Global ETF News Older than One Year
Highlights of the International Energy Agency Oil Market Report
October 9, 2009--Global oil demand has been revised up by 200 kb/d for 2009 and by
350 kb/d for 2010, given more optimistic IMF economic prognoses
and stronger preliminary data from the Americas and Asia. Global oil
demand now averages 84.6 mb/d in 2009 and 86.1 mb/d in 2010,
implying yearly growth of ‐1.7 mb/d and +1.4 mb/d, respectively.
Crude oil prices in September continued to trade in a $65‐75/bbl range, although high distillate stocks ahead of winter and worries about the global economic recovery added a downward bias, with WTI and Brent trading at around $68‐72/bbl in early October. Market concerns over Iran’s nuclear programme have been muted, partly because OPEC’s spare production capacity currently exceeds 5.4 mb/d.
• OECD industry stocks decreased by 3.9 mb in August to 2,750 mb, 2.8% above last year’s level. Crude draws in North America and the Pacific outweighed middle distillate increases in all three regions. End‐ August forward demand cover decreased to 60.7 days, 3.7 days higher than a year ago.
• Global oil supply rose by 310 kb/d in September to 84.9 mb/d, driven by non‐OPEC growth. Compared with September 2008, global supply was nearly flat, as a non‐OPEC recovery of 1.6 mb/d relative to last year’s hurricane‐hit base was offset by OPEC curbs. That said, OPEC supply has continued to rise from early 2009 lows.
• Non‐OPEC output projections are left largely unchanged, and production should continue to rise towards the end of 2009. Output is expected to average 51.0 mb/d this year, rising to 51.6 mb/d next year. Total annual growth stands at +380 kb/d in 2009 and +550 kb/d in 2010, augmented by OPEC NGL growth of 550 kb/d and 850 kb/d, respectively.
• Global refinery crude throughput in 4Q09 is reduced by 0.2 mb/d to 73.2 mb/d, as further weakness in refining margins undermines the outlook. Declines in OECD Europe and North America compound lower Latin American projections, only partially offset by higher Other Asian estimates resulting from stronger 3Q09 data.
Source: International Energy Agency (IEA)
Speech by SEC Chairman:
Remarks at IOSCO Technical Committee Conference
Chairman Mary L. Schapiro
U.S. Securities and Exchange Commission
October 8, 2009--If investors cannot obtain important and accurate information necessary for them to judge the financial soundness, management and prospects of an enterprise, they are more likely to make poor decisions — or perhaps choose not to invest at all. Indeed, during the crisis, investor confidence in the transparency of the markets, sufficiency and even the reliability of the information they were getting was shaken to the core.
In too many areas, investors could no longer be certain that they were getting clear, relevant, and reliable information about their investment options. Because investors could no longer discern a clear picture of the risks they were taking, many exited these markets.
Furthermore, we have seen that if markets are opaque and regulators are unable to monitor the positions taken by financial intermediaries, then regulators will be unable to do their jobs effectively. In such cases, we cannot fully enforce fraud and other business conduct standards vital for orderly markets, let alone assess the potential risks to the financial system or take effective action if the need arises.
Of course, the SEC’s philosophical emphasis on transparency is shared by securities regulators around the world, as well as by IOSCO as an organization. And, IOSCO has been instrumental in advocating and facilitating transparency throughout the world’s capital markets, through the creation of numerous standards and principles promoting transparency in key aspects of the securities markets. One highlight is the International Disclosure Standards for Cross-Border Offerings and Listings by Foreign Issuers, issued in 1998, which continue to form the basis for disclosure by issuers around the world.
Similarly, the IOSCO Multilateral Memorandum of Understanding is a powerful tool for promoting transparency by allowing us to see beyond our borders when it comes to misconduct in the securities markets.
Regulatory Priorities
My fellow SEC Commissioner, Kathy Casey, already has given an excellent overview of the work being done by IOSCO to increase market transparency. So, I thought I would focus my attention on some SEC regulatory priorities that are concurrently under consideration by IOSCO.
