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India's central bank buys 200 tons of IMF gold for $6.7 billion
November 2, 2009--India's central bank confirmed Tuesday it had purchased 200 tons of gold bullion from the International Monetary Fund, effectively boosting its holdings by more than 50% and diversifying its $285 billion foreign-exchange stockpile.
The sale was part of the IMF's previously announced plan to sell 403.3 metric tons of bullion as part of efforts to shore up the institution's finances.
India paid $6.7 billion for the bullion, which was purchased during a two week period ending Oct. 30.
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Source: MENFA
S Korea’s banks report sharp rise in profits
South Korea’s banks reported a sharp rise in profits in the third quarter, highlighting the extent of the recovery in Asia-Pacific’s fifth-largest economy in recent months.
Korea’s financial watchdog said on Tuesday that profits at the 18 banks rose 53 per cent to Won2,300bn ($1.9bn) in the July to September period, from Won1,500bn a year ago. Loan-loss provisions fell 36 per cent to Won1,600bn.
Source: FT.com
Phase 2 of New Post-vetting Regime
October 30, 2009--The Stock Exchange of Hong Kong Limited (the Exchange), a wholly-owned subsidiary of Hong Kong Exchanges and Clearing Limited (HKEx), will amend the Listing Rules to cease pre-vetting issuers' announcements for major transactions and connected transactions from 1 January 2010 as Phase 2 of the new post-vetting regime commences.
Phase 1 of the new post-vetting regime commenced on 1 January 2009. Pre-vetting requirements for some categories of announcements, including share/discloseable transactions and issues of securities, were removed from the Listing Rules.
Phase 1 of the new regime was implemented following market support in the consultation launched in January 2008. The consultation conclusion of the "Combined Consultation Paper on Proposed Changes to the Listing Rules" was published in November 2008.
The Exchange stated in the 2008 Consultation Conclusion that it would, subject to market readiness and the Securities and Futures Commission (SFC)'s approval, cease pre-vetting all announcements. Based on the proposed timetable, Phase 2 will be implemented on 1 January 2010 and will cover announcements for major transactions and connected transactions. It will take a further 12 months for the final phase to be implemented to cover all remaining categories of announcements.
Since the implementation of Phase 1 of the new post-vetting regime, 8,827 issuers' announcements were post-vetted between January and September 2009, including 2,014 announcements related to Phase 1. A majority of the post-vetted announcements (96 per cent) required no follow up or no further action given the issuers' responses to the Exchange's initial enquiry. Most issuers were able to comply with the Listing Rules when they announced their transactions under the new regime.
Pre-vetted announcements reduced substantially from 16 per cent in 2008 to 5 per cent in 2009 (up to September). The Exchange anticipates a further reduction to 1 per cent after implementation of Phase 2.
"We are very pleased with the market support and issuers' smooth transition to Phase 1 of the new post-vetting regime," Mark Dickens, HKEx's Head of Listing, said. "The change in vetting approach promotes issuers' self-compliance and facilitates timely dissemination of information to the market."
From January to September 2009, the Exchange handled 384 written enquiries from issuers on rule interpretation and listing matters (2008: 350). Issuers have sought the Exchange's guidance on Listing Rules compliance issues before they published their announcements.
The Exchange published a new series of Listing Decisions for notifiable transactions, connected transactions and other specific rules in October 2009. It will continue to provide guidance materials to assist issuers to meet their obligations under the Listing Rules. The Exchange encourages issuers to seek its guidance on rule interpretations in individual cases.
The rule amendments to implement Phase 2 have been approved by the Board of the Exchange and the SFC, and will become effective on 1 January 2010. The rule amendments can be downloaded from the "Regulatory Framework and Rules - Rules and Guidelines on Listing Matters - Listing Rule Update for Main Board Listing Rules" and "Regulatory Framework and Rules - Rules and Guidelines on Listing Matters - Listing Rule Update/Interpretation for GEM Listing Rules" sections of the HKEx website.
