Friday 3rd July 2015
NEWS TICKER: FRIDAY, JULY 3rd 2015: Deutsche Börse says a new iShares ETF from BlackRock's product offering has been launched on Xetra and Börse Frankfurt today. The iShares MSCI EMU USD Hedged UCITS ETF launched on Xetra ETF provides access to euro-zone equities with currency hedging against US dollar. The exchange organisation says the ETF enables investors to participate in the performance of stock corporations in the euro zone while also benefiting from currency hedging against the US dollar. This protects investors against an appreciation of the US dollar against the euro. - The Straits Times Index (STI) ended 3.3 points or 0.1% lower to 3327.84, taking the year-to-date performance to -1.11%. The top active stocks today were UOB, which gained 0.82%, DBS, which closed unchanged, Singtel, which declined 0.24%, CapitaLand, which declined 1.13% and Global Logistic, with a 0.78% fall. The FTSE ST Mid Cap Index declined 0.06%, while the FTSE ST Small Cap Index rose 0.02%. The outperforming sectors today were represented by the FTSE ST Basic Materials Index, which rose 0.82%. The two biggest stocks of the Index - Midas Holdings and NSL- ended 1.59% higher and 0.67% lower respectively. The underperforming sector was the FTSE ST Real Estate Investment Trusts Index, which slipped 0.67%. CapitaLand Mall Trust shares declined 2.30% and Ascendas REIT declined 2.41% - According to Flightglobal, China’s state aviation supplier has tentatively signed for up to 75 Airbus A330s in an agreement which will help bridge a production gap to the re-engined A330neo. General terms of the agreement inlcude an order for 45 jets plus a memorandum of understanding for another 30 options. The deal took place during an official visit to France by Chinese premier Li Keqiang. Airbus has long been negotiating the landmark agreement following a preliminary deal to establish an A330 completion centre in Tianjin. The pact with China Aviation Supplies Holding, which is likely to include several aircraft configured in the lower-weight regional version. Meanwhile, Airbus CEO Fabrice Bregier says the package is a “new vote of confidence” in the twinjet. “China is today the most important market for aviation in the world,” he adds - Morningstar has upgraded the Royal London UK Equity Income fund to a Morningstar Analyst Rating of Silver. The fund was previously rated Bronze. Experienced manager Martin Cholwill has, over his decade-long tenure on the fund, consistently applied his proven investment process to good effect. His strategy is sensible for delivering yield and competitive total returns for investors, with a focus on free cash flows and valuations. The fund also enjoys a cost advantage over its rivals, with ongoing charges lower than the category norm. These factors have led to a strong and consistent performance profile over a number of years - The amount of outstanding Euro commercial paper (CP) and certificates of deposit (CD) declined significantly in the week ending July 1st, according to CMDPortal data. Outstandings dropped by $11.80bn to $861.59bn during the week. Sovereign, supranational and agency CP outstandings dropped by $2.80bn to $219.44bn. Corporate CP outstandings declined the most during the week by $5.56bn to $89.83bn. Meanwhile financial CP outstandings declined by $3.04bn to $503.37bn - SWIFT says that BTG Pactual, one of Latin America’s largest financial services firms, has joined the Know Your Customer (KYC) Registry, a centralised repository that maintains a standardised set of information about correspondent banks required for KYC compliance. For the KYC Registry, banks contribute an agreed ‘baseline' set of data and documentation for validation by SWIFT, which the contributors can then share with their counterparties. Each bank retains ownership of its own information, as well as control over which other institutions can view it - Laurel Powers-Freeling is to join the board of Atom, the UK’s newest bank, as its senior independent non-executive director. The appointment comes hot on the heels of Atom’s announcement that the Prudential Regulation Authority and the Financial Conduct Authority have approved its digital business model. Powers-Freeling was recently appointed as Chairman of Sumitomo-Mitsui Banking Corporation Europe - China has guaranteed that 100% foreign-owned firms (typically known as WFOEs – Wholly Foreign-Owned Entities) will be able to manufacture and market their own products for sale to mainland clients, operating under exactly the same rules as local private funds. The announcement comes at the end of the US-China Strategic and Economic Dialogue, which appears to have resulted in unprecedented rights for foreign firms participating in China’s financial markets. Greater access to China’s Interbank Bond (IBB) market has also been granted, with the elimination of firm-level ownership quotas in addition to improved access and operating rights for foreign banks. Finally, Shanghai’s Free Trade Zone (FTZ) has been specified as the testing ground where foreign owners can establish wholly-owned futures companies with access rights to domestic exchanges. China’s opening-up to foreign asset managers is now moving faster than our most optimistic predictions. With that speed in mind, we predict that all of the above opportunities will be available to foreign owners by the end of 2015.

