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Jamie Dimon is the best big bank CEO, by shareholder returns
Capital Markets
<p>After almost a decade leading JPMorgan, Jamie Dimon has provided better shareholder returns than any of his competitors.</p> <p>Since Dimon took control at the beginning of 2006 the total shareholder return for the $2.4 trillion JPMorgan has been a total 119.5%, including dividends, reports the Motley Fool. Dimon is also the longest ranking big bank CEO. Dimon's closest competition is Wells Fargo CEO John Stumpf. Wells Fargo has had 97.3% shareholder return since Stumpf became CEO in June 2007.</p> <p>Goldman Sachs reported 47.1% shareholder return since Lloyd Blankfein became CEO in June 2006. Morgan Stanley has 40.6% return since James Gorman's appointment in January 2010. And Bank of America reported 22.1% return since Brian Moynihan became CEO in January 2010.<br /> Photo: Financial Times </p>
Daily Scan: Alibaba hits $14B record for Singles' Day; Macy's plunges 14%
Capital Markets
<p>&nbsp;</p> <p>Updated throughout the day</p> <p>November 11</p> <p>The S&amp;P 500 ended 0.3% lower, largely on weakness in the energy sector where oil futures fell 2.9% on supply fears. Macy's got slammed Wednesday, falling 14% after a big miss on revenues and a weaker outlook going forward. The bond market and banks were closed in honor of Veteran's Day.</p> <p>Here’s what else you need to know:</p> <p>U.S. arrests cousins of Venezuela president in drug bust. The pair were charged with trying to transport 800 kilograms of cocaine into the country. The U.S. has long suspected that high-ranked government officials are involved in dealing drugs. Wall Street Journal (paywall)</p> <p>Apple in talks with banks to develop P2P mobile system. Move over Venmo and Square. Apple is in talks with major banks including JPMorgan and Wells Fargo to enable iPhone users to pay their buddies through Apple Pay. Wall Street Journal (paywall)</p> <p>Alert! Alert! Alert! Facebook's new app Notify has landed and will push as many news notifications as you want from a menu of 70 publishers. It's one of the biggest real estate grabs yet for the lockscreen on your phone. And it only takes 8 seconds to open a story you want to read. Hmmm. The Verge</p> <p>Alibaba hits new record on Singles' Day event with help of Frank Underwood and James Bond. The biggest Internet commerce event in the world raked in more than $14 billion. Actor Kevin Spacey helped promote the sale in a video as President Underwood. Reuters, South China Morning Post (paywall)</p> <p>Republicans show greater unity in substance-based debate. The consensus says Florida Sen. Marco Rubio and Texas Sen. Ted Cruz shone the brightest while the erstwhile frontrunner Jeb Bush wasn't terrible. Donald Trump was polite. The candidates sparred on immigration, security, and the economy and many invoked the legacy of Ronald Reagan. Politico</p> <p>AB Inbev snaps up SABMiller for $105.5 billion. Molson Coors may pay $12 billion for the part of MillerCoors it doesn't own -- paving the way for regulatory approval of the ginormous merger.  After weeks of backs and forths between the two companies, Anheuser-Busch InBev announced on Wednesday that it had formally agreed to purchase SABMiller for a whopping £69.78 billion ($105.5 billion). Cheers, people. Fortune/Wall Street Journal (paywall)</p> <p>New York State attorney general shuts down fantasy sports sites. Eric T. Schneiderman said DraftKings and FanDuel are gambling enterprises, illegal in the Empire State. The move is a major setback for the popular websites, under scrutiny after an employee inadvertently released confidential information and subsequently won $350,000. Last month, Nevada said the pair should be considered gambling sites. New York Times (paywall)<br /> You won’t believe this:<br /> Yaaas! My bestie is always on fleek. Dictionary.com has added more than 150 new words including: Bestie, Digital Citizen, Doge, Facepalm, Feels, Fleek, IRL, Sapiosexual, and Yaaas. Look 'em up! BuzzFeed</p> <p>&nbsp;<br /> Photo: Pete Bellis</p>
Mary Jo White and SEC to look into short sellers