Source: Hong Kong Limited (HKEx)
Strong Start for China's 'Nasdaq'
October 30, 2009--The price of shares for all 28 firms on China's new Nasdaq-style stock market more than doubled when it opened for trading for the first time on Friday.
The ChiNext stock market is designed to attract financing for small to medium sized enterprises.
The 28 listed companies are almost all privately-owned outfits, in contrast with the state-owned firms that dominate China's main stock market.
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Source: BBC
Japan’s central bank to end corporate debt buying in December
October 30, 2009--Japan’s central bank said Friday it would stop buying corporate debt in December, ending some of the emergency credit measures implemented earlier this year as it battled recession, plunging markets and a lending freeze.
After keeping its key interest rate unchanged at 0.1 percent as widely expected, the Bank of Japan also predicted a sluggish few years for the world’s second biggest economy: tepid recovery and three straight years of deflation.
In its semiannual outlook report, the central bank forecast that prices would continue falling through March 2012. It estimates the core consumer price index will fall 1.5 percent this fiscal year through March 2010, retreat 0.8 percent next fiscal year and then lose 0.4 percent the year after.
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Source: Todays Zaman
SSE Central SOEs ETF Launched
October 29, 2009--October 27 witnessed the 1st ETF, namely, the SSE Central State-owned Enterprises ETF Index Fund, on the market in 3 years after General Manager Guo Tehua of ICBC Credit Suisse Asset Management Co., Ltd. (ICBCCS) and President Chen Geng of Guotai Junan Securities Co., Ltd. stroke the gong to announce the opening of trade on the Shanghai Stock Exchange (SSE) that day.
The new product provides the investors who keep their eyes on the sector of the state-owned enterprises (SOEs) with another high-efficient investment instrument. All this will further activate the SOEs sector and ETF trading and attract more investors by offering more opportunities for investment in the SOEs.
Relevant officials from the SSE and China Securities Index Co., Ltd. as well as nearly a hundred of guests from several securities dealers and assets management institutions extended their congratulations. ICBCCS General Manager Guo Tehua and SSE Vice President Liu Xiaodong signed the "Agreement on Listing".
It is learnt that the SSE Central SOEs ETF, the 1st listed ETF in 3 years and the first of its kind ever in China, tracks the SSE Central SOEs Index, which pools 50 stocks of listed companies of SOEs with large market capitalization and sufficient liquidity on the SSE. So, it is also called the "super SOEs blue chip". Benefited from the RMB4 trillion economic stimulus plan of the state and the increasingly speeding process for reorganization of SOEs, the value of investment in SOEs has long been cherished by the investors. Statistics show that in 2009, such indicators as the P/E and P/B ratios of the SSE Central SOEs Index are the lowest among the main indices. By October 21, 2009, the average P/E ratio of the SSE Central SOEs 50 Index had been 22.16 times, lower than that of the SSE Composite Index of 26.63 times, that of the SSE 50 Index of 23.24 times and that of the CSI 300 Index of 25.75 times. Over RMB3 billion were achieved through online cash subscription in a single day, raising 4.5 billion units from a great many excited subscribers during the period of issuing SSE Central SOEs ETF.
The securities code for listing and trading of SSE Central SOEs ETF is "510060", with the code for subscription and redemption of "510061". Investors can trade the fund on the secondary market in the same way of purchase and sale of stocks. Besides, they can also make subscription and redemption for the fund through the package portfolio of constituent stocks of the SSE Central SOEs Index on the primary market, with a minimum requirement of 1 million fund units for each lot.
Source:Shanghai Securities News
TSE and TOCOM Agree to Establish Joint Venture to for Setting Up Emissions Trading
October 29, 2009--Tokyo Stock Exchange Group, Inc. (TSE Group) and Tokyo Commodity Exchange, Inc. (TOCOM) reached an agreement to establish a joint venture in the future. The objective of the new company will be to set up an emissions trading exchange, in order to contribute to the reduction of greenhouse gases and facilitate emissions trading. Both parties had already signed a Memorandum of Understanding (MOU) on comprehensive mutual cooperation in January 2008.
