Global ETF News Older than One Year
Banks concede reform is inevitable
February 3, 2010--Paul Volcker and Barack Obama have either thrown the world into chaos or given the cause of global bank regulation new impetus – it depends on your point of view. But one thing is for certain: the twin US initiatives to derisk banks and tax them according to their size – the Volcker rule and the Obama levy as they have been dubbed – have seized the attention of bankers and regulators around the world.
The US last month first made clear that it wanted to exact a levy of 0.15 per cent on any bank balance sheet over $50bn. Then it said that banks should no longer engage in what it felt were riskier practices – investing in hedge funds, private equity or proprietary trading, the archetypal casino-style betting of bank funds for a quick profit.
Source: FT.com
ETF Landscape: Industry Review - Year End 2009-Blackrock
February 2, 2010--Global ETF assets break through US$1 trillion milestone at the end of 2009
At the end of December 2009 the global ETF industry assets exceeded US$1 trillion with 1,947 ETFs and 3,787 listings from 110 providers on 40 exchanges around the world.
Although there was significant growth in assets during 2009, just 100 ETFs, out of 1,947,account for US$683.3 BN OR 66% of the US$1 Trillion total.
Additionally, there were 611 OTHER Exchange Traded Products (ETPs) with assets of US$150.79BN from 37 providers on 18 Exchanges.
Combined there were 2,558 products with 4,687 listings, assets of US$1,186.48 BN from 133 providers on 43 exchanges around the world at the end of December 2009.
Source: ETF Research and Implementation Strategy, Blackrock
Impairment reporting - improving stakeholder confidence
February 2, 2010--Ernst & Young study of over 170 users of financial reports reveals that impairments reported during the last two years were lower than expected.
Executive Summary
Complexity, consistency and building confidence
Despite growing signs that the global economy is regaining its health, it is likely that recovery will be gradual for most and fragile for many.
What is not in doubt is that market confi dence was severely impacted in virtually every area of the global economy. Whatever the timeline for recovery, boards will continue to find it challenging to deliver the future performance and returns needed
to satisfy investors. In the meantime, scarcity of capital and increased risk aversion are driving investors and lenders to focus on the reliability of information used to make investment decisions.
Source: Ernst & Young
World Federation of Exchanges (WFE)Announces Priorities for 2010
February 2, 2010--The officers and members of the Board of Directors of the World Federation of Exchanges (WFE) today announced priorities for the year in which WFE celebrates its 50th anniversary. The WFE brings the world’s regulated exchanges together in order to improve the quality of markets.
The Board of Directors targeted the following priorities for 2010, pledging to:
• Support reform in the regulation of OTC derivatives markets, which were a contributing factor in the recent financial crisis. The exchange community offers a clear alternative and a model for post-trade clearing and settlement, risk management and transparency in pricing. WFE intends to convey this message through constructive collaboration with policy makers and regulators, including a closer working relationship with the International Organization of Securities Commissions (IOSCO), to ensure that these reforms are coordinated globally, and in a manner which reduces systemic risk.
• Continue to press for international cooperation and coordination among regulators and exchanges on intermarket mechanisms.
• Examine the structure of fixed income markets in order to evaluate how post-trade transparency, risk management and investor protection could help these markets recover from the drop in liquidity that they have experienced since the credit crisis.
View the WFE 2009 Market Highlights
Source: World Federation of Exchanges (WFE)
FTSE Group Appoints New Committee Chairman
February 2, 2010--FTSE Group (“FTSE”), the award winning global index provider, today announces the appointment of David Hobbs, Director of FTSE Group, as Chairman of the FTSE Policy Group. The FTSE Policy Group is the senior FTSE practitioner committee, which reviews the ongoing management of all FTSE indices and advises FTSE Group on strategic index and investment-related issues.
FTSE committees are made up of leading investment market professionals from around the world who serve in a voluntary capacity providing a credible “voice of the market” which FTSE can rely upon to offer informed and expert advice. The committees ensure that all FTSE products and services reflect their underlying market and that FTSE index ground rules meet the highest standards of the industry. Expert industry opinion also lends substance and authority where FTSE is required to make complex decisions.
David Hobbs has been a Director of FTSE Group since July 2006, following a career at UBS spanning 38 years and culminating in the position of Managing Director and Global Head of Passive Investment at UBS Global Asset Management. During his career at UBS, David worked closely with FTSE, chairing a number of FTSE practitioner committees, including the FTSE Equity Indices Committee which at that time was responsible for oversight of all FTSE’s major equity indices.