Capital Markets
<p>The Securities and Exchange Commission chairman spoke to Bloomberg Television on Tuesday, revealing her concerns over short sellers.</p> <p>U.S. regulators are considering a move that would mean short sellers have to emerge from behind the veil of secrecy that currently cloaks their work. White expressed her concerns about negative comments from research firms that have increasingly affected share prices of late, in an interview with Bloomberg Televison.<br /> SEC to examine short selling disclosure rules more closely<br /> “It’s a complex sort of landscape, but it is an issue that has our intense attention,” said Mary Jo White during the interview, responding to a question about the potential for new rules governing short-selling disclosures by investors.</p> <p>Although White refused to mention specific companies in her response, one example of the impact of criticism on share prices is drug-maker Mallinckrodt Plc. Shares in the company fell 17% on Monday following criticism on Twitter from Citron Research, a commentary site run by Andrew Left. Renowned short seller Left’s Citron Research also provoked a rout of Valeant Pharmaceuticals International Inc. last month.</p> <p>Under existing rules hedge funds are required to report their long positions on a regular basis, but no rules govern their short positions. In contrast funds working in Europe have had to disclose shorts of over 0.2% of a company’s market value and up to regulators since 2012. Public disclosure is required for shorts that total 0.5%.<br /> Pressure growing for new rules<br /> “Short selling has a legitimate, positive purpose in the marketplace,” White said. “That’s very different, though, than if you manipulate by short selling.”<br /> Left makes his bearish positions public on Citron, and more disclosure might not affect his work. However the use of Twitter is set to come in for more scrutiny from White, who believes that a 140-character Tweet can do the same damage as a four hour presentation.<br /> The New York Stock Exchange has also appealed to the SEC for new rules forcing investors to reveal which stocks they are short selling. A letter dated October 7 asked the SEC to “bring light to a less transparent and increasingly consequential corner of the securities market.”</p> <p>At the same time it is important to recognize that short selling is one of many ways, including derivatives, that investors can bet against a particular stock.</p> <p>This article was originally published by ValueWalk. </p> <p>&nbsp;</p>
Of rate hikes and small-cap ETFs
Asset Management
<p>For a good portion of this year, investors have been regaled with tales of alleged small-cap strength by way of the rising dollar, which implies small-cap stocks and the exchange-traded funds that hold them should be beneficiaries of rising interest rates.</p> <p>That has not been the case, however, as the iShares Russell 2000 Index (ETF) (NYSE:IWM), the largest small-cap ETF, has fallen half a percent year-to-date, while the S&amp;P 500 is higher by nearly 1 percent.</p> <p>The iShares S&amp;P SmallCap 600 Index (ETF) (NYSE: IJR) has been better with a 1.5 percent year-to-date gain, but that is far from awe-inspiring.<br /> What Would An Interest Rate Hike Mean?<br /> With the Federal Reserve seemingly on course to raise interest rates in December, investors should be pondering what the near term holds for ETFs such as IJR and IWM.</p> <p>Read more at Benzinga.<br /> Photo: Pete Markham</p>
Frank Underwood goads Chinese consumers to participate in Singles' Day ecommerce lollapalooza
Lifestyle
<p>Kevin Spacey resumes his role as Frank Underwood, the diabolical political operative in "House of Cards" to goad Chinese consumers into participating in Singles' Day, the biggest internet ecommerce event anywhere.</p>
Daily Scan: Asian shares end mixed; China industrial output slumps
Capital Markets
