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SIFMA Report on Municipal Securities Industry
2010 Issuance Expected to Exceed $450 Billion, an Increase Over Estimated 2009
December 9, 2009--The Securities Industry and Financial Markets Association (SIFMA) today released its 2010 Municipal Issuance Survey. Compiled from responses provided by large and regional municipal bond underwriters and dealers, the report forecasts what type of activity is expected in the taxable and tax-exempt municipal securities market in 2010.
Respondents forecast that $450.5 billion in total tax-exempt municipal securities will come to market next year, a 7.9 percent rise from the $418 billion estimated this year. Increases are expected in both long- and short-term issuance and variable rate demand obligation (VRDO): long-term issuance is forecast to be $347.5 billion in 2010; short-term is forecast to be $68 billion; and VRDO to be $35 billion.
Build America Bonds (BABs) are also expected to continue their strong trend with 2010 issuance forecast to be almost 50 percent greater than 2009 estimates, at $85 billion.
“Despite fiscal difficulties at the state and local levels, the strong issuance forecast underscores the market’s appetite for municipal bonds and the ability of state and local governments to make use of different financing vehicles available to them, including Build America Bonds,” said Randy Snook, executive vice president, business policy and practices, SIFMA. “Having a stable and efficient municipal bond market that helps states and local communities finance important initiatives is a critical component of the financial services industry’s efforts to help grow the U.S. economy.”
View the 2010 Municipal Issuance Survey
Source: SIFMA
Standard & Poor's and BGCantor Market Data to Jointly Develop New U.S. Treasury Indices
November 8, 2009--Continuing to expand its family of fixed income indices, Standard & Poor's, the world's leading index provider, announced today that it has signed an agreement with BGCantor Market Data, L.P., a leading market data provider and a subsidiary of BGC Partners, Inc. to jointly develop a new family of U.S. Treasury Indices.
The new U.S. Treasury Bond Indices, expected to launch in the first quarter of 2010, will use end of day U.S. Treasury bond pricing from BGCantor Market Data, and will be maintained and published by S&P Indices. The joint effort will result in U.S. Treasury Indices designed to meet custom requirements, liability driven investing and portfolio building strategies.
"The unprecedented borrowing by the U.S. government, coupled with the current flight to quality dynamics of the domestic marketplace, has created a need for indices that offer investors additional transparency and insight into the government bond market," says James Rieger, Vice President at S&P Indices. "We are delighted that BGCantor Market Data has decided to lock arms with S&P Indices to provide fixed income investors with the solutions that they need to meet their investment objectives."
Bernie Weinstein, head of BGCantor Market Data, added: "We are very pleased to be working with S&P to develop this family of indices. BGC Partners' eSpeed platform was the first fully electronic platform for US Treasuries, transforming the way these securities were traded. These new indices from S&P, based on our market data, will provide a key benchmark designed to increase transparency and efficiency, and further support our customers' activity in the U.S. government bond markets."
The new family of U.S. Treasury Indices will initially include the following:
- S&P/BGCantor 0-3 Month U.S. Treasury Bill Index
- S&P/BGCantor 3-6 Month U.S. Treasury Bill Index
- S&P/BGCantor 6-9 Month U.S. Treasury Bill Index
- S&P/BGCantor 9-12 Month U.S. Treasury Bill Index
- S&P/BGCantor 0-1 Year U.S. Treasury Bond Index
- S&P/BGCantor 1-3 Year U.S. Treasury Bond Index
- S&P/BGCantor 3-5 Year U.S. Treasury Bond Index
- S&P/BGCantor 7-10 Year U.S. Treasury Bond Index
- S&P/BGCantor 10-20 Year U.S. Treasury Bond Index
- S&P/BGCantor 20+ Year U.S. Treasury Bond Index
- S&P/BGCantor U.S. TIPs Index
For more information Standard & Poor's growing family of fixed income indices, please visit: www.fixedincomeindices.standardandpoors.com.
Source: Standard & Poors
ISE Announces Enhancements to its ISE FX Options® Product Suite
Options on the Brazilian real and Single Penny Strikes to Roll Out in Early 2010
December 8, 2009--The International Securities Exchange (ISE) is pleased to announce it
will introduce enhancements to its ISE FX Options product suite in early 2010. First, ISE will expand its
product offering to include options on the Brazilian real (USDBRL). In addition, ISE plans to introduce
“penny strikes” for each expiration month, creating a deep in the money call option for all currency pairs.
When this new offering is implemented, investors will have more direct exposure to the FX spot price.
Both new products are pending regulatory approval.
