Dow Jones Indexes launches indexes for Asia, Europe
“A 30-stock index is not necessarily ideal as a benchmark
for asset managers but it does lend itself well to investible
products such as ETFs, for which there is a lot of demand from
mutual funds and other investors,” said John Prestbo, editor and
executive director of Dow Jones Indexes. “We see the index as a
shorthand expression of the regional market.”Seven of the component stocks on the Asia Dow are based in
Japan, the most of any nation in the index followed by
Australia, China and Hong Kong with four each.Toyota Motor Corp , and the Hong Kong listings of
Industrial & Commercial Bank of China Ltd and HSBC
Holdings Plc are some of the large Asian blue-chips
included in the Asian index.The Asia Dow takes a slightly different approach from others
in that Japan and Australia are also included in a Pan-Asian
index.Traditionally, the regional investment landscape has been
split into Japan and Asia excluding Japan, partly because of the
developed nature and larger size and depth of the Japanese
equity market compared with the rest of Asia.”We are sensitive to Japan’s size, but I think there is a
countervailing trend here of looking at the region as a single
equity market which would include Japan,” said Prestbo.Southeast Asia also finds representation in the Asia Dow
with one company each from Indonesia, Malaysia and Singapore,
namely Astra International , CIMB Group Holdings Bhd
and Jardine Matheson Holdings Ltd .
UPDATE 1-Safe Bulkers Q3 results beat Street, shares rise
Oct 17 (Reuters) - Drybulk shipper Safe Bulkers Inc
posted better-than-expected third quarter results, helped by
higher number of operating days and fleet expansion.”We continue to implement our newbuilding program and we may
pursue further attractive vessel acquisition opportunities,”
President Loukas Barmparis said in a statement.The company’s vessels, mainly used for transportation of
coal, grain and iron ore, were operating for 1,491 days, up from
1,372 days a year ago.The Athens, Greece-based company’s profit decreased to $19.8
million, or 28 cents a share, from $22 million, or 33 cents a
share, from the year-ago period.Excluding items, the company posted a profit of 37 cents a
share.For the quarter ended Sept. 30, net revenue for increased by
4 percent to $42.5 million.Analysts, on an average, expected the company to earn 34
cents a share on revenue of $40.1 million, according to Thomson
Reuters I/B/E/S.Safe Bulkers shares were trading up 8 percent at $6.78 after
the bell, having closed at $6.30 on the New York Stock Exchange.
GLOBAL MARKETS-Asia shares rise on progress in euro zone rescue
* Euro underpinned after Slovak deal on rescue fund* China trade slows in Sept as global economy weakens* Spread on iTraxx Asia ex-Japan investment grade index
narrows sharplyBy Chikako MogiTOKYO, Oct 13 (Reuters) - Asian shares rose on Thursday on
growing optimism that Europe will take concrete steps to contain
the region’s debt woes and head off a systemic banking crisis,
but European equities were seen weaker as credit problems
fuelled growth concerns.Strengthening investor confidence in the euro zone
underpinned the single currency, while receding concerns about
the banks’ problems threatening the wider financial system
sharply tightened Asian credit markets.”Markets are feeling better. The sense is that things are
beginning to be put in place, bondholder haircuts, bank
recapitalisations and the EFSF l„lexpansion,” said a
Singapore-based trader with an Asian bank referring to the
two-year old euro zone debt crisis.MSCI’s broadest index of Asia Pacific shares outside Japan
rose 1.4 percent, following a 1.4 percent gain
in the MSCI world equity index , which posted an
increase for the sixth session in a row on Wednesday.The Nikkei average rose to a four-week high on
Thursday, with shares of major exporters such as Sony Corp
rising as players bought back on tentative signs of
progress in the European debt crisis.VIX EYEDIn a sign some stability and risk appetite may be returning,
the overall market volatility as measured by the VIX index
, Wall Street’s so-called “fear gauge”, has hovered around
30.The level, pulling back sharply from crisis-like levels near
50 hit in August, suggested investors are less inclined to seek
protection in stock index options against an equity market
slide.In credit markets, that had been feeling the strain of
waning confidence in the financial system in recent months,
spreads on the iTraxx Asia ex-Japan investment grade index
narrowed by about 17 points due to easing worries.Another sign of activity picking up is an expected sale of
3-year, $300 million dollar bonds by China Merchants Bank, the
first such deal out of Asia in a month.But some analysts remained cautious of the latest easing of
tension, seeing it as an adjustment to a recent over-sold
condition and saying the markets were not yet out of the woods.”The Vix still remains at an elevated level and the recent
decline is merely a rebound from an excessively pessimistic view
in the markets,” said Junya Tanase, chief strategist at
JPMorgan Chase in Tokyo.”Rather than a sign of a full-fledged risk-on returning, it
is just an evidence of a slight easing of risk aversion
sentiment.”The euro steadied in Asia on Thursday, having jumped to a
near one-month high on the dollar as Europe took a step closer
to shoring up its financial rescue fund.Lawmakers in Slovakia struck a deal on Wednesday to ratify a
plan to bolster the euro zone’s rescue fund by Friday,
effectively ending a crisis that had threatened the currency’s