<p>Updated throughout the day</p> <p>November 11</p> <p>Chinese shares climbed higher Wednesday after a mixed bag of economic data spurred bets on more stimulus measures from Beijing. The Shanghai Composite ended the day up 0.27%, while the Shenzhen Composite finished the session up 1.97%. Ever the contrarians, their Hong Kong-based H-share brethren tanked 0.67%. As for the rest, here’s how they did:</p> <p> Hang Seng Index: -0.22%<br /> Nikkei 225: +0.10%<br /> Straits Times Index: -0.22%</p> <p>Things are looking a whole lot better in Europe. The U.K.’s FTSE 100 has climbed 0.54%, while the German DAX and French CAC have surged 1.05% and 0.71% respectively. Draghi’s upcoming speech and the finalized megabrewer deal have no doubt aided in their lifting.</p> <p>Here’s what else you need to know:</p> <p>AB Inbev snaps up SABMiller for $105.5 billion. After weeks of backs and forths between the two companies, Anheuser-Busch InBev announced on Wednesday that it had formally agreed to purchase SABMiller for a whopping £69.78 billion ($105.5 billion). Cheers, people. Wall Street Journal</p> <p>Chinese industrial production misses estimates. China’s highly-anticipated industrial output figure came in at 5.6% for October, slightly weaker than the expected 5.8% reading and also below September’s 5.7% growth rate. The nation’s retail sales report however was slightly better, punching at 11% year on year versus a 10.9% expected climb. Still though, this should be enough to raise more than a few eyebrows over the country’s economic outlook. ForexLive</p> <p>Yuan hits near one-month low. China’s yuan was trading at 6.3617 against the dollar earlier this morning, slumping just a whisker shy of its one-month low after the PBOC fixed its midpoint rate 6.3614. This was the seventh time a row the bank has fixed the currency at a weaker level. SCMP (paywall)</p> <p>BOJ’s Harada defends stimulus program. In his first speech since he joined the Bank of Japan, policy board member Yatuka Harada defended the bank’s massive program by saying that it has boosted company earnings and lifted job growth by tanking the yen. He did however acknowledge that there were “worrying signs” in private consumption, and he did add that should the job market worsen, “it’s necessary to offer additional monetary easing without hesitation.” Reuters</p> <p>Consumer sentiment down under hits a new high. In a surprise score, the Westpac Melbourne Institute Index of Consumer Sentiment rose from 97.8 in October to 101.7 in November, leading Westpac’s Chief Economist, Bill Evans, to say: “This is a cracking result. Apart from the brief surge we saw following last May’s Budget this is the highest print for the Index since January 2014.” Melbourne Institute (pdf)</p> <p>Minneapolis Federal Reserve Bank names new president. Neel Kashkari, the man who led the controversial TARP program at the U.S. Treasury during the financial crisis, will replace Narayana Kocherlakota as president and CEO at the end of the year. The troubled asset relief program was used as a venue to bailout banks and major financial institutions. Kashkari, who is not an economist, worked at Goldman Sachs, making him the fourth of 12 presidents to join the Federal Reserve system. He also ran for Governor of California. Wall Street Journal (paywall)</p> <p>Three charged for massive financial hack. U.S. prosecutors charged one U.S. man and two Israeli men in relation to the cyber hack of JPMorgan, Fidelity, and other financial institutions between 2012 and 2015. The federal prosecutor called it “securities fraud on cyber-steroids.” Charges include hacking and identity theft. BBC</p> <p>Japan Inc. earnings have been pretty dog-eat-dog. Amid volatile commodity prices, automobile demand, and smartphone supplies, a serious zero-sum game has emerged in corporate Japan. Mitsubishi Corp – once the top dog among the big resource trading houses – has been knocked off the top spot by Itocho, while Sony emerged as the winner in its battle against Sharp. Nikkei Asian Review</p> <p>Died: Former West German Chancello
Avenue Capital shuts down original hedge fund
Hedge Funds
