THURSDAY 18 AUGUST 2016 WORLD BUSINESS NEWSPAPER EUROPE

Smart Money Wooing the 99% Old bugs

The bearish case for equity Goldman Sachs moves into Main Japanese grannies are leading
markets JOHN AUTHERS, PAGE 22 Street banking BIG READ, PAGE 7 a gold rush NOTEBOOK, PAGE 8

Russian tanks Briefing

on border fuel
Ukraine fears
As Russian tanks rumble towards
Ukraines east, there are growing con-
cerns over the fragility of a ceasefire
between Kiev and Russia-backed
separatists.
A flare-up in fighting that began spo-
radically in July following Russian
claims of a Ukraine plot against annexed
Crimea is turning into a massive
build-up of conventional Russian forces
and weapons along the countries
shared borders.
Western defence and intelligence
experts say there are signs from Russia
that it is willing to test limits as the coun-
try pursues an easing of sanctions from
the west at a meeting with G20 leaders
next month.
Russian build-up page 2
i Obamacare storm intensifies over Aetna
A row over a decision by the insurer to scale back its
commitment to US health reform has escalated
with revelations that it had threatened such action
if regulators tried to block its deal for a rival. PAGE 11
i Convicts to make way for coup suspects
Turkey has announced a change in parole rules that
will trigger the release of 38,000 convicts to make
room in the countrys crowded prisons for people
detained after last months failed coup. PAGE 4
i ANC loses control of Pretoria as talks fail
The African National Congress has lost control of
the capital Pretoria after opposition parties rejected
its effort to form coalitions and delivered a stinging
rebuke to South Africas ruling party. PAGE 4
i Aung San Suu Kyi in crucial Beijing visit
Myanmars de facto leader will
have talks on a three-day trip
to Beijing that could well come
to define Myanmar-China
A Ukrainian paratrooper surveys damage from shelling in the coastal town of Shyrokyne, the brunt of recent attacks Aleksey Filippov/AFP/Getty Images relations for years to come, an
expert has said. PAGE 2

i Australia to close PNG asylum centre

Minutes reveal hard-fought

Australia is to close an offshore detention centre in
Papua New Guinea, after the PNG supreme court
ruled it was illegal. Canberra said no one from the
centre will ever be settled in Australia. PAGE 2

iTokyo missile plan amid islands tension

debate as Fed splits over rates Japanese plans have emerged for a new anti-ship
missile that would complicate enemy planning
after months of Tokyo-Beijing rancour over East
China Sea islands. WWW.FT.COM/WORLD

i Italy warns Brexit delay will hurt reform

3 Policymakers seek more evidence on rebound 3 No consensus on timing of second rise
SAM FLEMING WASHINGTON
Federal Reserve policymakers left open
the prospect of a further interest rate
rise this year even as they insisted they
needed more evidence on the durability
of the rebound before feeling confident
enough to pull the trigger.
Minutes from their latest meeting last
month revealed a hard-fought debate
over when to move rates, with a couple
of participants urging an immediate
move, while others urged caution amid
questions over how rapidly inflation
would return to target.
Fed officials generally agreed that a
strengthening of the jobs market and
the relatively benign market reaction to
the UKs vote to leave the EU in June
meant some of the uncertainties that
had hung over the US economy had
diminished.
But there was no consensus on the
urgency of a second rate rise since last
December, given the mixed prospects at
home and abroad. Even as the Fed held
rates unchanged during the meeting,
two participants wanted to see an
immediate move. Others said an
increase would soon be warranted.
Several other participants were more
cautious, according to the minutes.
They said the Federal Open Market
Committee would have ample time to
react to a rise in inflation if needed and
preferred to wait until they were more
confident that price growth was heading
sustainably to the Feds 2 per cent
target.
Having lifted short-term interest rates
Rome has warned that a move by the UK to delay
negotiations over its exit from the EU would impede
a push for reform in the bloc that is needed to head
by a quarter-point in December, the Fed rise, with risks abroad continuing to off growing Euroscepticism in Italy. PAGE 4
has held fire this year as policymakers weigh on officials minds.
weigh competing forces influencing the The UKs vote to leave the EU helped
economy both at home and overseas. convince the central bank to hold fire in Datawatch
Growth is expected by economists to June, while extreme volatility in foreign
pick up in the third quarter following a Fed officials exchange markets associated with con-
soggy performance in the second quar- fusion over Chinese policy pinned the EU workers in the UK Nearly a third of
ter, and after a pause in May hiring in generally Fed to the sidelines earlier in the year. Share of total employed in workers in food
selected sectors (% 2014-2016) manufacturing in
the labour market has regained agreed some Officials including Jerome Powell, a
momentum, holding the unemploy- Fed governor, have argued that policy Food manufacturing the UK are EU
29.7
ment rate at 4.9 per cent. Wage growth uncertainties loosening by central banks overseas is Domestic personnel
migrants. This
sector and
is now at its quickest since the end of the also making it trickier for the Fed to 21.8
financial crisis.
that had tighten. Accommodation others will face
19.3 challenges when
However, inflation remains comforta- hung over Central bankers have also hinted that Construction Britain leaves the
bly below the Feds 2 per cent target, even if the Fed does lift rates again, it 10.6
prompting some officials to call for cau-
the US may not need to tighten by a lot. Fed pol- Coal mining
bloc. The work
and residency
10.0
tion before pulling the trigger on a sec- economy icymakers estimate of long-term fed All industries rights of many of
ond rate increase. Global events have funds rate centre around 3 per cent, 8.0 these workers
this year also had a tendency to foil
had compared with a range of 0.25 to 0.5 per Source: Resolution Foundation remains uncertain
arguments within the Fed for a second diminished cent now.

Republicans see desperation in Trump

reshuffle three months before election
DEMETRI SEVASTOPULO WASHINGTON Trump family members had been push- man for Republican candidate Mitt
ing for a more scripted campaign. Romney in the 2012 race. Unless they
Donald Trumps decision to overhaul
Jeffrey Lord, a former Reagan admin- find a way to switch out the candidate,
his campaigns leadership less than
istration official who is a surrogate for nothing will really change.
three months before election day was
Mr Trump, said critics were underesti- Mr Manafort told the Financial Times
greeted by some Republicans as a
Europes Olympics chief sign of desperation even as backers
mating his willingness to correct his he would remain on the campaign, amid
arrested over ticket scam campaign, pointing out that he had pre- reports Mr Trump made the changes
insisted it would turn round his flag-
viously fired Corey Lewandowski, his because he was tired of being told to
ging prospects.
Report i PAGE 3 abrasive former campaign manager, veer away from the more combative
The revamp by the Republican nominee and replaced him with Mr Manafort. Mr approach that helped him win the
will be led by Stephen Bannon, a former Lord welcomed the promotion of Ms Republican primary.
Austria 3.60 Luxembourg 3.60 Goldman Sachs banker and editor of the Conway, saying she knows the Ameri- Charlie Black, a former partner of Mr
Bahrain
Belgium
Din1.7
3.60
Macedonia
Malta
Den220
3.50
conservative Breitbart News, who has can political system from bottom to top Manafort who is advising the Trump
Bulgaria
Croatia
Lev7.50
Kn27.50
Morocco
Netherlands
Dh43
3.60
built a successful media career attack- and every rung along the way. campaign, played down suggestions the
Cyprus 3.50 Norway NKr35 ing Hillary Clinton and establishment But while supporters embraced the reshuffle marked a return to the let
Czech Rep Kc100 Oman OR1.50
Denmark DKr32 Pakistan Rupee 280 Republicans. Mr Bannon becomes the shift as evidence that Mr Trump recog- Trump be Trump model espoused by
Egypt
Finland
E20
4.10
Poland
Portugal
Zl 18
3.50
campaigns chief executive while Kelly- nised that he needed to change tack, Mr Lewandowski before he was
France 3.60 Qatar QR15 anne Conway, a veteran pollster, takes critics saw it as a bad sign so late in the replaced by Mr Manafort. There is no
Germany 3.60 Romania Ron17
Gibraltar 2.70 Russia 5.00 over as campaign manager. campaign season. A campaign reason to think that Kellyanne Conway
Greece
Hungary
3.50
Ft1090
Serbia
Slovak Rep
NewD420
3.60 The move reduced the influence of upheaval in June is always a bad sign. A doesnt think that Trump needs to get
India
Italy
Rup195
3.50
Slovenia
Spain
3.50
3.50
Paul Manafort, the veteran operative campaign upheaval in August is even rid of some of his sharp edges.
Kazakhstan US$5.50 Sweden SKr37 and campaign chairman who along with worse, said Kevin Madden, a spokes- Analysis page 3
Kenya Kshs300 Switzerland SFr5.90
Latvia 6.99 Tunisia Din7.50
Lebanon LBP7500 Turkey TL10
Lithuania 4.30 UAE Dh15.00

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2 FINANCIAL TIMES
Russian build-up fuels conflict fears
Moscow heightens tension by flexing military muscle on Ukraines border ahead of G20 talks
SAM JONES LONDON
ROMAN OLEARCHYK KIEV
In Ukraines restive east, artillery explo-
sions ring out all night: international
monitors there record dozens of shell
bursts every evening. The ceasefire
between Kiev and the Russia-backed
separatists is fraying badly.
The flare-up in fighting began sporad-
ically in July. But now, Ukraine and its
western allies are observing a more wor-
rying development: a massive build-up
of conventional Russian forces in Cri-
mea and along the countries shared
border.
Russia has positioned military units
totalling thousands of troops to the
north in Bryansk, to the east near Ros-
tov, to the south in Crimea and to the
west in the separatist Moldovan region
of Transnistria. There are signs they are
preparing to fight. Last week, Crimean
residents began posting online about a
large deployment of artillery and tanks
in the north of the peninsula within
firing range of Ukraine. The internet
there was temporarily shut down.
According to Ukrainian intelligence
agencies, an entire Russian air defence
regiment has been embedded with the
separatists in Donbass. The Buk missile
launchers, which shot down Malaysia
Airlines flight MH17, are again being
deployed. A photo from Ilovaisk train
station, near Donetsk, shared online on
Tuesday and verified by defence ana-
lysts interviewed for this article, claims
to show a train in the sidings, laden with
Russian tanks.
Preparations for conventional con-
flict between Russia and Ukraine are
accelerating, and the likelihood of open
war is increasing rapidly, the Institute
for the Study of War, a US think-tank,
wrote in a report last week. On Monday,
that appeared to come a step closer. Ser-
gei Lavrov, Russian foreign minister,
vowed exhaustive measures would be
taken against Kiev in reprisal for what
Russia called an attempted terror attack
by Ukraines defence ministry.
These are very, very clear signals
from Russia that say they are willing to
escalate and to push boundaries, says
Kathleen Weinberger, a Russia and
Ukraine expert at the ISW. Were see-
ing reports of big military convoys being
sent into the separatist areas, Russian
troops being sent to the border and a lot
more naval equipment in the Black Sea
including some of their most
advanced subs, which have quite power-
ful ground-attack cruise missiles.
But, notes Ms Weinberger: A lot of
this is still unknown. Russia are showing
us a very overt and threatening 20 per
cent but leaving 80 per cent of what
theyre doing unclear. That ambiguity
Russian military build-up in and around Ukraine
Tanks
Warships BELARUS
Warplanes
Military convoys
Missile batteries
Troops
Kiev
UKRAINE
MOLDOVA
TRANSNISTRIA
ROMANIA
Border closed
* Annexed by Russia, disputed by
Ukraine and the international community
Source: Institute for the Study of War Black Sea Sevastopol
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.comma 1, DCB Milano.
Defence analysts have verified an image shared online on Tuesday purporting to show Russian tanks in eastern Ukraine
works to Russias advantage, she says.
An actual invasion might not.
That analysis is shared by many in
Ukraine and among the western
defence and intelligence community.
I do not expect a full-scale military
invasion at the moment as the losses on
Putins side would be big and a victory
would be far from certain, says Ihor
Romanenko, Ukraines lieutenant gen-
eral in reserve and the former deputy
head of the general staff. He is [trying]
to force international leaders into con-
cessions, starting with easing of sanc-
tions and forcing Ukraine to adopt the
Minsk agreements according to his
interpretation.
Russias desire is for elections in Don-
bass to occur before any ceasefire, a
move that would probably cement the
semi-autonomy of the region and fatally
weaken Kievs ability to stand up to
Moscow politically. That plan has been
stalled for months. [Putin] is not
happy with the situation, says Lt Gen
Romanenko. He sees that as time drags
on, the worse it plays out for his long-
term Ukraine and Russia plans . . . So
now he is trying to reshuffle the situa-
tion in his own interest.
Bryansk
RUSSIA
LUGANSK
DONETSK
Donetsk
Sea of Azov
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INTERNATIONAL
Russias military build-up is a likely
precursor to the Group of 20 summit on
September 4, says the general. Mr Putin
will inevitably meet German chancellor
Angela Merkel and French president
Franois Hollande to discuss Ukraine.
Russia is dialling the tension in the
region up and down as it has done in
the past to suit its agenda ahead of
another round of diplomatic talks, says
a senior European intelligence official.
The sabre-rattling is about reinterpret-
ing the Minsk agreements in Russias
favour, the official says.
While such a purpose might rule out
an overt land-grab, it does not preclude
serious military conflict in fact, many
intelligence analysts believe it probably
depends on violence.
I think were about to see a controlled
escalation all along the line of contact
higher shelling and much more violence
and fighting, says Alex Kokcharov,
country risk analyst at IHS Markit.
Politically, if the separatists take more
territory, that would play out badly for
Russia in negotiations, but provoking
Ukraine into hostilities without neces-
sarily doing that might work to their
advantage . . . they want to make Kiev
into an untrustworthy partner and
erode support for it in the west.
Casualty rates are already at their
highest levels since last August. They
100km
will probably rise higher. Russia may
seek to bring its anti-aircraft capabili-
ties to bear too, or it could declare a no-
fly zone to try to goad Kiev into fighting.
Ukraines 25th anniversary of its inde-
pendence is on August 24 and could be a
symbolic moment at which fighting
might erupt, says Mr Kokcharov. That
ROSTOV would give Putin 10 days before the
G20, enough time to make things
uncomfortable for the west, he says.
Fatigue among European nations over
Ukraine is already running high. Mr
Putin may be betting that with more
violence and a provoked, angry
Ukrainian response he can make
them break ranks and recalibrate the
Minsk protocol to his advantage.
Myanmar
Aung San Suu Kyi heads for China in bid to thaw frosty relations
MICHAEL PEEL BANGKOK
LUCY HORNBY BEIJING
Aung San Suu Kyi, Myanmars de facto
leader, was due to arrive in Beijing
NOVEMBER 7 2015
yesterday for a trip that could give the
first big steer on how her government
would position the country between
world powers vying for influence.
Myanmars dominant politician, who
holds the office of state counsellor
21/10/2015 10:51
because she is barred from the presi-
dency, is scheduled to visit China to
warm relations that had become frosty
under the previous government.
Analysts see the three days of talks as
a further sign of Aung San Suu Kyis
desire to engage with China on areas
from energy supply to a peace process
aimed at ending decades of internal con-
flict in Myanmar. China is keen to retain
both influence and large infrastructure
projects in its impoverished neighbour,
which it views as a critical corridor from
the Indian Ocean for supplies of goods
such as oil and gas.
Yun Sun, a Sino-Myanmar relations
expert at US think-tank the Stimson
Center, wrote in an article: The out-
come of Aung San Suu Kyis meetings
Yatseniuks plea
Former PM revives call for
defensive weapons
Ukraine has urged western leaders to
hold the line against Russian
aggression in the country, saying there
is no case for a weakening of sanctions
against the Putin administration.
On a visit to Brussels, Arseny
Yatseniuk, the former prime minister,
revived demands for Nato allies to
provide defensive weapons to Kiev,
saying Russia alone was to blame for
increased violence in Ukraine.
Although Mr Yatseniuk was replaced
as premier in April by an associate of
Petro Poroshenko, president, his party
remains part of the ruling coalition. He
told the Financial Times he was
representing Ukraine in Brussels,
where he met Donald Tusk, European
Council president, and Nato chiefs.
His appeal came days after Vladimir
Putin, Russian president, claimed his
country had foiled a plot by Ukrainian
special forces to enter the annexed
Crimean peninsula to carry out
terrorist acts.
Tensions between Kiev and Moscow
are at their highest for almost a year.
Arseny Yatseniuk says Russia is to
blame for more Ukraine violence
could well come to define Myanmar-
Chinarelationsformanyyearstocome.
The trip is Aung San Suu Kyis first to a
world power as a government minister,
after earlier sorties to Southeast Asian
neighbours Laos and Thailand. The pro-
democracy campaigner and former
political prisoner visited China for the
first time last year at the Communist
partys invitation, months before she led
her opposition National League for
Democracy party to a landslide victory
in elections hailed as the most free for
more than half a century.
Therhetorichasbeenwarmfromboth
countries despite Myanmars close eco-
nomic links with Asian rivals such as
Japan and Aung San Suu Kyis ties with
western countries such as the UK, where
she lived for many years. Her two sons
are British,aswasherlatehusband.
Chinas state news agency Xinhua this
week said the perception that Myanmar,
under the National League for Democ-
racy, would turn to the west was unten-
able, citing unnamed people familiar
with bilateral and party relations.
Du Jifeng, a Sino-Burmese studies
expert at the Chinese Academy of Social
Sciences, said Beijing had recalibrated
This is just fake another Russian treatment of asylum seekers. The UN
fake, Mr Yatseniuk said.
Mr Tusk, who also spoke with
Mr Poroshenko by phone yesterday,
said Moscows version of events was
not credible.
EU leaders must decide this year
whether to extend sanctions against
Russia. Angela Merkel, German
chancellor, rallied British support in
June to extend the measures for six
months, but Hungary, Italy and Greece
have suggested that the penalties are
counter-productive.
Referring to pressure to ease
sanctions, Mr Yatseniuk said: This
would be the betrayal of the bedrock
of the EU and . . . the free world.
He accepted that the renewal of
sanctions on Russia would be
difficult for Europe. But he saw no
prospect of Mr Putin executing the
Minsk II peace deal of 2015, which was
supposed to ease the conflict.
Sanctions cannot be lifted until
Russia fully implements Minsk and
gets out of Crimea, Mr Yatseniuk said.
There are different voices that
started to emerge in Europe: lets lift tralia director at Human Rights Watch.
sanctions; lets build a new type of
dialogue with Russia; lets be more
co-operative. These are the sound of
weakness.
Dialogue was needed but it could
not happen under the barrel of
Russian-made guns.
Diplomatic measures and financial
penalties were not sufficient, he
added. A more comprehensive
package was required than the
military training provided by Nato.
Members of the alliance are
reluctant to deepen military support
for Kiev.
Youll need always to have very
strong military to deter not to
attack, but to deter and thats my
message to the entire world. We are
protecting our homeland and . . .
European and Nato borders.
its approach after waking up belatedly
to the scale of political change under
way in Myanmar.
China underestimated the situation
when Aung San Suu Kyi and her party
were still in opposition, he said. Now
China has realised that Myanmars
democratisation is an inevitable trend.
Beijings overtures to Aung San Suu
Kyi have been mixed. Officials have
maintained ties with politicians from
the previous government and also the
military dictatorship of almost 50 years,
Myanmars de facto
leader Aung San
Suu Kyi, right, aims
to engage Beijing
on issues such as
energy supply
which grew highly dependent on Beijing
as western sanctions affected it.
China has long loomed large in Myan-
mar, accounting for about half of its for-
eign investment and 40 per cent of its
trade. An oil pipeline is already feeding
a refinery in south-west China and
planned dam projects would supply
electricity to both countries.
Thursday 18 August 2016
Asylum seekers
Australia
agrees to shut
refugee camp
after criticism
of conditions
JACKIE RANGE SYDNEY
Australia is to close one of two offshore
detention centres for asylum seekers, a
move that challenges its tough policy
on the treatment of refugees.
The decision to shut the processing cen-
tre on Manus Island in Papua New
Guinea came after a meeting yesterday
between Peter ONeill, PNG prime min-
ister, and Peter Dutton, Australias min-
ister for immigration and border pro-
tection.
After the talks in Port Moresby, the
capital of Papua New Guinea, Mr Dutton
said: It has been the longstanding posi-
tion of this government to work with
PNG to close Manus and support those
people as they transition into PNG or
return to their country of origin.
It is unclear what will happen to the
854 men held at Manus. Mr Dutton told
ABC, Australias state broadcaster, there
was no timeline for closure but both
countries would work towards it as
quickly as possible. Were talking to
third countries . . . to look at settle-
ment options, he said, adding that
extra resources would be given to PNG
to support the transition. But he reiter-
ated that no one from the centre will
ever be settled in Australia.
Australia has faced criticism for its
and human rights groups have insisted
that holding refugees in basic camps on
tiny South Pacific islands is inhumane.
But Canberra believes that keeping
asylum seekers offshore, and stopping
boats from reaching its shores, is the
only way to end the business of smug-
gling people to Australia.
The policy has also played well in
terms of domestic politics. A number of
populist and protectionist politicians
were elected in Australias recent elec-
tion, including four from the anti-immi-
grant One Nation party, which is led by
Pauline Hanson. She has called for a halt
to Muslim immigration and a ban on the
construction of mosques.
Mark Rolfe, lecturer at the school of
social sciences at the University of New
South Wales, said: There is generally
popular support for not letting them
[asylum seekers] in. And polls show this
over time.
Refugee advocates applauded yester-
days move. The decision to close the
Manus detention centre is welcome but
long overdue, said Elaine Pearson, Aus-
She said the men on Manus should now
be moved to Australia or a safe third
country rather than to another transit
centre on PNG or countries of origin.
Nearly a thousand men on Manus
have already lost three or more years of
their lives locked up in limbo for no
good reason. Theyve endured dirty,
cramped conditions, inadequate medi-
cal care and violence. Finally, it is time
to let them move on with their lives in
safety and dignity, Ms Pearson said.
PNG in April called on Australia to
close the centre after its Supreme Court
ruled that the detention of asylum seek-
ers there was illegal.
That request came after a 23-year-old
man living on Nauru, Australias other
main offshore detention centre, set
himself on fire in front of UN officials in
protest at his detention there. He died of
the injuries he sustained.
Thant Myint-U, a Myanmar political
analyst, tweeted that the aim of Aung
San Suu Kyis visit should be a new
vision of Sino-Myanmar ties, including
mutually beneficial economic ties, then
work backwards to todays various
issues.
Aung San Suu Kyi has already begun
to address one high-profile disagree-
ment with China, setting up a commis-
sion to review the previous govern-
ments decision to suspend the high-
profile Beijing-backed $3.6bn Myitsone
dam project. Beijings need for the dam
and other Myanmar hydroelectric
projects has also grown less urgent
because of electricity oversupply in the
Chinese province of Yunnan across
Myanmars north-eastern frontier.
Another test of the relationship is a
crucial peace process scheduled to be
launched in Myanmar this month to end
more than six decades of on-off conflict
between the government and regional
militias. The conference highlights the
troubles caused by another flashpoint in
Sino-Myanmar relations: fighting in
Myanmar between government forces
and an ethnic Chinese armed group.
Additional reporting by Luna Lin in Beijing
Thursday 18 August 2016 FINANCIAL TIMES 3