“We are very excited to expand the breadth of our ISE FX Options suite with new products that offer traders even more flexibility in hedging exposure to global currencies,” said Kris Monaco, Director of New Product Development at ISE. “Demand for exchange-traded, centrally-cleared FX products continues to grow. Options on the Brazilian real will provide investors with exposure to one of the fastest growing emerging market currencies. Penny strikes will allow investors to execute tied-to-spot trading strategies without the counterparty credit risks associated with the over-the-counter FX spot market. For the first time, investors will be able to trade such multi-leg FX spread strategies without legging risk.”
ISE currently lists FX options on nine currency pairs. The USD-based, or “per US$,” currency convention is available for all nine pairs and allows investors to express their views on the strength or weakness of the U.S. dollar relative to global currencies while adopting the trading strategies they currently use for equity and index options. The “in US$” currency convention, which is the inverse of the USD-based convention, is the traditional convention used in the FX spot market and is available on four currency pairs.
As exchange-listed securities, ISE FX Options can be easily accessed through most major brokerage
accounts that are approved for trading equity and index options. These products are cash-settled and
have European style exercise. For more information, please visit www.ise.com/fx.
Source: International Securities Exchange (ISE)
Interactive Brokers Will Offer Trading on ELX Futures
December 8, 2009--ELX Futures, L.P. (ELX Futures), a new fully electronic futures exchange, announced today that Interactive Brokers Group, Inc. (NASDAQ GS: IBKR), an automated global electronic market maker and broker specializing in routing orders and executing and processing trades in securities, futures and foreign exchange instruments will become a member of the exchange and will offer trading on ELX Futures.
Neal Wolkoff, Chief Executive Officer of ELX Futures, said, “We are pleased to partner with Interactive Brokers, which will provide us with significant presence to a diverse customer base when it offers FCM services for futures contracts traded on ELX Futures. This new relationship with Interactive Brokers further establishes ELX Futures as a competitive, new alternative in the futures marketplace.”
“Interactive Brokers has always encouraged increased competition amongst trading venues as it is good for our customers. We look forward to working with ELX in providing an additional outlet for the trading of futures,” said Steve Sanders, Senior Vice President, Product Development at Interactive Brokers.
ELX Futures launched trading with an initial slate of four U.S. Treasury futures products on July 10th after receiving regulatory approval from the U.S. Commodity Futures Trading Commission (CFTC) to become a Designated Contract Market, with OCC as its clearinghouse. ELX has relationships with nine of the top 10 FCMs ranked by segregated funds as published by the Futures Industry Association.
Source: ELX Futures
Claymore Launches First Ever China Tech ETF
December 8, 2009--Claymore Securities, Inc, today announced the launch of the Claymore China Technology ETF (NYSE Arca: CQQQ), the first ETF to focus on the Chinese technology sector.
The addition of CQQQ brings Claymore’s suite of China-focused ETFs to four: China technology (NYSE Arca: CQQQ), China all-cap (NYSE Arca: YAO), China small cap (NYSE Arca: HAO) and China real estate (NYSE Arca: TAO).
“We believe that the successful launch of our China all-cap ETF (NYSE Arca: YAO) in October, which posted record first-day volume for a US-listed ETF launched in 2009,1 confirmed investor appetite for investments focused on China. Earlier products, TAO and HAO, opened the doors for portfolio diversification within the China portion of an investor’s portfolio. We are excited about the launch of the newest addition to our suite, which is the first ETF to grant investors access to the Chinese technology sector, an area of the market that appears posed for continued growth,” said Christian Magoon, President of Claymore Securities, Inc.
Despite a challenging world-wide economic environment, China is predicted to claim the world’s highest GDP growth in both 2009 and 2010.2 It is expected that this growth may result in a substantial increase in China’s technology demands. Approximately $54 billion of China’s $585 billion stimulus package is being allocated to technology advancements, with a new focus on high-end production.3 The combination of the stimulus package with the increased spending power of China’s growing urban population¯90% of China’s urban households are projected to be middle class or above by 20254¯may have a considerable impact on the future demand for new technologies and improvements to existing technologies that may help drive future revenue and profits of China technology companies.
Chief Investment Officer of AlphaShares, the creator of the index that CQQQ seeks to track, and Princeton University economist, Dr. Burton G. Malkiel, noted, “Most investors, in my opinion, are underexposed to China to begin with. Some of the most utilized China-focused investment products have little or no exposure to the technology sector. China is developing intellectual property at a rapid rate and is already a technology powerhouse. CQQQ allows suitable investors to gain exposure to what I believe to be an important and fast growing sector of the Chinese economy.”
CQQQ seeks to replicate the AlphaShares China Technology Index (Index Ticker: ACNIT) (the “Index”). The Index seeks to measure and monitor the performance of the investible universe of publicly-traded companies based in mainland China, Hong Kong or Macau that are in the information technology sector, as defined by Standard & Poor’s Global Industry Classification Standard (“GICS”) and are open to foreign investment. The companies included in the Index must have a float-adjusted market capitalization initially of $200 million or greater and $150 million or greater for ongoing inclusion. As of October 31, 2009 the Index included 34 securities. For more information on CQQQ please visit www.claymore.com/cqqq.