Mark Makepeace, Chief Executive FTSE Group, said today: “David has extensive experience both as a market practitioner and as a FTSE committee member and will ensure that all FTSE indices continue to meet the constantly evolving needs of investors globally. We welcome him as the new Chairman.”
David is also a Fellow of the Chartered Institute for Securities & Investment, an Affiliate member of the UK Society of Investment Professionals and was awarded an Honorary Fellowship of the Faculty of Actuaries in June 2006.
Source: FTSE
Majority of Small Businesses Surveyed Worldwide Hold a Positive Business Outlook
Emerging Markets’ Small Business Confidence Leads Developed Countries
U.S. Surveyed for First Time Trails in Semi-Annual HSBC Small Business Confidence Survey
February 2, 2010-- A growing proportion of small businesses worldwide are bullish on the first half of 2010 and, for the first time since the financial crisis, many are signaling strong local economic growth and an increase in capital investment and recruitment plans. Still, business confidence among U.S. small businesses surveyed trails the sentiment of small businesses in emerging markets.
The semi-annual HSBC Small Business Confidence Monitor gauges the six-month outlook of small businesses on local economic growth, capital investment plans and recruitment. This fifth wave of the survey is the largest to date, capturing the views of more than 6,000 small businesses across 20 markets. In addition to gauging the views of small businesses in Asia, the Middle East, Europe, and Latin America, the most recent Small Business Confidence Monitor also surveyed small businesses in the U.S. for the first time. The results were used to calculate an index ranging from 0 to 200 where 200 represents the highest confidence level, 0 represents the lowest, and 100, neutral.
Mark Luppi, Executive Vice President and Head of Business Banking for HSBC - North America, said: "The small business sector is a key indicator of the overall health and competitiveness of local economies and our Small Business Confidence Monitor allows us to gauge the sentiment of this critical group. While the findings reveal that confidence levels are relatively positive in the U.S., they do lag behind the levels seen in the emerging markets surveyed. The news overall is encouraging with the majority of U.S. small businesses expecting capital expenditure and recruitment plans to remain relatively stable or increase slightly versus the reductions we have seen in the past."
Source: HSBC
Supply Chain Strategy for Major Global Companies 6% of Leading Companies Already Deselect Suppliers Who Fail to Manage Carbon, 56% Committed to Do So in the Future
February 1, 2010--Suppliers are now expected by some of their global
customers to demonstrate greenhouse gas emissions management, awareness and action, in order to maintain business relationships, a Carbon Disclosure
Project (CDP) report shows.
The second annual CDP Supply Chain Report, produced by A.T. Kearney, summarizes climate change information* from 710 suppliers. Members, who include global customers, such as Dell, Juniper Networks, National Grid, PepsiCo and Reckitt Benckiser are requesting their suppliers to disclose data via the CDP Supply Chain program. Although this report shows significant improvement in best practices over last year's results, suppliers still have a long way to go.
The 44 CDP Supply Chain member companies (see below) are leading in carbon management within their own businesses and expecting their suppliers to demonstrate strong carbon management strategies too:
-- 89% of CDP Supply Chain members have an established strategy to engage with suppliers on carbon related issues.
-- 91% of members have a board level executive responsible for climate change, compared to 80% within the Global 500 constituents.**
-- 90% have an emissions or energy reduction plan in place, compared to 51% in the Global 500.**
view the Carbon Disclosure Project-Supply Chain Report 2010
Source: Carbon Disclosure Project
BATS Global Markets Reports Record January
- BATS Exchange Earns More Than 10% Us Market Share, Sets Monthly Tape B Record - Bats Europe Eclipses Highs For Market Share, Notional Value
February 1, 2010 – BATS Global Markets, an innovative global
financial markets technology company, reports that BATS Exchange increased its US matched market
share in January to 10.2%, compared to 9.3% in December 2009, and set a new market share record in
Tape B securities with 16.6%.
BATS Europe, the fast-growing Multilateral Trading Facility (MTF), finished its best month to date with new market share records in the FTSE 100 (8.4%), FTSE 250 (5.9%), FTSE MIB (6.8%), DAX 30 (4.7%), SMI (3.6%), STOXX 50 (5.1%) and the overall European market (4.6%)
Source: BATS
SEC and UK FSA Hold Fifth Meeting of the SEC-FSA Strategic Dialogue
February 1, 2010--Today, Financial Services Authority (FSA) chairman Lord Turner and chief executive Hector Sants, and US Securities and Exchange Commission (SEC) chairman Mary Schapiro met as part of the SEC-FSA Strategic Dialogue.