INTERNATIONAL

Trump turns to like-minded populist

Republican candidates new campaign chief has long espoused anti-establishment stance as head of Breitbart news site
ANNA NICOLAOU NEW YORK
DEMETRI SEVASTOPULO WASHINGTON
What
In turning to Stephen Bannon to right they say
his campaign, Donald Trump is
embracing a man whom former If you look at
employees and associates describe as a Stephen
more intense version of the candidate
himself. Bannon and
what theyve
In announcing the move, Mr Trump
said his new hire the executive editor built at
of Breitbart News had been described Breitbart, its
in the media as the most dangerous win at all
political operative in America.
Mr Bannon, a former naval officer costs
and Goldman Sachs banker who has COREY
also had stints in Hollywood, has LEWANDOWSKI

jumped into politics in a similar way to

his new boss. He has established himself
in rightwing media as a freewheeling
populist who has filled a void for disaf-
fected conservatives searching for an
alternative to Fox News, the traditional
bastion for Republican politicians.
The Virginia-native, who was
appointed chief executive of the Trump
campaign 82 days before the November
election as Mr Trump has slumped in
the polls, has no experience running a
political campaign. This should sound
alarm bells, said Larry OConnor, a
former Breitbart employee who worked
with Mr Bannon several years ago.
But in other ways the move is less sur-
prising. Under Mr Bannon, Breitbart
has long espoused the kind of anti-es-
tablishment stance that propelled Mr
Trump to victory in the Republican pri-
mary race. The news site has also taken
an extremely tough line on illegal immi-
gration, which has been one of Mr
Trumps signature issues.
At Breitbart, Mr Bannon has steered
hard-hitting coverage of Hillary Clinton,
most prominently through the docu-
mentary Clinton Cash, which drew cov-
erage at mainstream media like the New
York Times.
If you look at Stephen Bannon and
what theyve built at Breitbart, its win
at all costs, Corey Lewandowski, the
former Trump campaign manager who
was fired two months ago in a previous
reshuffle, told CNN yesterday.
Mr Bannon joined the navy after grad-
uating from Virginia Tech. He went to
Wall Street as a Goldman Sachs banker
and later to Hollywood, where he pro-
duced films and took a stake in televi-
sion shows such as Seinfeld.
He drew the attention of conservative
media with his documentary about
Sarah Palin, the former Alaska governor
who was John McCains running mate in
the 2008 election, which helped make
him a frequent guest on Fox News.
Mr Bannon met Andrew Breitbart in
Los Angeles when he was starting his
Breitbart website. Together the two
crafted what Mr Bannon described as a
global, centre-right, populist, anti-
establishment news site.
Mr Breitbart had helped Arianna
Huffington start the Huffington Post,
and Breitbart would emerge as the
rightwing answer for digital media,
thrusting the two men into leading roles
as conservative agenda-setters.
Ken Doctor of Newsonomics said that
Breitbart, along with sites like the
Drudge Report and The Blaze, had
emerged as part of a reordering at the
Casino Steve Wynn, the US casino magnate, is
magnate refusing to support the White House
Wynn campaign of his long-time friend and
business rival Donald Trump, saying he
withholds is not happy with the dialogue
backing for between the Democratic and
long-time Republican presidential candidates.
friend Im craving a more substantial
conversation, politically and publicly,
about the economy of the US and what
it really takes to make a better life for its
citizens, Mr Wynn, left, told the
Financial Times in an interview in
Macau, the Chinese gambling haven.
Theres so much misinformation being
put out that its also frustrating.
Mr Wynns move not to back Mr
Trump comes as numerous high-profile
Republicans voice opposition to the
New York mogul who continues to use
divisive rhetoric that many believe will
cost the party the White House in
November. Mr Wynn backed Mitt
Romney, the Republican candidate, in
2012, but has before supported both
Democrats and Republicans.
Speaking in February after his victory
in the Nevada caucus, Mr Trump singled
out Mr Wynn in the audience as one of
the people who gives him advice. Mr
Wynn, who made much of his money in
casinos and real estate, even brokered a
meeting at his New York home in May
between Mr Trump and Karl Rove, the
former top strategist to George W Bush,
who has been one of the most vocal
critics of Mr Trump.
But while Mr Wynn has acted as an
informal adviser, he has opted not to
help finance the campaign following Mr
Trumps failure to become a more
presidential candidate. But he stressed
that he had not given one penny to
either the Trump campaign or to Hillary
Clinton, the Democratic nominee.
Im a friend of Donald and if he asks
me questions, I answer them, said Mr
Wynn, who was in Macau ahead of the
opening of his latest casino, the $4.2bn
Wynn Palace, and who has been a big
Republican donor in previous elections.
I dont know that I influence him in any
significant way. Im friendly with Bill and
Hillary Clinton and I have to say the
same thing about them. Ive contributed
to neither campaign.
Mr Trump received a bounce in the
polls after the Republican convention
last month, but a string of controversial
comments since then have dented his
support. Mrs Clinton has beaten Mr
Trump in the past 21 successive polls,
and leads by an average of 6.7 points,
according to Real Clear Politics.
Ben Bland in Macau and Demetri
Sevastopulo in Washington
top of US conservative media. Breitbart,
viewed as a descendent of the Drudge
Report, draws an estimated 12m unique
monthly visitors.
However, while Fox News, under the
helm of the recently ousted Roger Ailes,
has clashed with Mr Trump, Breitbart
under Mr Bannon has been more defer-
ential to the businessman, raising ques-
tions about his own leadership of the
news site.
If you put all your chips on Donald
Trump, and then assuming the polls
hold and he loses, then what is Breitbart
after the election? said Mr Doctor.
Mr Bannon stirred controversy at
Breitbart after one of its reporters
clashed with the Trump campaign ear-
lier this year. Michelle Fields accused
Mr Lewandowski of grabbing her arm
when she was trying to ask the candi-
date a question at a press conference.
Florida police charged Mr Lewandowski
with battery over the incident, but the
case was later dropped.
However, Breitbart, led by Mr Ban-
non, published a story questioning Ms
Fields claims, sparking fury from Ms
Fields and other employees who felt he
sided with Trump over his own
employee. Breitbarts editor Ben
Shapiro resigned in light of the inci-
dent, arguing that Mr Bannon put
a stake through the heart of
[Andrew Breitbarts] legacy.
I believe
Breitbart
became
Trump
Pravda so
that Steve
Bannon could
be the
conductor on
the Trump
Train
BEN SHAPIRO
Stephen Bannon
hosts a
conservative
radio talk show
last month
Kirk Irwin/Getty Images
Steve Bannon is a bully, and has sold
out Andrews mission in order to back
another bully, Donald Trump, said Mr
Shapiro. I believe Breitbart became
Trump Pravda so that Steve Bannon
could be the conductor on the Trump
Train.
Ms Fields, who quit Breitbart in light
of the incident, said on Twitter yester-
day: Now that we know Bannon is run-
ning the show, I think we can under-
stand why Ivanka and Jared checked out
and are on vacation during campaign.
Senior Trump Mr Bannons relationship with Mr
adviser Trump has also drawn scrutiny about
Kellyanne the sites editorial independence. How
Conway is now did Bannons relationship with Trump
campaign influence the sites coverage of other
manager to the Republican candidates? asked Mr
Republican OConnor. When story assignments
candidate were distributed, did the writers at
Breitbart know that the executive chair-
man was working with the Trump cam-
paign?
Glenn Beck, the former Fox News host
who was a strong supporter of Texas
senator Ted Cruz in the Republican pri-
mary, attacked Mr Bannon in February,
likening him to Hitlers propagandist
Joseph Goebbels.
By taking orders from a political can-
didate and reworking your entire site to
promote the lies of [Trump] . . . That
doesnt make you Roger Ailes. That
makes you Goebbels, said Mr Beck.

Beach volleyball Alleged scam

Copacabana serves up late-night party for primetime audience Police arrest Irish games chief
RIO 2016
MURAD AHMED RIO DE JANEIRO
In the early hours of yesterday, thou-
sands of Brazilians started a raucous
party on Copacabana beach.
It was there that Agatha Bednarczuk
spiked a ball into the sand to secure Bra-
zil a place in the final of the Olympic
womens beach volleyball against Ger-
many. Embracing her playing partner
Brbara Seixas after beating the US
favourites in their semi-finals, music
blasted as home fans danced in the
stands.
The match finished around 1am.
Scheduling games at such a late hour
may seem odd. There have been fears
throughout the tournament that forcing
players to perform late into the night
would lead to fatigue, resulting in a
poorer sporting spectacle. The womens
final yesterday began at midnight, as
does tonights mens final.
Its not up to us, says Ary Graa,
president of the Fdration Internation-
ale de Volleyball, the sports world gov-
erning body. The organisers do what
the television wants. The most impor-
tant TV here is American TV.
NBC, the US network owned by Com-
on suspicion of ticket touting
cast, paid $4.4bn to acquire the broad-
cast rights for the games to 2020 and a
further $7.75bn for rights until 2032.
Of the 28 sports at the Rio games, it
selects a handful for peak-time coverage
on American screens. Perennial favour-
ites swimming, diving, gymnastics,
athletics get plenty of airtime. As does
beach volleyball, a sport that entered
the Olympics just 20 years ago.
To suit the broadcaster, night matches
are timed for viewers on the US west
coast and follow the conclusion of mar-
quee races on the athletics track and in
the swimming pool. We have to con-
sider how the television industry
works, says Fernando Lima, FIVBs sec-
retary-general. And we want our ath-
letes to be seen.
TV audiences matter to the Olympics.
A report by research body Sportcal esti-
mated that the International Olympic
Committee, the governing body for the
games, made $8bn in revenues in the
four-year cycle encompassing the 2010
Vancouver winter games and the 2012
London summer games. Around
$3.91bn was made from media rights.
NBC needs high ratings to recoup
investment and the media group has
said it is on track to sell more than $1bn
worth of advertising across its channels
during the Rio games.
Beach volleyball is a TV executives
dream. Matches are easy to follow,
youth audiences are interested, and the
female athletes wear bikinis (men play
in baggy shorts and vests). When you
see the athleticism of the players, the
action is fantastic, insists Mr Lima, but
admitted that at the Olympic level,
most sports have athletes that are physi-
cally at the top condition. They have
beautiful bodies. Volleyball has
this . . . the players are very exposed,
lets say, in beach volleyball.
The Rio games represents a home-
coming for the sport. While six-a-side
volleyball can trace its origins to the
19th century, its beachside cousin
entered the Atlanta games in 1996. The
move came at the behest of Juan Anto-
in some countries, where the Olympics
Sand dance: Brbara Seixas and
Agatha Bednarczuk celebrate
nio Samaranch, then president of the
IOC. He became enamoured after
attending a beach volleyball world
championship held on Copacabana,
spotting an opportunity for the Olym-
pics to appeal to younger audiences.
TV images are helped by spectacular
staging. In Rio, matches are played in
the shadow of Sugar Loaf mountain. In
London four years ago, the central Lon-
don skyline loomed over the stadium on
Horse Guards Parade. At the next Olym-
pics, organisers want to hold matches
under skyscrapers in Shiodome with a
view of Tokyo Bay.
While Rio organisers have struggled
to sell tickets for supposedly prestige
events such as athletics, beach volley-
ball tickets are the hottest in town. This
is despite seats costing R$350 ($110) on
average, the games most expensive.
The atmosphere is part of the entry
price. Matches are played in an environ-
ment akin to an open-air nightclub.
The sports stated aim of gaining pop-
ularity worldwide appears to be work-
ing. For Beijing 2008, 31 countries
attempted to qualify, in London, 143,
and in Rio, 169.
It may never win over large audiences
are about bolstering national pride
above all else. But Mr Graa thinks his
sports appeal goes beyond competition.
Beach volleyball is a philosophy of life,
he says. Its saying to the world, Be receives about 200,000 of funding a
happy, have fun, have sun.
VINCENT BOLAND DUBLIN
SAMANTHA PEARSON RIO DE JANEIRO
The head of Irelands Olympic commit-
tee has been arrested in Rio de Janeiro
in connection with an alleged ticket-
touting scam, plunging Irish sport into
an embarrassing crisis.
Pat Hickey, president of the Olympic
Council of Ireland and head of the Euro-
pean Olympic committees, was arrested
at his hotel yesterday over alleged illegal
ticket sales, Brazilian police said in a
statement.
Mr Hickeys arrest appears to be an
escalation of an investigation into an
alleged ticket scam operation involving
tickets for the Olympics in Rio, which
originated with the OCI.
Police in Rio also said yesterday that
they had issued arrest warrants for
three other Irishmen Michael Glynn,
Eamonn Collins and Ken Murray who
are directors of PRO 10 Sports Manage-
ment, a Dublin-based company that is
the authorised ticket reseller of Irish
tickets for this years Olympic Games.
Mr Hickey, 71, has been OCI president
since 1988 and is also a member of the
International Olympic Committee. The
controversy has cast a spotlight on the
accountability of the OCI, which
Additional reporting by Murad Ahmed in
year from the Irish government.
Noel Rock, a member of parliament
for the governing Fine Gael party, said in
a statement: This is extraordinary and
unprecedented, and casts a dark
shadow over our Olympics.
The OCI said late yesterday that Mr
Hickey had stood down temporarily
from his roles in international sports
governance, the Associated Press
reported. Mark Adams, an Interna-
tional Olympic Committee spokesman,
said Mr Hickey had been taken to hospi-
tal and that it was establishing the
facts behind his arrest.
Evidence of an alleged ticket-touting
scam in Rio, involving tickets linked to
the OCI, first emerged earlier this
month when Brazilian police arrested
Kevin Mallon, a Dublin-based executive
for a British sports management com-
pany THG Sports. THG said at the time
that neither the company nor Mr Mal-
lon had broken local or IOC laws.
PRO 10 did not comment yesterday
on the arrest warrants issued for its
directors and said it had not been con-
tacted by the Brazilian authorities. But
it said any suggestion that it had put the
tickets up for general resale in contra-
vention of IOC guidelines is utterly
untrue and completely without any
foundation.
Rio de Janeiro
4 FINANCIAL TIMES
Turkey frees convicts
as detainees face jail
An officer stands guard outside the damaged police headquarters in Ankara. Some of the detainees have been held in its sports hall Dimitar Dilkoff/AFP/Getty Images
Ankara plans to release 38,000
prisoners while numbers of
those held in purge escalates
MEHUL SRIVASTAVA ISTANBUL
Turkey will release 38,000 convicts
early in an apparent effort to make
space in its overcrowded prisons for the
droves of people rounded up by the gov-
ernment since last months failed coup.
Of the nearly 35,000 people detained
following the coup including military
personnel, bureaucrats and journalists
about 6,000 are still being held. The
change of parole requirements that will
allow for the releases was decreed by
President Recep Tayyip Erdogan, under
emergency powers he assumed after the
putsch was defeated.
Turkeys prisons, the most crowded in
the Europe, were already stretched to
capacity, with the number of convicts
rising threefold between 2001 and 2014
to about 150,000 at least twice as
many people as the system was
designed to accommodate, the Institute
for Criminal Policy Research says.
With prisons overflowing, the post-
coup detainees were held in places such
as the Ankara police headquarters
sports hall and riding club stables.
Two government officials said the
sweeping parole reform was unrelated
to the recent detentions. Still, it has
Eurozone
Portugal lauds austerity victory but economic fears remain
PETER WISE LISBON
Antnio Costa cheered from the stands
as Portugal inflicted a surprise defeat
on the French to win this summers
Euro 2016 football championships.
Now the countrys anti-austerity prime
minister is celebrating some unex-
pected triumphs of his own.
His supporters hailed last weeks EU
decision not to punish Portugal for miss-
ing its budget deficit targets as a success
for Mr Costas programme of reversing
tough austerity measures a strategy
that has seen his Socialist party climb to
a commanding lead in opinion polls.
They also say the recent damning
internal report into the International
Monetary Funds handling of the euro-
zone debt crisis vindicates his argument
that imposing austerity on struggling
eurozone countries only further impov-
erishes them.
But Mr Costas apparent victories
have failed to ease international con-
cerns over Portugals weak growth,
fiscal imbalances and massive debt
burden, or to put Lisbon beyond the
reach of its EU overseers.
While acknowledging its own failings,
the IMF has warned that even modest
adverse shocks to the Portuguese econ-
omy could easily place the government
debt-to-GDP ratio on an explosive path.
Disappointing growth is also putting
pressure on Portugals only investment-
grade credit rating, Canadas DBRS
rating agency warned on Tuesday.
Sweeping reform. Early parole
drawn attention to the scale of the
purge, which has consumed the
Erdogan government since the coup was
quashed in mid-July. At least 70,000
people were fired from their jobs, for-
eign travel restricted for bureaucrats
and the deans of all Turkish universities
were asked to resign.
The crackdown continues, with Turk-
ish riot police this week raiding the
offices of 51 businesses and detaining
dozens of executives the government
Damage limitation
Merkel defends ties
after leaked report
Chancellor Angela Merkel has
delivered a robust defence of
Germanys close ties with Turkey in an
attempt to limit the damage done by a
leaked government report that
accused Ankara of widespread
support for Islamist groups.
Ms Merkels spokesman, Steffen
Seibert, praised Turkey as an
important partner in the fight against
Islamist terrorism and defended the
EUs German-led refugee pact with its
president, Recep Tayyip Erdogan.
The danger represented by the
readiness of Islamist terrorism to
resort to violence was a danger to
And although avoiding [EU] sanc-
tions was a big symbolic win that
showed the government could stand its
ground against the European Council
without reneging on any of its public
commitments, Portugal is clearly not
out of the woods, says Federico Santi,
an analyst with the Eurasia Group con-
sultancy.
Brussels decision to spare Portugal
and Spain from financial penalties over
their excessive deficits is widely attrib-
uted to the influence of Wolfgang Schu-
ble, Germanys finance minister, who is
said to have contacted the European
Commission to urge leniency.
Mr Costa, who took office in Novem-
ber at the head of a minority Socialist
party government supported by the far
left, has reaped political rewards from
the ruling after campaigning against
unjust and counterproductive fines
and threatening to go to the European
Court of Justice if the decision went
against Portugal.
The outcome has helped quell poten-
tial dissent in the volatile leftwing alli-
ance he formed after an inconclusive
October election. The radical Left Bloc
(BE) had threatened to call for a refer-
endum on Portugals EU membership if
financial sanctions were imposed on
Lisbon.
Avoiding fines has also burnished Mr
Costas credentials as a leader prepared
to challenge EU institutions, removing a
potential point of conflict with the BE
and Communist party (PCP).
INTERNATIONAL
accuses of aiding the exiled cleric,
Fethullah Gulen, who it has blamed for
the coup. The mass arrests so swiftly
after the coup have prompted allega-
tions of human rights abuses.
Johannes Hahn, the EU commis-
sioner, has raised the possibility of pre-
prepared lists of government oppo-
nents while human rights groups have
alleged arbitrary detentions and inhu-
mane conditions for prisoners.
Photographs of beaten and half-na-
Turkey, Germany and the EU, which
could only be fought through
international co-operation, including
with Turkey, he said yesterday.
Berlin is trying to play down the
revelations, which have emerged at a
time when bilateral relations have
been strained by the Turkish
governments sweeping crackdown
after last months failed military coup.
Turkey attacked the German report,
saying it showed a twisted mentality
in its view of Ankara and its president.
The foreign ministry called for a
clarification from German courts
without specifying what that meant.
Meanwhile, Ms Merkels domestic
critics seized on the leaked document
as proof that Berlin needed to rethink
relations with Ankara and back away
from Mr Erdogan. Stefan Wagstyl
But government policy remains heav-
ily constrained by EU demands for fiscal
discipline. While showing clemency
over fines, Brussels has called for addi-
tional consolidation measures such as
lifting value added tax rates, with an
estimated impact on the underlying
deficit, excluding extraordinary meas-
ures and interest payments, of 0.25 per
cent of gross domestic product this year
and 0.6 per cent in 2017.
The extra fiscal effort in 2017 will be
particularly demanding given that it
requires an estimated 1bn in cuts in a
year when Mr Costas planned rollback
of austerity is expected to add 1.6bn to
government spending. The BE and PCP
will resist any move to step back from
the prime ministers commitments,
Portugals budget deficit
As a % of GDP
0 International investors are also con-
-2
-4
-6
Forecast
-8
-10
-12
2006 09 11 13 15 17 19 21
Source: IMF World Economic Outlook April 2016
ked detainees were printed in pro-gov-
ernment newspapers. Amnesty Inter-
national said some people had been tor-
tured, starved and denied medical treat-
ment. The government said evidence
against detainees had been collected in
long-running probes before the coup.
One Turkish prison warden also
rejected the charges of inhumane treat-
ment, saying: We are doing the best we
can. The warden said he had as many as
three people for each spot in his prison,
and while detainees slept on the floor or
in shifts, they were provided with
healthy food and medical visits.
The sudden revision to parole
requirements will allow people not con-
victed of major crimes such as mur-
der, sexual crimes and terrorism to be
released about halfway through their
sentences. That means most Kurds con-
victed for participating in a violent sepa-
ratist movement in Turkeys south-east
will remain imprisoned.
Turkey may need to find yet more
space for detainees, with officials warn-
ing that the purge is far from over dip-
lomats are still being recalled, deserters
being chased and there are weekly
announcements of raids on new busi-
nesses and journalists suspected of aid-
ing Mr Gulen, who has lived for decades
in rural Pennsylvania. The cleric has
denied any involvement in the coup.
Still, Turkey is demanding his extradi-
tion from the US so he can stand trial.
making the approval of next years
budget a potential political flashpoint.
The EUs control [over Portugal]
remains very strong, says Antnio
Costa Pinto, a Lisbon professor of poli-
tics. The margin for manoeuvre is very
small. All political outcomes depend on
Brussels. If the government can prevent
Portugal returning to a tougher version
of austerity, it will survive.
Mr Costa has increased the minimum
wage, begun restoring public sector
wages and state pensions to pre-bailout
levels and cut the working week for
most civil servants from 40 to 35 hours.
The aim is to lift domestic demand, but
growth has virtually stagnated this year,
although unemployment has fallen to
10.8 per cent, the lowest since early
2011. Fitch Ratings forecasts Portugals
fragile recovery will weaken this year
and next, with GDP growth falling to
1.3 per cent in 2017 from 1.5 per cent
last year.
cerned about the potential cost to the
state of plugging big capital gaps in the
banking sector and what will happen to
government bond yields when the Euro-
pean Central Bank eventually removes
its quantitative easing safety net.
The prime ministers soft approach German chancellor, and Franois Hol-
to austerity seems to be paying off politi-
cally, says Antonio Barroso, an analyst
with Teneo Intelligence, a risk consul-
tancy. But the government still faces
some important risks, especially
regarding the banking sector.
South Africa
ANC opponents reject
bids to form coalitions
AISLINN LAING JOHANNESBURG
The African National Congress, South
Africas ruling party, suffered a stinging
blow after opposition parties rejected
its attempts to form coalitions, mean-
ing it will no longer govern Pretoria, the
capital, for the first time since it took
power 22 years ago.
The latest rebuke for the ANC comes
after it suffered its worst ever electoral
performance at local elections this
month a result widely seen as an
expression of anger at President Jacob
Zumas scandal-prone leadership.
The former liberation movement,
which led the struggle against apartheid
came second to the opposition Demo-
cratic Alliance in Pretoria and Port Eliz-
abeth, which lies in its traditional heart-
land of the Eastern Cape province. It
also lost its majority in Johannesburg,
the countrys commercial hub.
Parties have been locked in coalition
talks since the August 3 vote and Preto-
ria and Port Elizabeth look set to be gov-
erned for the first time by the opposition
Democratic Alliance [DA], backed by
the militant Economic Freedom Fight-
ers and other smaller parties.
The EFF, a breakaway of the ANC,
emerged as the kingmakers following
the elections and Julius Malema, its fire-
brand leader, said yesterday he had
picked the better devil and would give
the EFFs vote to the DA to lead Pretoria.
He said the ANC had refused to enter-
tain his central coalition demand the
removal of Mr Zuma, who has been
embroiled in a raft of scandals amid
mounting complaints about corruption
and cronyism in Africas most industr-
ialised nation.
After seeing its share of the national
vote slide from 62 per cent in 2011 to
54 per cent, the ANCs top leaders met
last week to discuss the implications of
the damaging results. But Gwede Man-
tashe, the ANCs secretary-general, said
the party had agreed to take collective
responsibility for the loss of support,
indicating that the party was standing
by Mr Zuma.
The partys credibility has been
increasingly tarnished since Mr Zuma
took office in 2009, while the economy
is stagnating and poverty and unem-
ployment remain stubbornly high in
one of the worlds most unequal socie-
ties.
The DA, which has its roots in white
politics and already runs Cape Town,
Political uncertainty
Rome warns Brexit delay will
harm EU push for integration
JAMES POLITI ROME
Italy has warned that any decision by
the UK to delay Brexit negotiations
until late 2017 would risk extending
political uncertainty in Europe and
undermining integration among the
remaining EU member states.
Media reports suggest London is consid-
ering waiting until after French elec-
tions in April or May next year, or Ger-
man polls the following September or
October, before invoking Article 50 and
triggering the two-year negotiations
that will lead to a formal exit.
Theresa May, UK prime minister, had
told Matteo Renzi, her Italian counter-
part, that Britain would launch exit
talks early next year. But further delay
could paralyse debate on much-needed
changes in Brussels, which Italy is keen
to push amid growing Euroscepticism at
home, according to Sandro Gozi, Romes
EU affairs secretary.
The uncertain timing of the Brexit
talks has been a source of frustration in
many European capitals.
If there is to be a delay, the priority
for us is that it should not lead to immo-
bility, to inertia on all the other things
we need to do at the EU level, Mr Gozi agreements with countries of origin.
said in an interview with the Financial
Times. Europe has to give urgent, con-
crete answers, which certainly cannot
wait more than a year.
Mr Gozi defended the EUs choice of
Michel Barnier, a former commissioner,
as the European Commissions Brexit
chief. The architect of post-crisis EU
financial regulation has clashed with
City of London bankers and the choice
was coolly received in the UK capital.
He has a long European experience
and knowledge of the single market,
Mr Gozi said. The past has not been
easy between Barnier and London, but
he is a serious and competent person.
Mr Renzi is to host Angela Merkel,
proposed a referendum on the euro. The
lande, French president, next week on
the island of Ventotene for informal
talks on the EUs future without the UK.
Italian officials hope the gathering will
serve as a springboard for action when
leaders of the 27 remaining member
Thursday 18 August 2016
garnered about 27 per cent of the vote,
while the EFF, which was competing in
its first local poll, won about 8 per cent.
Mr Malema, who dismissed the DA as
a party of white racists, said EFF coun-
cillors would not take up executive posi-
tions in Pretoria and would remain on
the opposition benches.
But he added that the party
would give its controlling vote to the
DA to avoid stalling service delivery
and to achieve its central aim of
knocking the arrogant ANC from its
perch.
We couldnt be neutral, we had to
take sides . . . This is history. We were
caught between two devils and we had
to choose the better devil, Mr Malema
told reporters.
The ANC cant see what is happening
in this country, so they must now feel
the pain as individuals.
The two opposition parties are, how-
ever, locked in a stand-off over control
of Johannesburg because of the EFFs
antipathy towards the DAs mayoral
candidate, Herman Mashaba, a success-
ful businessmen.
The DA has insisted it will stick with
Mr Mashaba and the dispute over his
candidacy could mean the city ends up
being controlled by a minority ANC
administration.
Herman Mashaba was our candi-
date, people voted for him. We are
strong here, you cant ask people to vote
then change, said Mmusi Maimane, the
DAs leader.
Still, he added that he was deeply
humbled by the EFFs decision to back
the DA in Pretoria, saying it demon-
strated the determination of all the
opposition parties to punish the ANC for
abuse of power.
EFF leader Julius Malema speaking
at Alexander township yesterday
states meet in Bratislava in September.
If it delivers a credible response, the
summit could lead to a new political
pact, to be launched on the 60th anni-
versary of the Treaty of Rome, which
founded the EU in 1957, Mr Gozi said.
Italy wants a more integrated EU with
more pooling of sovereignty and risk
over such issues as economic policy
and migration and security. Berlin and
Paris have resisted that agenda.
Romes narrower objectives for inte-
gration include boosting the so-called
Juncker plan, which provides funds for
infrastructure across the bloc.
Italy also hopes more EU funds can be
directed towards youth unemployment
and cultural exchanges. It has urged
member states to step up implementa-
tion of commitments on migrants, fund-
Europe has to give
urgent, concrete answers,
which certainly cannot
wait more than a year
ing deportation of those not eligible for
asylum and negotiating readmission
Ventotene is where Altiero Spinelli, a
founder of the federalist movement,
penned a manifesto for a United States
of Europe while imprisoned during the
second world war. Europe needs to
change, said Mr Gozi. This means
strengthening the fundamental rights,
and the fundamental values, which
pushed Europeans to stay together.
Italy has long been among the blocs
cheerleaders for integration. But Euro-
sceptic sentiment has grown as it has
struggled through a long recession and
difficult austerity policies.
The leading Democratic party is neck
and neck in national polls with the pop-
ulist Five Star Movement, which has
third-strongest party is the anti-EU,
anti-immigrant Northern League.
Mr Renzi has staked his job on a refer-
endum on constitutional reform to be
held in November.
Price of a badly framed choice page 9
Thursday 18 August 2016 FINANCIAL TIMES 5
6 FINANCIAL TIMES Thursday 18 August 2016

