and Consumer stocks led the market up, increasing 0.72% and 0.54% respectively.
Health Care and Financials were the worst performers, falling 1.22% and 1.10%.
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Source: Emerging Global Advisors
S&P, TSX Group Launch Two New Indices For The Canadian Market
December 20, 2010-- Standard & Poor's, the world's leading index provider, and TSX Group Inc., operator of Toronto Stock Exchange and Montreal Exchange, announced today the launch of the S&P/TSX Equity Income Index and the S&P/TSX Composite Dividend Index, providing Canadian investors with two new innovative ways of measuring higher yielding stocks.
The S&P/TSX Equity Income Index is a strategy index focused on dividend income and comprised of 50 to 75 stocks selected from the S&P/TSX Composite, the headline index and principal broad market measure for the Canadian equity market. All stocks in the S&P/TSX Equity Income Index have a non-zero indicated annual dividend yield and are existing members of the S&P/TSX Composite.
The S&P/TSX Equity Income Index meets the Canadian investing community's desire for a new high yield, high dividend index to replace the S&P/TSX Income Trust Index which will lose most of its constituents on December 31, 2010 as many non-REIT income trusts in Canada are converting to corporate structure. The S&P/TSX Income Trust Index will continue to be calculated and published by Standard & Poor's.
The S&P/TSX Composite Dividend Index aims to provide a broad-based benchmark of Canadian dividend-paying stocks. The Index includes all stocks in the S&P/TSX Composite with positive annual dividend yields as of the latest rebalancing of the S&P/TSX Composite.
"The launch of these two new indices is the direct result of several consultations with the Canadian investment community, including industry leaders in income investing," says Abigail Etches, Director at S&P Indices. "The S&P/TSX Equity Income Index and the S&P/TSX Composite Dividend Index will provide investors with exposure to higher yielding stocks on a consistent basis while staying true to our hallmark of a transparent, rules-based methodology."
For more information about the S&P/TSX Equity Income Index and the S&P/TSX Composite Dividend Index, please visit www.standardandpoors.com/indices.
Source: S&P Indices
Banja Luka Stock Exchange Added To Dow Jones FEAS Index Universe
December 20, 2010-- Dow Jones Indexes, a leading global index provider, today announced that Banja Luka Stock Exchange will be added to the Dow Jones FEAS index universe.
The Dow Jones FEAS Indexes measure the performance of companies across the Euro-Asian region. There are three indexes in the family: a composite and two regional sub-indexes.
The Dow Jones FEAS Composite Index currently includes component stocks of 12 out of the 34 members of the Federation of Euro-Asian Stock Exchanges. The exchanges included are Abu Dhabi (UAE), Amman (Jordan), Banja Luka (Bosnia and Herzegovina), Belgrade (Serbia), Istanbul (Turkey), Karachi (Pakistan), Manama (Kingdom of Bahrain), Muscat (Oman), Sarajevo (Bosnia and Herzegovina), Skopje (Republic of Macedonia), Sofia (Bulgaria), and Zagreb (Croatia).
The Dow Jones FEAS Middle East/Caucasus Index currently includes stocks from the following four FEAS member exchanges: Abu Dhabi, Amman, Manama, and Muscat.
The Dow Jones FEAS South East Europe Index measures the performance of companies listed on the following seven FEAS member exchanges: Banja Luka, Belgrade, Istanbul, Sarajevo, Skopje, Sofia, and Zagreb.
The Dow Jones FEAS Indexes are designed to cover 95% of the free-float market capitalization of each country in the respective index. In addition to float-adjusted market capitalization, components are selected based on readily available prices. The indexes are calculated and disseminated in Euro and U.S. dollar, and weighted by float-adjusted market capitalization.
The Dow Jones FEAS Indexes are rebalanced quarterly, including an update of outstanding shares and float factors.
For more information on the Dow Jones FEAS Indexes, please visit http://www.djindexes.com.
Source: Dow Jones Indexes
SEC Proposes Permanent Rule Requiring Municipal Advisors to Register With Agency
December 20, 2010-- Securities and Exchange Commission has voted to propose a rule creating a new process by which municipal advisors must register with the SEC.
The proposed rule, required by the Dodd-Frank Wall Street Reform and Consumer Protection Act, would supplant a temporary rule the Commission adopted in September. Because the Act required that these advisors register by Oct. 1, 2010, the Commission adopted its earlier temporary rule on an interim basis so that advisors could fulfill the Act's mandates.
Municipal advisors provide advice to state and local governments and other borrowers involved in the issuance of municipal securities or with respect to the investment of governmental monies. Municipal advisors also solicit business from a state or local government for a third party. Subject to certain exemptions, the definition of municipal advisor under the Dodd-Frank Act includes financial advisors, guaranteed investment contract brokers, third-party marketers, placement agents, solicitors, finders, and certain swap advisors that provide municipal advisory services.
view SEC Rule proposal
Source: SEC.gov
Van Eck files with the SEC
December 20, 2010--Van Eck has filed a post-effective amendment, registration statement with the SEC for
Market Vectors Andean Equity ETF.
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Source: SEC.gov
iShares files with the SEC
December 20, 2010--iShares has filed a post effective amendment, registration statement with the SEC for
iShares MSCI All Peru Capped Index Fund ETF.
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Source: SEC.gov
Position limits proposal under private scrutiny
December 20, 2010--A US regulator has changed procedural tack as it considers new restraints on commodity speculation after a public meeting on the measures ended without a vote last week.
The so-called position limits proposal, which would cap investor holdings in 28 commodities from oil to palladium, is now being circulated privately among the five commissioners of the Commodity Futures Trading Commission, people familiar with the process said. If a majority sign off, the plan will be released for public comment without another meeting.
