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Dow Jones Indexes Launches Emerging Markets Consumer Titans 30 Index
To Serve As a Basis for an Exchange-Traded Fund
September 14, 2010--Dow Jones Indexes, a leading global index provider, today announced the launch of the Dow Jones Emerging Markets Consumer Titans 30 Index. The index measures the performance of 30 leading consumer goods and consumer service companies in emerging markets.
The Dow Jones Emerging Markets Consumer Titans 30 Index is licensed to Emerging Global Advisors, LLC and will serve as a basis for an exchange-traded fund (ETF), to be listed on NYSE Arca. The ETF, called the EGShares Emerging Markets Consumer ETF (NYSE ticker: ECON) is the first emerging market ETF focused on consumer trends in the developing world.
“Consumer spending is a leading economic indicator,” said Michael A. Petronella, president, Dow Jones Indexes. “The Dow Jones Emerging Markets Consumer Titans 30 Index tracks the largest and most profitable consumer goods and consumer services companies in developing countries today. This allows investors to examine consumer spending in developing countries during the global economic recovery,” he said.
“As the developed world transitions from a society of spenders to a more prudent one of increased savings, the emerging world is slowly moving in the other direction,” said Richard C. Kang, chief investment officer & director of research, Emerging Global Advisors, LLC. “Although individually the emerging market consumer may have a smaller amount to spend, because of the size and youth of this demographic they are able to compensate for the massive structural changes happening in the developed world. This ETF is the first emerging market fund paying attention to this trend,” he said.
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Source: Dow Jones Indexes
Morningstar Reports U.S. Mutual Fund and ETF Asset Flows Through August 2010
September 14, 2010--Morningstar, Inc. (Nasdaq: MORN), a leading provider of independent investment research, today reported estimated U.S. mutual fund and exchange-traded fund asset flows through August 2010. Flows into long-term mutual funds increased by more than 11 percent in August to $16.8 billion, with fixed-income funds again receiving the majority of these assets. Outflows from domestic-equity ETFs contributed to net outflows of $1.3 billion from U.S. ETFs in August, ending a six-month streak of consecutive monthly inflows.
Additional highlights from Morningstar's report on mutual fund flows:
Taxable-bond funds accumulated assets of $168.5 billion year to date, and much of these inflows are likely attributable to low yields on money market funds. Money market funds have seen outflows in 16 of the 19 months since February 2009, for a total loss of nearly $1.0 trillion, reducing money market total net assets and market share to $2.7 trillion and 27.6%, respectively.
Outflows persisted for U.S. stock funds, with redemptions of $14.3 billion in August. Funds in the large growth and large value Morningstar categories saw the greatest outflows, surrendering a combined $8.6 billion in August alone and $38.3 billion for the year to date.
Although domestic-equity funds have seen outflows of $42.2 billion in 2010 and $25.7 billion in 2009, U.S. stock funds still have total net assets of more than $2.9 trillion. The $67.9 billion in outflows since the end of 2008 are not even 2.4 percent of that total, and passively managed domestic-equity funds have actually seen inflows in 34 of the past 36 months.
PIMCO's bond lineup helped it gather $7.7 billion in August to top all fund families, followed by Vanguard, although the firm's inflows dropped to $4.0 billion after taking in $4.9 billion in July. American Funds and Fidelity, which specialize in actively managed funds, lost another $5.5 billion and $1.6 billion, respectively, to outflows in August.
Additional highlights from Morningstar's report on ETF flows:
International-stock ETFs had inflows of $4.4 billion, the highest of all asset classes for the second straight month, thanks to strong demand for emerging-markets ETFs. Over the trailing three-year period, emerging-markets ETFs have accounted for more than 61 percent of flows into the asset class.
SPDR S&P 500 SPY, the largest ETF in terms of net assets, saw outflows of $6.6 billion in August, as investors moved their assets into higher-yielding equity strategies, including defensive and dividend-paying sectors and preferred stock ETFs.
iShares iBoxx $ High Yield Corporate Bond HYG and SPDR Barclays Capital High Yield Bond JNK, with inflows of $464 million and $332 million, respectively, led flows into junk bond ETFs, as investors took on more risk in search of more attractive yields in August. Short-term bond ETFs remained popular despite their unimpressive yields.
Precious-metals ETFs, bolstered by inflows of $827 million into SPDR Gold Shares GLD, were the most popular ETFs in the commodities asset class in August.
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Source: Morningstar
CME mistakenly places test orders for trading
September 14, 2010--CME Group, the world’s biggest futures exchange, mistakenly placed orders on active energy and metals markets as it was undertaking a quality assurance procedure.