ARTS

A stately home in steel and concrete T H E AT R E

Allegro
Southwark Playhouse, London
The Yale Center for British aaaee
Art has undergone a Sarah Hemming
meticulous restoration nearly Well, they might not have discovered a
40 years after it was built, gem here, but they have still polished it
writes Edwin Heathcote up very nicely. The ever enterprising
Southwark Playhouse mounts the Euro-
pean premiere of this 1947 Rodgers and

W
hen Louis I. Kahn built
the Yale University Art
Gallery in 1953, it was
the first major Yale
building to be built in a
modern style. It was only 20 years since
the completion of architect Egerton
Swartwouts Beaux Arts building, and
only 30 since most of Yales elaborate,
carved gothic stone buildings went up in
the 1920s. Another couple of decades
later, Kahn embarked on an extension,
the Yale Center for British Art, on the
opposite side of Chapel Street. It opened
in1977, threeyearsafterKahns death.
Tom Wolfe excoriated Kahns exten-
sioninhisbiting1981bookFromBauhaus
to Our House, using a photo of the blank
brick faade butting up to Swartwouts
intricately carved stonework to demon-
strate what he saw as the aesthetic and
intellectual poverty of modernism. But
Kahn was probably the wrong target. He
was an architect obsessed with the per-
manence of buildings, the substance and
the quality of light and texture. Never-
theless, he was hurt by the critiques of
thefirstbuilding,andtheCenterforBrit-
ishArtwasperhapsanattemptto atone.
Kahn integrated neat storefronts into
the faade and a sunken plaza with a
caf, he peeled away a corner to make
an entrance and created a light-filled
courtyard as a lobby. The whole building
is filled with ethereal light and articu-
lated more finely, more carefully and
more successfully than its darker, more
sombre predecessor. And now, more
than 40 years later, a meticulous resto-
ration has revived it and managed to
combine a sense of freshness with a deli-
cate patina that makes the passing of
timesubtly clear.
Sometimes modernism seems to have
been modern for a very long time. But
this is a building that, in a way, has come
back into fashion. Its unfinished steel
shutters, oak panels, steel-framed win-
dows and finely worked concrete sur-
faces look as fresh today as they might
Freshness: have in the 1960s when he designed Everything from the door handles and
above, the them. Although it finally opened in 1977 handrails to sofas and material blends
restored Long the year of disco and Star Wars this has been analysed, researched and
Gallery at the quiet, careful building fell between the remade. Even the wool carpets have
Yale Center for bombast of Brutalism and the arch been developed to match the original
British Art. kitschofpostmodernism. hue, not by dyeing but by tailoring the
Below: fourth- The Center for British Art was com- diet of the sheep so that their wool
floor gallery. pleted by Pellecchia and Meyers, who matched the original beige. They must
Below right: had worked on the designs in Kahns haveeatenalotofmuesli.
Gary Tushaw office. It has been restored by local New The most familiar motifs have become
in Allegro Haven practice Knight Architecture, totemic through endless publication,
Richard Caspole
based on a detailed conservation plan homage and rip-off: the concrete cylin-
Scott Rylander drawn up by British-based specialists der containing theatrical stairs; the oak
Peter Inskip and Stephen Gee. The reno- infill panels (the sun-bleached originals
vation is so fine it is almost obsessive. now replaced); the deep-coffered ceil-
ings; the domestic space of the galleries.
However, there are some small changes
thatmakeabigdifference.TheLongGal-
lery is now an unbroken volume, a corri-
dor of art in which paintings are stacked
in a crowded montage, academy-style,
so that it presents a single perspectival
view. Freestanding walls have also been
subtly shifted so as to be less regular and
present a more complex journey with
glimpsesfromone worktothenext.
Clearly the natural setting for philan-
thropist Paul Mellons astonishing
collection of British art would have been
an English country house. But this is a
very metropolitan, egalitarian setting,
with free public access. Somehow Kahn
managed to execute an urban building in
a frankly industrial manner yet recon-
cile that with the scale, intimacy and
material finesse of grand domesticity
within. That blend of raw surfaces and
aristocratic art, of tough building and
romantic yearning, simultaneously
refers to the heavy industry from which
Andrew Mellon derived his huge for-
tune, and to the refinement of his son
Paul, a revered collector with a fine eye
and one of Americas greatest cultural
patrons (he also sponsored the National
GalleryofArtinWashingtonDC).
The Yale gallerys steel panels shim-
mer again between concrete frames.
In the way the steel picks up the col-
ours of the sky, there is a faint glim-
mer of a wall crowded with Constable
studies of cloudscapes. The steel and
glass surfaces subtly reflect something of
their surroundings. What appears as an
industrialbuildingisrevealedoncemore
asastatelyhomeforart.
britishart.yale.edu
Hammerstein musical, with ingenious
director Thom Southerland drawing
every ounce of life and poignancy out of
it. Innovative for its time, Allegro tells the
story of an unassuming everyman in
early 20th-century America and casts a
sceptical eye over the American dream.
The action is deliberately low-key, the
lyrics to the songs often conversational.
Our modest hero Joe is born not into
adversity or greatness, but into the lov-
ing home of a small-town doctor. We fol-
low him as he goes to medical college,
marries his childhood sweetheart, aban-
dons his fathers practice for a lucrative
career in Chicago but, sickened by the
money-grabbing lifestyle there, rejects
success. The crux of the piece is the
enduring problem of when and whether
you should compromise your principles.
The narrative covers four decades, so
allegro is the word. There is no time to
delve into complex moral situations or
to develop characters much beyond the
superficial. Joes father is noble; his best
friend Charlie is a bit of a lad; his wife
Jennie is graspingly materialistic. Mean-
while songs such as A Fellow Needs a
Girl offer a pretty sickly, outdated ethic.
Southerland and his fine cast make
the most, however, of this whistle-stop
tour, filling the stage with hustle and
bustle, revelling in the inventive use of
the chorus to comment on the action
and to voice the thoughts in Joes head.
Anthony Lambles simple, versatile set
uses ladders and platforms to offer flex-
ibility and to echo the musicals preoc-
cupation with social climbing. Lee
Prouds witty choreography is to the
fore in a student Charleston, while
the musical standards are high. Gary
Tushaw is immensely likeable as Joe
and there is great support from
Leah West as a sweet-voiced, pass-
ing flame and Dylan Turner as his
roguish friend.
To September 10
southwarkplayhouse.co.uk

Brilliant, smooth-singing sociopath

Global Appointments

OPERA
Don Giovanni
Drottningholm Opera, Stockholm
aaaae
Guy Dammann
Who is Don Giovanni serenading in his
celebrated Act Two song, Deh vieni alla
finestra? Elviras maid, ostensibly. But
here, in a new production for the 250-
year-old Drottningholm Palace Theatre,
director Ivan Alexandre knows his
subjects guilty secret. Jean-Sbastien
Bous Giovanni barely even glances at
the empty window before taking to the
front of the stage where, accompanied
by Karl Nyhlins mandolin, he sings to
the audience.
But this too is an illusion. For as this
simplest of all operatic showpieces con-
tinues into its second verse responding
to his own entreaties with growing
delight, it becomes clear that he is really
singing to himself. Like many socio-
paths, Giovanni can only really feel love
or pity for himself.
This insight sits at the heart of a thrill-
ing performance of Mozarts opera
which is remarkable for the vivid
brilliance of its portrayal of a hero
whose moral freedom and enlightened
materialism derive, ultimately, from his
total indifference to the fears and
Thrilling: Jean-
Sbastien Bou
(standing) as
Don Giovanni
Mats Bcker
desires of others. Antoine Fontaines set
provides a material corollary for Gio-
vannis mesmerising singing, using a
system of interlocking curtains which
accord the anti-hero control over the
space in which the other characters
interact. At the same time, Bous
remarkable ability to draw the musical
flow to a complete standstill, or to whip
it up into a frenzy of bullying com-
mands, suggests that his power extends
even to the temporal.
His performance is matched by
Robert Gleadows superbly portrayed
Leporello. The other soloists, perhaps
partly through intention but also on
account of the acoustic vagaries of the
ancient theatre (which Alexandre
seems worryingly ignorant of), are
much less vividly drawn.
The real magician, though, is the
conductor Marc Minkowski, whose feel
for seamless dramatic pacing and
sharply defined textures shine through
in the confidence and freedom of
the musicians.
There was much to admire, too, in
the setting, including a wonderful
shadow-play for the masked ball. But, as
with last years Figaro, the period-stage-
within-a-period-stage scenic model
remains at best inexplicable and at
worst grossly obstructive of both dra-
matic clarity and, in a more literal sense,
Drottningholms unique 18th-century
stage technology.