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Source: FT.com
iShares files with the SEC
December 17, 2010--iShares has filed a post-effective amendment, registration statement with the SEC for
iShares MSCI Australia Index Fund ETF.
view filing
Source: SEC.gov
Fee Rate Advisory #4 for Fiscal Year 2011
December 18, 2010--The President and Congress are expected to extend the continuing resolution funding the Securities and Exchange Commission through Dec. 21, 2010. During this period, fees paid under Section 6(b) of the Securities Act of 1933 and Sections 13(e), 14(g) and 31 of the Securities Exchange Act of 1934 will remain at their current rates.
As previously announced, 30 days after the date of enactment of the Commission’s regular fiscal year 2011 appropriation, the Section 31 fee rate applicable to securities transactions on the exchanges and in the over-the-counter markets will increase from their current rate of $16.90 per million dollars to a new rate of $19.20 per million dollars. The assessment on security futures transactions under Section 31(d) will remain unchanged at $0.0042 for each round turn transaction.
In addition, five days after the date of enactment of the Commission’s regular appropriation, the Section 6(b) fee rate applicable to the registration of securities, the Section 13(e) fee rate applicable to the repurchase of securities, and the Section 14(g) fee rate applicable to proxy solicitations and statements in corporate control transactions will increase from their current rate of $71.30 per million dollars to a new rate of $116.10 per million dollars.
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Source: SEC.gov
DB Global Equity Index & ETF Research : US ETP Market Weekly Review: US ETP AUM aiming for $1 trillion at the year end
December 17, 2010--Market Review
The market sentiment was overall favorable for the US market last week. Many Wall Street analysts and economists released positive outlooks for the US, followed by encouraging developments in Washington related to the Tax Deal, on top of additional positive economic data releases.
All this information caused the US equity market to move steadily upward one day at a time, finishing the week on its higher level in the past two years (as measured by the S&P 500). The S&P 500 was up by 1.28%, and the MSCI World increased by 0.56%, while the MSCI EM declined by 0.62%. At the same time, Gold price in USD was down by 1.99% and the USD appreciated 1.4% against the EUR. Total US ETP flows experienced strong above-average inflows of $9.7 bn vs $0.3 bn inflows the previous week. The weekly average ETP flows stands at $2.3 bn year to date. US ETPs AUM reached an all-time high of $981 bn, and now prepare to attempt the 1 trillion dollar year end mark for the first time.
Equity ETP flows: Investors pour money heavily into US Broad ETF
Equity ETPs recorded a massive $10.4 bn in inflows vs $1.1 bn in outflows in the previous week. Equity inflows were mainly driven by geographic and market size exposure, flowing abundantly into Long US focused and Broad Market ETPs (Figure 1 and 2).
It is worth to point out that half of the equity inflow ($5.2 bn) was driven by one single ETF, namely, the Vanguard Total Stock Market ETF (VTI), which recorded a 31% increase in its shares outstanding last Thursday. As it is common to most of Vanguard ETFs, VTI is a share class of an index fund which includes other mutual fund share classes as well. Hence although the assets for the ETF are around $20 bn, that is just a small portion of the overall fund assets of about $150 bn, and consequently the $5 bn inflow could have been easily driven by a share class conversion performed by large clients.
Last week also saw healthy inflows to the Long Small Cap ($2.1 bn) and Long Mid Cap ETFs ($1.2 bn). In the case of the Small Cap ETFs, the flows were probably driven by the relatively better performance of this segment (S&P 600, +2.51%) when compare to Large (S&P 500, 1.28%) or Mid Cap (S&P 400, +1.39%)
Fixed Income ETP flows drain away, Corporates and Foreign Sovereigns hang on
Apparently the come back to Fixed Income ETFs, didn’t last long. Last week $696 mm were drained away, more than offsetting the $542 mm inflows in the previous week. Notwithstanding, the year to date flows total still remain at a respectable $34 bn mark. Corporates and Foreign Sovereigns helped to offset the impact of this money flight by contributing with $104 mm and with $60 mm inflows, respectively.
The flows dynamics keep changing within the Precious Metals 2.0
Commodity ETPs experienced $259 mm in outflows during the last week, vs $961 mm inflows in the previous week. Concerns regarding an imminent rate hike in China in order to keep inflation under control, combined with profit taking after a couple of bullish weeks, kept commodities on the bearish side. Energy related ETPs experienced the largest outflows ($302 mm), while within Precious Metals products the $316 mm outflows in gold were mostly offset by the other glittering metals.
New Launch Calendar
Last week there were 9 new ETPs listed in the US. All of the new products were listed in NYSE Arca and were issued by 3 different ETP Providers. The products offer new Equal-Weight, Long/Short and Gold company exposure/themes.
Rydex launched 5 ETFs with an equal-weight approach offering International, Emerging Market, and Size exposure. Direxionshares brought 3 ETFs to market, two of which offer access to Gold mining companies on a leverage long and short basis, and one non-leverage, their first ever, tracking an equally weighted Airline index. Last but not least,. ProShares unveiled a fund that tracks a combined fundamental long/short investment approach.
Turnover Review
US ETP Avg. Daily Turnover dropped 5.4% totaling $64 bn at the end of the week. Equity ETPs registered the largest absolute decrease with $3.3 bn or -5.5% week over week.
Assets Under Management (AUM) Review
Strong Flows pushed US ETP assets to a new record high. Overall assets rose by 1.2%, reaching $981 bn at the end of the week. Year to date US ETPs AUM have increased $199 bn or 25.5%.
To request a copy of the report
Source: Deutsche Bank Global Equity Index & ETF Research