The SEC has taken significant steps to address issues relating to the financial crisis. In addition to our efforts to transform our own enforcement program and crack down on market abuse, the SEC has embarked on an aggressive rule reform agenda. Many of these reforms are aimed at enhancing disclosure in order to increase transparency. I cannot discuss all of the SEC’s initiatives, but I want to focus on three areas of particular interest.
Accounting The first area of critical importance is accounting.
Increasing transparency in the market through a high-quality, global set of accounting standards has also long been high on IOSCO’s agenda. We know that the Technical Committee’s Standing Committee One works closely with the International Accounting Standards Board to provide useful input on standards, based on IOSCO members’ experiences.
Financial reports prepared in accordance with high-quality, consistent accounting standards are one of the most effective tools for providing transparency to the markets and instilling confidence in investors. Yet the financial crisis demonstrated that some standards must be improved to provide investors with the critical information they need. That is why there is a great deal of support around the world for improving accounting standards and public disclosures.
Accounting standard setters, including the International Accounting Standards Board and the US Financial Accounting Standards Board, are both in the process of addressing important issues raised by the crisis. And at the same time, those standard setters are continuing to cooperate on the convergence of accounting standards. I applaud the quick reaction and ambitious timeline that accounting standard setters have laid out to revise the standards in question.
We must not lose sight of the fact that the purpose of accounting standards is to provide a clear and accurate picture of a company’s financial condition, which is critical to providing investors a sound basis for relying on those disclosures, and making capital allocation decisions. We want to make sure accounting standards are “right” — and that those standards are the same when markets are going up, as when they are going down.
We all want confident investors, stable markets, and a sound financial system. And it is only by maintaining accounting standards whose overriding purpose is to provide accurate and transparent financial information to investors in public markets that we can expect investors to recover the confidence necessary to return to securities markets worldwide.
These objectives are true regardless of whether you are discussing accounting standards developed in Norwalk, London or anywhere else in the world.
read full speech by Chairman Schapiro
Source: SEC.gov
On horizon 2050 - billions needed for agriculture
October 8, 2009-Net investments of $83 billion a year must be made in agriculture in developing countries if there is to be enough food to feed 9.1 billion people in 2050, according to an FAO discussion paper published today.
Agricultural investment thus needs to increase by about 50 percent, according to the paper prepared for the High Level Experts’ Forum on How to Feed the World in 2050, Rome 12-13 October 2009. Some 300 top international specialists will attend the meeting.
Required investments include crops and livestock production as well as downstream support services such as cold chains, storage facilities, market facilities and first-stage processing.
Private investment essential
The projected investment needs to 2050 include some $20 billion going to crops production and $13 billion going to livestock production, the paper said. Mechanization would account for the single biggest investment area followed by expansion and improvement of irrigation.
A further $50 billion would be needed for downstream services to help achieve a global 70 percent expansion in agricultural production by 2050.
Most of this investment, in both primary agriculture and downstream services, will come from private investors, including farmers purchasing implements and machinery and businesses investing in processing facilities.
Public investment also necessary
In addition, public funds will also be needed to achieve a better functioning of the agricultural system and food security, the paper said. Priority areas for such public investments include: i) agricultural research and development; ii) large-scale infrastructure such as roads, ports and power, and agricultural institutions and extension services; and iii) education, particularly of women, sanitation, clean water supply and healthcare.
But in 2000 total global public spending on agricultural research and development totalled only some $23 billion and has been highly uneven. Official Development Assistance (ODA) to agriculture decreased by some 58 percent in real terms between 1980 and 2005, dropping from a 17 percent share of aid to 3.8 percent over the period. Presently it stands at around five percent.
Of the projected new net investments in agriculture, as much as $29 billion would need to be spent in the two countries with the largest populations – India and China. As far as regions are concerned, sub-Saharan Africa would need about $11 billion invested, Latin America and the Caribbean $20 billion, the Near East and North Africa $10 billion, South Asia $20 billion and East Asia $24 billion.