To August 27, dtm.se

DA N C E
BalletX
Joyce Theater, New York
aaaae
Apollinaire Scherr
At BalletX this week, company co-
founder Matthew Neenan and free-
lancer Trey McIntyre do not have us fix-
ate on steps. Nor do these American
mavericks declare their place on the
continuum between contemporary
dance and ballet. Unlike Jorma Elos
fussily Forsythian neoclassicism, which
kept telling us where it came from with-
out divulging why we should care,
Neenan used pedestrian gestures to
evoke the perennial mysteries that
other people pose and McIntyre
embraced ungainliness until we ached.
In Neenans delicately layered Show
Me, a chorus of four dancers arrayed
along the back scrim abstractedly fin-
gered their faces and kneaded their
stomachs while gazing at the ambiva-
lent romances and quasi-collegial quar-
tets before them. They did not seem to
notice that they too were being watched
by us. We came to suspect we were
also missing things. Neenan kept the
foreground dancers enough to the side
that you could not watch them without
relegating the fidgety chorus to the
periphery, and vice versa. But wherever
Bitter joy: Trey McIntyres Big Ones
you looked, the scene filled with
ellipses, like the fascinatingly incom-
plete dramas spied on the street. The
effect was wondrous.
Neenans low-key style was surrepti-
tious partner to his careful design. Like-
wise, McIntyre had tragedy enter by the
backdoor of the absurd. His Big Ones
played out to a medley of the late Amy
Winehouses ballads. The 10 dancers
were decked out in Reid Bartelme and
Harriet Jungs tall, black bunny ears.
Bright-eyed, velvety, vulnerable
Chloe Felesina was first to strap on those
ears, a nod perhaps to the singers trade-
mark towering beehive. Though often
excluded from the communal bunny
hops, Felesina attracted a bouncy, inat-
tentive boy (endearing Daniel Mayo)
who crumbled whenever she needed a
lift and only bounded back afterwards.
There were no villains in Big Ones any
more than there are bad rabbits, but
there was a heroine. To have Winehouse
so poetically imagined was a bitter joy.
To August 21, joyce.org
Thursday 18 August 2016
Plagued by years of flat revenues, executives have been on the hunt for new income streams to boost
shareholders returns. Can the Wall Street bank become a friend to the consumer and small business?
I
n April this year Goldman Sachs did
something it had never done
before. For almost 150 years, it had
prospered by getting close to people
of power and influence: wealthy
institutions, multinationals, rich fami-
lies. Now it was trying to appeal to the
hoi polloi, offering online savings
accounts that can be opened with a
deposit of just $1, with interest rates
about 100 times better than those at big
US retail banks like Wells Fargo or Bank
of America.
But the launch of GS Bank, propelled
by the acquisition of a $16.5bn book of
deposits from GE Capital, was not
exactly glitch-free. People were baffled
by an automated menu system that
failed to recognise simple instructions,
says Rob Berger, founder of Dough-
roller.net, a personal finance site. Some
customers reported long delays in open-
ing an account; others complained that
they could not get on to the platform via
an iPad or a Chromebook.
Even now, GS Banks call centre in
Cedar Rapids, Iowa, is not open 24 hours
a day, unlike other providers of online
savings accounts such as Capital One,
American Express or Discover.
Because it was Goldman everyone
expected the white glove service, says
the head of a cash management firm. It
was not the white glove service.
Goldman is moving into Main Street
for a simple reason: life on Wall Street
has become much tougher since the glo-
bal financial crisis. Once-powerful busi-
ness lines such as fixed-income sales
and trading have been struggling with
tighter regulation and a shift to elec-
tronic platforms, while choppy markets
have discouraged clients from putting
on big and complex trades that have
long been Goldmans forte.
Youd have thought that
Goldman, the great
restructurers, would have
been able to re-engineer the
business, but they havent
At the same time, revenues in the
banks asset management division have
been squeezed by a broad shift to pas-
sive rather than active investing. Even
Goldmans investing and lending seg-
ment, a ragbag of businesses involving
the bank placing bets with its own capi-
tal, has been hemmed in by new restric-
tions on proprietary trading.
All that has weighed on profits. Gold-
mans return on equity the best and
simplest measure of how well it is using
shareholders money slipped below
10 per cent last year and is expected to
come in at about 8 per cent in 2016. That
would make two years of annual RoE in
single digits easily the worst run since
Goldman went public in 1999.
Post-crisis struggle
Goldmans returns have been better
than peers such as Citigroup, BofA and
Morgan Stanley, which have undergone
more radical surgery, selling assets
worth tens of billions of dollars while
shutting entire business units. But some
investors still wonder why Goldman, a
bank that has always taken pride in the
strategic advice it provides to clients,
seems to be finding it hard to adapt to
the post-crisis world. For the past four
quarters it has lost its crown as Wall
Streets most profitable listed bank a
title that now belongs to JPMorgan
Chase.
Youd have thought that Goldman,
the great restructurers, would have
been able to re-engineer the business,
but they havent, says Jeff Morris, head
of US equities at Standard Life Invest-
ments in Boston. If Goldman cant
change their business to achieve better
returns, it really speaks to how tough
the regulatory environment is.
Executives at Goldman bridle at the
suggestion the bank has stood still while
the world changed around it. They point
out that it has kept annual revenues
more or less steady at about $34bn since
2012, despite cutting risk-weighted
assets by about one-fifth in that time, on
estimates from CLSA, the brokerage.
They also note that the bank has
responded to regulatory demands by
roughly doubling its equity capital since
the crisis, which compresses returns to
shareholders.
Pay often a flashpoint has come
down a lot too, reflecting smaller
bonuses as well as the different business
mix. In the second quarter this year,
Goldmans accrual for compensation
and benefits came to $95,718 per
employee, less than half the figure of
$211,968 of 10 years ago.
At Goldmans annual shareholder
meeting in Jersey City in May, Lloyd
Blankfein, chairman and chief execu-
tive, said that if profits had been weak, it
was because of heavy exposure to hedge
funds, asset managers, banks and bro-
By Ben McLannahan
A play for the 99%
kerages groups that are inclined to
shut up shop in thin, brittle markets. By
contrast, universal banks such as
JPMorgan Chase and Citi deal with huge
multinationals that need steady flows of
interest-rate swaps and currency
hedges, whatever the weather.
Once investors regain some poise,
said Mr Blankfein, Goldman would
bounce back too. Higher interest rates,
lower energy prices and a stronger econ-
omy should help boost the velocity of
trading. There are signs on the horizon
and indications that we are finally, after
a very long time, coming out of that [low
volume] environment, he said.
But the strategy of being the last man
standing in trading is a risky one, says
Mike Mayo, an analyst at CLSA in New
York.
He points to there being no guarantee
of livelier markets, and increasing capi-
tal requirements imposed by regulators.
Even if the biggest banks pass the
annual stress test, he notes, the Federal
Reserve is not letting them return more
Goldman Sachs: years of adjustment
Staff and revenue
Revenue per
employee ($m) revenue ($bn)
1.6
1.4
1.2
1.0
0.8
0.6
0.4
0.2
0 0
1999 2005 10
Sources: CLSA; Goldman Sachs
Wealth funds
Sovereign deals continue
to attract scrutiny
In his 2012 book Why I Left Goldman
Sachs, Greg Smith described elephant
trades deals so big that they netted
Goldman at least $1m in income.
According to Mr Smith, a former
derivatives salesman, they were the
reason the bank was so keen on
courting sovereign wealth funds in
FINANCIAL TIMES
FT BIG READ. GOLDMAN SACHS
than 100 per cent of earnings via buy-
backs and dividends.
In that context, say analysts, Gold-
man needs new income streams to boost
RoE. In the autumn it plans to start
putting its new GE connections to work,
launching a venture offering loans
online to consumers and small busi-
nesses. That unit has hired dozens of
senior people from companies including
Lending Club, Citi, Amex and Barclay-
card.
More retail banking products could
follow such as car loans, mortgages or
a robo wealth management platform.
In March Goldman took a step in that
direction by buying Honest Dollar, an
Austin-based start-up that helps free-
lancers and small businesses set up
retirement savings programmes online.
It was a deal that gave the but-
toned-up bank a new managing director
in Texas: William Hurley, a former IBM
and Apple executive and ex-bassist in
a funk band who goes by the name of
Whurley.
Trading activity
Trading Goldmans share of
trading by sector (%)*
30
20 Equity trading revenue
10
Fixed-income, currencies and
commodities trading revenue 0
16 2009 10 11 12 13 14 15 16
* Peers include Bank of America, Citigroup,
JPMorgan Chase and Morgan Stanley
emerging markets. Such clients have a
lot of money and not much experience
of putting it to use.
But at least two of those relationships
have put Goldman into the spotlight.
In London, a judge is soon to rule
whether Goldman forced the Libyan
Investment Authority into risky and
ultimately lossmaking derivatives
trades. Goldman denies this. In the case
of 1MDB, the scandal-stricken wealth
fund from Malaysia, Goldman has not
been accused of wrongdoing. But at
Looking for
velocity: Goldman
In the new regulatory world, any
profitable business that you can get in to
Sachs chief Lloyd that fits, you have to look at, says Jef-
Blankfein, top; frey Harte, an analyst at Sandler ONeill
William Hurley, in New York.
below, is now an MD
Retail push
of the bank after it
bought Honest Before the financial crisis, Goldman did
Dollar Getty Images not even have a federally insured bank
but it was forced to open one in 2008 as a
condition of receiving bailout funds.
Since then, it has gone after wholesale
deposits aggressively, seeking to cut its
dependence on the short-term debt
markets that froze during the crisis.
Deposits now account for 23 per cent
of the banks funding mix, up from 3 per
cent at the end of 2007. The bank is now
much less likely to suffer the kind of
liquidity crunch that saw off Bear
Stearns and Lehman Brothers and
almost did for Goldman itself.
The new mix helps profits, too. Even
though Goldman is paying its GS Bank
depositors a near market-leading inter-
est rate of 1.05 per cent a year on online
Funding mix
Per cent Q4 2007 Q2 2016
Long-term
Long-term Deposits 3 unsecured
unsecured Deposits
50 Secured debt
debt funding
40 23
30 34
30
46
20
13 19
10
Short-term
8 Secured
Short-term 8 unsecured 16 funding
unsecured debt
debt Shareholders Shareholders
equity equity
least half a dozen regulators are asking of the proceeds from three bond sales,
if the bank should have trodden more known as Project Magnolia, Project
carefully when it raised $3.5bn for the Maximus and Project Catalyze.
fund in a series of bond sales in 2012 According to an action last month by
and 2013. One of the authorities, the the US Department of Justice, a chunk
New York department of financial of the cash was siphoned off to shell
services, called in Goldman figures for a companies controlled by conspirators.
discussion this month, according to a Rather than boosting the third-largest
letter seen by the Financial Times. economy in Southeast Asia, the money
Among half a dozen areas of interest, was spent on Van Gogh paintings,
the DFS was keen to know whether Beverly Hills mansions and the rights to
Goldman did any due diligence, profits from the movie, The Wolf of Wall
investigation or research into the use Street.
7
Trading blow Exposure to hedge
funds, asset managers, banks and
brokerages has weakened profitability
Taking on P2P? GS Banks depositors
from the GE Capital deal will be a
useful support for any lending venture
Regulatory reality It has responded to
demands by roughly doubling its
equity capital since the crisis
savings accounts, for example, that is
still much less than the cost to Goldman
of issuing long-term bonds.
But getting closer to retail depositors
via the GE deal is more than a matter of
cheap, sticky funding. It also opens
Goldman up to a new class of customer:
the 99 per cent.
Until the price of entry dropped to a
dollar, people used to need at least $10m
in net assets before they could become a
Goldman Sachs account-holder. Now, if
anyone wants to put down more than
$250,000 the standard government
insurance coverage limit they have to
go elsewhere. (GE had set the bar much
higher, at $1m.)
GS Banks 160,000 or so depositors
should be a useful support for the new
lending venture, which represents a
direct strike against peer-to-peer plat-
forms, which match needy borrowers
with investors hungry for yield. In a
research note last year, Goldman ana-
lysts said $10.9bn of annual profit gener-
ated by traditional bricks-and-mortar
lenders was at risk of being lost to more
nimble upstarts. Of that, the largest
chunk $4.6bn was from unsecured
personal loans, with another $1.8bn
from small business loans.
A successful launch of a Lending
Club-like business would be a feather in
the cap of Stephen Scherr, a former
head of the financing group who was
named chief strategy officer in June
2014. This summer he was given the
extra title of chief executive of GS Bank
USA, the banking arm, suggesting that
he has joined a front rank of candidates
to lead the whole bank one day.
Institutional makeover
Recasting Goldman as the friend of the
consumer and small business will not be
easy. For many people across the US, the
The bank has responded to
demands by roughly
doubling its equity capital,
which compresses returns.
Pay has come down a lot too
brand is associated more readily for its
legal and political scrapes after the
financial crisis than its philanthropic
programmes such as 10,000 women
or 10,000 small businesses. Within
the past year, the bank has taken hits for
its connections to 1MDB, the Malaysian
sovereign wealth fund at the centre of a
sprawling corruption probe. This week,
Edwin Chin, a former head trader, was
barred from the industry by the Securi-
ties and Exchange Commission and
ordered to pay $400,000 to settle accu-
sations that he repeatedly mischarged
customers.
Yet to others the Goldman name
means almost nothing. Brenton Givens,
a 44-year-old Avon representative from
Hawthorne in Los Angeles, says he
knew very little about the bank when it
replaced GE but closed his account after
a few months, attracted by better offers
elsewhere. He now prefers an app called
Digit, which sweeps money from cheque
to savings accounts without fees.
Former Goldman staffers also wonder
whether all the new arrivals at the dig-
ital consumer financial services unit
including a former head of marketing at
Jockey International, the underwear
company will thrive at the bank,
which has previously developed its own
leaders.
One former employee notes a more
fundamental mismatch: the fact that
making money from retail banking
depends on churning simple, low-mar-
gin transactions at high volumes. That is
the opposite of Goldmans core strategy
over its 147 years, which has focused on
complicated deals for big clients.
Goldman is clearly gunning for
growth from GS Bank: vacancy lists on
its website show 22 positions available
at the unit, more than in securities and
investment banking combined. But the
strategic pivot to traditional banking
will make sense only if it leads to better
returns, says Mr Mayo.
For now, he says, it is clear only that
Goldman has not evolved as quickly as
it should.
8 FINANCIAL TIMES
THURSDAY 18 AUGUST 2016
The Fed ponders making
a change to its target
Shifting the inflation goalposts should not be the immediate priority
This weeks news that US core inflation
came in lower than expected in July has
increased the likelihood that the US
Federal Reserve will keep interest rates
on hold for the rest of this year. True,
there may be some boost in the form of
inflation emanating from China, where
producer prices have recently shown
strength. But the Fed and other central
banks face a structural predicament
from which they will not escape via an
increase in import prices.
An apparent slow drift down in the
natural rate of interest and trend
growth across nations means a lower
long-term level of policy rates, less
room to cut during recessions and the
need to resort to extraordinary and
possibly distorting measures such as
quantitative easing.
John Williams, president of the San
Francisco Federal Reserve, this week
posited a solution: that the Fed might
increase its inflation target, allowing
the economy to run faster than other-
wise and pushing interest rates higher.
This would allow bigger cuts in rates
during recessions.
Yet as a practical matter, it is hard to
argue in the current conjuncture that
the Fed is chafing against the con-
straints of its policy framework. The
central bank has leeway it is choosing
not to use. The 2 per cent inflation tar-
get did not force the Feds open market
committee to raise interest rates in
December last year for the first time
since 2006. The increase was a purely
unforced error, as would be another
rate increase in the near future.
The Feds main problem at the
moment is not its framework, but over-
estimating inflationary pressure and
underestimating the cost of yet more
undershooting of its target. Raising the
target is likely only to mean that the
central bank misses it by more and
thereby leaches credibility.
If the Fed is to adjust its goal, it would
May flexes her muscles
over tax avoidance
Extending fines from individuals to scheme promoters makes sense
Theresa May has made a number of
changes to policy and personnel in the
month since becoming Britains prime
minister. One thing has not altered,
though, and that is the governments
determination to crack down hard on
tax avoidance. Mrs May made this a
theme of her leadership campaign,
calling tax the price we pay for living
in a civilised state.
Now her administration has opened
a new front in the battle. A Treasury
consultation paper published on
Wednesday has proposed the idea of
extending the penalties for avoidance
schemes disallowed by Her Majestys
Revenue & Customs to those who
advise on them. Under the new regime,
accountants, lawyers and consultants
that peddle or assist these schemes
could end up paying a fine of up to 100
per cent of the money that would have
been lost to the taxpayer.
Taking the battle to the supply side of
the tax avoidance industry is sensible.
Few individuals, or even companies, go
to the trouble of devising their own tax
wheezes. Instead they purchase off-
the-shelf schemes through advisers,
often to a blueprint drawn up by a tax
specialist and buttressed by a barris-
ters opinion that can be shopped from
a compliant QC. For the most part, the
client has only the dimmest idea of
what is actually being done in his or her
name.
The existing rules do little to curb
this activity. The taxman poses no
direct threat to the underlying pro-
moter and its associates, whose main
concern is being sued by irate clients
for negligence, or, perhaps, in losing
their reputations. Set against that, the
financial reward from marketable
schemes can be significant. Take, for
instance, a recent, unsuccessful, avoid-
ance scheme involving the UK brewer
Greene King. Dubbed Project Sussex, it
was peddled to a number of companies
make more sense to adopt another of
Mr Williams suggestions and target a
price level rather than an inflation rate,
aiming to follow a period of inflation
running below target by spending an
equivalent time above it. That would
encourage it to run the economy at a
faster rate while avoiding a confusing
change in the numerical target which,
as Fed chair Janet Yellen said in a
speech in September, would raise sus-
picions that the goalposts would be
opportunistically moved again.
In any case, policymakers should be
concentrating on hitting the current
target, not talking about changing it.
Holding central bankers solely respon-
sible for inflation is part of the prob-
lem. Stable positive inflation comes
when demand is bumping up against
the economys output capacity. If cen-
tral banks are struggling to generate
such demand without extraordinary
and potentially distortionary actions, it
is up to finance ministries to do their
part by stimulative fiscal policy.
Although there have been a few signs
of fiscal policy turning stimulative in
the large advanced economies, they are
a long way from accepting the full role
that taxing and spending should have
in boosting demand.
Formally sharing responsibility for
hitting an inflation target between
monetary and fiscal policymakers is
going too far: it would merely encour-
age blame-shifting. But central bank-
ers could certainly be more open about
the need for boosts from more public
spending or tax cuts, or both, to help
address the issue of chronically under-
performing growth and low inflation.
Mr Williams deserves credit for
increasing the salience of the discus-
sion about targets. Yet the immediate
need is to use monetary and fiscal tools
better within the existing framework,
rather than to tinker with the workings
of the system.
and aimed to save in aggregate about
30m in taxes. Had it passed muster,
its promoter, the accountant EY, would
have walked away with 10 per cent of
that amount.
The proposed rules would throw a
clod of grit into this machinery. First,
they would apply to a wide range of
advisers, from the schemes promoters
to those playing a more distant ena-
bling role, such as company formation
agents. That means that even should
the creators be offshore, their onshore
agents could be caught in the net.
Second, the rules should act as a par-
ticular disincentive to those promoting
and enabling speculative and aggres-
sive wheezes. Even if heavy fines turn
out to be rare events, the very possibil-
ity of their happening should elevate
the cost of advisers professional
indemnity insurance at least until
they demonstrate a low claims experi-
ence. That in turn should raise the cost
of such avoidance schemes, limiting
their appeal to those looking to mas-
sage down their tax.
While the simplicity of the proposal
is an advantage, the government
should take care to ensure that it does
not unreasonably hit defensible tax
planning. Tax rules are not ultimately
set in aspic. Avoidance is generally
defined as creating a tax-break that
parliament never intended. Yet what
legislators mean at a particular time
can change as circumstances evolve.
Tax rules would be easier to adminis-
ter if the whole tax code was less com-
plicated. Britain, along with other
advanced economies, has allowed its
fiscal regime to become an ugly and
convoluted sprawl. Unpicking and sim-
plifying that is no less of a necessary
endeavour for Mrs May and her admin-
istration to act upon. But in the mean-
time, and with the flawed system Brit-
ain has, a tougher line on the agents of
avoidance would do no harm at all.
Shareholder value has its positive version
Sir, Alfred Rappaport (What
managers misunderstand about
shareholder value, August 15) has an
interesting point: shareholder value
can, and should, be viewed as a positive
objective, enhancing long-term
attitudes. It could be said that many
family businesses have successfully
adopted such a long-term shareholder
value. But Louis Brennan (Letters,
August 16) is right to remind us that
shareholder value does not come
naturally in this positive version, and
that the negative, short-term selfish
one, adopted by many executives and
money managers, can be very
destructive.
Most likely the problem is the
remuneration practices. It is often said
that stock options and other
performance-related bonuses enable
an alignment of shareholders and
executives interest. This is quite far
You are too kind
to Chairman Kim
Sir, Your gentle admonishment of Jim
Kim, the World Bank president, and
the careless US administration that put
him there despite his managerial
performance at Dartmouth and scant
preparation for the role is too kind
(The case for reform at the World
Bank, editorial, August 11).
Under Mr Kim the World Bank has
been gutted of its remaining technical
staff many of them women with
any backbone to confront rampant
project failure and corruption, and
dare counter Chairman Kims woefully
simplistic and uninformed
understanding of the complex
development challenges facing our
world.
His whimsical management
gobbledegook has done nothing to
address a byzantine internal
complaints system akin to a military
tribunal that has seen whistleblowers
dismissed and some accused officials
promoted. By the Banks own HR stats,
three-quarters of complaints are filed
by women, most of whom are on short-
term contracts while retirees enjoy the
perks of pensions and fat consulting
contracts.
The only tenable way forward is for
the World Bank to submit to an
external monitoring system that allows
for a timely and transparent evaluation
of its projects. Meanwhile Mr Kim and
rest of his boomer cohort could likely
do less harm on the golf course.
C Nigelson
Washington, DC, US
Politics is about conviction
and Corbyn has that
Sir, What a curious editorial is Labour
moderates must think before they
split (August 15). Your
recommendation to those Labour MPs
thinking of setting up a new party
sounds like the advice a marketing
consultant might give a company
seeking to replace an old and failing
product line: look for a gap in the
market and seek to fill it. But isnt
politics meant to be about conviction?
Labour leader Jeremy Corbyn has a
following because that is what he has.
Most current politicians do not: they
pursue policies they think will sell.
The gap you identify is the space to
[the Tories] right on cultural
Abenomics
breeds a new
generation
of gold bugs
Tokyo
Notebook
by Leo Lewis
Letters
from the truth: option holders
interests are widely diverging from
those of shareholders, and the strike
price of options is often fixed dubiously
and at shareholders expense. Mostly,
performance is very far from
managerial excellence in the
shareholders interest. The
remuneration patterns of executives
too often reward volatility and short-
term targets, to the delight of
professional money managers who
thrive on volatility and turnover, and
often trade on privileged information.
As to the efficiency of this
remuneration pattern, the lack of
talent, vision and concern for long-
term shareholder interest of hordes of
highly paid bank executives was clearly
demonstrated during the financial
crisis and recurring financial
misconduct. Yet they are among the
most highly paid and supposedly
Follow that self-driving car
questions. What on earth does that
mean? Further on you suggest that a
breakaway Labour party could
advocate minimum possible
disruption to the nations economic
life, having earlier stated the need for
a more sceptical line on immigration
and market forces. Arent those two
statements a bit contradictory? If you
mean obtaining all the benefits of the
single market but with none of the
attendant costs, isnt that like apple
pie and motherhood what everyone
wants?
David Essex
London SW20, UK
Iron Chancellor was
a good actuary too
Sir, Retirement age for young
Germans will have to rise to 69, central
bank warns (August 16). That is a
quite reasonable, even generous,
retirement age if you are going to live
to 85 or 90 or more.
Moreover, it would not be the
highest retirement age Germany has
had. When Otto von Bismarck
introduced the first state pension
scheme in the German Empire of 1889,
the retirement age was set at 70!
Needless to say, on average you were
going to live many fewer years after 70
then than now. The Iron Chancellor
knew what he was doing, actuarially
speaking.
Alex J Pollock
Distinguished Senior Fellow,
R Street Institute,
Washington, DC, US
So an American fund manager, a
British darts champion and a Japanese
grandmother go into a Tokyo bar.
Theres no punchline, the bar is
fictional and the characters never
actually meet but the people are
real enough. Each of them just sits
there for ages chatting slightly
tediously about gold, embodying a
growing obsession with the metal.
One of them likes UK gold