Latest Video

A Clarion Call for Investors in Youth-led Enterprise

Tuesday, 01 July 2008
A Clarion Call for Investors in Youth-led Enterprise At the Doha Summit on young people and employment, held in February this year, the issues of chronic youth unemployment, discrimination against women in the job market, lack of skills required for particular jobs among university graduates and the negative perception about private sector jobs were key discussion topics. In a groundbreaking development, involving FTSE Group with youth initiative Silatech, established by Her Highness Sheikha Mozah bint Nasser Al Missned of Qatar, is now leading a regional wide index project to support youth-led small and medium sized enterprises (SMEs) in the Middle East and North African region. Over the medium to long term, the project hopes to encourage sustained private sector institutional investment in seed companies in the region to facilitate equal opportunity and employment. Francesca Carnevale reports. http://www.ftseglobalmarkets.com/
At the Doha Summit on young people and employment, held in February this year, the issues of chronic youth unemployment, discrimination against women in the job market, lack of skills required for particular jobs among university graduates and the negative perception about private sector jobs were key discussion topics. In a groundbreaking development, involving FTSE Group with youth initiative Silatech, established by Her Highness Sheikha Mozah bint Nasser Al Missned of Qatar, is now leading a regional wide index project to support youth-led small and medium sized enterprises (SMEs) in the Middle East and North African region. Over the medium to long term, the project hopes to encourage sustained private sector institutional investment in seed companies in the region to facilitate equal opportunity and employment. Francesca Carnevale reports.
A 2007 report by the International Business Leaders Forum (IBLF) puts the scale of the problem in context. In the report, IBLF notes that over 290m people live in the Middle East and North African region (MENA) and the demographic is expected to double over the next thirty years. Out of today’s population, some 60% is under 24. That in turn means that 20m jobs have to be found right now to reduce current levels of unemployment, and over 100m new jobs have to come on stream in the next 20 years to meet supply.

Youth unemployment is chronic in emerging markets and for all its much vaunted riches and resources, the story is the same in the MENA region. Finding a job is the top priority for 68% of Arab youth and if the means to find work are not there, then the result could be very challenging indeed. The problem has been in mind for some time. A few years ago, at an International Fund for Agricultural Development meeting in Rome, Gulf Co-operation Council (GCC) secretary-general Abdul Rahman al-Attiyah compared unemployment to a ticking bomb likely to cause a “revolt” should the region fail to act comprehensively and soon. His fears may be justified. IBLF’s report says that 80% of young Arabs do not believe they will find employment easily; while 70% of young Arabs think it is up to the government to solve the unemployment problem.



The private sector can play an important role in tackling the growing crisis of youth unemployment and perhaps for too long governments and aid agencies have been seen as the only solutions to what could be an impending crisis. However, businesses and pressure groups across the Middle East now appear to be picking up cudgels and instigating—albeit in a small way—initiatives to help create new employment and enterprise opportunities for young people. IBLF’s report was published, for instance, with the support of the Young Arab Leaders, Emirates Environmental Group, Young Entrepreneurs Association, the United Nations Development Programme (UNDP) and a consortium of companies. Now comes a clarion call to action by FTSE Group and Silatech, which together are working to attract global investors into the process of change through the launch of a special index project to support youth led small businesses in the MENA region.