CME declined to say which contracts were placed into the live market or how many orders were sent or executed, but a person familiar with the situation numbered them in the tens of thousands.
The mistaken order flow began at 3:38pm Eastern time on Monday and lasted six minutes. CME said the erroneous orders had no impact on prices.
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Source: FT.com
CFTC, SEC Announce Panelists, Room Update and Webcast Address for September 15 Public Roundtable to Discuss Swap Execution Facilities and Security-Based Swap Execution Facilities
September 14, 2010-The staffs of the Commodity Futures Trading Commission (CFTC) and Securities and Exchange Commission (SEC) today announced the panelists, a room update and the webcast address for their September 15, 2010, public roundtable to discuss Swap Execution Facilities (“SEFs”) and Security-Based Swap Execution Facilities (“SB SEFs”).
Room Update and Webcast Address
The roundtable will be held in the Multi-Purpose Room (Room L-006) at the SEC Headquarters located at 100 F Street NE, Washington, DC. Members of the public should disregard the room noted in CFTC press release #5889-10 and SEC press release #2010-166 (see related documents). The discussions will be open to the public with seating on a first-come, first-served basis.
Members of the public also may listen by telephone and should be prepared to provide their first name, last name, and affiliation. The roundtable’s agenda and call-in information may be found in CFTC press release #5889-10 and SEC press release #2010-166 (see related documents).
In addition to listening by telephone, members of the public may access a webcast of the roundtable at: www.sec.gov.
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Source: CFTC.gov
Gensler Statement on CFTC/SEC Public Roundtable to Discuss Swap Data, Swap Data Repositories and Real Time Reporting
September 14, 2010--Commodity Futures Trading Commission Chairman Gary Gensler today commented on the joint CFTC-SEC Public Roundtable to Discuss Swap Data, Swap Data Repositories and Real Time Reporting.
Chairman Gensler said:
“Promoting transparency is at the core of the CFTC’s mission,” CFTC Chairman Gary Gensler said. “The Dodd-Frank Act’s provisions on data, swap data repositories and real time reporting will increase transparency both to regulators and to the public. The views of today’s panels will help the CFTC as we write rules to implement essential provisions of the Dodd-Frank Act.”
Source: CFTC.gov
State Street Global Advisors Launches First Global Natural Resources ETF
September 14, 2010-State Street Global Advisors (SSgA), the investment management business of State Street Corporation, today announced that the SPDR(R) S&P(R) Global Natural Resources ETF (Symbol: GNR) began trading on the NYSE Arca on September 14, 2010. Its annual expense ratio is 0.40 percent.
Designed to provide investors with diversified, global exposure across the Energy, Metals and Mining, and Agriculture sectors, the SPDR S&P Global Natural Resources ETF seeks to track the performance of the S&P Global Natural Resources Index. The Index includes ninety of the largest publicly-traded companies in global natural resources and commodities businesses. In addition to being listed on a developed market exchange, Index constituents must have a minimum of $1 billion market capitalization and a three month average daily trading value of $5 million or more.
"The SPDR S&P Global Natural Resources ETF was developed in response to demand from sophisticated investors and financial advisors seeking precise natural resources exposure that is not overweight on the energy sector," said James Ross, senior managing director at State Street Global Advisors. "With the addition of the SPDR S&P Natural Resources ETF, our family of SPDR ETFs provides investors with an opportunity to benefit from increasing natural resources demand across the globe."
Index holdings are equally-weighted across the energy, metals and mining, and agriculture sectors. This index methodology offers investors exposure that is diversified, liquid, and balanced, and prevents overweighting energy companies, which make up more than 10 percent of the S&P 500(R) Index based on market capitalization.
"With the consumption of natural resources poised for growth in both emerging markets and developed countries, the investment outlook for this sector remains promising," said Dan Peirce, vice president and a portfolio manager with the Multi Asset Class Solutions team at State Street Global Advisors. "In light of the sector's attractive supply and demand dynamics and relatively low correlation with other asset classes, the benefits of investing in natural resources are becoming increasingly apparent to investors."
State Street manages more than $200 billion in SPDR ETF assets worldwide (as of June 30, 2010) and is one of the largest ETF providers in the US and globally.