sovereigns; one prefers the maple leaf,
a Canadian gold coin known for its
purity; one is saving up the $140,000-
odd required for a 100oz slab of
bullion. One has bought a home safe,
another has rented a deposit box in a
bank and the third has looked into
buying space in a Swiss vault. All three
check their phones for live gold prices
the way others check for Pokmon.
Whats behind the obsession? In
January, as part of Prime Minister
Shinzo Abes floundering attempts to
stimulate the Japanese economy,
negative interest rates were
introduced. In a country with high
savings levels, that has proved
alarming. Meanwhile, the policy has
driven down the yields on sovereign
bonds, beloved of Japanese savers to
the point where 80 per cent are
trading on negative yields. The UKs
Brexit vote two months ago is also
taking a toll.
So gold has emerged as a kind of
shiny financial aspirin for a new
generation of gold bugs: a natural-
sounding painkiller for unnatural
times. As recently as last year, the
fund manager delighted in pointing
aligned. Volkswagen and other
corporate scandals further confirm the
deleterious effects of these
remuneration practices.
Thus by all means let us embrace
shareholder value, but the positive,
long-term version of it; let us improve
remuneration practices for executives;
and let us devise remuneration for
money managers that motivates them
to look after their investors interest
rather than their own.
The slogan say on pay for
shareholders will be void as long as
shareholders assemblies are
dominated by perversely remunerated
money managers, who are quite happy
to approve perverse remunerations for
other executives.
Eric De Keuleneer
Solvay Brussels School of Economics,
Universit Libre de Bruxelles,
Brussels, Belgium
Much to be desired
on energy policy
Sir, One can only agree with Jonathan
Ford (May should seize the chance to
overhaul Britains energy policy,
August 15) that the UK energy policy
has potential for improvement. In my
view this has been the case since
Margaret Thatcher in 1990 insisted
that the UK would be unable to
stabilise CO2 emissions at the 1990
level in 2000 rather, in 2005!
However, reading beyond the
headline is disappointing, for two
reasons. First, Mr Fords opinion seems
to be, at least partly, driven by the
traditional view that most bad things
come from Brussels. Let me remind
FT readers that the arbitrary climate
deadlines and the UKs EU-mandated
2030 emissions target, obviously seen
by Mr Ford as negative elements, are
derived from policies wholeheartedly
backed by the UK, and necessary if the
overall objective is to be met of keeping
the global temperature rise below 2C.
On substance, Mr Fords suggestions
also leave much to be desired. Apart
from the fact that the UK, in a Brexit
scenario, has no individual, quantified
international climate obligation it is
difficult, if not impossible, to see how it
could push back the arbitrary 2030
target and still deliver a respectable
contribution to the global efforts to
observe the 2C target. And it is difficult
to imagine how the UK, traditionally in
the forefront of the EU liberalisation
drive, would all of a sudden see
relaxation of the state aid rules as a
key driver in future UK energy policy
development.
Are British and EU consumers
saddled with inflated energy bills?
The answer depends on inflated
compared to what?. If compared to
wholesale prices in the present
markets, driven down by the forced
introduction of renewables, yes. If
compared to the prices likely to have
prevailed in a liberalised market
without renewable energy obligations,
no. In the latter case, present consumer
prices would probably have been close
to the agreed Hinkley Point prices,
more or less the price required for any
new plant to be commercially
attractive.
There is still much to be said about
UK, and EU, energy policy.
Jorgen Henningsen
Copenhagen, Denmark
out that if you type why gold
bugs . . . into Google, it auto-
completes the sentence with . . . are
wrong. His position has reversed; he
will now explain, at length, why he is
building a store of gold eagles for his
two young daughters.
Japan has been called the regions
star performer by the World Gold
Council, which noted in its most
recent report that for the first time in
a decade the country has clocked its
fourth consecutive quarter of positive
net investment in the metal.
For those of us whose route home
takes us past a small, bustling gold
dealership, this is no surprise. Chie
Igarashi, the grandmother from
Tokyo, is part of a growing band of
people aged 50-70 who have decided
to express their scepticism over Mr
Abes economic vision not at the ballot
box (where the prime minister
received resounding support at last
months upper house election) but at
their nearest bullion dealer.
Since the start of 2016, Mrs Igarashi,
aged 66, has bought four gold coins
which at about $1,340 an ounce are
worth roughly Y520,000. The surge in
the yen since the June 23 Brexit
referendum, which has taken it to a
near three-year high against the
dollar, has sharpened her appetite for
more.
She is not alone. Sales at Japans
largest gold retailer, Tanaka
Kikinzoku, tripled from normal levels
on June 24 and its overall sales of gold
in the first quarter of 2016 were 35 per
cent higher than the same period a
Thursday 18 August 2016
Email: letters.editor@ft.com or
Fax: +44 (0) 20 7979 7790
Include daytime telephone number and full address
Corrections: corrections@ft.com
Any democracy, even US,
can fall victim to populism
Sir, Regarding your editorial Donald
Trumps campaign is harming US
democracy (August 13): it may be
true that Mr Trumps campaign has
damaged the quality and reputation of
democracy in America. However, if
there is any positive to be drawn from
this, it is that American democracy is
now offering the free world the
opportunity to realise that any
democracy, even the US, can fall victim
to populism under certain conditions.
Similar to the appeal of fascism in
the 1930s, it seems that economic
malaise and a sense of unfairness is
causing some in America to be seduced
by the illusion being offered by Mr
Trump of simple answers to complex
issues.
The challenge for the US and other
democracies is to recognise and
respond to the causal link between
adverse economic shocks (the
Depression and first world war
reparations in the 1930s, the Great
Financial Crisis post-2008) and the
hardship and sense of injustice they
cause, on the one hand, and the
phenomena of electorates being
seduced by leaders and policies that
are harmful to their democracies on
the other.
If every crisis offers opportunity,
then the phenomenon of Mr Trump
should serve as a reminder to
democracies everywhere that no
electorate, however sophisticated and
freedom-loving, is immune to
populism and its dangers. It should also
be a reminder that the light of
democracy may not be as hard to
extinguish as we all care to imagine,
and might every now and then require
some self-sacrifice from all of us to
keep it burning.
Richard Bartlett
Shanghai, China
What can the lawyers
know about auditing?
Sir, It was interesting to read the views
of various US lawyers on the case
brought by the bankruptcy trustee of
Taylor, Bean & Whitaker against PwC
(PwC on trial for not spotting $2.9bn
fraud, August 17).
Audits are largely based on
documentation prepared by third
parties. If that documentation is
convincingly falsified in collusion with
the company being audited, a fraud is
not detectible so much is obvious.
The question, however, is how
convincingly the documentation was
falsified in this case, and thus, first,
whether PwC should have become
suspicious and, second, whether audit
procedures were available to
substantiate or allay the suspicion.
Neither of which, I suspect, is known to
the lawyers pontificating on the
subject.
Indeed, reading the views of lawyers
on auditing strikes me as similar to
hearing the views of professional
footballers on brain surgery; or
perhaps listening to Donald Trump on
foreign policy.
Bruce Mathers
Zug, Switzerland
Correction
c Lady Thatcher lived in Londons
Chester Square, not Eaton Square as
wrongly stated in an article about the
Duke of Westminster on August 13.
year earlier. Every time a new
element of uncertainty hits
households, Tanaka Kikinzoku
registers a rise in applications for its
pure gold accumulation plan an
investment scheme where a
reassuring nugget is set aside monthly.
The darts player, who is among the
worlds top eight and was in the
Japanese capital last month for the
Tokyo Masters, like Mrs Igarashi
modestly describes himself as a total
beginner to gold, while displaying a
stunningly intricate knowledge of
prices (to two decimal places),
purities (to three decimal places) and
currency arbitrage opportunities.
He is fascinated by Tokyo; less by its
traditional charms than by the lessons
its despairing savers can offer the
world. He is a sportsman whose
winnings are primarily earned in the
boozy, Brexity roar of clubs and halls
across the UK: more even than the
prospect of political turmoil in Britain,
he fears falling interest rates and the
appropriate destination for his
considerable prize money.
Japan, he declares in the green room
immediately after losing a semi-final
and checking his phone for the gold
price, offers a sobering example to
him and other stars of bar room sports
of what happens when a leading
economy moves to negative interest
rates. More gold, he decides after
cross-examining me expertly on the
behaviour of Japanese grandmothers,
must be the wisest choice.
leo.lewis@ft.com
Thursday 18 August 2016
Central bankers are threatening the engine of the economy
OPINION
Bill
Gross
Y
ou can pay me now . . .
counsels the sensible
mechanic promoting Fram
oil filters in the old-time
advert, . . . Or pay me
later, interjects his pricier associate, as
he tinkers with the broken engine of a
customer who has ignored the advice.
Central bankers should take heed. Dirty
oil and artificially priced financial mar-
kets have much in common. Both can
destroy engines eventually and in the
case of central banking it is the motor of
the real economy that is at risk.
Historically, it has generally been
assumed that lower bond returns would
eventually lead to higher bond and
equity prices, and that the capital gains
and lower commercial and consumer
interest rates associated with them
would stimulate additional investment
How to work
when your boss
does not care
WORK AND
CAREERS
Michael
Skapinker
R
oyal Mail has said that it may
not be able to afford its staffs
defined benefit pension
scheme beyond 2018. The
venerable UK postal busi-
ness is unlikely to be the only company
to take this drastic measure. The col-
lapse in government bond yields, which
pension funds use to calculate their abil-
ity to pay future benefits, has tipped
schemes around the world into crisis.
Plunging annuity rates mean the
future looks grim, too, for workers with
defined contribution pensions, who
have to provide for their own retire-
ments with the proceeds of what they
have paid into their plans.
The gloomy pensions scene is one way
in which life has deteriorated for devel-
oped-world workers. Real wages for
most people have been stagnant while
executive pay has soared.
Add to that automation, outsourcing
and job losses because of low-cost com-
petition and it is no surprise that sur-
veys show employees are discontented,
disengaged and mistrustful.
The most recent annual Edelman
Trust Barometer, produced by the pub-
lic relations company, showed that
OPINION
Richard
Thaler
T
he Brexit vote has created
an environment of great
uncertainty for Britain, the
EU and the global economy.
No one can predict with any
confidence what will happen for at least
the next three years, but economists are
in unusual agreement that if Brexit
occurs it will be bad for the UK and bad
for the EU.
How did we get here? One answer lies
in choice architecture, the decision-
making framework in which choices are
made.
Consider the original charter of the
EU. An important principle of good
choice architecture is to anticipate how
things might go wrong and take steps in
advance to mitigate the damage. In the
formation of the EU, this step did not
seem to attract the attention it
deserved. What will happen if a country
and consumption a virtuous circle
leading to job growth, mild inflation and
higher profits.
The US Federal Reserve began a quan-
titative easing programme in 2010;
interest rates are historically lower
across much of the developed world.
Meanwhile, gross domestic product is
growing in many eurozone nations,
even if unemployment is higher than
many would like. An unbiased observer
ought to admit that the model is work-
ing. So why change the oil filter?
But are near-zero interest rates and a
global store of about $13tn worth of neg-
ative-yielding bonds actually good for
the real economy? Recent data suggests
they may not be. Productivity growth,
perhaps the best indicator of an econ-
omys vitality, is abysmal in most devel-
oped countries. It has been declining in
the past half-decade or so, not coinci-
dentally tracking the advent of QE and
zero lower bound interest rates.
In the US the year-on-year trend for
productivity has turned negative. Most
central bankers dismiss this fact as a
short-term aberration. But the Japanese
economy provides an example of what
large numbers of workers no longer
trusted the company they worked for. In
Japan, only 40 per cent trusted their
employers. In France it was 48 per cent
and 57 per cent in the UK. In the US,
nearly two-thirds of employees trusted
their companies but that has to be set
against other downbeat US surveys.
Gallups most recent polling of the US
workforce showed that 34.1 per cent
were engaged, which meant they
worked with passion and felt a pro-
found connection to their company.
Another 16.5 per cent were actively
disengaged, which meant they were not
just unhappy but were undermining
their colleagues work. The largest
group, 49.5 per cent, were simply not
engaged. They had mentally checked
out and were just going through the
motions. This may not look that bad:
over a third were enthusiastic about
their jobs and many of the others were
at least not getting in anyones way.
You could paint an even brighter gloss
on Gallups figures by noting that the
engaged figures are the highest it has
recorded. Between 2000 and 2013, the
proportion of US workers found to be
engaged never rose above 30 per cent.
But it is going to get worse. The
employees of the future are the least
happy: only 29 per cent of millennials
feel engaged with their work.
Workplace satisfaction question-
naires have their critics. A 2014 survey
of the research in Human Resource
Development Quarterly concluded that
there was no consensus on what
Britain is paying the price for a badly framed choice
breaks the rules but is financially unable
to repay its debts? The ambiguity in this
answer has been evident in the drama
surrounding Greece and a possible
Grexit.
Another question that appears to
have been left unanswered originally is
what would happen if a country wanted
to leave, as the UK might wish to do. The
EU resembled the Hotel California
described in the Eagles song, where,
You can check out any time you like /
But you can never leave. Eventually
this omission was addressed by the crea-
tion of the now famous Article 50 of the
Lisbon treaty, adopted in 2009, which
provides the rules for a country that
wishes to secure a divorce from the EU.
(It has to be said that few states have
provisions for leaving a union to which
they belong; the US fought its deadliest
war over such an issue.)
Although Article 50 was created to
determine what happens in the case of a
break-up, it is far from a full prenuptial
agreement. Rather than stating the
terms under which a country can leave,
it only prescribes a process. Once a
country triggers Article 50, it has two
years to negotiate terms and in the event
FINANCIAL TIMES
Comment
interest rates at or near zero can do to a
large, developed economy. The answer
is not much: not much real growth; not
much inflation and, together, not
enough nominal GDP growth to repay
historic debt should yields on sovereign
debt ever return to normal.
In other large economies, a further
negative effect of zero lower bound
yields and interest rates can be
Job cuts, reduced pensions,
defaults all have the
potential to turn a virtuous
circle into a cycle of decay
observed. Investment an important
source of productivity growth has
never returned to the norms seen before
the global crisis of 2008. Corporations
are using an increasing amount of cash
flow to buy back shares as opposed to
investing for growth. In the US, more
than $500bn is spent annually to boost
investors incomes rather than future
profits. Money is diverted from the real
employee engagement was and that it
was difficult to draw conclusions about
what helped or hindered it.
But most of us can probably recognise
Gallups findings. In more than 40 years
of visiting the US I have, as a customer,
noticed the growing bifurcation of
employee attitudes: there is a group who
is still delighted to serve you and a grow-
ing number who seems to think your
turning up has ruined their day.
Employee disenchantment has costs
beyond poor customer service: absen-
teeism, shoddy work and high turnover.
So given that pension problems and
low-cost competition are not going
away, what, other than slashing their
top executives salaries, can employers
do about staff unhappiness?
If you have poor
managers, look to your
colleagues or customers
for validation
that no agreement is reached (or exten-
sion granted), the country is out and
presumably treated like any other coun-
try, using the rules established by the
World Trade Organisation.
Making the rules so vague has had
unintended consequences. First, it
allowed proponents of Brexit to offer
voters the apparently unrealistic hope
that the UK could negotiate an associate
A good rule of thumb is
that the more complicated
the decision, the less
desirable a referendum
status similar to that of Norway, but
with some modifications of the rules on
free movement of people. Second, the
rule creates a long period of uncertainty
for both the UK and other member
states. The UK could wait a year or more
before triggering Article 50, to be fol-
lowed by what would almost certainly
be nearly two years of negotiations.
(International negotiations are like
home improvement projects: they
economy to financial asset holders
where in many cases it lies fallow, earn-
ing little return if invested in govern-
ment bonds and money markets.
Why would the private sector or gov-
ernments not borrow at practically no
cost to invest in a centuries old capital-
istic model proven to reward risk-taking
in the real economy? Well, for govern-
ments and supranational agencies such
as the International Monetary Fund,
balanced budget orthodoxies and even
national laws as in Germany rule the
day. We are not all Keynesians now.
The private sector may be reluctant to
invest because of a host of secular forces
that increase risk, including ageing pop-
ulations that temper consumer spend-
ing and an anti-globalisation trend of
which the Brexit vote is an example.
Savvy corporate chief investment offic-
ers who know anything about bond
pricing may also recognise that an
investment in the real economy albeit
at historically low borrowing costs
will pose its own risks once yields begin
to return to normal and borrowing costs
increase.
There are other obvious drawbacks to
First, make sure their companies are
well considered. One of the questions
Gallup asks is whether the mission or
purpose of the company makes staff feel
their jobs are important.
Companies should not be misled by
the word mission. Mission statements
count for little. This is about whether
people are proud to tell their friends,
family and neighbours that they work
for the company.
That means providing a decent serv-
ice, not becoming a constant source of
complaint on social media and staying
out of trouble. Nobody is proud to work
for a company embroiled in scandal.
Second, companies cannot tell staff to
take care of their own pension provi-
sion, thus expecting them to take adult
responsibility for their retirement, and
then treat them like children in every
other way.
Excessive monitoring and control are
the enemies of an engaged workforce.
Explaining to people what you expect of
them and letting them use their initia-
tive to achieve it is the hallmark of effec-
never finish early.) A better design
would have been to spell out the details
of a voluntary break-up in advance so
any country would have a reasonably
solid basis for evaluating the pros and
cons of EU membership. It may not be
too late to remedy this situation if the
EU can figure out a way to clarify the
terms of an exit.
David Cameron, the former UK prime
minister, was responsible for another
piece of questionable choice architec-
ture when he promised to hold the EU
referendum.
When should voters be asked their
opinion about policy questions? Gov-
ernments vary greatly on the extent to
which they rely on direct democracy
rather than a combination of represent-
ative government plus bureaucratic
agencies, such as central banks. As an
example, Switzerland and the state of
California regularly rely on referen-
dums to make decisions, but the US gov-
ernment never does.
When governments have the option
to use either method, how should they
choose? A good rule of thumb is that the
more complicated the decision, the less
desirable a referendum. And it is hard to
near-zero yields and interest rates. His-
toric business models with long-term
liabilities such as insurance compa-
nies and pension funds are increas-
ingly at risk because they have assumed
higher future returns and will be left
holding the short straw if yields and
rates fail to return to more normal lev-
els.
The profits of these businesses will be
affected as will the real economy. Job
cuts, higher insurance premiums,
reduced pension benefits and increas-
ing defaults: all have the potential to
turn a once virtuous circle into a cycle of
stagnation and decay.
Central bankers are late to this logical
conclusion. They, like most individuals,
would prefer to pay later than now. But,
by pursuing a policy of more QE and
lower and lower yields, they may find
that the global economic engine will
sputter instead of speed up. A change of
filters and monetary policy logic is
urgently required.
The writer is the portfolio manager of the
Janus Capital Group Global Unconstrained
Bond Fund strategy
tive management. If employers fail to
improve the lives of their workers, what
can employees do themselves? Working
takes up such a large proportion of our
lives. It is a shame to spend it unhappy,
seething or just switched off.
If you have poor managers, look
elsewhere for validation: to your col-
leagues or, if you deal with them
directly, your customers. Treating them
well even when your company does not
is likely to leave you, as well as them, far
happier.
It is also a way of improving your rep-
utation and increasing the chances of a
job offer from someone who notices and
appreciates you.
This month, a mother wrote a Face-
book tribute to a London Underground
worker called Pip, who, for years, has
been making sure that pregnant women
have seats during the rush hour. Many
others said he had helped them too.
We all like praise from our bosses. But
being praised like Pip is far better.
michael.skapinker@ft.com
think of a more complex choice than
Europe to put to voters.
Furthermore, given the ambiguity of
Article 50, voters had no way of knowing
what outcomes would come from a vote
to Remain or Leave. Theresa May, now
prime minister, made this point before
the vote: The reality is that we do not
know on what terms we would have
access to the single market.
But the referendum was held, so the
question is what to do now. Certainly a
majority of just four percentage points
in a nonbinding referendum should not
be considered a mandate to hastily
invoke Article 50. The vote was more
like a straw poll of voter sentiments
about a range of issues than a consid-
ered evaluation of the costs and benefits
of membership of the single market.
Since voters were given a choice that
was impossible to evaluate sensibly,
they should be given the opportunity to
change their mind if the facts change
either via a vote of parliament or a sec-
ond referendum. In short, Brexit should
not mean (an immediate) Brexit.
The writer is author of Misbehaving: The
Making of Behavioural Economics
9
The value of
local lessons in
tackling global
killer diseases
OPINION
Michael
Bloomberg
T
he outbreak of the Zika
virus has become an issue
of global concern. And
rightly so: such communi-
cable diseases must be
aggressively tackled to prevent them
becoming a pandemic.
But there is another category of dis-
eases that now represent the worlds
leading cause of death, killing 43m peo-
ple each year, including 16m who die
before their 70th birthday. Over 80 per
cent of those deaths occur in low- and
middle-income nations. The diseases
and injuries that cause these deaths also
cost the world about $7tn between 2011
and 2025. Yet even though most of them
are preventable, they receive 2 per cent
of the worlds health funding.
So-called non-communicable dis-
eases, or NCDs, include cancer, diabetes,
cardiovascular diseases like heart
attacks and stroke, and chronic respira-
tory diseases like asthma. Some, like
many types of cancer, still do not have a
cure. Yet, we have learnt that millions of
lives can be saved if individuals, govern-
ments and health organisations take rel-
atively low-cost steps to help people quit
smoking, eat healthier diets and exer-
cise more regularly.
Such low-cost measures also exist to
reduce preventable deaths from inju-
ries, particularly road crashes. Adopting
and enforcing seatbelt and helmet
requirements, vehicle safety standards,
and drunk driving prohibitions all save
lives. Roads can also be engineered to
reduce the likelihood of crashes. And by
improving the availability of data on all
injuries and NCDs, local and national
Millions of people can be
saved through low-cost
steps and policies to help us
live more healthily
governments can better target their pol-
icies and resources.
Margaret Chan, director-general of
the World Health Organisation, is step-
ping up the fight to prevent these
deaths. As part of her push, I have
accepted her invitation to serve as the
WHO global ambassador for noncom-
municable diseases. Our mission is to
achieve the UN goals of reducing prema-
ture NCD deaths by one-third by 2030,
and halving the number of road deaths
and injuries by 2020.
Great progress is possible. During my
12 years as mayor of New York City, life
expectancy increased by more than
three years, far faster than the national
average, largely because of our ambi-
tious public health agenda, which
included battling smoking and obesity.
I am optimistic that we can spread
this type of progress from the ground
up, partly because I have seen it happen
with another major global challenge: cli-
mate change. In recent years, local
actions to reduce greenhouse gas emis-
sions have led to more ambitious
actions by national governments. The
historic climate breakthrough in Paris
would not have been possible had we
not first demonstrated that cities
which account for the large majority of
greenhouse gases are strongly com-
mitted to leading by example.
Winning the battle against climate
change helps us win the battle against
many NCDs, and vice versa because
large emitters of greenhouse gases also
tend to be large emitters of deadly air
pollution. And just as cities have helped
spur more national and international
action on climate change, they can do
the same for NCDs and other preventa-
ble causes of death.
The goals set by the UN are bold and
could save more than 30m lives by 2030.
They are relatively low cost. In fact,
many of the most powerful changes are
policies that, like banning indoor smok-
ing, have no cost at all.
And they are within reach, because
unlike other epidemics, there are
proven steps we can take to prevent
heart disease, asthma, certain cancers,
diabetes and road crashes steps that
some wealthier nations have already
taken.
Now it is our job to ensure that no
country is left behind. By working
together, we can make the next decade a
decisive turning point in the battle
against one of the greatest public health
challenges of our time.
The writer is the founder of Bloomberg LP
and a former mayor of New York City
10 FINANCIAL TIMES Thursday 18 August 2016