Source: Claymore Securities
Knight Capital Group and ISE Announce Knight’s Purchase of Competitive Market Maker Trading Rights on ISE
December 8, 2009--– Knight Capital Group,
Inc. and the International Securities Exchange (ISE) are pleased to announce that Knight
Equity Markets, L.P. will become a Competitive Market Maker (CMM) on ISE’s options exchange,
effective in the first quarter 2010. Knight purchased ten CMM trading rights from TD Options, LLC that
cover every options class listed on the exchange.
“Knight is developing options market making capabilities as an extension of our equities and fixed income
trade execution services for broker-dealers,” said Thomas M. Joyce, Chairman and Chief Executive
Officer, Knight Capital Group, Inc. “ISE is one of the most advanced, efficient and transparent options
markets for investors. We look forward to joining as a market maker and generating additional liquidity for
the benefit of all market participants.”
“ISE is very excited to welcome Knight to its family of world class liquidity providers,” said Gary Katz, President and Chief Executive Officer of ISE. “Knight will bring its advanced trading systems and expertise as a global liquidity provider to its new market making role at ISE. As a CMM, Knight will play a key role in providing competitive quotes and deep liquidity for all options products traded on ISE.”
Knight will maintain its Electronic Access Member (EAM) trading rights on the exchange.
Source: International Securities Exchange (ISE)
ISE and Deutsche Börse Systems Announce Selection of RCN Metro as
December 7, 2009--– The International Securities Exchange (ISE) and
Deutsche Börse Systems (DBS) today announced that they have signed an agreement with RCN Metro Optical Networks, a division of RCN Corporation (NASDAQ: RCNI) and a premier
provider of fiber optic-based network solutions, to deploy RCN Metro’s low latency fiber
network (Xtreme Network) to connect ISE’s current and future data center sites.
This
connection will act as a critical pathway in support of ISE’s migration to its new options trading
system, which is being developed using the expertise of ISE and DBS and is scheduled to roll out
in Q4 2010.
In addition to supporting ISE’s data center migration, RCN Metro will also serve as a key network carrier to connect trading members located in North America to both ISE, the world’s largest equity options exchange, and its parent company, Eurex, one of the largest derivatives exchanges in the world. Eurex is jointly operated by the Deutsche Börse Group and SIX Swiss Exchange.
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Source: International Securities Exchange (ISE)
NYSE Liffe US Mini Gold Futures Hit Record Volume, OI for 2009
December 7, 2009--On Friday, December 4th, NYSE Liffe US mini gold futures volume reached a new high for 2009 of 22K. Mini gold OI jumped 24% to 8.3K.
Friday’s activity reflected widespread participation from a variety of different customers, including retail participants, OTC bullion traders and professional traders. Mini silver futures volume on December 4th was also strong at 5K, 62% above the Q4 09 average and OI moved up 5%.
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Source: NYSE Liffe US
ETF Landscape: US Annual Review of Institutional Users of ETFs
December 7, 2009--Highlights
In the four quarters of 2008 a total of 2,657 institutional investors worldwide have reported using one or more US ETFs. Over the past 11 years, the number of institutional users has increased 1,510%. This represents a CAGR of 28.7%.
Institutional investors in 41 countries reported using at least one US ETF in 2008. The United States, the United Kingdom, Canada, Switzerland and Spain have the largest number of institutional users and account for 89%.
Over 80% of the largest US institutional investors (those with assets over US$10 Bn) report using one or more ETFs, while less than a third of institutions with assets under US$250 Mn report using ETFs. The overall penetration rate is still very low at 2.8% of reporting institutions.
for more info
Source: Source: ETF Research and Implementation Strategy Team, Blackrock
President Obama establishes Interagency Financial
December 7, 2009--Attorney General Eric Holder, Treasury Secretary Tim Geithner, Housing and Urban Development (HUD) Secretary Shaun Donovan, and Securities and Exchange Commission (SEC) Chairwoman Mary Schapiro today announced that President Barack Obama has established by Executive Order an interagency Financial Fraud Enforcement Task Force to strengthen efforts to combat financial crime.
The Department of Justice will lead the task force and the Department of Treasury, HUD and the SEC will serve on the steering committee. The task force's leadership, along with representatives from a broad range of federal agencies, regulatory authorities and inspectors general, will work with state and local partners to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, address discrimination in the lending and financial markets and recover proceeds for victims.
The task force, which replaces the Corporate Fraud Task Force established in 2002, will build upon efforts already underway to combat mortgage, securities and corporate fraud by increasing coordination and fully utilizing the resources and expertise of the government's law enforcement and regulatory apparatus. The attorney general will convene the first meeting of the Task Force in the next 30 days.
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Source: U.S. Department of the Treasury