In a bid to stop global warming, worldwide efforts are being made to reduce greenhouse gases. In Japan, achieving numerical targets agreed in the Kyoto Protocol and drafting post-Kyoto mid-term targets have become an important policy issue. In addition, the “experimental introduction of an integrated domestic market for emissions trading” began last autumn.
In light of this situation, while an expansion of emissions trading is foreseen in the future, the recent financial crisis has led to the re-acknowledgement of the importance of the features of an exchange such as high levels of liquidity and transparency as well as stable and reliable settlement.
Under such circumstances, the TSE Group and TOCOM concur that it is necessary to take concrete steps toward the establishment of an emissions trading exchange. The two parties have vast experience and expertise on forming effective markets and large participant bases in the course of operating their respective securities and commodities exchanges over the years. They agree that it is their social responsibility to jointly apply such knowledge and experience to the establishment of an emissions trading exchange.
In addition, both parties will work together to consider the design and rules for the emissions trading exchange. Last year, the Tokyo Stock Exchange (TSE), a market operator wholly-owned by the TSE Group, set up the “TSE Carbon Market Study Group” to examine practical issues required to establish a carbon market exchange with experts on emissions trading. The study group is scheduled to be re-launched soon as a study group jointly operated by both TSE and TOCOM. It will be a venue for discussions and examinations in more detail.
The joint venture company is also expected to gather opinions from concerned parties for carrying out studies in a wide ranging field related to emissions trading.
Source: TOCOM
Changes of Designated Securities for Short Selling
October 29, 2009--The Stock Exchange of Hong Kong Limited, a wholly-owned subsidiary of Hong Kong Exchanges and Clearing Limited (HKEx), announces that with effect from 5 November 2009 (Thursday), 58 additional securities will be eligible for short selling and 11 existing designated securities will be removed from the list. The total number of designated securities for short selling will be 445 after the revision.
The securities to be added to the list of designated securities and the securities to be removed from such list are shown in the attachment. The revised list of all designated securities is also available on the HKEx website.
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Source: STOCK EXCHANGE OF HONG KONG (HKex)
Morgan Stanley faces China setbacks
October 29, 2009--When China Investment Corp invested $5bn in Morgan Stanley in late 2007 the US bank was widely seen as having stolen a march on its investment banking rivals.
With China’s $200bn sovereign wealth fund sitting high on the share register, Morgan Stanley surely now had the contacts to help unlock doors in a country which foreign groups find difficult to navigate.
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Source: FT.com
DB Index Research -- Weekly ETF Reports -- Asia -Pacific
October 28, 2009--Highlights
Market Overview
There are 187 equity based ETFs in the Asia Pacific region with 246 listings across 12 countries and 15 exchanges. Japan has the largest market share by AUM accounting for 41.03% of the whole market, whilst China has the largest market share by turnover with 40.40%.
There were four new listings in the last week. Maps Investement Mgmt Co listed one new ETF on the Korean Stock Exchange. Lyxor cross-listed 3 ETFs on the Singapore Stock Exchange.
Turnover
Monthly average daily turnover declined 4.6% in the last week. Turnover for the previous week was USD 800m. The largest ETF by turnover was the China 50 ETF issued by China Asset Management with USD 185m accounting for 23.1% of total turnover.
Assets Under Management
AUM declined 2.8% in the previous week. AUM as of Oct 26th were USD 60.0bn. The largest ETF by AUM is the iShares Asia Trust - iShares FTSE/Xinhua A50 China Tracker, managed by BGI, with AUM of USD 6.6bn.
To request a copy of the report click here
Source: Aram Flores and Shan Lan -DB Index Research
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