Double happiness
China has given the green light for overseas investors to buy A shares listed in Shenzhen through a tie-up with
Hong Kong. Greater access to the new economy sector will give foreigners more ways to express a view on China.
Scrapping aggregate investment limits implies that openness matters more than preventing capital flight

Twitter: @FTLex Email: lex@ft.com

Gilead:
breaking the fever
Gileads strategic conundrum is so
acute that it forced one analyst to come
right out and advocate what most
short-sellers only gesture at: a short-
term fix likely to destroy value over the
long term. He wrote, a few months ago,
that the time appears ripe for Gilead
to do a significant transaction. Of
course, options for the type of M&A
that Gilead may need could prove to be
limited and a series of smaller tuck-
in deals may be prudent for the long
term. All the same, it is hard to see
how those could whip up near-term
revenue trajectory (or sentiment).
One can only sympathise with the
poor fellow. Gileads shares are off by
a third since the middle of last year,
after a three-year run in which they
sextupled on the back of breakthrough
Hepatitis C vaccines. HCV sales now
appear locked in slow decline. All the
same, one desperately wants a reason
to own the stock. It trades at seven
times earnings, making it the cheapest
big drug stock in the world. It generates
oceans of cash and has no net debt.
There has to be something Gilead can
do shed its discount. Right?
What Gilead is trying is share
repurchases. It is not working. Since
2014 it has spent $24bn, almost a
quarter of the current market cap,
buying its own shares. The shares are
22 per cent below the average price
paid. Buying back shares in the face of
falling profits is very chancy. Pfizer
managed to keep its shares rising
following the expiration of the patent
on Liptitor, buying back $45bn in
shares between 2011 and 2015. Pfizer
also had massive cost-cutting
opportunities, though. Gilead is
admirably lean already.
The quickest way to cut the discount
would be to sell the company. At a 30
per cent premium, it would be a
$140bn deal, the biggest drug deal after
Pfizers $160bn purchase of Allergan.
Would, say, Merck be interested, if
Gilead would take shares as payment?
Conceivably. But hoping a big spender
appears is not a strategy.
And so to buying growth. Gileads
$11bn purchase of Pharmasset in 2011
was risky, but was one of the best deals
ever. Yet if ever a good-sized biotech
asset comes on the block (Medivation,
target of the moment, has five groups
interested) a wild money fight breaks
out. The chance of overpaying rises.
Gileads puzzle has only one good
solution: patience. Invest in research,
do small deals, stay lean and endure
a low valuation for a few more years.
Balfour Beatty:
the next act
In the canon of business drama, the fall
and recovery of an overextended con-
tractor is a classic. Take Balfour Beatty.
Up to 2010 was hubris growth at all
costs, including 45 acquisitions be-
getting a litter of lossmaking contracts
andahiggledy-piggledy structure. Then
nemesis,withsevenprofitwarnings,and
catharsis, as new management arrived
to reimpose such old virtues as simple
organisation and choosier bidding.
Yesterdays half-year results drew back
the curtain on the latest scene, with an
unexpected new player Brexit.
Thus far, Balfour reports little
actual damage (though it used the
referendum aftermath to launch a
brazen plea for more UK infrastructure
spend). Its legacy contracts are a
diminishing drag, and losses of 66m
on 862m of UK sales were better than
expected enough for an underlying
profit of 7m and the resumption of
the dividend. Yet its equity is valued
below 1.8bn. Without its 1.25bn
portfolio of private finance initiative
projects the core business is being
assessed as worth just 500m.
Caution is justified: for construction
a good result is generating 2 or 3 per
cent operating profit margins, leaving
little room for bad luck such as Brexit.
Political risk makes planning harder,
particularly in manpower, where
supply was already tight. Balfour likes
to bring on young staff, but to promise
a full career it needs long-term
certainty over large projects, recently
in short supply. Threatened curbs on
immigration do not help either.
Against this, 500m is cheap for the
core construction business with more
than 7bn annual sales, half from the
US. Its operational reboot is on track.
Most of a 100m savings target has
already been realised. Lower-for-longer
interest rates should boost the 1.25bn
value of the project portfolio, leaving
the core construction business even
cheaper. It is winning orders in areas
where it is has made money, such as a
Shanghai Shenzhen
Privately owned enterprises
(% of market cap)
80
60
40
20
0 0
Median forward p/e ratio
40
20
0 0
FT graphic Sources: Thomson Reuters Datastream; Haver Analytics; Goldman Sachs
So good, the Chinese did it twice. This
week, regulators gave the go-ahead
for Shenzhen-Hong Kong Stock
Connect. The scheme, which mirrors
one set up for Shanghai in late 2014,
will allow overseas investors to buy
A shares listed on Chinas Shenzhen
exchange. Both systems also permit
mainland-based investors to buy
shares listed in Hong Kong. After the
announcement the indices remained
flat, but the scheme is still significant.
Shenzhen Connect will add 880
stocks to the list of nearly 600
available in Shanghai, giving access to
three-quarters of the mainland-listed
universe. The quality is even more
noteworthy. Shanghais exchange has
a far higher presence of stodgy state-
owned enterprises; less than one-
Californian rail electrification project.
Closer to apotheosis, then, but too soon
to call a happy ending.
Hedge funds:
big is bad
The shock is not that hedge funds are
suffering; it is that it has taken this long
for it to happen. Brevan Howard, once
one of the worlds largest, is rapidly
shrinking. Assets under management
have reportedly halved in two years,
and now stand at $19bn.
There are clear reasons why any
active investment fund charging a large
performance fee (20 per cent of profit
is the standard hedge fund cut, and
Brevans) and fixed management fee (2
Exchange rate correlates with southbound flows
Retail ownership Renminbi
(%) per $
80 6.7
60
40
20 6.6
2016-17 eps growth 6.5
(cagr, %) 40
6.4
20
6.3
Aug 2015
third of the index consists of privately
established companies. Three-quarters
of Shenzhens index, by contrast,
comprises non-SOEs. Many of these are
in higher growth new economy
sectors, such as healthcare and
technology, giving overseas investors
more ways to express their views on
Chinas economy.
Foreign investors will also become
more familiar with Chinas retail
investors. Goldman Sachs notes that
nearly two-thirds of the index by
market capitalisation is owned by
individuals, compared with one-third
of Shanghai. The high retail
participation shows in lofty valuations,
as well as high turnover relative to the
markets size.
Market strategists believe that the
per cents of assets) should struggle to
maintain good performance as it grows.
First, as assets grow, the number of
places it can invest without distorting
the markets shrinks. Second, at some
point that 2 per cent starts to be a big
number. Keeping the management fees
rolling in with performance just good
enough to retain assets becomes a
more attractive approach than trying
to consistently beat a benchmark.
Over the past three years, the
smallest funds (under $100m) beat
those with over $1bn returning
around 5 per cent annually against 4.6
per cent, according to Preqin. The gap
is more pronounced in the year to July,
when the biggest funds fell while the
tiddlers gained more than 2 per cent.
There is also evidence that one should
stick with the smallest funds in times
Shanghai Connect southbound net buying
(rmb bn, 15-day moving average)
2.5
2.0
1.5
1.0
0.5
0 textbooks are right: Univisions debt is
2016 Aug
broader access to China A shares
granted by Shenzhen Connect makes
their inclusion in MSCI regional
indices more likely. Perhaps, but
work still needs to be done. Foreign
investor concerns about voluntary
stock suspensions by Chinese
companies, as well as the exchanges
self-appointed right to veto index
products that reference A shares
irrespective of where they are listed
are yet to be assuaged.
The likelihood is they will be. With
the scrapping of limits on the amount
of funds allowed to invest both ways,
the scheme sends a more important
message.
Chinas commitment to opening its
markets even trumps concerns about
a flood of money heading south.
of market crisis, according to a Cass
Business School study.
Quant funds seem to have an easier
time scaling their investment strategies
as assets increase. In the first quarter of
this year Commodity Trading Advisers,
a type of quant, had inflows of $13.7bn.
Overall, though, hedge funds had an
even bigger outflow.
The core problem of hedge funds as
an asset class is quite simple: having a
management fee that stays fixed this
high as assets under management
change makes little sense. Any fund
whose costs were rising with the
amount managed would be sclerotic.
As those costs are relatively fixed,
funds should be paid proportionally
less as they grow to cover them.
Twenty per cent may be outrageous,
but 2 per cent is dangerous.
Univision/Gawker:
handcuffs
According to the textbooks, debt serves
to discipline corporate managers.
Interest payments pre-empt wasteful
empire-building. For media companies,
the empire of choice now is digital
content. Telco juggernaut Verizon, for
example, has spent $9bn on relics
Yahoo and AOL. Univision privately
held since its $14bn leveraged buyout
in 2007 also likes new media. But the
forcing it to behave.
Late yesterday, Univision won a
bankruptcy auction for edgy web
publisher Gawker Media, paying just
$135m. Gawker had been forced to seek
protection from creditors, most
notably pro wrestler Hulk Hogan. Mr
Hogan had won a $140m judgment
against Gawker and its founder Nick
Denton related to an invasion of
privacy lawsuit funded by tech investor
Peter Thiel. Gawker, which has several
digital properties, generated $50m in
revenue in 2015.
While Gawkers circumstances are
not elegant, the heft of a big corporate
parent could make the burden of
building a sustainable digital operation
easier to bear. Upstarts such as Vox
Media and BuzzFeed have also found
deep-pocketed backers.
Univision has been active, but has
kept its spending in the low hundreds
of millions. This year, it took a 40 per
cent stake in humour site The Onion. It
bought out Walt Disney in their joint
venture in Fusion, a TV network and
digital operation aimed at millennials.
Despite these efforts, virtually all of
Univisions $2bn revenue comes from
traditional TV advertising and cable
subscriptions.
The sagging shares of others in those
businesses (Disney, Fox, and Time
Warner) have delayed Univisions
public listing, now reported to be
happening later this year. Its
debt/earnings ratio still exceeds six
times, and its total valuation will not be
far off what was paid for it in 2007.
At least investors can be sure that it
will remain cautious with its capital. It
has no other choice.
Lex on the web
For notes on todays breaking
stories go to www.ft.com/lex

Todays temperatures
Abu Dhabi Sun 44 Malta Sun 29
18 1020 Amsterdam Sun 23 Manila Thunder 31
Ankara Sun 29 Miami Cloudy 32
22
19 16 Athens Sun 33 Milan Thunder 29
1010 26 Bahrain Sun 39 Montreal Fair 27
Barcelona Fair 29 Moscow Fair 26
22 Beijing Thunder 25 Mumbai Fair 31
Belfast Shower 20 Munich Shower 22
LOW
1010 18 Belgrade Fair 26 Naples Fair 28
21 Berlin Cloudy 21 New York Fair 32
21 1010 Brussels Fair 22 Nice Sun 26
21
LOW Budapest Sun 25 Nicosia Sun 39
25 Cairo Sun 36 Oslo Fair 22
L Cardiff Cloudy 24 Paris Shower 25
2 25 Chicago Fair 31 Prague Sun 24
23 Cologne Sun 26 Reykjavik Fair 15
29
1010 Copenhagen Shower 19 Riga Shower 17
1010
25 27 Delhi Shower 34 Rio Cloudy 26
31 29 Dubai Sun 44 Rome Fair 27
Dublin Cloudy 19 San Francisco Fair 23
27 Edinburgh Cloudy 20 Singapore Fair 32
27
35 28 Frankfurt Sun 26 Stockholm Shower 17
31 3 Geneva Thunder 25 Strasbourg Shower 24
39
Hamburg Fair 21 Sydney Sun 21
33 30 16 Helsinki Shower 18 Tokyo Thunder 29
33 32
24 Hong Kong Thunder 30 Toronto Cloudy 28
Istanbul Sun 31 Vancouver Sun 24
38 Lisbon Sun 27 Vienna Sun 25
Wind speeds in KPH London Cloudy 24 Warsaw Fair 21
Forecasts by Los Angeles Sun 27 Washington Cloudy 33
Wind speed Luxembourg Fair 22 Zagreb Rain 25
in KPH Madrid Sun 35 Zurich Thunder 23

CROSSWORD ACROSS
9 Maines not mistaken for another
5 Support among fans with minute
gone in game (10)
No. 15,322 Set by SLEUTH state (9) 6 Exam or lesson in which master is
10 Characteristic principally lacking deficient (4)
        with a dish from India (5) 7 Equipment mostly put on car in
11 Good promise falling short in Italian port (6)
 
artist (7) 8 Grotesque sort of royal egg,
12 Piece of skill in gambling scrambled (8)
producing large financial gain (7) 15 Figures on register required for
  13 Revered figure loses head for a returns? (10)
period (3) 16 Cheer Latin rogue out of difficulty
14 It could be represented in amiable (2,3,5)
type (not half) (11) 17 Lift for police detaining
   
17 Fear day before study (5) ungentlemanly sort after appeal
18 Tree guide lacking introduction thats instructive (8)
(3) 20 Model getting drunk? Wait
    19 Sample discrimination (5) patiently (3,5)
21 Stop discordant tune in club first 22 Ring from Cornish area I have put
(11) on top of locker (6)
   
23 Recall deeply personal pull (3) 24 Discussion of inexperienced
25 College joint for one thats novelist (6)
cheerful (7) 26 Secretary facing outwardly tough
27 Clash with daughter enthralled by course (4)
   dog (7) 27 Betray on radio tight-knit group
28 Clumsy painter awkwardly (4)
dropping a roller initially (5)
29 Time a woman interrupts Solution 15,321
 
endlessly extended debate (9) $ 6 3 , & 7 2 1 < % / $ , 5
3 ( $ 5 2 $ , 2
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Thursday 18 August 2016 11

Sumitomo Cathay Pacific Admiral Dollar index Brent crude Portugal 10-yr Sterling/dollar Stoxx 600
Modern fable The unicorn Heavy govt bond
that gored an Asian lion 8.21% 7.31% 7.7% 0.1% 0.7% 11bp 0.3% 0.8%
TONY BARBER, PAGE 12
514 HK$11.92 20.81 94.92 $49.55 2.94% $1.3008 340.47

Aetna accused Roll back Norways oil fund cuts value of UK

property portfolio on uncertainty after Brexit
Short
View
of Obamacare Miles
Johnson
reprisal after When does a juicy dividend yield merely disguise a value
trap? This is the question that any investor taking a curious

deal is blocked
peek at UK housing stocks must ponder following Britains
vote to leave the EU.
This week the UK 10-year bond yield rose slightly off
lows hit this month but still provides investors with a pal-
try 0.58 per cent in annual income. Shares in British
housing-related stocks have bounced since the referen-
dum but remain depressed, with several offering dividend
3 DoJ halted $37bn Humana takeover yields above 6 per cent that reflect understandable uncer-
tainty about the British economy and house prices.
3 Letter reveals insurers threat to act The market appears to believe that these stocks can be
bought only if an investor has faith that the pre-
referendum structural drivers supporting the UK housing
DAVID CROW NEW YORK Almost 13m Americans are covered by market remain in place, namely a chronic shortage of resi-
the plans. Many of those were previ- dential property, government incentives and historically
A row over a decision by Aetna to scale ously unable to afford a policy or turned low mortgage rates.
back its commitment to Barack away by insurers for being too sick. If Brexit causes severe damage to the British economy,
Obamas signature healthcare reform However, private insurers that sell this argument goes, then a fall in land values and house
escalated yesterday with revelations plans through the marketplace have prices will mean the book values and earnings of UK
that the insurer had previously threat- complained they are incurring signifi- housebuilders will be severely impaired.
ened such a move if regulators tried to cant losses, because the people who An alternative way of looking at this is that many house-
block its $37bn takeover of a rival. have signed up are much sicker and builders are already pricing in a severe fall, and right now
Aetna on Monday became the latest older than expected. UnitedHealthcare offer investors a tempting asymmetric bet in all but the
insurer to pull its plans from exchanges and Humana recently announced plans worst outcomes for UK property. In 2007, at the pre-crisis
where Americans can buy affordable to scale back their commitment. peak, investors were paid almost the same amount to hold
coverage, arguing it was losing hun- Aetna did not respond to a request for UK 10-year debt as the gross yield on UK residential prop-
dreds of millions of dollars on policies comment. erty. Since the crisis this gap has ballooned as gilt yields
sold through the exchanges. The com- Last month the DoJ filed a lawsuit to have tumbled, with gross residential UK property yields
pany said it would stop selling plans in block the deal, and a second transac- sitting at about 300 basis points over 10-year gilts, com-
11 of the 15 states where it currently tion: Anthems $48.6bn takeover of pared with less than 50 basis points in 2007. Going for-
operates and cancel its expansion plans. Cigna. Aetna and Anthem have vowed ward, low rates should provide a floor for land values.
The decision to pull back from the to appeal. Officials argued the consoli- Shares in Berkeley Group, a housebuilder focused on the
marketplace came just weeks after the dation would turn the health insurance south-east, are down a quarter since the referendum and
US Department of Justice moved to market from one with five big players to offer investors a yield of 8 per cent. Shares in Persimmon,
block Aetnas takeover of Humana. It three, with dire consequences for con- focused on development outside London, trade at 16 per
quickly sparked accusations that it was sumers and employers who foot the bill cent less than they did before the vote and yield 6.3 per
punishing the Obama administration for the private system. cent. Both hold net cash on their balance sheets and are
for torpedoing its deal. In a Facebook post, Elizabeth Warren, committed to paying their dividends for the next five
Those accusations grew louder yes- the Democratic senator for Massachu- years. In a world where UK government debt provides
terday after a letter from Aetna to the setts, accused Aetna of using the health ever-shrinking income, both shares look attractive.
DoJ was leaked, in which the insurer of the American people . . . as a bargain- The fund owns a lease on a stake in Londons Regent Street, above Matthew Chattle/Rex/Shutterstock
warned it would have to reduce its com- ing chip to force the government to bend
mitment to the exchanges if the deal to one giant companys will. Property spreads
were held up, and pull out altogether if it However, critics of the Affordable RICHARD MILNE OSLO fund said the revisions had cut return in the second quarter of Gross yield less 10-year gilt yield
was ultimately blocked. Instead of Care Act, often dubbed Obamacare, JUDITH EVANS LONDON
the returns on its total property 1.3 per cent. It benefited from a (% points)
5
expanding to 20 states next year, we seized on Aetnas decision to pull back Britains vote to leave the EU portfolio, including the UK, by fall in bond yields partly fuelled London
would reduce our presence to no more from the exchanges as further proof that 1.4 per cent, while currency by the Brexit vote. England and 4
has hit Norways $890bn oil
than 10, said the letter dated July 5, the presidents landmark healthcare movements after the June 23 Brexit probably will mean Wales 3
fund, as managers announced
which was signed by Mark Bertolini, law is fundamentally flawed and needs that they had slashed the valu- poll cut them 1.6 per cent more. something for UK market and UK government
2
Aetnas chief executive. It is very likely to be repealed. ations of its UK property port- Almost a quarter of its UK and London property mar- debt is providing
that we would need to leave the public Another health insurer is pulling folio by 5 per cent. NKr222bn ($26.96bn) prop- kets. We did the devaluation 1 an ever-shrinking
exchange business entirely . . . should back due to persistent financial losses erty portfolio is invested in the according to that. However, its income, which
0
our deal ultimately be blocked. on Obamacare plans, tweeted Donald The worlds largest sovereign UK, with 16 per cent of the total really early days to speculate on means that shares
The public healthcare exchanges were Trump, the Republican presidential wealth fund said the move was located in London. the ultimate impact, said 2005 07 09 11 13 16 in housebuilders
launched in 2013 and were quickly nominee, adding that the companys because of increased volatility Overall, the oil fund, which Trond Grande, deputy head of Sources: Thomson Reuters Datastream; Hometrack look attractive
billed as one of the biggest achieve- decision to retrench was only the and uncertainty after the UK holds Norways surplus oil the funds manager.
ments of the Affordable Healthcare Act. beginning. referendum to quit the EU. The wealth, eked out a positive Oslo ruffles feathers page 13 miles.johnson@ft.com

Ex-Perella Weinberg banker convicted

of insider trading via tips to his father
ADAM SAMSON NEW YORK merely discussed his work with his rate secrets and fed them to his father
father without realising he planned to on a silver platter for quick and illegal
A former banker at the boutique
trade on the information. profits.
investment bank Perella Weinberg has
My dad made some terrible mis- The elder Mr Stewart had earlier
been convicted of securities fraud after
takes, he testified. He used me. pleaded guilty to one count of conspir-
passing tips about pending healthcare
The elder Mr Stewart recruited a acy to commit securities fraud and
deals to his father who traded on the
friend and business associate, Richard fraud. He was sentenced to four years
information.
Wynn opens $4bn hotel in Cunniffe, to work as a trading partner in probation.
gambling centre Macau A jury yesterday found Sean Stewart, the scheme, which garnered $1.16m in Martin Cohen, an attorney for Sean
35, guilty on all nine counts in an insider profits from 2011 to 2014. Stewart, said : We respect the jurys
Gambling mogul Steve Wynns $4.2bn trading trial in federal court in Manhat- As an apparent kickback, Mr Stewart verdict but are very disappointed and
hotel in Macau is a bet on riding out a tan. paid about $10,000 for a photographer believe the jury got it wrong.
downturn that has seen revenue dip in Mr Stewart was accused of sharing for his sons 2011 wedding, the DoJ said. He said that Mr Stewart tried to com-
the only part of China where such information on five healthcare deals he Preet Bharara, the US Attorney in pel his father to testify but the elder Mr
gambling is legal. Investors like his was privy to as an executive at JPMorgan Manhattan, said that insider trading Stewart asserted his Fifth Amendment
vision; Wynn Macau shares have risen Chase, and then later at Perella Wein- rigged the securities markets in favour right against self-incrimination.
more than 50 per cent in six months. berg, to his father, Robert Stewart. of cheaters. Robert repeatedly stated that Sean
Report i PAGE 13 In the trial, Mr Stewart framed him- Time and time again, Sean Stewart Stewart was not involved in Roberts
self as an innocent party, claiming he took his clients most sensitive corpo- unlawful conduct, Mr Cohen said.

