Global ETF News Older than One Year
Oil Market Report: Markets remaining calm
May 15, 2019--The theme we identified in last month's Report of "mixed signals" is appropriate again this month, with geopolitics and industry disruptions confusing the supply outlook, and the first change to our 2019 demand outlook for several months. The ongoing geopolitical supply concerns around Libya, Iran, and Venezuela have been joined in the past few days by the attacks on shipping off Fujairah and on two pumping stations in Saudi Arabia.
At the time of writing, there is no disruption to oil supplies and prices are little changed. The IEA is monitoring the situation, particularly in view of the proximity of Fujairah to the strategically vital Strait of Hormuz. We are also monitoring the impact of the contamination of Russian crude oil passing through the 1.4 mb/d Druzhba pipeline system. The issue will be resolved in due course, eased by commercial and government stock draws by Russia’s customers. One consequence could be a loss of confidence in the quality of the crude flows and thus a search, where feasible, for alternative supplies that could intensify price pressures for heavy/medium sour crude oil.
Source: International Energy Agency
Nasdaq Launches Global Environmental, Social and Governance (ESG) Reporting Guide for Companies
May 15, 2019--asdaq (Nasdaq: NDAQ) today announced the launch of its new global environmental, social and governance (ESG) reporting guide to support public and private companies.
The 2019 ESG Reporting Guide includes the latest third-party reporting methodologies widely adopted by the industry, and aims to help companies navigate the evolving standards on ESG data disclosure, regardless of geography or market capitalization.
"ESG data points have become essential tools, not only for investors seeking performance indicators, but also for companies trying to increase operational efficiency, decrease resource dependency, and attract a new generation of empowered workers," said Nelson Griggs, President of the Nasdaq Stock Exchange.
Source: Nasdaq
Bitcoin vaults above $7 000 level as crypto rally gathers steam
May 13, 2019--Bitcoin jumped above $7 000 and didn't look back, as its longest winning streak since 2013 continued to rekindle the global cryptocurrency market.
Source: FIN24
MSCI adds Saudi Arabia, Argentina indexes to emerging markets index
May 13, 2019--MSCI Inc, the world's largest index provider, said on Monday it would include the MSCI Saudi Arabia and MSCI Argentina indexes in its closely watched and widely duplicated emerging-markets index, in a move that could draw billions of dollars into the stocks.
MSCI said 30 Saudi Arabian securities would be added, representing an aggregate weight of 1.42% in the MSCI Emerging Markets Index, while eight Argentinian securities would be added at an aggregate weight of 0.26% in the MSCI Emerging Markets Index. All changes will be implemented as of the close of May 28.
Source: Zawya.com
Composite Leading Indicators (CLI), OECD, May 2019-CLIs continue to point to easing growth momentum in most major economies
May 13, 2019--Composite leading indicators (CLIs), designed to anticipate turning points in economic activity relative to trend six to nine months ahead, continue to point to easing growth momentum in most major economies.
Easing growth momentum remains the assessment for the United States, Japan, Canada, the United Kingdom and the euro area as a whole, including Germany and Italy.
On the other hand, the CLI for France now anticipates stable growth momentum, driven by improvements in consumer confidence, car registrations and share prices.
Among major emerging economies, stable growth momentum is now the assessment for the industrial sector in China, reflecting more positive signals from the chemicals and construction sectors and from share prices, and remains the assessment for India, with similar signs emerging in Russia. In Brazil, the CLI continues to point to growth gaining momentum.
Source: OECD
MSCI adds Saudi Arabia, Argentina indexes to emerging markets index
May 13, 2019--MSCI Inc, the world's largest index provider, said on Monday it would include the MSCI Saudi Arabia and MSCI Argentina indexes in its closely watched and widely duplicated emerging-markets index, in a move that could draw billions of dollars into the stocks.
MSCI said 30 Saudi Arabian securities would be added, representing an aggregate weight of 1.42% in the MSCI Emerging Markets Index, while eight Argentinian securities would be added at an aggregate weight of 0.26% in the MSCI Emerging Markets Index. All changes will be implemented as of the close of May 28.
Source: Reuters
MSCI Equity Indexes May 2019 Index Review
May 13, 2019--MSCI Inc., a leading provider of research-based indexes and analytics, announced the results of the May 2019 Semi-Annual Index Review for the MSCI Equity Indexes-including the MSCI Global Standard, MSCI Global Small Cap and MSCI Micro Cap Indexes, the MSCI Global Value and Growth Indexes, the MSCI Frontier Markets, and MSCI Frontier Markets Small Cap Indexes, the MSCI Global Islamic and MSCI Global Islamic Small Cap Indexes, the MSCI Pan-Euro and MSCI Euro Indexes, the MSCI US Equity Indexes, the MSCI US REIT Index, the MSCI China A Indexes, MSCI China A Onshore Indexes and the MSCI China All Shares Indexes.
All changes will be implemented as of the close of May 28, 2019. These changes have been posted on the Index Review web page on MSCI's web site...
Source: MSCI Inc.
IMF Working Papers The Motives to Borrow
May 10, 2019--Summary
Governments issue debt for good and bad reasons. While the good reasons-intertemporal tax-smoothing, fiscal stimulus, and asset management-can explain some of the increases in public debt in recent years, they cannot account for all of the observed changes.
Bad reasons for borrowing are driven by political failures associated with intergenerational transfers, strategic manipulation, and common pool problems. These political failures are a major cause of overborrowing though budgetary institutions and fiscal rules can play a role in mitigating governments' tendencies to overborrow. While it is difficult to establish a clear causal link from high public debt to low output growth, it is likely that some countries pay a price—in terms of lower growth and greater output volatility—for excessive debt accumulation.
view the IMF Working Papers The Motives to Borrow
Source: IMF
IMF Working paper-CoMap: Mapping Contagion in the Euro Area Banking Sector
May 10, 2019--Summary
This paper presents a novel approach to investigate and model the network of euro area banks' large exposures within the global banking system. Drawing on a unique dataset, the paper documents the degree of interconnectedness and systemic risk of the euro area banking system based on bilateral linkages.
We develop a Contagion Mapping model fully calibrated with bank-level data to study the contagion potential of an exogenous shock via credit and funding risks. We find that tipping points shifting the euro area banking system from a less vulnerable state to a highly vulnerable state are a non-linear function of the combination of network structures and bank-specific characteristics.
view the IMF Working paper-CoMap: Mapping Contagion in the Euro Area Banking Sector
Source: IMF
Research Announcement: Moody's-ETFs ability to weather liquidity risk governed by its underlying market
May 9, 2019--ETFs have experienced rapid expansion in a calm environment
Extended bursts of volatility could reveal that ETF liquidity mirrors underlying market liquidity
The liquidity of exchange traded funds (ETFs) differ owing to the varying characteristics determined by their underlying markets and indexes.
Liquidity providers of ETFs are rewarded through arbitrage but are also exposed to market, liquidity and operational risks.
These risks, when coupled with an exogenous systemwide shock, could in turn amplify systemic risk, a credit negative for market participants, Moody's Investors Service says in a new report. This includes unexpected market liquidity shortfalls which would be further pronounced within ETFs tracking inherently illiquid markets, such as high-yield credit.
"In the event of a liquidity drought in underlying markets, market makers would likely reflect this risk in their ETF quotes. So in effect, ETFs track not only the performance of their underlying assets, but also the liquidity of these assets," according to Fadi Abdel Massih, a Moody's Assistant Vice President-Analyst.
Source: Moody's Investors Service
