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BATS and Chi-X Europe in exclusive talks
December 22, 2010--BATS Global Markets, operator of the third largest stock exchange in the US, is in exclusive talks with a group of banks to combine its business with Chi-X Europe and create the largest share trading venue in Europe by volume, two people familiar with the matter said.
The move signals the biggest shake-up in share trading in the region since competition was allowed against established national exchanges four years ago.
Dwindling US supplies keep oil above $90
December 22, 2010--Oil rose to a fresh 26-month high on reports that crude stocks shrank and the economy accelerated in the US, the world’s largest petroleum consumer.
Nymex February West Texas Intermediate crude rose 66 cents to $90.48 a barrel, trading above $90 for the third time this year. ICE February Brent rose 45 cents to $93.65.
December 2010 “Islamic Market’s Measure” Preliminary Report - Monthly Report On The Performance Of The Dow Jones Islamic Market Indexes
December 22, 2010--Based on the close of trading on December 21, the global Dow Jones Islamic Market Titans 100 Index, which measures the performance of 100 of the leading Shari’ah compliant stocks globally, gained 6.74% month-to-date, closing at 2230.89. In comparison, the Dow Jones Global Titans 50 Index, which measures the 50 biggest companies worldwide, posted a gain of 6.78%, closing at 176.02.
The Dow Jones Islamic Market Asia/Pacific Titans 25 Index, which measures the performance of 25 of the leading Shari’ah compliant stocks in the Asia/Pacific region, increased 7.02%, closing at 15.69. The Dow Jones Asian Titans 50 Index, in comparison, posted a gain of 6.25%, closing at 143.05.
Measuring Europe, the Dow Jones Islamic Market Europe Titans 25 Index, which measures the performance of the 25 of the leading Shari’ah compliant stocks in Europe, closed at 2163.73, a gain of 8.72%, while the conventional Dow Jones Europe Index gained 8.38%, closing at 269.33.
Measuring the performance of 50 of the largest Shari’ah compliant U.S. stocks, the Dow Jones Islamic Market U.S. Titans 50 Index increased, closing at 2259.48. It represents a gain of 5.92%. The U.S. blue-chip Dow Jones Industrial Average increased 4.79%, closing at 11533.16.
IMF Publishes First Worldwide Survey of Foreign Direct Investment Positions
December 22, 2010--The International Monetary Fund (IMF) today released results from its inaugural Coordinated Direct Investment Survey (CDIS), the first worldwide survey of foreign direct investment positions. The results, published as an online database, cover investment positions at end-2009 for 72 participating economies. The survey will be carried out annually and the intention is to broaden coverage in terms of both geographical representation and breakdowns of the data.
“Policymakers and analysts will find the CDIS database an invaluable tool in assessing the patterns and volumes of foreign direct investment as well as the increasing interconnectedness of economies,” Ms. Adelheid Burgi-Schmelz, Director of the IMF’s Statistics Department, said after the launch.
Foreign direct investment (FDI) is cross border investment where a resident in one economy has control or a significant degree of influence on the management of an enterprise resident in another economy. This category of investment is of large and growing importance, increasing the need to improve data about it. In 2006, the IMF’s Committee on Balance of Payments Statistics endorsed the CDIS proposal, and the IMF began work on the project after formally deciding to proceed in March 2007.
BlackRock New Report * ETF Landscape Industry Highlights, End of November 2010
December 22, 2010--At the end of November 2010, the global ETF industry had 2,422 ETFs with 5,413 listings and assets of US$1,231.0 Bn, from 133 providers on 46 exchanges around the world.
Additionally, there were 1,039 other Exchange Traded Products (ETPs) with 1,747 listings and assets of US$161.4 Bn, from 54 providers on 22 exchanges.
Combined, there were 3,461 products with 7,160 listings and assets of US$1,392.4 Bn, from 165 providers on 50 exchanges around the world, at the end of November 2010.
China extends help to tackle euro crisis
December 21, 2010---- China has promised to take further "concerted action" to support European financial stabilisation, including continuing to buy the bonds of countries at the centre of the sovereign debt crisis, according to senior European officials.
