Maduro wins Venezuelan presidential election | EU extends maturity of Irish and Portuguese rescue loans | Japan and U.S. move toward trade agreement, officials say
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15 April 2013
CFA Institute: Financial NewsBrief
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Chinese GDP growth declined to 7.7% in Q1
Expansion of China's gross domestic product fell from 7.9% in the fourth quarter to 7.7% in Q1, as the economic recovery lost momentum. Experts polled by Reuters had expected 8% growth. Meanwhile, revenue from property sales increased 61.3%, adding to concerns that the property market is overheating and will collapse. Reuters (15 Apr.), Xinhuanet.com (China) (15 Apr.), Bloomberg (15 Apr.)
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Maduro wins Venezuelan presidential election
Venezuela's National Electoral Council declared Nicolás Maduro winner of the presidential election after he received 50.66% of the vote. Maduro promised to continue the policies of the late President Hugo Chavez, who chose him to be his successor. El Universal (Venezuela) (14 Apr.), MercoPress (Uruguay) (15 Apr.), USA Today/The Associated Press (15 Apr.)
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EU extends maturity of Irish and Portuguese rescue loans
EU finance ministers have agreed to give Ireland and Portugal an extra seven years to pay back rescue loans. Irish Finance Minister Michael Noonan says the change should reduce the interest rate the country will have to pay when it returns to the private bond market at year-end. The Irish Times (Dublin) (13 Apr.), Independent.ie (Ireland) (13 Apr.), European Voice (Brussels) (tiered subscription model) (12 Apr.)
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Japan and U.S. move toward trade agreement, officials say
Japan has agreed to concessions giving the U.S. more access to its auto market and is willing to discuss further steps to ease a trade imbalance between the countries, U.S. officials said. The moves, although modest, open the door to Japan joining an 11-nation discussion that could lead to a free-trade zone that includes the U.S. and much of Asia, they said. The Washington Post (tiered subscription model) (12 Apr.)
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Europe's transaction tax will hurt economies, bankers say
Critics of Europe's upcoming tax on financial transactions say the levy will threaten struggling economies, and bankers are confident authorities will be persuaded to rein in the tax. Italy has already introduced a financial-transaction tax, which has decreased volume in equities and prompted brokers to curb activity. Reuters (14 Apr.), Financial News Online (U.K.) (subscription required) (15 Apr.), Financial Times (tiered subscription model) (12 Apr.), International Financial Law Review online (11 Apr.)
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Chinese economic news drives down Asian-Pacific markets
News that China's economic rebound might be faltering sent markets falling Monday across Asia-Pacific. Hong Kong's Hang Seng index dropped 1.4%. China's Shanghai Composite fell 1.1%. Australia's S&P/ASX 200 lost 0.9%. South Korea's Kospi slid 0.2%. Japan's Nikkei 225 gave up 1.6%. Bucking the trend, India's Sensex was up 0.5%. The Economic Times (India) (21 Apr.), The Wall Street Journal (tiered subscription model) (15 Apr.)
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Review shines light on commodity trading
During the past 10 years, the top commodity traders in the world have earned nearly $250 billion, as the sector has experienced significant growth since it began in 2000. Financial Times (tiered subscription model) (14 Apr.)
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Economics
U.K. should renegotiate relationship with EU, group says
The U.K. should remain a member of the EU but should renegotiate the relationship, according to 64% of nearly 4,400 companies with the British Chambers of Commerce. The group said its members want the U.K. to have sole authority over employment law, regional development policies and legislation governing health and safety. The Telegraph (London) (tiered subscription model) (15 Apr.), BBC (14 Apr.)
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Newly formed German party wants euro eliminated
The new Alternative for Germany Party has launched a campaign to abolish the euro. The political party wants some power exercised by the EU returned to member states, and it advocates federal-level referendums similar to those in Switzerland. Pollsters say the party has a chance of luring supporters away from the ruling center-right coalition headed by Chancellor Angela Merkel. Deutsche Welle (Germany)/Agence France-Presse/Deutsche Presse-Agentur/Reuters (14 Apr.), EuroNews.com (France) (14 Apr.), The New York Times (tiered subscription model) (14 Apr.)