The purpose of the Dialogue, which was established in 2006, is to engage at the senior levels of the two agencies on current matters affecting the US and UK capital markets and areas of future collaboration. This was the fifth meeting of the Dialogue. Some of the areas of mutual interest discussed during today's meeting included:
Corporate governance and executive compensation;
Regulation of hedge funds and investment advisors and the protection of customer assets;
Disclosure regimes around client asset risks;
Market infrastructure, particularly relating to central counterparties for OTC derivatives;
Market supervision;
Cooperation on cross-border supervision.
At the meeting, Schapiro, Turner, and Sants agreed that, given the linkages between the US and UK markets, enhanced supervisory cooperation is critical to market integrity. Cooperative efforts between the staffs of the two agencies are increasing in areas such as oversight of credit rating agencies, hedge fund advisers and the clearing of OTC derivatives. To facilitate this expanding cooperation, the two agencies plan to review the existing Memorandum of Understanding Concerning Consultation, Cooperation and the Exchange of Information Related to the Supervision of Financial Services Firms and Market Oversight, entered into by the SEC and the FSA in 2006. This memorandum of understanding is designed to promote the coordination of robust and sound supervision of cross-border financial institutions and markets.
Today’s Dialogue also provided the opportunity for the SEC and the FSA to continue discussions in the areas of corporate governance, particularly board risk oversight, and executive compensation. Consistent with the emerging international consensus, both agencies’ current efforts seek to address, among other things, the intrinsic links between the types and degree of risks regulated entities/registrants assume and their corporate governance and compensation policies.
FSA chief executive Hector Sants said,
“Global cooperation between regulators is central to tackling the reform agenda and the relationship between the FSA and the SEC is key for international markets. Our ongoing dialogue gives us the opportunity to widen the areas of cooperation between the FSA and the SEC, in particular progressing our collaborative work on hedge funds and credit rating agencies.”
SEC chairman Schapiro said,
“This Dialogue has proven its utility again in allowing the SEC and FSA to share expertise and experiences regarding the rapid changes occurring in our capital markets. As regulatory reform advances on both sides of the Atlantic, we can feed this combined body of knowledge into the development of high-quality regulatory systems that take into account both national and international market dynamics.”
Source: FSA
Eurex achieved 63.4 million contracts in its equity index segment – the largest product segment, compared with 70.2 million contracts the year before. Futures on the DJ EURO STOXX 50® Index stood at 26.6 million contracts and 23.5 million on the options o
ADV increased by 3 percent/ Significant growth year-on-year for Eurex’s interest rate derivatives segment
February 1, 2010--In January 2010, the international derivatives exchanges of Eurex Group recorded an average daily volume of 10.8 million contracts (Jan 2009: 10.5 million). Of those 7.0 million were Eurex contracts and 3.75 million contracts were at the U.S.-based International Securities Exchange (ISE). In total, 140.0 million contracts were traded at Eurex and 71.2 million at the ISE.
Eurex achieved 63.4 million contracts in its equity index segment – the largest product segment, compared with 70.2 million contracts the year before. Futures on the DJ EURO STOXX 50® Index stood at 26.6 million contracts and 23.5 million on the options of this index.
The equity derivatives (equity options and single stock futures) segment at Eurex recorded 36.8 million contracts (Jan 2009: 40.0 million). Thereof, equity options totaled at 28.8 million contracts and single stock futures another 8.0 million contracts. Dividend-based derivatives represented roughly 370,000 contracts.
The interest rate derivatives segment increased by 16 percent and achieved 39.6 million contracts (Jan 2009: 34.1 million). The Euro-Bund-Future reached 15.0 million contracts in January, the Euro-Bobl-Future 8.7 million contracts and the Euro-Schatz-Future 10.6 million contracts. The Euro BTP future – launched in September 2009 – totaled almost 100,000 contracts.
In January 2010, Eurex Repo reported growth in all markets. Its secured money market segment GC Pooling recorded an average outstanding volume of 78.7 billion euro, which is up 57 percent year-on-year. The EUR Repo market grew by 31 percent and totaled 95 billion euro. All Eurex Repo markets achieved an average outstanding volume of €181.1 billion, an increase of 19 percent year-on-year.
The electronic trading platform Eurex Bonds, which rounds out Eurex’s fixed-income product range, grew in January 2010 by 8 percent y-o-y and recorded a volume of €7.7 billion (single counting) compared to €7.1 billion the previous year. In December the figure was €5.2 billion.
Source: Eurex