Regional differences
The projections point to wide regional differences in the impact of new investments when translated into per capita terms. Given different population growth rates, Latin America, for instance, is expected to almost halve its agricultural labour force while sub-Saharan Africa will double its own. This means that by 2050 an agricultural worker in Latin America would have 28 times the capital stock – or physical assets such as equipment, land and livestock – available as his or her colleague in sub-Saharan Africa.
Foreign direct investment in agriculture in developing countries could make a significant contribution to bridging the investment gap, the paper said.
But political and economic concerns have been raised about so-called “land grab” investments in poor, food-insecure countries. Such deals should be designed in such a way as to maximize benefits to host populations, effectively increasing their food security and reducing poverty.
Source: Food and Agriculture Organization of the United Nations
ETF Securities: Gold Price Hits All Time High, Demand For Gold ETCs Soars
October 7, 2009--The gold price broke to an all time record high of $1,045 per ounce yesterday on the back of surging investor demand for a hedge against persistent weakness in the US dollar. With the US dollar weakening on the back of historically low interest rates and growing sovereign and private investor concerns about the sustainability of rapidly rising US government debt and quantitative easing, demand for gold has soared. On the back of these growing concerns about the structural outlook for the US dollar, ETF Securities has seen soaring demand for its physically-backed gold ETCs, with total gold holdings backing its ETCs up over 40% since end of last year. ETF Securities' total gold holdings now stand at 8,380,282.792 ounces (US$8.7bn), up 110% over the past two years.
Nicholas Brooks, Head of Research and Investment Strategy at ETF Securities commenting on the rise in the gold price said:
"The US dollar has been in structural decline for some time and the continued rapid rise in US government debt and extremely loose monetary policy has clearly raised a red flag for both sovereign and private holders of US dollars. After many years of being net sellers of gold, recently central banks have turned net buyers. Private investors - both large institutions and individual investors - have also been turning to gold to hedge against possible structural dollar weakness and possible government temptation to turn to inflation as a method of reducing the real value of rapidly rising government debt. The surge in demand for gold does not appear to be short term in nature as we have been seeing very rapid growth of investor holdings of gold through our ETCs for over a year now. Combined flows into ETFS Physical Gold and Gold Bullion Securities have increased by 2,304,888 ounces since September of last year, a 41% rise. This trend has accelerated recently, with gold holdings rising by 5% over just the past six weeks, highlighting growing sovereign and private investor concerns about the sustainability of US policies."
Source: On-line news
FTSE Xinhua Quarterly Review Results - Jiangxi Copper (A) To Be Added To FTSE/Xinhua China A 50 Index - BYD (H) To Be Added To FTSE/Xinhua China 25 Index
October 7, 2009--FTSE Xinhua Quarterly Review Results - Jiangxi Copper (A) To Be Added To FTSE/Xinhua China A 50 Index - BYD (H) To Be Added To FTSE/Xinhua China 25 Index
Both indices are widely followed, forming the basis of Exchange Traded Funds (ETFs), and derivative products on exchanges around the world.
The definition of Red Chips has been updated to reflect the view of investors which has evolved to include components such as assets and revenues derived from Mainland China in addition to ownership of Mainland Chinese entities.
Several changes were approved to FTSE Xinhua B 35 index, FTSE Xinhua 200, 400 and Small Cap Index. Full details of all inclusions and deletions for the FTSE Xinhua Index Series can be obtained here. The changes will be effective after the close of trading on Friday 16 October, 2009.
The FTSE Xinhua Index Series is reviewed quarterly in January, April, July and October by an independent index committee, comprising a group of local and international financial market experts. The index series is widely regarded as the leading measure of the China market by domestic and international investors with total assets tracking and benchmarking against the index series was exceeding USD 92 billion worldwide till the end of September 2009.