The officials, who declined to be named because of the sensitivity of the issue, said one of China's vice-premiers Wang Qishan, whose responsibilities include oversight of the economy, had given assurances that China would step up support for European stabilisation efforts "if necessary".
Copper price at record on supply concerns
December 21, 2010--Copper prices hit an all-time high on Tuesday well above the key $9,000 a tonne level, after the world’s third largest mine of the red metal halted exports after an accident.
The jump in copper prices came amid a broader rally in commodities prices, with the cost of cotton hitting a fresh all-time high and the price of high quality coffee surging to a 13½-year peak.
What Caused the Global Financial Crisis - Evidence on the Drivers of Financial Imbalances 1999 - 2007-IMF Working Paper
December 20, 2010--Summary: This paper investigates empirically the drivers of financial imbalances ahead of the global financial crisis. Three factors may have contributed to the build-up of financial imbalances: (i) rising global imbalances (capital flows), (ii) monetary policy that might have been too loose, (iii) inadequate supervision and regulation. Panel data regressions are performed for OECD countries from 1999 to 2007, so as to shed light on the relative importance of these factors, as well as the extent to which these factors might have interacted in fuelling the build-up.
We find that the build-up of financial imbalances was driven by capital inflows and an associated compression of the spread between long and short rates. The effect of capital inflows on the build-up is amplified where the supervisory and regulatory environment was relatively weak. We find that, by contrast, differences in monetary policy cannot account for differences across countries in the build-up of financial imbalances ahead of the crisis.
U.S. Leveraged Finance Multiple EV-aluator
December 20, 2010--Summary
In this introductory installment of its recurring valuation-focused special report series, Fitch Ratings provides a summary of how market multiples (enterprise value [EV]/EBITDA) for more than 400 high-yield issuers in the U.S. have tracked over time on an aggregated sector basis. The report highlights how these market multiples have compared with transaction multiples of publicly traded U.S. companies and with the
distressed valuation multiples employed by Fitch for purposes of its recovery analysis.
This report also provides a snapshot of how leveraged certain sectors are relative to their enterprise valuations assigned by the market, and in doing so offers an insight into how implied equity cushions have fluctuated through the credit cycle. Fitch’s key
observations include the following:
Current market valuation multiples for most sectors have rebounded from their downturn lows with the revival in the equity markets. As expected, the highest swings in market valuation (as measured in terms of standard deviation) over the past decade have been witnessed in cyclical sectors such as homebuilding, technology, followed by media and entertainment. Curiously, though, the retail sector - also arguably subject to similar cyclicality forces ? emerged as the most stable in terms of market valuations across time.
This report also provides empirical evidence that supports a moderate deleveraging trend (relative to leverage levels in 2006) among speculative-grade companies in seven out of the 18 sectors. The chemicals sector, followed by energy and natural resources, delevered at a faster rate than their valuation multiples had compressed since 2006, contributing to enhanced equity cushions.
The recent resurgence in M&A activity has been spurred by an enabling environment of low bond yields, robust primary markets, reasonable corporate valuations, strong corporate cash balances (expected to be over $2 trillion), and limited organic growth prospects. As evident from the sector charts on pages 3-24, current transaction multiples for an overwhelming majority of sectors are still nowhere near their 2006-2007 peaks.
December 2010 Monthly Preliminary Performance Report Dow Jones-UBS Commodity Indexes
December 20, 2010--The Dow Jones-UBS Commodity Index was up 5.76% for the month of December. The Dow Jones-UBS Single Commodity Indexes for Cotton, Sugar and Coffee had the strongest gains with month-to-date returns of 27.94%, 17.97%, and 11.98%, respectively. The three most significant downside performing single commodity indexes were Live Cattle, Natural Gas and Gold, which were down 1.76%, 1.53%, and 0.50% respectively, in December.
Year to date, the Dow Jones-UBS Commodity Index is up 11.49% with the Dow Jones-UBS Cotton Sub-Index posting the highest gain of 105.14% so far in 2010. Dow Jones-UBS Natural Gas Sub-Index has the most significant downside YTD performance, down 45.00%.