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BlackRock New Report ETF Landscape: Industry Review - Q1 2011
May 5, 2011--At the end of Q1 2011, the global ETF industry had 2,605 ETFs with 5,905 listings and assets of US$1,399.4 Bn from 142 providers on 48 exchanges around the world. This compared to 2,131 ETFs with 4,133 listings and assets of
US$1,081.9 Bn from 123 providers on 42 exchanges at the end of Q1 2010.
Additionally, there were 1,119 other ETPs with 1,835 listings and assets of US$183.7 Bn from 58 providers on 23 exchanges. This compared to 718 ETPs with 1,025 listings and assets of US$153.6 Bn from 42 providers on 18 exchanges at the end of Q1 2010.
Combined, there were 3,724 products with 7,740 listings, assets of US$1,583.2 Bn from 178 providers on 52 exchanges around the world at the end of Q1 2011. This compared to 2,849 products with 5,158 listings, assets of US$1,235.4 Bn from 147 providers on 44 exchanges at the end of Q1 2010.
Combination of Deutsche Börse and NYSE Euronext: Commencement of acceptance period for shareholders of Deutsche Börse
German Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht, BaFin) has approved the publication of the offer documents The acceptance period will commence on 4 May and will end on 13 July 2011 Shareholders will receive one ordinary share of Alpha Beta Netherlands Holding N.V. for each Deutsche Börse share
May 4, 2011--Under the exchange offer, shareholders of Deutsche Börse AG can tender their shares to the joint holding company of Deutsche Börse and NYSE Euronext (Alpha Beta Netherlands Holding N.V.) effective immediately. For each share of Deutsche Börse AG shareholders will receive one share of the Dutch holding.
On 2 May 2011 the Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht, BaFin) approved the publication of the offer documents in the context of the combination of Deutsche Börse and NYSE Euronext. Deutsche Börse AG has thus made another important step forward on its route towards combining with NYSE Euronext.
The acceptance period during which shares can be exchanged will commence on 4 May and end on 13 July 2011. Acceptance of the exchange offer will be carried out via the relevant custodian banks. Until the conclusion of the transaction, the shares of Deutsche Börse tendered for exchange can be traded under a new securities identification number (ISIN DE000A1KRND6).
Reto Francioni, CEO of Deutsche Börse AG, said: "The publication of the offer document is a further milestone on our way towards the planned combination. Our shareholders now have the historic opportunity to participate in the new stock exchange group by exchanging their shares. They will benefit not only from the immediate increase in value from the expected synergies but also from attractive growth opportunities of the combined group."
Macroeconomic Costs of Higher Bank Capital and Liquidity Requirements-IMF Working Paper
May 4, 2011--Summary:
This paper uses a DSGE model with banks and financial frictions in credit markets to assess the medium-term macroeconomic costs of increasing capital and liquidity requirements.
The analysis indicates that the macroeconomic costs of such measures are sensitive to the length of the implementation period as well as to the adjustment strategy used by banks, and the scope for monetary policy to respond to the regulatory changes.
view the IMF Working paper-Macroeconomic Costs of Higher Bank
Capital and Liquidity Requirements
Tax Biases to Debt Finance: Assessing the Problem, Finding Solutions- IMF
May 3, 2011--EXECUTIVE SUMMARY
Most tax systems today contain a “debt bias,” offering a tax advantage for corporations to finance their investments by debt. This has grown increasingly hard to justify.
One cannot compellingly argue for giving tax preferences to debt based on legal, administrative, or economic considerations. The evidence shows, rather, that debt bias creates significant inequities, complexities, and economic distortions. For instance, it has led to inefficiently high debt-to-equity ratios in corporations. It discriminates against innovative growth firms, impeding stronger economic growth. Debt bias also threatens public revenues, because it enables companies to reduce tax liabilities by using hybrid financial instruments as well as by restructuring their finances internally, moving debt between affiliates.
view the paper-Tax Biases to Debt Finance: Assessing the Problem, Finding Solutions
Factories in China, US slow as those in Europe, India see boom
May 3, 2011--Manufacturing growth in the world’s two biggest economies softened in March but firmed in Europe and India, according to reports highlighting the fractured nature of the global economic recovery.
The United States and China both saw a tempering of factory production in April, with the pace of US manufacturing expansion easing for a second straight month. Still, US activity remained firm and input prices rose to their highest in nearly three years, according to data from the Institute for Supply Management released on Monday. ISM said its factory index fell to 60.4 in April from 61.2 the previous month, slightly above forecasts for a reading of 60. It has held above the 50-threshold that separates growth from contraction since August 2009 and peaked in February2011.