More information about the FTSE Xinhua Index Series is available at www.ftsexinhua.com
Source: FTSE
The demise of the dollar
October 6, 2009--n the most profound financial change in recent Middle East history, Gulf Arabs are planning - along with China, Russia, Japan and France - to end dollar dealings for oil, moving instead to a basket of currencies including the Japanese yen and Chinese yuan, the euro, gold and a new, unified currency planned for nations in the Gulf Co-operation Council, including Saudi Arabia, Abu Dhabi, Kuwait and Qatar.
Secret meetings have already been held by finance ministers and central bank governors in Russia, China, Japan and Brazil to work on the scheme, which will mean that oil will no longer be priced in dollars.
The plans, confirmed to The Independent by both Gulf Arab and Chinese banking sources in Hong Kong, may help to explain the sudden rise in gold prices, but it also augurs an extraordinary transition from dollar markets within nine years.
Source: The Independent
Jeffries wants its commodities ETF to be global benchmark
October 6, 2009--Jefferies, the U.S. securities and investment banking group, said on Monday it hopes its recently launched exchange-traded fund (ETF) that invests in the stocks of commodity producers will become a global benchmark.
The Thomson Reuters-Jefferies CRB Global Commodity Equity Index Fund tracks an index containing shares of 150 companies based in 32 countries that are involved in the production and processing of commodities.
Launched on Sept. 21, it is Jefferies' first publicly traded ETF that is comprised of corporate stocks. The company also publishes the Reuters-Jefferies CRB Index .CRB, a major vehicle used by investors in commodities.
Source: Mineweb
Statement by Secretary Timothy F. Geithner to the Plenary Session
and World Bank Annual Meetings,
Delivered by
Acting Assistant Secretary Mark Sobel
October 6, 2009--On behalf of Secretary Geithner and the U.S. delegation, thank you to the people of Istanbul and our host country Turkey. It is fitting that we meet today in this great country - a land at the crossroads of history and civilization.
During the Great Depression, the global economy faced a crossroads, and it chose the path of unilateralism and inwardness. Over the last year, we faced the deepest challenge since then. Standing at another crossroads, the international community chose the path of unprecedented cooperation and multilateralism. We took decisive action to restore growth, boost employment, and repair financial systems. We mobilized nearly $1 trillion in support for emerging markets, helping to slow a serious capital drain.
The United States is doing and will do its part. We supported U.S. and global growth through our stimulus plan, restored confidence in the U.S. financial system through our stability and regulatory reforms as well as our transparent stress tests, and helped stem the loss of confidence facing emerging markets through President Obama's successful call for rapidly mobilizing $500 billion through a renewed New Arrangements to Borrow at the IMF.
We are now witnessing stabilization of the global economy and the beginnings of recovery. But we cannot be complacent. Conditions remain fragile. The international community must implement its critical agenda to sustain the recovery and help create jobs, to strengthen regulatory frameworks, and to begin preparing cooperative exit strategies. We also need to pursue additional trade liberalization, including an ambitious and balanced conclusion to the Doha Development Round.
Together, we recognize that the world cannot return to a pattern of uneven growth, characterized by an excessive reliance on a single engine of consumption-led growth, while others relied heavily on external demand. First and foremost, the responsibility for tackling these problems rests with sovereign governments, including my own.
But as we build a strong, sustained and balanced global economy, we must advance a forward-looking agenda so that the IMF and World Bank can enhance their legitimacy and update their missions to meet future challenges.
For the IMF, this means that rigorous surveillance must help us shed light on trends that could lead to the next unsustainable boom. Under the new G-20 Framework for Strong, Sustainable and Balanced Growth, the IMF must provide forward-looking analysis of whether the world's major countries are implementing economic policies, including exchange rate policies, which are collectively consistent with G-20 objectives. The IMF will need to be a truth-teller.
