SPDR Weekly Report
January 10, 2014--Weekly Market Report
ECONOMIES: Employment disappoints in both the US and Canada. The Bank of England leaves policy unchanged. The European Central Bank also remains on hold but strikes a decidedly dovish tone. Retail sales rise solidly in Australia.
MARKETS: Federal spending authority runs out next week in the US but investors don't appear worried. Equities are mixed. Government bonds have caught a bid. CAD is notably weaker. Oil prices change little.
NEXT WEEK PREVIEWED
SPOTLIGHT: Retail sales and industrial production will likely rise moderately in the US, while housing starts will probably fall.
Inflation likely remains benign in the US and UK and extremely low in France. Job creation probably remains sluggish in Australia.
THE WEEK IN REVIEW
US
The MINUTES OF THE DECEMBER FED POLICY MEETING reveal a
Committee that is now sufficiently confident about the
economy's prospects to begin tapering, but remains keenly
aware of the downside risks, and especially eager to prevent
any premature tightening from the bond market by stressing a
gradual and data dependent approach:
"[Participants] generally indicated that the broad contours
of their outlook for real activity, the labor market, and
inflation had not changed materially since their October
meeting, but most expressed greater confidence in the
outlook and saw the risks associated with their forecasts
of real GDP growth and the unemployment rate as more
nearly balanced than earlier in the year."
Moreover:
"... most members agreed that the cumulative
improvement in labor market conditions and the likelihood
that the improvement would be sustained indicated that
the Committee could appropriately begin to slow the pace
of its asset purchases at this meeting."
However:
"...members also weighed a number of considerations
regarding such an action, including their degree of
confidence in prospects for sustained above-potential
economic growth, continued improvement in labor
market conditions, and a return of inflation to its...
For more information, including product fact sheets and related whitepapers, visit spdrs.com.
Source: SSgA
EPFR Global News Release- Pendulum swings towards Bond Funds during the first week of the New Year
January 10, 2014--In contrast to the first full week of 2013, when record setting flows into Funds EPFR Global-tracked Emerging Market and Global Equity kicked the 'Great Rotation' narrative into high gear, the New Year kicked off with Bond Funds posting their biggest weekly inflow since early May while Equity Funds recorded modest net redemptions.
Among the fund groups that carried on where they left off in 2013 were Japan and Europe Equity Funds, with flows into the former hitting levels last seen in mid-2Q13 and the latter extending their current inflow streak to 28 consecutive weeks, and Europe Bond Funds which recorded their biggest inflow in over eight months. Emerging Markets Equity Funds, Commodities Sector Funds and Municipal, Mortgage Backed and Inflation Protected Bond Funds, meanwhile, remain out of favor with investors.
Visit www.epfr.com for more info
Source: EPFR
BlackRock ETP Landscape: 2013 Equity Flows All-Time High
January 10, 2014--Robust ETP flows in December mark strong 2013 with Equity ETPs reaching all-time record.
Global ETP flows accelerated in December to $24.7bn, following the Fed's decision to begin trimming its
$85bn monthly bond-buying program. This removed market uncertainty and Equity ETPs responded, bringing in the bulk of the inflows for the month at $28.9bn-entirely from Developed Markets.
Full-year Equity ETP flows set an all-time record at $247.3bn, overtaking 2008 which was the only other year they had exceeded $200bn.
Total 2013 flows of $235.5bn surpassed $200bn for the second consecutive year, underscoring the industry's continued secular growth.
Source: BlackRock ETP Landscape Research
Nomura appoints Todd Sandoz as Global Head of Execution Services and Equity Trading
January 10, 2014--Nomura, Asia's global investment bank, today announced the appointment of Todd Sandoz as Global Head of Execution Services and Equity Trading.
Based in London, Mr. Sandoz will report to Steve Ashley, Head of Global Markets, and Naoki Matsuba, co-Head of Global Markets. The global Execution Services business comprises Equity Execution Services including Instinet, Prime Services, Electronic Trading, Futures and Options and OTC Clearing
Source: Nomura
Funds With $100 Billion May Be Too Big to Fail, FSB Says
January 9, 2014--Investment funds that manage more than $100 billion in assets may be labeled too big to fail, global regulators said, as they seek to expand financial safeguards beyond banks and insurers.
Hedge funds with trading activities exceeding a set value of $400 billion to $600 billion would also be assessed by national authorities to gauge whether they need extra rules because their collapse could spark a crisis, the Financial Stability Board said in a statement yesterday.
Source: Bloomberg
Euronext bolsters senior management ahead of summer listing
January 9, 2014--European exchange operator Euronext, now owned by U.S. group IntercontinentalExchange (ICE.N), made several senior appointments on Thursday to strengthen its leadership ahead of a stock market listing later this year.
Euronext, which operates exchanges in Paris, Amsterdam, Brussels, London and Lisbon, named Anthony Attia, formerly senior vice president and chief of staff to Euronext Chief Executive Dominique Cerutti, as chief executive of Euronext Paris.
Source: Reuters
Zywot gets BNY Mellon MD role
January 9, 2014--The head of CIBC Mellon's securities lending trading desk gets new position
Phil Zywot has been appointed to managing director of securities finance at BNY Mellon following the 2013 merger of its securities lending desk with that of Canadian bank CIBC Mellon, Global Investor/ISF has learned.
Zywot was most recently vice president and head of trading on CIBC Mellon's securities lending desk.
A spokesperson for CIBC Mellon confirmed the appointment, stating that Zywot will be responsible for Canadian securities finance within BNY Mellon's Global Collateral Services business.
Source: globalinvestor.com
Record outflows from commodity ETPs in 2013 as investors dump gold
Record $42.9 bln withdrawn globally in 2013-BlackRock
Gold ETPs account for over 90 pct of outflows
December outflows for commodity ETPs at $5.4 bln
January 9, 2014--Commodity exchange traded products (ETPs) suffered their worst
year on record in 2013 as investors dumped their gold holdings and joined the equity rally, data
from BlackRock showed.
A whopping $42.9 billion was withdrawn from commodity ETPs in 2013, with gold ETPs accounting for $40 billion of those outflows, asset manager BlackRock said. The SPDR Gold ETP lost $25 billion, the single biggest ETP outflow in 2013.
Source: Reuters
Global food prices steady in December, 2013 prices third highest on record-UN agency
January 9, 2014-For the second consecutive month, the cost of food worldwide remained nearly unchanged in December, with overall global food prices for 2013 among the highest on record, the United Nations food agency today reported.
In a news release, the UN Food and Agriculture Organization (FAO) said its most recent Food Price Index averaged 206.7 points, nearly the same as the 206.4 in November.
Source: UN
Thomson Reuters-Global Conduct Risk Survey Report
January 9, 2014--The aftermath of the financial crisis sparked significant changes in the approach taken toward financial services regulation around the world. Regulators' attention and resources are now centered on the behavior of firms and how they conduct their business.
To support the financial services industry in its management of conduct risk, and enable firms to benchmark their own practices against global peers, Thomson Reuters Accelus has undertaken its first survey dedicated to finding out how the industry is defining and dealing with conduct risk.
The responses received covered the Americas, Africa, Asia, Australasia, Europe and the Middle East, and represented firms from across the financial services sector, including banks, insurers and fund managers.
Source: Thomson Reuters