Companies / Sectors / People

Companies
1MDB.............................................................7,7
AOL.................................................................10
Aberdeen Asset Management........21
Admiral..........................................................21
Advent International ...........................14
Aeroflex.........................................................13
Aetna...............................................................11
Albemarle....................................................20
Alibaba...........................................................12
Amazon.........................................................14
Anthem...........................................................11
Apple...............................................................12
Arrium............................................................12
BAE Systems..............................................13
BHP Billiton...............................................20
BP....................................................................20
BT Group......................................................13
Balfour Beatty...........................................10
Berkeley Group..........................................11
Blackstone....................................................12
Bunge.............................................................22
BuzzFeed.....................................................10
CVS..................................................................14
Cargill.............................................................22
Carlsberg......................................................21
Childrens Investment Fund.............14
Cigna................................................................11
Cobham....................................................13,21
Comcast...........................................................3
Comibol........................................................20
Commerzbank...........................................14
ConocoPhillips..........................................20
Deutsche Bank..........................................14
Didi Chuxing...............................................12
ExxonMobil................................................20
FMC.................................................................20
Facebook......................................................12
First Solar....................................................20
Fusion.............................................................10
Gawker Media...........................................10
Glencore.......................................................20
Global Fashion Group...........................12
Goldman Sachs...........................................7
Google............................................................12
Hexcel...........................................................20
Hikvision.......................................................22
Home Depot...............................................21
Humana..........................................................11
Huawei...........................................................12
IOI Corporation........................................22
Indivior...........................................................21
Investec Asset Management...........20
JPMorgan Chase...................................7,11
Jupiter Fund Management................21
Kellogg..........................................................22
Kinnevik.........................................................12
Kuka................................................................22
Laird...........................................................13,21
Lending Club................................................7
Lens Technology.....................................12
Libyan Investment Authority............7
Lowes.............................................................21
Maverick.......................................................14
Merck..............................................................10
Midea..............................................................22
Mondelez......................................................22
Nestl.............................................................22
Nippon Steel...............................................12
Nokia...............................................................13
Oppo................................................................12
P&G.................................................................22
PLDT...............................................................12
Partners Capital.......................................14
Parvus ..........................................................14
Perella Weinberg......................................11
Persimmon...................................................11
Pinterest........................................................12
Pioneer Natural Resources..............20
Posco...............................................................12
Postbank......................................................14
QBE..................................................................14
Qinetiq............................................................13
Raiffeisen.....................................................14
Rio Tinto......................................................20
Rocket Internet.........................................12
Savills..............................................................21
Schroders......................................................21
Shell................................................................20
Skatbank.......................................................14
Snapchat.......................................................12
Standard Chartered...............................21
Statoil............................................................20
SunEdison...................................................20
Supercell.......................................................12
Target.......................................................14,21
Tencent.........................................................12
Tesla Motors.............................................20
Thales.............................................................13
Total .............................................................20
Twitter............................................................12
Tybourne......................................................14
Umicore........................................................20
Unilever.........................................................22
Union Investment...................................14
Univision .....................................................10
Urban Outfitters.......................................21
Verizon..........................................................10
Viking.............................................................14
Vox Media...................................................10
Walmart.........................................................14
Walt Disney................................................10
WeChat..........................................................12
Weichai Power..........................................22
Wienerberger.............................................21
World Health Organisation.................9
Wynn Macau...............................................13
Yahoo.............................................................10
Zhejiang Shibao.......................................22
Sectors
Aerospace & Defence...........................13
Automobiles..............................................20
Banks....................................................7,14,20
Basic Resources......................................20
Construction...............................................10
Energy...........................................................20
Financial Services.......................14,20,22
Financials.........................................10,14,20
Industrials..............................................12,22
Insurance.................................................11,14
Media..............................................................10
Mining...........................................................20
Oil & Gas.....................................................20
Pharmaceuticals.......................................10
Retail.........................................................12,14
Retail & Consumer.................................14
Technology.....................................12,20,22
Telecoms.......................................................12
Travel & Leisure......................................13
People
Cook, Tim.....................................................12
Cornell, Brian.............................................14
Cryan, John.................................................14
Denton, Nick..............................................10
Grabau, Lorenzo......................................12
Grande, Trond............................................11
Hohn, Sir Chris.........................................14
Li, Charles....................................................22
Lockwood, David................................13,21
Mellors, David............................................13
Mitteregger, Erik......................................12
Murphy, Bob...............................................13
Neal, John....................................................14
Nelson, Tom..............................................20
Plant, Tim....................................................14
Regan, Pat...................................................14
Sewing, Christian.....................................14
Sheffield, Scott.........................................20
Thiel, Peter.................................................10
Wynn, Steve................................................13

The Financial Times Limited 2016 Week 33

12 FINANCIAL TIMES Thursday 18 August 2016

COMPANIES
INSIDE BUSINESS
Technology
EUROPE

Apple to open first China R&D centre Tony

US group invests in crucial
market after revenues fall
as local rivals gain ground
TIM BRADSHAW SAN FRANCISCO
Apple plans to open its first research and
development centre in China this year,
the latest in a series of steps to bolster its
presence in a vital region as sales slow.
Tim Cook, Apples chief, revealed the
and Oppo, as well as tougher economic
conditions.
The centre will employ both new and
existing staff. Apple already has 9,000
employees in China, roughly half of
whom work in its 42 retail stores. In the
past four years, Apple has doubled its
corporate offices in China to 45.
We look forward to expanding our
operations in China with a new research
and development centre as we continue
to grow our talented team here, Apple
Even as revenues slide, Apple is
increasing its investment in future
products and international expansion.
Last month, the US tech group revealed
a 26 per cent increase in its quarterly
R&D spending to $2.6bn, a record 6 per
cent of revenues. Its annual R&D spend-
ing is now approaching $10bn.
In May, Apple invested $1bn in Didi
Chuxing, a Chinese car-booking service
an unusual move for a company that
has typically favoured smaller deals. As
Barber
China as part of a wider crackdown on
foreign content. Apple also lost a patent
case in Beijing that threatened to block
sales of the iPhone 6.
China has also become a growing
Unicorn stake is a sore
focus for Apples environmental efforts
as it pushes its supply chain partners to
point for Philippine
use more renewable energy. Yesterday,
it said Lens Technology, a glass manu-
facturer, would obtain 100 per cent of its
telecoms company
45 electricity from wind power by the end
Number of Apples of 2018 the first Apple supplier to
corporate offices in

plans to increase investment in local
R&D at a meeting this week with Zhang
Gaoli, Chinas vice premier.
The move comes after Apple reported
revenues fell one-third in the latest
quarter in Greater China, where Apple
faces growing competition from local
smartphone makers such as Huawei
said. It did not specify the scale of staff- well as providing a strategic partnership
ing or financial investment involved. as a secretive Apple team works on
The centre will open later this year, developing its own car, the investment
bringing together our engineering and was widely seen as an attempt to build
operations teams in China as we develop goodwill with the Chinese government
advanced technologies and services for after setbacks in the region.
our products, both for our customers in Earlier this year, Apples iTunes films
China and around the world, it said. and iBooks services were blocked in
Industrials. Financial challenge
T
China, double that
make such a commitment. he Lion and the Unicorn is an English nursery
of four years ago In last months earnings call Mr Cook rhyme, probably from the early 18th century.
stressed the long-term opportunity in The verses provided the inspiration for a
$1bn China, where sales grew 55 per cent to thoughtful essay written by George Orwell
$40bn in the first three quarters of during the second world war about the Eng-
Apples investment
in Didi Chuxing, the Apples fiscal year. Revenues from its lish national character.
China car-booking books and movies stores in China were In the modern context of young internet companies val-
service, in May less than $1m before being blocked. ued on the stock market at billions of dollars or euros, the
same title would serve nicely for a cautionary tale for
investors. I have in mind the Philippine Long Distance Tel-
ephone Company, which paid 333m in 2014 for a 10 per
cent stake in Rocket Internet, a German start-up incuba-
tor. A lion features prominently on the Philippine national
coat of arms.

Arrium steels itself to save Whyalla plant
Canberra government pressed
for more bailout funds as the
search for a buyer intensifies
JAMIE SMYTH
WHYALLA, SOUTH AUSTRALIA
The politically charged rescue of
Arrium, one of two surviving Australian
steelmakers, is entering a critical phase
with its administrators pressing the gov-
ernment to stump up more bailout
funds and intensifying the search for a
buyer.
This week Morgan Stanley will share
an information memorandum on the
group with global steelmakers including
South Koreas Posco and Japans Nippon
Steel, as well as private equity groups, to
try and drum up interest.
But Arriums administrator told the
Financial Times that more public
money and tougher anti-dumping rules
are needed to save the companys loss-
making Whyalla steelworks, which is
competing against a wave of cheap Chi-
nese steel imports.
I have $50m from the federal govern-
ment but that is just a loan, says Mark
Mentha, a partner at KordaMentha,
which was appointed to rescue Arrium,
which collapsed in April. I dont need
loans and I dont need debt. I need
grants, or I need loans that convert into
grants.
KordaMentha is seeking A$150m
(US$115m) support from the federal
and state governments and a similar co-
investment from a successful bidder to
invest in new equipment to make the
steelworks viable.
This week it finalised a 10 per cent sal-
ary reduction with Arriums trade
unions, a deal that will be voted on by
staff before the end of the month. In
addition, it has negotiated cost savings
from contractors and suppliers, which
will cut up to A$300m from annual run-
ning costs by the end of 2017 to move
Arrium towards cash break-even.
We are hopeful this sends a loud
message to bidders but also to the fed-
eral and state governments: that
employees, contractors and the banks,
which wont get back 100 cents in the
dollar, are making a significant contri-
bution to the future of Whyalla, says
Mr Mentha, who previously worked on
the administration of the Ansett airline
in 2001.
He says Arriums steelworks face the
same challenges as UK, US and Indian
steelmakers due to a flood of cheap Chi-
nese steel exports on world markets.
He adds that the government needs to
be more proactive with anti-dumping
measures because there is a time lag
between their implementation and
market impact. We should deal with
the problem up front rather than trying
to fix the mess afterwards.
Regulators around the world imposed
ble, including its Molycorp metal grind-
ing unit, which is likely to be sold sepa-
rately for up to A$1.5bn under a parallel
process run by Deutsche Bank.
But rescuing the steelworks is a finan-
cial challenge. It is also a sensitive politi-
cal issue in Australia, where the Liberal-
National coalition had previously
opposed bailing out industries in dis-
tress.
In 2014, the government balked at
bailing out car manufacturers, precipi-
tating the end of a near century-old
industry.
But with a quarter of Whyallas popu-
lation relying on Arriums steelworks
for employment, the government of
Malcolm Turnbull stumped up a
A$50m loan to Arrium ahead of an elec-
tion in July.
Canberra has committed to using
Whyalla steel to upgrade 1,200km of
railway track and strengthen its anti-
dumping system to bolster the business.
But the coalition is reticent about com-
mitting more money to Arrium before a
potential buyer is brought to the table.
Nick Xenophon, whose eponymous
party won three senate seats in South
Australia in part due to local concerns
about Whyalla, says that it would be a
cataclysmic error not to support the
company.
It is in the national interest to have a
strong domestic steel industry and the
consequences of not doing so on tax
receipts, unemployment and disruption
to steel supply would be terrible, he
says.
Mr Mentha says: When Morgan
Stanley get off the plane in Korea and
the Koreans, Japanese or Chinese [bid-
ders] say what is the governments atti-
tude . . . if Morgan Stanley say I dont
know the bidder will say I have better
opportunities elsewhere.
More public funds would enable
Arrium to upgrade its plant to produce
more innovative and more profitable
products.
But given the glut of Chinese steel on
world markets analysts believe finding a
buyer will be challenging.
Burning issue: the lossmaking Whyalla plant is competing against a wave of Chinese imports Alamy Japanese and South Korean steelmak-
ers are more interested in investing in
Southeast Asia and have so far
85 new duties and taxes on steel imports expressed little interest in investing in
Worlds top steelmakers from foreign competitors in the first six Australia.
Production, 2015 (m tonnes) months of 2016 49 per cent more than The US private equity group Black-
a year ago, according to Bloomberg. stone was part of a rescue plan sup-
Canberra is reviewing its anti-dumping ported by the companys management
97.1 ArcelorMittal regime. but this was knocked back by creditors,
47.7 Hesteel Arrium was forced into administra- who balked at accepting losses of 50
46.4 Nippon Steel and Sumitomo Metal tion in April owing A$4bn to creditors in cents on every dollar they lent to the
42.0 Posco a move that threatens to close its steel company.
34.9 Baosteel works in Whyalla, a town of 24,000 peo- Mr Mentha says that he is confident a
34.2 Shagang ple in the heart of South Australias buyer can be found as long as the federal
32.5 Ansteel iron triangle industrial heartland. and state governments support the
29.8 JFE Steel The sprawling operation is the last company.
28.6 Shougang domestic producer of long structural If the governments do not provide
26.3 Tata Steel steel products such as steel beams and the money we have asked for then the
rail tracks that are used in big construc- economic, financial and social conse-
tion and railway projects. quences for Whyalla are horrendous,
Source: worldsteel Parts of Arriums business are profita- he adds.
As for the unicorn, it is not only a mythical single-
horned beast but also a term coined by Aileen Lee, a US
venture capitalist and seed investor, to describe any young
tech company with a valuation of more than $1bn.
Two weeks ago PLDT disclosed that its first-half net
income had plunged by a third from a year earlier. One
cause was an impairment
charge, equivalent to about
90m, incurred for the com-
PLDT is not alone
panys Rocket investment. In in wondering
essence, the lion acknowl-
edged that its bet on the uni-
if Rocket will
corn had gone awry. ever turn in
PLDTs purchase of its
Rocket stake was an early
regular profits
example of what has become
an established trend of Philippine appetite for foreign
assets. The nation has been going through a long spell of
healthy economic growth, and its corporate sector has
liquidity to spare.
Even so the investment was unusual. It is not every
day that a former monopoly telecoms group in an
emerging south-east Asian economy takes a big chance
on an internet company that has just sprung up halfway
across the world.
Rocket, which was founded in 2007, launched itself on
the Frankfurt stock market soon after PLDT bought its
stake, with an initial share price of 42.50 that valued it at
6.7bn. But those days are a distant memory to sharehold-
ers. The stock price has tumbled to less than 19, giving
Rocket a market capitalisation of just over 3bn. PLDT is
far from the only investor wondering if and when the Ber-
lin-based company, and the start-ups it oversees, will ever
turn in regular profits.
If the Philippine lion is licking its wounds, another com-
pany is apparently shedding its illusions about Rocket
Kinnevik, the venerable Swedish investment group.
Lorenzo Grabau and Erik Mitteregger, who represented
Kinnevik on the German
groups supervisory board,
stood down in June, ostensi-
Critics say the
bly because the two compa- German group
nies business models were
converging in a manner
is a copycat, with
that created a potential con- no innovative
flict of interest.
This explanation seems
technology
inadequate. Kinnevik is one
of Rockets oldest business partners. However, it has
always adopted a far less gung-ho approach than Rocket to
valuing start-ups. Rocket valued Global Fashion Group at
700m at the end of 2015, while Kinnevik, using a more
cautious methodology, valued it at 400m.
The Swedish group retains a 13 per cent stake and hold-
ings in several of the start-ups. However, it, like other
Swedish companies, prides itself on extremely high stand-
ards of corporate transparency and reliable communica-
tion with investors. And many investors are concerned
about the opaqueness of Rockets financial reporting, the
apparent inability of even its strongest start-ups to make a
profit and delays to the stock market listings planned for
those start-ups.
Unless Rocket adopts a more professional approach to
its responsibilities, Kinnevik may well pull out of the Ger-
man company over the next two or three years.
Such reservations about Rocket do not necessarily inval-
idate its basic business model. Critics call it a copycat com-
pany that, without any innovative products or technology,
merely has a talent for identifying good business models at
other ecommerce companies and applying them to differ-
ent markets. But there are no patents on business models,
and what Rocket does borrowing and adapting ideas
has gone on since the earliest days of civilisation.
The real problem is that the German group does not pro-
vide satisfactory information to the investors on whom it
counts to fulfil its ambition of being an internet star as big
as Amazon or Alibaba.
tony.barber@ft.com

Technology Technology

Tencent bolstered by focus on mobile gaming Pinterest makes push into video advertising
CHRISTIAN SHEPHERD AND
NATHALIE THOMAS
Second-quarter profits at Tencent,
whose products range from instant
messaging and social networks to
online games, exceeded expectations
as it continued to expand its mobile
gaming business.
The Shenzhen-based tech group, which
recently led a consortium that bought
an 84 per cent stake in Clash of Clans
maker Supercell for $8.6bn, made a net
profit of Rmb10.7bn ($1.6bn) in the
three months to June 30.
This exceeded forecasts of Rmb9.5bn
and was a 47 per cent increase on the
same period a year ago. Revenue rose
52 per cent year-on-year to Rmb35.7bn.
Like rival Alibaba, which this month
also posted better than expected sec-
ond-quarter figures, Tencent has been
increasing the proportion of revenues it
generates from smartphones.
During the second quarter it made
Rmb9.6bn in revenue from smartphone
games, a 114 per cent increase on the
same period a year earlier.
Overall, online game revenues
increased 32 per cent year on year to
Rmb17.1bn.
The vast majority of gaming revenues
whether on smartphones or PCs
comes from in-game add-ons, where
users can pay for virtual perks such as
new weapons in combat games.
Aside from the trend towards mobile
gaming, a shift towards mobile advertis-
ing has helped push up profits, accord-
ing to Elinor Leung, analyst at CLSA, a
Hong Kong-based investment group.
Using a model similar to Facebook,
the company recently began to include
ads in public areas of its popular WeChat
messaging app, where they appear
among posts from individual users and
official public accounts.
WeChat alone had 806m active
monthly users in the second quarter,
representing 34 per cent year-on-year
growth.
HANNAH KUCHLER SAN FRANCISCO
Pinterest is starting to sell video adver-
tising, hoping marketers adopt the
moving image to showcase the beauty
products, clothes and homeware that
are popular on the platform.
The online pinboard, which wants to be
the Google for discovery, is following
social media companies Facebook,
Twitter and Snapchat by pushing hard
into digital video and video advertising.
Advertisers will be able to buy pro-
moted video pins to show, for example,
a make-up tutorial or a recipe, and show
buyablepinsunderneath,so a consumer
can watch a video and click to buy.
Jon Kaplan, head of sales at Pinterest,
who joined the company after being
vice-president of US sales and opera-
tions at Google, said Pinterest was
investing heavily in video as users
have flocked to it.
The number of video pins has risen 60
per cent in the past year, while YouTube
is now the most popular site pinned to
users boards. Earlier this month, it
launched its own native video player.
Brands can either make content espe-
cially for the site, which has more than
100m monthly active users, or repur-
pose advertising from elsewhere.
It is not just necessarily bringing TV
advertising to the platform, but if you
are customising for YouTube or Snap-
chat, it at least makes sense to bring it to
Pinterest, if not customise for Pinterest
as well, Mr Kaplan said.
Pinterest, last valued at $11bn, has
raised $1.3bn from investors, including
Fidelity, Rakuten and Silicon Valley
venture capital firms SV Angel and
Andreessen Horowitz. The site func-
tions as a wishlist for consumers, with 55
per cent of users visiting to shop or find
products, according to the annual
report on internet trends by Mary
Meeker of Kleiner Perkins.
It expanded advertising internation-
ally earlier this year, opening up to mar-
keters in the UK.
Thursday 18 August 2016 FINANCIAL TIMES 13