The initiative will promote the creation of small and medium sized enterprise (SME) markets and indices across the MENA region in order to “facilitate their growth and development and thereby increase youth employment opportunities,” notes Imogen Dillon-Hatcher, managing director of Europe, Middle East and Africa at FTSE Group. The initiative will encourage and support individual exchanges “in establishing their junior SME markets, that are lightly regulated and thereby encourage the development of smaller, entrepreneurial companies. We know that such companies are more likely to employ and even be run by the 18 to 30 age group,” she adds. The first initiative will be implemented in Qatar, where local regulator, the Qatar Financial Markets Authority (QFMA) is working with the Doha Securities Market to establish a ”younger market that will attract investors. The next stage is to establish credible investible indices supporting the junior markets that will attract institutional investment,” explains Dillon-Hatcher. Moreover, she adds, the World Bank and the International Labour Organisation (ILO) are also supporting the broader Silatech initiative.

“This initiative is about energising SMEs, which are critical to the creation of youth employment opportunities, [which is] our main goal,” says Rick Little, chief executive of Silatech. Silatech, is focused on connecting young people across MENA to encourage employment and provide new business development services, unlocking capital and encouraging new business start-ups. Moreover, other exchanges in the region have indicated their interest in the project. “We have already had the commitment of the QFMA and expect to make announcements related to other exchanges which are in accord with the project very soon,” adds Dillon Hatcher.

The initiative also has broader connotations. According to Dillon-Hatcher, “it also resonates in markets such as Syria and Yemen, for instance, where there is no formal exchange arrangement, but where we can encourage small firms to list on other exchanges in the wider region to get access to investor funds.” In Syria, for instance, the major issues are lack of skills among the youth and a high preference for the public sector; a common trend in most countries of the region. In Tunisia, unemployed youth from rural areas are increasingly migrating to the cities. In Yemen, unemployment among women is six times higher compared to that of men. These dissonances have economic consequences, and it is estimated that MENA countries are losing as much as $25bn in income every year due to unemployment.

Global firms are also investing in the initiative. Cisco Systems is in the process of creating “an incredible web based communications network supporting the project,” notes Dillon-Hatcher, “designed to appeal to 18 to 30 year olds, providing forums, chat rooms and providing advice and access to training and meeting facilities.”

It is important to remember, notes Dillon-Hatcher, that the project has sound business principles behind it. “Without that it simply would not work. Although our involvement fits neatly with our high standards of corporate citizenship driven by our relationship with UNICEF, we also have a business stake in the project. What we are creating here sits alongside our day job. That ensures its longevity and our commitment as a business. Unless it fitted in with our strategy, it could wither on the vine.” By way of explanation, she points to the perennial requirement of exchanges in the MENA region to establish national indices and pan regional indices. “Our job is to create appropriate indices for the junior markets, perhaps with different frameworks to suit local market conditions, but with a common methodology.”

Ultimately, “All exchanges in the region are keen to establish new products, such as exchange traded funds (ETFs) and this project should be seen in this regard, as a means of diversifying indices in the MENA region, and offering investors access to the growing prosperity of the region as a whole across the business spectrum. The youth opportunity project in this regard is a very exciting development, which also has significant repercussions for youth employment in the region over the longer term,” highlights Dillon-Hatcher. In other words, its business case is based on the fact that the overall success of the Middle East in increasing prosperity among its population, and in particular, younger members of that population, is of central importance to every business with long-term operations in the region.

Tweets by @DataLend

DataLend is a global securities finance market data provider covering 42,000+ unique securities globally with a total on-loan value of more than $1.8 trillion.

What do our tweets mean? See: http://bit.ly/18YlGjP