SOURCE: State Street
EGShares Launches Industry’s First Emerging Markets Consumer Exchange-Traded Fund
September 14, 2010--EGShares, the only dedicated emerging markets sector ETF provider in the U.S., has launched the Emerging Global Shares Emerging Markets Consumer Titans Index Fund (NYSE: ECON). This is the first ETF that offers investors access to emerging markets companies that we believe are well positioned to benefit from the rapidly growing spending patterns of the middle class in the world’s fastest growing economies. ECON invests in the securities in the Dow Jones Emerging Markets Consumer Titans 30 Index.
“We believe many equity research firms have positioned the emerging market consumer theme as the pre-eminent structural and demographic opportunity for the foreseeable future,” said Robert Holderith, President and CEO of EGShares. “We are pleased to offer investors the first broad-based emerging markets ETF as a way to try to capitalize this investment opportunity.”
The Dow Jones Emerging Markets Consumer Titans Index is a 30-stock index with an average market capitalization of $14.5 billion. The index’s top five industry weights, as of 6/30/10, were General Retailers (16.27%), Automobiles & Parts (14.85%), Beverages (14.24%), Food Producers (13.46%), and Media (10.86%), followed by Food & Drug Retailers, Tobacco, Travel & Leisure, Personal Goods, and Household Goods. ECON charges a net expense ratio of 0.85% (gross expense ratio: 1.20%).*
According to Richard Kang, CIO and Director of Research at EGShares, “One of the primary secular drivers in today’s economic environment is that households in the developed world are deleveraging—spending less, saving more—while those in the emerging markets are moving in the opposite direction. Although the median household income may be small in relation to developed markets, both the large size and young age of the emerging market population make this a key theme for both the near and long term. Today, the West is consuming less but at least others around the globe are picking up the slack.”
Tom Sowanick, co-president and CIO of Omnivest Group, a Princeton, NJ-based investment advisory firm, said the most provocative story for U.S. investors right now is in emerging markets and the key plot points in that story are demographics, urbanization and, of course, consumerism. “Emerging economies will benefit from the three Ds; Demographics, Density and Distance,” said Sowanick, who is the former CIO of Merrill Lynch’s Private Client Group where he spent 25 years in research. “Over the next 20 years, Asia will represent 55% of the world’s urban population, with India and China accounting for 30% of the total.”
Sowanick continued: “Urbanization and the increase of megacities, primarily in India and China, will witness a massive migration to urban cities of nearly 1 billion people. Urbanization will also shift consumer demand from rural appetites to urban appetites. Skyscrapers, transportation, energy consumption and food consumption will increase substantially over the next two decades from this migration and the emergence of a massive middle class.”
The EGShares Emerging Markets Consumer ETF is the ninth ETF to be introduced by EGShares. The company’s other ETFs are the EGShares India Infrastructure ETF (INXX), the EGShares India Small-Cap ETF (SCIN), EGShares Brazil Infrastructure ETF (BRXX), EGShares China Infrastructure ETF (CHXX), EGShares Emerging Markets Metals/Mining ETF (EMT), EGShares Emerging Markets Energy ETF (EEO), EGShares Emerging Markets Financials ETF (EFN) and the EGShares Emerging Markets Composite ETF (EEG).
Source: Emerging Global Advisors LLC
State Street files with the SEC
September 13, 2010-State Street has filed a post-effective amendment, registration statement with the SEC for
SPDR® S&P® Global Natural Resources ETF.
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Source: SEC.gov
SEC Announce Panelists for September 14 Public Roundtable to Discuss Swap and Security-Based Swap Data, Swap and Security-Based Swap Data Repositories and Real Time Reporting
September 13, 2010-- The staffs of the Commodity Futures Trading Commission (CFTC) and Securities and Exchange Commission (SEC) today announced the panelists for their September 14, 2010, public roundtable to discuss Swap and Security-Based Swap Data, Swap and Security-Based Swap Data Repositories (SDRs) and Real-Time Reporting.
Note: the Roundtable’s agenda and call-in information may be found in CFTC press release #5886-10 and SEC press release #2010-166 (see related documents).
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Source: CFTC.gov
Emerging Markets Week in Review 9/6/2010 - 9/10/2010
September 13, 2010--The Dow Jones Emerging Markets Sector Titans Composite Index increased 0.71% last week, reaching its highest weekly close since April. Industrials and Technology led the market up, climbing 1.79% and 1.75% respectively. Telecom, the least positive sector for the week, increased 0.18%.
Since hitting a low on May 25, the Composite index is up 16.95%, led by increasingly bullish signs that the emerging markets consumer is leading the global economy in the recovery. In less than four months, the Dow Jones Emerging Markets Consumer Titans Index is up 28.06%.
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Source: Emerging Global Advisors