Statistics : Annual inflation accelerates to 2.7% in March 2011
May 3, 2011--Consumer prices in the OECD area rose by 2.7% in the year to March 2011, compared with 2.4% in February. This increase was driven by an acceleration in energy prices which grew by 12.4% in March, compared with 10.2% in February. Food prices continued to rise at relatively high rates: 3.2% in March (compared with 3.1% in February).
Excluding food and energy, consumer prices rose by 1.4 % in March 2011, the highest rate since March 2010.
Inflation accelerated strongly in the year to March 2011 in Canada (to 3.3%, up from 2.2% in February) and the United States (to 2.7%, up from 2.1%). It also accelerated in France (to 2.0%, up from 1.7%) and Italy (to 2.5%, up from 2.4%) but was stable in Germany (2.1%) and Japan (0.0%). In the United Kingdom, inflation remained relatively high compared to other major economies but slowed to 4.0% in March compared with 4.4% in February. Euro area annual inflation (HICP) rose to 2.7%, up from 2.4% in February.
NYSE Euronext Chief Isn’t Fazed by Hostile Nasdaq Bid
May 3, 2011--While the Nasdaq OMX Group and the IntercontinentalExchange finally said on Monday they intended to go directly to NYSE Euronext shareholders to win over the exchange operator, the Big Board’s chief executive said he wasn’t worried.
Duncan L. Niederauer, NYSE Euronext’s chief executive, said that his company’s limited response on Monday to Nasdaq and ICE’s announcement was because it contained little new information.
“A lot of it was expected,” he told DealBook on the sidelines of the Milken Institute’s Global Conference 2011 here.
World markets get boost from bin Laden death
May 3, 2011--The death of al-Qaida leader Osama bin Laden has helped lift the mood in the markets all around the world Monday at the start of an extremely busy week of economic news.
U.S. President Barack Obama's announcement that the man who inspired the deadly Sept. 11, 2001, terror attacks in the United States had been killed in an operation by special forces in Pakistan, prompted an increase in investors' appetite for risk. That usually benefits assets like stocks but dents widely-considered financial safe havens, such as gold.
S&P CIVETS 60 Index Launched to Measure Growth Beyond the BRICs
The 'CIVETS' - Colombia, Indonesia, Vietnam, Egypt, Turkey & South Africa - combine potential for growth and accelerating global investor interest
May 3, 2011--In response to market demand, S&P Indices has launched the S&P CIVETS 60, a tradable index comprised of second-generation emerging markets, characterized by dynamic, rapidly changing economies and young, growing populations. CIVETS is a recent, and increasingly, widely recognized acronym that refers to the countries of Colombia, Indonesia, Vietnam, Egypt, Turkey and South Africa.
The S&P CIVETS 60 is comprised of ten liquid stocks trading on each relevant domestic exchange within the 6 CIVETS countries. The Index is unique in that no other index covers these specific markets as a tradable index, and it is likely to serve as the basis for ETFs in Europe and Asia.
"With reasonably sophisticated financial systems and rapidly maturing equity markets, the six CIVETS countries show all the signs of becoming increasingly important to international investors," says Michael Orzano, Associate Director of Global Equity Indices at S&P Indices. "The launch of this Index underlines the leadership we've shown in building out our family of emerging/frontier market and BRIC indices over the last decade."
To be included in the S&P CIVETS 60, stocks must have a float-adjusted market capitalization above $500 million. The Index is a modified market capitalization-weighted index, with no country having a weight of more than 30% at each semi-annual rebalancing.
The CIVETS countries have a total population of over 580 million as of December 31, 2010, and share some key characteristics: their economies are relatively diversified, not overly reliant on natural resources, and with increasing foreign direct investment.
As of March 31, 2011, South Africa represented 31.61% of the Index, followed by Indonesia (28.14%), Turkey (21.01%), Columbia (12.49%), Egypt (5.68%) and Vietnam (1.07%).
Assessing Fiscal Stress -IMF Working Paper
May 2, 2011--Summary
This paper develops a new index which provides early warning signals of fiscal sustainability problems for advanced and emerging economies. Unlike previous studies, the index assesses the determinants of fiscal stress periods, covering public debt default as well as near-default events.
The fiscal stress index depends on a parsimonious set of fiscal indicators, aggregated using the approach proposed by Kaminsky, Lizondo and Reinhart (1998). The index is used to assess the build up of fiscal stress over time since the mid-1990s in advanced and emering economies. Fiscal stress has increased recently to record-high levels in advanced countries, reflecting raising solvency risks and financing needs. In emerging economies, risks are lower than in mature economies owing to sounder fiscal fundamentals, but fiscal stress remains higher than before the crisis.