<p>2015 has not been kind to distressed asset funds. Oaktree for instance has been posting lackluster earnings, and many of them got creamed betting on troubled energy companies. For Avenue Capital however, the year marks one of the worse events in its 20-year history – well, symbolically at least:<br /> “Amid a negative performance and a shift to funds with longer-term investor commitments, the distressed-investing firm Avenue Capital Group is closing its original hedge fund, Avenue Investments, and returning money to the fund's investors.”<br /> CNBC does add that the fund composed just $350 million out of the firm’s $13 billion total AUM though, so it might not have any material effect on Avenue as a whole.<br /> Photo: Bryan Mills</p>
S&P Dow Jones Indices rejects China A-share benchmark inclusion
Asset Management
<p>S&amp;P Dow Jones Indices continues to exclude Chinese A-shares from all of its standard global benchmark indices.</p> <p>“The consensus is to take a wait-and-see approach as significant uncertainty remains around what the eventual landscape will be for foreign investors,” according to a press release</p> <p>For now, international funds will have to benchmark against alternatives indexes such as the S&amp;P Emerging BMI + China A, S&amp;P Global BMI + China A, and S&amp;P Total China BMI.</p> <p>Despite already introducing measures to open up the China A-shares market, policy makers need to do more to reassure global investors. This includes improving the structure of qualified investor schemes, clarifying tax issues, resolving logistical problems caused by same-day settlement and reducing uncertainty about repatriating foreign exchange.</p> <p>“Advancement continues, but the current market environment supports a cautious approach on potential benchmark inclusion,” noted S&amp;P Dow Jones.<br /> Photo: Stanley Young</p>
Asia-Pac ETFs post fifth straight month of inflows
Asset Management
<p>With China’s economic outlook increasingly going from bad to worse, you’d almost think investors would want to hold off pumping money in the region. Nope.</p> <p>According to London-based research and consultancy firm ETFGI, Asia-Pacific ETFs and ETPs have just posted another month of strong inflows:<br /> “ETFs/ETPs listed in Asia Pacific ex Japan gathered 1.2 billion US dollars in net new assets in October 2015. This marks the 5th consecutive month of positive net inflows. The Asia Pacific ex-Japan ETF/ETP industry had 761 ETFs/ETPs, with 904 listings, assets of US$119.4 Bn, from 115 providers listed on 17 exchanges in 13 countries at the end of October 2015, according to ETFGI’s Global ETF and ETP insights report for October 2015.”<br /> Among the region’s biggest winners in October were Samsung AM, which gathered around $380 million, China AM, which raked in about $230 million, and CSOP/China Southern, which bagged $150 million. Year to date however HSBC/Hang Seng lords above them all with an impressive $5.8 billion in net inflows.</p> <p>Japan seems to be a lot better though, a sign that investors continue to be attracted to the region’s progressively changing business climate:<br /> “In Japan, YTD net inflows were up 121.9% on the record set last year, standing at US$35.0 Bn at the end of October 2015.”<br /> Photo: Charles LeBlanc</p>
No guarantee against hackers
FinTech
<p>The alleged hacking scheme against 10 financial institutions and other US companies highlights the importance of cybersecurity for every firm.</p> <p>As Manhattan attorney Preet Bharara, who’s office has indicted three men, said, “[It is] a brave new world in hacking for profit…It is hacking as a business model.”</p> <p>So, a speech by Singapore’s former head of cybersecurity at FinanceAsia’s Annual Compliance Conference in Hong Kong on Tuesday was rather timely. (paywall)</p> <p>“We can never be 100% secure from cyberattacks. Never,” warned Alan Seow who was employed at Singapore’s Ministry of Communication and Information.</p> <p>Companies can put up some resistance by adopting a three-tiered approach: having effective defensive measures, rapid response processes and robust recovery systems.</p> <p>But, “even companies that spend a lot of money on experienced staff and put sensible measures in place have no guarantee of keeping ahead of hacking opponents,” reports FinanceAsia.<br /> Photo: Brian Klug</p>