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Analysis: Structural reform is Japan's next big challenge
Japanese Prime Minister Shinzo Abe, who made ending the persistent problem of deflation his top priority, got everything he wanted from the central bank but he may find implementing structural economic reform a tougher challenge, according to The Economist. The process is "complex and vulnerable to interference by vested interests," says Morgan Stanley's Robert Feldman. "Now, in other words, for the hard part," The Economist notes. The Economist (tiered subscription model) (13 Apr.)
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Financial advisers say they face time crunch
Most financial advisers are generally happy about their business, but 64% are worried that they don't have time to "get things done," according to a study by Pershing. Advisers are pressed for time because two-thirds are adding clients, while less than 10% are reducing them, the study found. AdvisorOne (11 Apr.)
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Germany says treaty changes are needed for banking union
German Finance Minister Wolfgang Schaeuble has voiced concerns about EU plans to create a banking union, saying changes to treaties would be required. "Banking union only makes sense ... if we also have rules for restructuring and resolving banks," he said. "But if we want European institutions for that, we will need a treaty change." Bloomberg (13 Apr.), The Telegraph (London) (tiered subscription model) (13 Apr.), Financial Times (tiered subscription model) (14 Apr.)
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EU sees progress in battle against tax evasion
The EU's move to prevent residents from hiding assets in tax havens is picking up momentum. Countries agreeing to increase automatic cross-border sharing of bank-account information have doubled. "The surge in member states' appetite for progress and action in the fight against evasion is extremely welcome," EU Taxation Commissioner Algirdas Semeta said. The New York Times (tiered subscription model) (14 Apr.)
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SEC committee wants tougher rules for target-date funds
Rules governing target-date funds should be strengthened to better inform investors about risks and costs, according to a committee that advises the Securities and Exchange Commission. The committee recommends that fund prospectuses clearly state risk assumptions, that marketing materials warn that the funds are not guaranteed and that fee disclosures better explain total costs over the anticipated life of the investment. Pensions & Investments (free access for SmartBrief readers) (12 Apr.)
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Google reportedly agrees to modify search procedure in Europe
Google and EU antitrust regulators have come to an agreement that changes how the Internet giant presents search results, sources say. Google reportedly is legally bound to label search results related to its properties. In some cases, Google is required to offer links to competing search engines, the sources say. The New York Times (tiered subscription model) (14 Apr.)
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Chinese regulator focuses on IPO reforms
The China Securities Regulatory Commission appears to be concentrating on reforms aimed at initial public offerings, as investigative teams examine financial disclosures for companies that have filed to go public. Global Times (China) (14 Apr.)
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GOP could fight Obama proposal to raise SEC and CFTC funding
President Barack Obama's budget proposal for fiscal 2014 would increase funding for the Securities and Exchange Commission and the Commodity Futures Trading Commission. The plan would raise SEC funding from $1.3 billion to $1.674 billion, and the CFTC would get $308 million, up from $205 million. Republican legislators are expected to fight those increases, as they have every year since the passage of the Dodd-Frank Act. The Hill/On the Money blog (13 Apr.)
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John Rogers, CFA to Speak at SQA Fuzzy Day in NYC on 31 May 2013
SQA presents its marquee conference "Sustainable Investing: Hype or Opportunity" where latest research in the field of socially responsible investing will be showcased. The conference will feature leading experts from the U.S., Europe, and Australia: John Rogers, Robert Shiller, Jack Gray, Bob Litterman, Bruce Kahn and others.
Join us 31 May in NYC.
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Financial Products
First Trust enters European ETF market
U.S. fund manager First Trust Advisors has made its first move into the European market of exchange-traded funds by listing three products on the London Stock Exchange and the Irish Stock Exchange. The First Trust Emerging Markets AlphaDEX UCITS ETF tracks the MSCI Emerging Markets Index. The First Trust U.S. Large Cap Core AlphaDEX UCITS ETF focuses on the Standard & Poor's 500 index. The First Trust United Kingdom AlphaDEX UCITS ETF is linked to the FTSE 100 Index. FundWeb (U.K.) (11 Apr.), IndexUniverse.eu (11 Apr.), InvestmentEurope.net (11 Apr.)
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