Friday 25th July 2014
slib33
FRIDAY ANALYSTS TICKER: July 25th 2014 - According to Adam Cordery, global head of European fixed income, Santander Asset Management, and fund manager for the Santander Euro Corporate Short Term and Euro Corporate bond funds, “Pricing of risk assets doesn’t offer much of a margin for error at the moment. And now Europe is starting to go on holiday, market liquidity may get poorer than normal, and any buys today may well have to be holds until September. It is always interesting to note what yields are required to attract clients to financial products. Twenty years ago, bond funds offering yields of 10%+ could generally attract lots of client interest very quickly. However as rates have come down over the years, so the yields clients demand have fallen. Now 4% seems to be the new 10%, he say. Cordery thinks that unfortunately, investors often want today the yield/risk mix that was available last year, so the products that get launched, sold and bought in size may be more risky than people think. “Products with 4% yield will sell well today, but to get to a 4% yield in Euro you need to invest in a portfolio with an average rating of single-B, and that is far from being risk-free. I get the impression the conventional wisdom today is to think that interest rates must surely go up soon and the main risk to bond portfolios is an increase in bund yields. Because of this many investors are buying short-duration products and floating rate notes, perhaps viewing them as a safe choice, almost like cash. It is possible however that these products may yet prove to have a considerable sensitivity to changes in credit market spreads and/or bond market liquidity, and may prove to be no protection at all.” - Commenting on the RBS share price jump, Dr Pete Hahn of Cass Business School, says “It's hard to tell whether the RBS share price jump today is more about relief or optimism. The former is about fewer fines, fewer losses on loans, and fewer costs in a shrinking business and possibly dividends for shareholders. And there's the rub, owning shares (as opposed to interest bearing debt) should be about optimism and long-term growth in dividends. But from a shrinking business? Few would argue that RBS' retail and corporate bank had efficiencies to be gained and cash flow that might be converted to dividends; yet like most banks, RBS' cost of equity remains stubbornly and appropriately above its ability to provide a return on that equity. For shareholders, current improvements should mean dividends in the medium term but a recognition that RBS may lack any merit for new investment and delivering any long-term dividend growth - not good. While many large retail banks are getting safer, in some aspects, and we often speak of them in terms of moving toward utility type models, banks take risks, are cyclical, face competition, have new business challengers, and are simply are not utilities. Investors shouldn't get ahead of themselves here.” - According to the monthly survey held by the central bank of Turkey, the country’s capacity utilization (CU) rate declined slightly to 74.9% in July from 75.3% in June. Meanwhile, seasonally adjusted (SA) CU also declined to 74.3% from 74.7% in June, writes Mehmet Besimoglu at Oyak Yatirim Research. As for manufacturing confidence, the index declined to 109 from 110.7 in May. On SA basis, the index also edged down slightly to 106.4 from 107.2. SA capacity utilisation was broadly stable in 1H14, averaging at 74.7%. This is the same level with the 2013 average. Despite the political turmoil and volatility in financial markets, activity has been relatively resilient. Export recovery & government spending supported production in 1H. Following the elections, public spending relatively decelerated. The turmoil in Iraq also decelerated export recovery from June. Nevertheless, we still expect 3.5% GDP growth in 2014, writes Besimoglu.

Instinet names Adam Toms CEO of Instinet Europe Limited

Monday, 11 June 2012
Instinet names Adam Toms CEO of Instinet Europe Limited Instinet Incorporated, the provider of electronic trading and agency-only brokerage services, says that  Adam Toms has been appointed CEO of its Instinet Europe Limited subsidiary. Fumiki Kondo, chief executive of Instinet Incorporated, explains that, “Adam brings a deep understanding of the needs of our clients and the challenges they face in today’s rapidly-changing and highly-complex markets. We expect his knowledge, experience and leadership will be invaluable as we work to grow Instinet’s European business.” http://www.ftseglobalmarkets.com/

Instinet Incorporated, the provider of electronic trading and agency-only brokerage services, says that  Adam Toms has been appointed CEO of its Instinet Europe Limited subsidiary. Fumiki Kondo, chief executive of Instinet Incorporated, explains that, “Adam brings a deep understanding of the needs of our clients and the challenges they face in today’s rapidly-changing and highly-complex markets. We expect his knowledge, experience and leadership will be invaluable as we work to grow Instinet’s European business.”

With its agency model, advanced electronic platform and well-deserved reputation for trading excellence, Instinet provides a unique value proposition to the buy side,” said Toms. “I am extremely excited to join its talented group of employees in Europe as we work to build upon Instinet’s considerable legacy.”  The move is something of a surprise as most market watchers had anticipated Instinet to be rolled into parent Nomura’s equity trading franchise, encased in Nomura International; moreover the agency trading model has undergone a testing period of late.  However, Toms is a very high profile trading business leader and will undoubted bring a harder edge to the Instinet business. It will be interesting to see what he does with the Instinet brand.

Toms served as managing director; co-global head of electronic trading at Nomura International, where he successfully led the integration of the Lehman’s trading business into the Japanese major. When he first joined Nomura following its acquisition of the European assets of Lehman Brothers, he headed  up the firm’s European Portfolio and Electronic Sales Trading desk. Prior to that, Toms was an Equity Trader at Barclays Global Investors in London.

Toms will succeed Richard Balarkas, who will leave the firm to pursue other interests. “Over the past four years, Richard has effectively steered Instinet Europe through myriad challenges amidst difficult market conditions. We thank him for his many contributions during that time, and wish him all the best in his future endeavours,” says Kondo.

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