The World Bank will need to focus more on building resilience to crisis and foundations for prosperity. As the world emerges from crisis, the poorest will require strong and sustained support from the multilateral development banks. With concessional financing deploying more quickly, donors must commit to successful and timely replenishments of IDA and the African Development Fund. When considering the MDB capital requests, we must recognize the importance of maintaining the IBRD's financial soundness. As the centerpiece of the multilateral development system, the World Bank is best positioned to address challenges that require globally coordinated action. In particular, the Bank must more actively prioritize work on three emerging global priorities, agriculture and food security, support in the most fragile environments, and facilitating the transition to a green economy.
For the IMF and World Bank to be effective in these tasks, their broad membership must consider them legitimate and representative. We are delighted that the international community is now committed to achieving a 5% shift in IMF quota share toward dynamic underrepresented countries by January 2011 and the call to shift at least 3% of the Bank's voting power to developing and transition countries and the recommitment to reach an agreement by the 2010 Spring Meetings.
The past six months have plainly demonstrated the benefits of stronger Ministerial engagement in setting strategic policies and priorities at the international financial institutions. To sustain this, we must find a way to enhance the effectiveness and efficiency of both the IMFC and the Development Committee. Furthermore, we need far more efficient and strategic Executive Boards, which better reflect the realities of the global economy.
In closing, the international community has rarely shared such a sense of common purpose and urgency. All of our countries – developing, emerging, or advanced – want to avoid a repeat of the worst economic crisis in decades. So let us press forward on this path of multilateralism to offer greater hope and prosperity for people in every corner of the world.
Source: U.S. Department of the Treasury
NASDAQ OMX Sees Momentum In Initial Public Offerings & Listing Application Growth
October 6, 2009-The NASDAQ OMX Group, Inc.
(Nasdaq:NDAQ), the world's largest exchange company, has seen increased
listings momentum through IPOs and listing applications during the
second half of 2009. Year to date, NASDAQ OMX has won 15 IPOs that have
raised $ 4.2 billion. Currently the exchange has 171 listing
applications in the pipeline from sectors including biotech, technology
and social media.
Recently, NASDAQ OMX welcomed Shanda Games which raised over $1 billion, more than any other Chinese IPO listed on NASDAQ. Shanda Games is the second Chinese IPO for NASDAQ this year, joining game developer Changyou.com which listed in April 2009. Greater China continues to be a key market for NASDAQ OMX, with a total of 116 listings. Other recent NASDAQ OMX wins included A123 Systems, Avago and Talecris Therapeutics.
"With the IPO market showing signs of revival, NASDAQ OMX continues to build momentum by winning the majority of IPOs coming to market across a variety of industry sectors," said Bruce Aust, Executive Vice President, NASDAQ OMX. "While we haven't seen a return to the levels we saw in 2006 and 2007, we are encouraged by the recent IPOs and the pickup in IPO and listing applications we've seen in the last several months."
This week, insurance industry risk specialist Verisk Analytics Inc. plans to list on NASDAQ, marking the largest U.S. initial public offering in the last 12 months. NASDAQ OMX continues to attract switches from NYSE Euronext with a total of 14 companies transferring to NASDAQ in 2009. These companies have a total value of over $13.1 billion and include Mattel Inc., R&R Donnelly & Sons, and Dreamworks Animation.
Source: NASDAQ OMX
Top asset managers lose USD16trn in a year
September 5, 2009--Assets managed by the world’s largest 500 fund managers fell by over 23 per cent in 2008 to USD53.4trn, down from USD69.4trn the year before, according to the Pensions & Investments/Watson Wyatt World 500 ranking.
The fall in assets is the first since 2002 and the largest since the research began in 1996.
Carl Hess, global head of investment consulting at Watson Wyatt, says: “2008 was a dreadful year for fund managers with the majority posting record losses. Even after the strong market recoveries since March this year, our expectation is that values will remain below 2007 levels, meaning the outlook for this year’s revenues and earnings in the sector remain poor.”
Source: ETF Express