main safety net. Slovakia is the only country in the 17-nation
bloc left to approve the revamp of the fund.Adding to the sense of urgency, the President of the
European Commission, Jose Manuel Barroso, said Europe needed to
take decisive action on Greece and outlined a broad plan to
contain the debt crisis.As European officials step up efforts to provide a more
specific roadmap to resolve its debt woes and recover investor
confidence, the European Union is expected to announce a bank
recapitalization plan designed to cushion the impact any default
by Greece could have on the region’s banks.Germany and France, the leading powers in the bloc, have
promised to propose a comprehensive strategy to fight the debt
crisis at an EU summit on Oct. 23.CHINA SLOWS, IMF WARNSEurope’s sovereign debt crisis has dampened investor
sentiment, caused market turmoil and added to uncertainty over
the global economy, which was underscored by China’s data.European equities are seen opening lower on Thursday
following sharp gains in the previous session as investors book
profits after weaker-than-expected Chinese trade data suggested
the country was feeling the impact of a global slowdown.Germany’s DAX and France’s CAC-40 were
expected to open down as much as 0.4 percent each.China’s trade surplus narrowed in September for a second
straight month as growth of exports and imports both pulled
back, reflecting global economic weakness and domestic cooling.Exports rose 17.1 percent last month from a year ago,
slowing from a 24.5 percent gain in August, and imports
increased 20.9 percent, compared with August’s 30.2 percent
rise.Hong Kong’s Hang Seng Index rose 1.9 percent on
Thursday, poised to extend a five-session winning streak helped
by mainland property developers that posted strong gains in
contract sales between January and September.Slower demand in the world’s second-largest oil consumer
weighed on oil prices, pushing Brent crude down to near
$111 on Thursday, snapping six days of gains.U.S. November crude slipped 0.8 percent to $84.86 a
barrel, after tumbling to an intraday low of $84.64.Near-term risks to Asia’s economies are “decidedly” rising
due to Europe’s debt woes and a U.S. slowdown, requiring
policymakers to be nimble and prepared to rapidly reverse
course, the International Monetary Fund said on Thursday. It
also warned about a risk of capital outflows from the region.
UPDATE 3-Chrysler, UAW reach tentative labor pact
* GM four-year contract ratified in late September* Ford workers still voting on tentative pact* Fiat shares up 7.6 percentBy Bernie Woodall and Deepa SeetharamanDETROIT, Oct 12 (Reuters) - The United Auto Workers and
Chrysler Group LLC reached tentative agreement on a four-year
labor contract for the No. 3 U.S. automaker’s 26,000 unionized
workers, the union said on Wednesday.This is the first labor pact for Chrysler since its 2009
bankruptcy and federally funded bailout.The agreement follows deals between the UAW and Chrysler’s
Detroit rivals, General Motors Co and Ford Motor Co .Chrysler is managed and majority-owned by Italy’s Fiat SpA . Fiat shares were up 7.6 percent to an eight-week high
following news of the Chrysler agreement.The GM contract was ratified by workers late last month,
and Ford workers are in the process of voting on their pact.
While the GM contract was ratified by a nearly 2-to-1 margin,
early returns from Ford local union halls show essentially a
50-50 split.The voting at Ford continues
through Oct. 18.In a press statement, UAW President Bob King said the
Chrysler contract will create 2,100 U.S. jobs and commit the
company to a $4.5 billion investment in vehicle production.Further details will be issued later Wednesday by the UAW.General Holiefield, head of the UAW’s Chrysler department
and lead negotiator in the contract talks, said the agreement
“is the latest in a remarkable turnaround.”“Chrysler has turned the corner and with this agreement
will continue to move forward,” he said. “It’s a new day at
Chrysler.”Labor analysts do not expect the contract to be as generous
for workers as the deals at GM and Ford, due to Chrysler’s
relatively poor financial position.Fiat took the reins at Chrysler after the company’s 2009
restructuring. Chrysler has since reversed a slide in U.S. auto
sales and repaid U.S. government loans.The 2009 U.S. rescue saddled Chrysler with an outsized debt
load, in contrast to GM, which emerged from bankruptcy with
little debt. Chrysler refinanced $7.6 billion of that debt on
its balance sheet in May.Chrysler lost $254 million in the first half of the year.Ford posted a first-half net profit of $4.95 billion and
has shown a net profit for nine consecutive quarters. GM has
shown a profit for six straight quarters and had a first-half
net profit of $5.7 billion.Sergio Marchionne, chief executive of both Fiat and
Chrysler, has said Chrysler should not have to accept as
expensive a contract as Ford and GM.”Some of the deals that we’ve seen being signed between
Ford and GM (with the UAW) are probably, given Chrysler’s own
predicament … overly generous,” Marchionne said last Friday.The UAW’s talks with Chrysler began in late July but
stalled last month as the company pushed for more union
concessions than its Detroit rivals got.Ford was the only one of the three Detroit automakers to
avoid bankruptcy and restructuring in 2009.Ford’s tentative deal with the UAW calls for each veteran
hourly worker to get at least $16,000 in bonuses. The GM deal
is slightly less generous, but Ford may benefit as lower-paid
new workers fill new positions or replace veteran employees.
