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Morningstar Quarterly Commentary: A Flat Fourth Quarter
A flat fourth quartercaps off the market's strong 2012 performance.
January 8, 2013--Despite fiscal cliff concerns, the U.S. stock market finished the fourth quarter essentially flat, locking in a strong 16% gain for the year.
Politics dominated the headlines in the fourth quarter, with the biggest news being the presidential election.
Despite some pre-election polls predicting a tight race, the results were largely one-sided as President Obama had little trouble retaining the White House, which trigged a short-term sell-off.
Obama’s victory offered greater clarity on certain issues, such as solidifying Obamacare’s future, but brought up uncertainty on other issues, such as the fiscal cliff.
In the back half of the quarter, the uncertainty of the fiscal cliff controlled the financial news and drove businesses’ investment decisions. Many firms issued special dividends in late December to avoid a potential increased tax rate on dividend income, or pushed off capital expenditure decisions until the cliff issue is resolved.
Similar to its 2011 run-in with the debt ceiling, Congress was unable to come to agreement in advance, and took the issue down to the 11th hour.
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Source: Morningstar
ETFs lead US equity trading in 2012
January 8, 2013--Exchange traded funds were among the most widely used US financial securities in 2012 with the world's largest ETF, the SPDR S&P 500, averaging trading worth more than $18bn a day last year.
Assets held in SPDR S&P 500, known as SPY, ended last year just above the $123bn mark, boosted by net new investor inflows of $15.8bn and a gain of 13.4 per cent for the US stock market.
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Source: FT.com
Finra to Shine Light on Dark Pool Trading
January 8, 2013--A top regulator plans to shine a light on dark pools, private trading venues that allow buyers and sellers to post orders that are hidden from the rest of the market.
Richard Ketchum, chief executive of Financial Industry Regulatory Authority, said in an interview Tuesday that the regulator is expanding its oversight of the dark-trading venues, with an eye on whether orders placed in public exchanges are “trying to move prices or encourage sellers that may advance their trading in the dark market.”
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Source: CompliancEX
CBOE Unveils New Corporate Branding
January 8, 2013--The Chicago Board Options Exchange (CBOE) has unveiled a new branding initiative, which has been introduced company-wide, including across social media platforms, marketing and communications materials and its website.
The brand makeover has also been incorporated into a major new advertising and integrated marketing campaign. New York-based agency of record Stein + Partners Brand Activation developed both the branding and the advertising with CBOE.
"CBOE continues to lead, shape and define the industry it created through unparalleled innovation in options and volatility products, trading technology and investor resources. The new branding effort builds on our rich heritage and highlights how CBOE's unique value proposition empowers today's investor," said Carol Kennedy, CBOE's Chief Branding Officer.
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Source: CBOE
S&P Dow Jones Indices Announces Changes To The S&P/TSX Canadian Indices-A Deletion From The S&P/TSX Preferred Share Index
January 8, 2013--S&P Canadian Index Services will make the following changes in the S&P/TSX Canadian Indices:
National Bank of Canada (TSX:NA) has announced that it will redeem for $CDN25.00 cash per share all of the outstanding shares of its Non-Cumulative Fixed Rate First Preferred Shares, Series 15 (TSX:NA.PR.K) at the close on January 15, 2013.
The shares of this issue will be removed from the S&P/TSX Preferred Share Index and the S&P/TSX North American Preferred Stock Index after the close of trading on Tuesday, January 15, 2013.
Source: S&P Canadian Index Services
CBO-Monthly Budget Review
January 8, 2013--The federal budget deficit was $293 billion for the first three months of fiscal year 2013 (that is, October through December 2012), $29 billion less than the shortfall recorded in the first quarter of last fiscal year, CBO estimates.
Without shifts in the timing of certain payments in both years, however, the deficit for the three-month period would have been about $60 billion lower this year than in fiscal year 2012.
Total Receipts Were Up by 11 Percent in the First Quarter of Fiscal Year 2013 Receipts for the first three months of fiscal year 2013 totaled $616 billion, $60 billion more than those in the same period last year. Compared with receipts in the first quarter of last year:
view the CBO-Monthly Budget Review
Source: CBO (Congressional Budget Office)
A Call for Ethics in ETF Advertising - Forbes
January 7, 2013--The fund industry is notorious for comparing the performance of their products to the wrong benchmarks and even made-up benchmarks. This is done to make a fund's performance appear to be superior relative to something-even if that something makes no sense. This decadent practice harms the credibility of an industry that has lost so much in recent years.
Sometimes, when an exchange-traded fund (ETF) doesn’t actually have performance, the fund provider will publish an index return that the ETF is attempting to follow. The index performance is then compared to other benchmarks so that investors can evaluate differences.
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Source: Forbes
NYSE, Nasdaq Indicate 'Flash Crash' Safeguards May Be Postponed
January 7, 2013--NYSE Euronext (NYX) and Nasdaq OMX Group Inc. (NDAQ) said new measures meant to prevent wild stock-market swings may be delayed in order to allow securities firms time to prepare their systems for the change.
The measures, "circuit breaker" techniques that halt or slow trading in periods of extreme stock or index volatility, were conceived in response to the 2010 "flash crash." As the implementation date has drawn nearer, market participants have warned they may need more time to run tests on how their computer systems would react to the new rules.
Under the proposed delay, the rules would go into effect April 8, rather than early next month as originally planned, according to notices NYSE and Nasdaq sent to customers Monday.
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Source: Wall Street Journal
Fidelity, late to learn value of ETFs, could cut into State Street
January 6, 2013-Fidelity Investments' belated bid to offer a range of exchange-traded funds will pit the firm squarely against another Hub-based financial giant, State Street Corp., which pioneered the increasingly popular investments.
Last March, Fidelity poached Anthony Rochte from State Street to build out its new ETF division. Then, last month, Fidelity filed plans with the Securities and Exchange Commission to unleash its ETF onslaught this year.
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Source: Boston Herald
JPMorgan's copper ETP splits opinion
Copper is often known as Dr Copper for the supposed predictive powers of the metal in signalling the health, or otherwise, of the global economy.
If critics are to be believed, the US Securities and Exchange Commission has opened the door to the widespread doctoring of the price of copper, with potentially serious ramifications for the world economy, given the metal’s ubiquity in electrical wiring.
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Source: FT.com