COMPANIES

Oslo ruffles feathers as it taps wealth

Aerospace & defence

Cobham chief
steps down
fund for first time in two decades after push
to diversify
Debate continues on Sea change widens loss
future of $890bn
SWF as concerns are LAUREN FEDOR AND NIC FILDES
LONDON

voiced over falling Cobham has appointed a new chief

oil prices and lower
returns for investors
RICHARD MILNE
NORDIC CORRESPONDENT
This year will prove to be a watershed
for the worlds largest sovereign wealth
fund as, for the first time in two decades,
Norways $890bn oil fund will have
money taken out by the government in
Oslo.
The withdrawals so far have been
small compared with the size of the
fund, which has grown rapidly to
become one of the worlds largest inves-
tors on the back of surpluses made by
Norways petroleum industry.
But as much as the issue is played
down by Norwegian politicians and
investment officials, the withdrawals
matter as part of an ongoing debate
about the future of the oil fund and how
much risk it is willing to take on in a
period when lower interest rates could
hit future returns.
This fund is meant to last genera-
tions and yet we are tapping it already
many, many years before we were
meant to. If we keep on spending as we
are and the fund cant earn decent
returns then we could end up eating into
it, says one of Norways leading busi-
nessmen, who did not want to be
named.
Espen Henriksen, associate professor
at the BI Norwegian Business School,
says that the withdrawals should not be
seen as too dramatic, however, a view
This fund is meant to last
generations yet we are
tapping it already years
before we were meant to
shared by Oystein Olsen, Norways cen-
tral bank governor.
Yesterday, the oil fund revealed that
NKr24bn ($3bn) had been withdrawn
by the government in the second quar-
ter following NKr21bn in the first.
Another NKr40bn is expected to be
taken out during the rest of the year as
against the funds assets valued at
NKr7.35tn.
But the professor, who is advising the
government on the oil fund, argues that
two trends are moving against Norway
that cause concern: low oil prices and
lower expected rates of return for inves-
tors.
Falling oil prices and higher govern-
ment spending are responsible for the
current withdrawals. Norways govern-
ment is allowed to spend up to 4 per cent
of the fund each year in its budget.
Until this year, the amount of money
taken from the fund has always been
less than the amount of petroleum reve-
nues put back by the government
resulting in an average annual inflow of
about NKr210bn over the past decade.
But the amount of oil and gas revenue
generated through a tax on produc-
tion as well as dividends from state com-
panies has dropped sharply in recent
months.
The 4 per cent figure was set to reflect
the oil funds expected rate of return.
But many, including the central bank
governor, doubt whether the oil fund
can achieve this with its asset mix of 60
per cent equities, 37 per cent bonds, and
3 per cent property. The fund returned
Inflows/withdrawals
NKr bn
2003 04 05 06 07 08
Fund returns
Per cent
Total fund Real estate
6 6
4 4
2 2
0 0
-2
-4
-6
-8
14 16 14 16
Sources: company; Bloomberg
Street cred Norways oil fund may be a relative
Property newcomer to owning property, but it
has already amassed a large portfolio
plan gains that includes some of the most
ground prestigious addresses in the world.
The worlds largest sovereign wealth
fund owns real estate on Regent
Street in London, the Avenue des
Champs-Elyses in Paris, Park Avenue
in New York and Market Street in San
Francisco.
The fund is set to build this prime
portfolio further in the wake of a
change in its mandate that will allow
an increase in the amount of unlisted
property investments to 7 per cent of
its total assets, up from 3 per cent as
present.
The oil fund likes to claim it acts
cautiously, which is why it revealed
yesterday it had marked down the
value of all its UK property 23 per
cent of the total portfolio by 5 per
cent following the British vote to leave
the EU.
But other property investors have
already cut harder and some in the
real estate industry think it has been
buying assets at high prices.
Id question how good value some
of those purchases have been, argues
one large European fund manager.
The oil fund has slowed purchases
this year in what some read as a sign
of concern over the potential
valuations of some markets.
Richard Milne
09 10 11 12 13
Fixed income
14 16 14
1.3 per cent in the second quarter and
just 0.6 per cent in the past year.
As a result, Mr Olsen has proposed
reducing the amount the government
can spend to 3 per cent or even lower.
The government appointed a com-
mittee including Prof Henriksen in
January to look at whether the oil fund
should invest more in equities to chase
higher returns as bond yields languish.
Its holdings already equate to about 1.3
per cent of every listed company in the
world making it one of the largest glo-
bal equity investors.
Mr Olsen has suggested bonds need
form no more than 20 to 25 per cent of
the fund, with the rest filled by equities
or tangible assets such as property or
infrastructure.
Trond Grande, deputy chief execu-
tive, says: The question is not really
what should we do to reach 4 per cent
but what is our risk appetite?
Mr Grande yesterday again under-
lined the funds nervousness over hold-
ing such a high share of bonds with
almost a quarter of its fixed income
portfolio now trading at rates below
zero. We have seen decades of falling
rates and that has given bond investors
a capital gain. There is a question mark
over how much further rates can fall
and if you can expect to have that kind
of capital gains in the future, he added.
Increasing the equity portion is not
without risks, however. The fund lost
almost a quarter of its value in 2008 and
officials worry about how the Norwe-
gian public the funds ultimate owners
executive less than two weeks after the
struggling UK aerospace and defence
company revealed it had tumbled into
a loss in the first half of this year.
David Lockwood, currently chief execu-
tive of the UK technology company
Laird, would replace Bob Murphy
before the end of the year, Cobham said.
Some investors had been pushing for
a change of leadership at Cobham after
it issued profit warnings in November
and April with the most recent being
accompanied by a cash call with share-
Funds top 200 equity holdings holders to cut the companys debt load.
by value Mr Murphys costly acquisition strat-
150 Share price performance in Q2 2016 (%) egy to diversify Cobham away from
-30 -20 -10 0 10 20 30
defence markets was criticised by cer-
Adidas tain analysts as it contributed to the
Shell companys deteriorating performance.
100 Novartis Mr Murphy, a US citizen who in 2012
became Cobhams first non-British chief
ExxonMobil
executive, would step down to pursue
other opportunities, the company said.
50 Cobham, a FTSE 250 company, is best
Abbvie known for its aircraft refuelling and mil-
HSBC itary radar equipment. Its most impor-
tant market is the US.
0 Nestl In March, Cobham fell to a pre-tax
loss of 39.8m for 2015, compared with
a profit of 24.3m in 2014. This month,
China Mobile it recorded a pre-tax loss of 38.4m for
-50 the six months to the end of June, having
14 15 16
Bob Murphy, a US citizen
who became Cobhams first
non-UK chief, will pursue
Equities
other opportunities
reported a 4m profit during the same
Microsoft period last year.
The decline was partly due to busi-
-2 nesses bought by Mr Murphy to diver-
Apple
-4 sify Cobham into commercial commu-
-6 nications and microelectronics.
-8 In 2014 Cobham finalised the largest
Intesa Sanpaolo
16 deal in its history by agreeing to buy
Aeroflex, a US communications equip-
ment maker. The transaction, which
NKr24bn would handle an even bigger fall. served to increase Cobhams borrowings
Sum withdrawn by There are also questions about how the significantly, valued Aeroflex at $1.5bn
the government in fund itself operates. So large have been including debt.
the second quarter its inflows that it was able to rebalance The deal proved ill-timed, because
following its portfolio in the past without the the Asian market for Aeroflexs wireless
NKr21bn in the first
forced selling that other institutional equipment soon collapsed, followed by
investors can be pushed into. For problems in the oil and mining indus-
NKr40bn instance, it cut exposure to Europe from tries, where the US company also has
What is expected to 60 per cent to 40 per cent in its fixed key customers.
be taken out during income portfolio by using new cash to Mr Lockwood told the Financial
the rest of the year,
as against the buy emerging markets bonds rather Times it was difficult to comment on his
funds assets valued than selling existing assets. recovery strategy for Cobham at this
at NKr7.35tn Thus far, the fund says it can cope stage but he did back the structure of the
with the withdrawals through cash flow business and its move to buy Aeroflex.
it receives from dividends and bond There is plenty value to be got, he said,
coupons, which last year reached referring to Aeroflex.
NKr191.5bn. But after increasing rap- In an interview with the Financial
idly in size over the past decade, some Times earlier this month, Mr Murphy
including the central bank governor insisted Cobham had the right
think that the fund may be as big as it is strategy.
going to get. The fund may be close to a Cobham also issued a profit warning
peak, Mr Olsen told the Financial shortly after Mr Murphy became chief
Times earlier this year. executive, reflecting how the company
That raises the pressure on politicians was hit hard by the end of the US wars in
not to take too much out of the fund. Afghanistan and Iraq.
This has long been the question: will Cobhams shares have fallen 14 per
the money burn a hole in politicians cent since he became the companys top
pockets? So far so good, you have to say, manager.
but the desire to spend may get bigger, Laird investors, meanwhile, have
says the businessman. been more supportive of Mr Lockwoods
If the oil fund has peaked in size, it will time at the helm of the FTSE 250 tech-
have to face some of the more difficult nology company. Shares have risen
questions sooner. But Prof Henriksen more than 50 per cent since he became
says that the fund has already done its chief executive in 2012.
job to an extent by making Norway Mr Lockwoods planned arrival at
richer and more diversified by convert- Cobham comes after it in June named
ing oil wealth into financial assets. David Mellors, chief financial officer at
It is definitely better to have this defence technology company Qinetiq,
fund than not to have the fund, he adds. as its new finance director.

Travel & leisure

Wynn bets $4bn on Macau gambling recovery as luxury casino opens doors
BEN BLAND MACAU
Gambling mogul Steve Wynn spent the
past week traipsing around his soon-
to-open $4.2bn casino in Macau with
his wife Andrea and two German Shep-
herds, inspecting everything from the
fancy rooms to the expensive artworks
and the restaurants named after him
and his spouse.
He jokes that there are 30,000 things
that keep him up at night before the
Wynn Palace opens on Monday at the
auspicious time of 8pm, but says it
takes the public in the building to get it
really shaped up.
By building the most expensive casino
in Macau, Mr Wynn is betting he can
ride out a downturn that has seen reve-
nue slump in the only part of China
where such gambling is legal. Investors
have been buoyed by his enthusiasm,
with shares in Wynn Macau up more
than 50 per cent in six months, outper-
forming the other five Macau casino
groups listed in Hong Kong.
Some analysts believe that the $24bn
spent on new casinos such as the Wynn
Palace will help arrest the slide in gam-
ing revenues by attracting enough mass
market gamblers to replace the high-
rollers who have been deterred by Presi-
dent Xi Jinpings corruption crackdown
Gambling mogul
Steve Wynn says
that the yield per
gaming table in
Macau is still the
best in the world
and the economic slowdown in China.
Gross gaming revenue fell 34 per cent
last year to $29bn and the Macau gov-
ernment has forecast that it will fall a
further 13 per cent this year to $25bn.
Despite hyperbolic statements about
the attractions of his new hotel, Mr
Wynn himself is not willing to call the
turn in the casino market.
Only time will say where does the
market settle, he said at one of the
hotels private villas. Theres the
demand thats there yesterday. And
then what is the impact of a new place,
especially one as ambitious as Wynn
Palace. Does it impact or change the
nature of the market? That remains to
be seen.
Richard Huang, a gaming analyst at
Nomura in Hong Kong, says that while
Mr Wynn has a reputation for building
Macau casino revenues on some of the best resorts in Las Vegas,
the wane including the Bellagio, Mirage and
$bn Wynn, investors are expecting too much
from the new Macau property.
50
He notes that the company has
Forecast
predicted a return on investment of
40
15-20 per cent, which is three to four
times more than Studio City and Galaxy
30 phase two, the two most recently
opened casinos, have been earning.
20 The problem is that while the number
of visitors from mainland China has
10
started to rise again, they are spending
less than the high-rollers who used to
frequent Macau.
0 We shouldnt be too optimistic about
2009 12 14 16 the project, says Mr Huang, explaining
Source: Macau Gaming Inspection and that returns have been falling since the
Coordination Bureau first wave of new casinos in the mid-
2000s, which recouped their invest-
ment costs in one year.
Mr Wynn accepts that the huge
growth of Macaus casino industry over
the past decade has been an anomaly
but says that the yield per gaming table
is still the best in the world because of
the Chinese propensity to gamble.
He is confident of a reasonable
return on investment in the current cli-
mate but suggests that much will
depend on the Chinese economy.
We are part of China, just as Las
Vegas is part of the US, he says. No
business, no enterprise in any commu-
nity runs counter or completely inde-
pendently of the environment in which
it exists. To that extent were a passen-
ger on the Peoples Republic of China
train.
14
Banks
Deutsche sends signal on bonus freeze
Investors welcome link
to revival of dividends
suggested by retail chief
JAMES SHOTTER FRANKFURT
Deutsche Bank should debate scrapping
bonuses for its management board for a
second consecutive year if shareholders
have to go without a dividend, the head
of its retail arm has said.
Germanys biggest bank scrapped
bonuses for top managers for 2015 after
reporting a 6.8bn net loss and warning
that it was unlikely to pay a dividend
before 2017 at the earliest.
In an interview with the Bild newspa-
per, Christian Sewing, who has run
Deutsche Banks retail arm since 2015,
German system creaks as more savers are charged
A second co-operative is to
bring in fees on big deposits,
leading to fears of a dam burst
JAMES SHOTTER FRANKFURT
In late 2014 Skatbank, a small co-opera-
tive lender in the province of Thuringia,
sent shockwaves through German
finance by saying it would charge,
rather than pay, interest on large
deposits held on behalf of its private
customers.
No one immediately followed suit.
From September, however, Skatbank
will have company. Last week the
Raiffeisen bank in Gmund am Tegern-
see, a small, well-off municipality some
50km south of Munich, said that from
next month it would charge customers a
custodian fee of 0.4 per cent on depos-
its above 100,000.
Like Skatbank, the co-operative in
Gmund am Tegernsee is small. But with
the European Central Bank charging
I expect others to do the
same. Given the pressure
on earnings, it is an
obvious thing to do
lenders 0.4 per cent on excess deposits
parked with their national central
banks, the co-operatives move has
reignited a debate about whether some
of its larger competitors could do the
same.
The ECBs policy applies across the
eurozone. But German banks have been
hit harder than their peers because
many are unable to recycle their glut of
deposits into loans.
Analysts at Deutsche Bank have cal-
culated that the policy will cost the Ger-
man banking system 787m this year,
more than any other eurozone country.
In response to this pressure, many
German banks have started to pass on
the costs of the ECBs levy to corporate
and institutional clients. Those that can
have boosted lending. And some, such
as Commerzbank, have considered rad-
ical alternatives, such as hoarding cash,
rather than parking excess deposits
with the ECB.
But on the whole the sector has shied
away from charging retail clients for
deposits for two reasons: groups fear the
stigma of being seen as among the first
to punish savers in a country where
Insurance
Brexit-linked rise in claims liabilities hits QBE Target cuts guidance on challenging trading
JACKIE RANGE SYDNEY
Sliding interest rates and a Brexit-
related jump in claims liabilities
have knocked 46 per cent from
first-half profit at QBE, the Australian
insurance group.
The group set aside an extra US$283m
for claims liabilities, a move that it
blamed on falling bond yields following
the turmoil sparked by the UKs vote to
leave the EU.
The insurer earns almost a third of
its revenues from Europe, including
the UK.
It is conceivable that we will see a
further substantial downward step in
global interest rates, further reducing
the insurance sectors investment
returns, John Neal, QBE chief executive,
said.
Net profit for the first six months
of 2016 fell 46 per cent to $265m com-
pared with the same period last
year, although the group sought to
reassure investors with a 5 per cent
said that if the situation did not
improve, a second year without man-
agement board bonuses should be on
the table.
It is not up to me to decide its up
to the supervisory board, he said. But
it is clear that if we dont pay our share-
holders a dividend, then our own
bonuses should also be debated.
Mr Sewings comments had been a
positive signal overall, said Ingo
Speich, a portfolio manager at Union
Investment, one of the banks top 20
shareholders.
Clearly its a political statement,
because in quantitative terms, the
bonuses paid to the management
board make up just a fraction of
the total bonus pool, he said.
The fixed salaries for Deutsches top
Radical alternatives: Commerzbank has considered hoarding cash instead of paying a 0.4% fee to park excess deposits with the ECB Marius Becker/epa
thrift is prized; second, they are cau-
tious not to prompt customers to with-
draw their cash en masse.
For some in the industry this logic still
holds. Michael Kemmer, head of the
association of German banks, said last
week he did not think Raiffeisen Gmund
am Tegernsees move would lead to pri-
vate clients across the board having to
Excess liquidity reserves
in Europe
By country, as of Jan 2016
(% of eurozones total excess)
0 10 20 30
Germany
France
Netherlands
All others
Finland
Belgium
Ireland
Italy
Sources: Deutsche Bank; Bloomberg; ECB
increase in its interim dividend to
A$0.21 per share.
A drop in global interest rates
of another 0.5 per cent, to almost
z e ro, c o u l d k n o c k a n o t h e r
$200m-$250m from QBEs net profit,
Mr Neal said.
The biggest worry is that margins
Net profit at the
Australian insurer
fell 46% for the
first half compared
with the same
period last year
have collapsed for QBE in 2016, said
Angus Nicholson, analyst at IG Markets.
Insurance profit margin a measure
of underwriting and investment profit
was 5.8 per cent, compared with 8.6
per cent in the same period the year
before.
In this low-yield environment, price
increases to insurance premiums are
going to be the only way to shore up the
FINANCIAL TIMES
COMPANIES
managers are also relatively high in
comparison with other Dax companies,
which makes it easier for them to do
without a bonus.
Its good and important that they are
sending a signal on this topic, because
that didnt happen at all under the pre-
vious management.
But the real question will be what
happens to bonuses below board level.
Deutsche typically makes a decision
on bonuses once its results for the whole
year are clear.
A person briefed on the matter said
the topic was not being discussed.
The bank is in the middle of a five-
year turnround designed to boost capi-
tal and profitability, which have trailed
those of peers over the past five years.
As part of the plan, which was final-
Banks. Retail services
pay for deposits, given the competitive-
ness of the German market.
Other industry watchers disagree. In
fact, they say, the dam is about to burst.
The question was always who would
move first, and I now expect others to
do the same, says Martin Hellmich at
the Frankfurt School of Finance and
Management. Given the pressure on
Cost of excess deposits
Impact of ECB deposit rate change,
by country (m)
40 0 200 400 600 800
Germany
France
Netherlands
Finland
Belgium
Ireland
Italy
Spain
balance sheet, which is likely to hit reve-
nues, he said.
The insurer said that it expected glo-
bal pricing to remain under pressure,
and cut its full-year targets for gross
written premiums from a range of
$14.2bn-$14.6bn to $13.7bn-$14.1bn.
Investors were also disappointed by
results from QBEs business in Australia
and New Zealand a region that
accounts for a quarter of the groups rev-
enue where it faced declines in pricing
and inflation in the cost of claims.
The disappointing results appear to
have claimed the scalp of Tim Plant,
head of QBEs Australia and New Zea-
land business, who is to leave the com-
pany with immediate effect after
being in the job for a year.
Pat Regan, QBE chief financial officer,
will replace former divisional chief
executive Mr Plant while the company
finds a new divisional head.
Mr Neal said that tougher conditions
in that market required a different
type of leader for the region.
Lender posted a 6.8bn net loss in
2015 and warned on dividends
their earnings, it is an obvious thing for
banks to do.
Prof Hellmich does not expect all cus-
tomers to be hit, however. Banks will
focus initially on clients with large bal-
ances, as both Skatbank and Raiffeisen-
bank Gmund am Tegernsee have done,
he says.
In future I think we will see deposits
over 100,000 and deposits below
100,000 treated differently.
As well as suffering from low interest
rates, German banks are struggling to
digest a cocktail of overcapacity, tight-
ening regulation and the costs of digital-
isation.
Neil Smith, an analyst at Bankhaus
Lampe in Dsseldorf, says a charging for
large deposits could relieve pressure on
margins.
Some banks have been increasing
the interest they charge on loans, and if
they are also able to charge retail depos-
its in a targeted way, then this would
show that the spread management that
many people thought couldnt happen
in Germany is taking place. That would
be quite a positive sign for the system.
Retail
LINDSAY WHIPP CHICAGO
Targets first comparable sales decline
in two years and falling traffic
prompted the retailer to cut full-year
earnings guidance in a stark warning to
investors over the choppy US retail
environment.
The weaker earnings outlook sent Tar-
gets shares down 6.5 per cent to $70.53
in late-morning trading in New York.
Brian Cornell, chairman and chief exec-
utive, said he was planning for a chal-
lenging environment in the crucial sec-
ond half, which includes the holiday
shopping season and back-to-school
sales. He said Target had the right
strategy to restore traffic and sales
growth over time.
Target expects full-year earnings
adjusted for early retirement of debt
of between $4.80 and $5.20 a share.
That compared with earlier guidance of
between $5.20 and $5.40. In the second
quarter, comparable sales dropped 1.1
per cent and the number of transactions
ised last autumn by John Cryan, chief
executive, Deutsche will cut costs by
laying off 9,000 staff and exiting 10
countries; slashing assets in its domi-
nant trading businesses; and offloading
Postbank.
Deutsche aims to boost its core tier
one capital to 12.5 per cent by 2018. At
the end of the second quarter, its ratio
stood at 10.8 per cent, which analysts
reckon amounts to a shortfall of about
7bn versus its 2018 target.
Many analysts have said Deutsche
will require a capital increase to fill
the gap.
However, Mr Sewing told Bild that
a capital increase was not under consid-
eration.
The bank is stable, he said. Our
capital is sufficient and satisfactory.
Prof Hellmich says more radical
action will be needed if interest rates
remain low. Even if negative rates were
to vanish tomorrow, the German bank-
ing model still wouldnt be sustainable,
he says.
Consumer demand and consumer
behaviour are changing so much that
German banks are going to have to com-
pletely rethink what services they pro-
vide in future, and how and where.
Germany is the most fragmented
banking market in the eurozone. Its
three pillar banking system a mix-
ture of smaller savings banks, co-opera-
tives and bigger commercial lenders
may need structural change, according
to Hans-Walter Peters, a partner at Ber-
enberg and president of the association
of German banks.
The German banking model has
a big advantage. It is able to respond
to the needs of companies of very
different sizes, he told the Frankfurter
Allgemeine Zeitung this week. [But]
we wont be able to keep the German
model the way it is. There will be
a consolidation.
dropped 2.2 per cent. Targets first quar-
terly decline since 2014 will sharpen
investor focus on Walmarts earnings
today, where US comparable sales are
expected to rise 1 per cent.
Retailers in the US have had a bumpy
ride over the past year or so. Shoppers
are prepared to spend, but they are
demanding value for money and are
spreading across different platforms
from mobile to physical stores.
This has led to competitive promo-
tions at a time when Amazons sales
have soared. Target said it had increased
promotions, but analysts said some of
its offerings may have looked compara-
bly more expensive. It has also been hit
by the sale of its pharmacy arm to CVS,
Targets first quarterly
decline since 2014 will
sharpen investor focus on
Walmarts earnings today
Thursday 18 August 2016
Financials
Hedge fund
investors
push for set
rate of return
before fees
MARY CHILDS NEW YORK
Investors are pushing hedge funds to
commit to a set rate of return before
they earn incentive fees, as managers
are pressured to borrow a page from
their competitors in private equity.
Hedge funds are agreeing to so-called
hurdle rates to assuage the sting of
underperformance.
Some have hard hurdles, meaning
they must generate typically between 4
and 10 per cent before they are paid,
while others must generate a certain
percentage above Libor or cash.
This is here to stay, and in fact
its going to become more the norm to
have these more creative relationships
on the fee side, said Kelsey Deshler, a
portfolio manager at Credit Suisse Asset
Management.
Long-only equity funds Viking, Mav-
erick and Tybourne employ benchmark
hurdles so that investors do not feel they
are paying fees simply for tracking the
market.
The increasing popularity of hurdle
rates reflects a shift in power away from
managers, who can command high fees
in times of strong performance, to
investors, as they pull money out during
periods of underperformance.
Clients have withdrawn $28bn in the
first half of 2016, leaving $2.99tn,
according to eVestment data, as many
funds lost money in volatile markets.
A recent Barclays report forecasts
that the number of funds will fall this
year, as liquidations tick up 12 per cent
compared with a historical average of
10 per cent and fewer new funds are
able to start.
Investors including Partners Capital,
the Orange County Employees Retire-
ment System and New Jerseys pension
have pushed for hurdles.
On the hedge fund side, Sir Chris
Hohns $11bn The Childrens Invest-
ment Fund in London has helped lead
the change, adding hurdles about three
years ago. Parvus has incentive fees for
its long-only fund on European bench-
marks since 2004, and in its hedged
strategy charges incentive fees every
three years.
Hurdles are more clear-cut in closed-
end structures, which have a time
limit, says Emma Bewley, Connection
Capitals head of fund investment. You
have to strike a balance between paying
appropriate performance while not
pushing a manager to take excessive
risk to beat the hurdle.
Pension schemes, insurers, and oth-
ers had piled into hedge funds seeking
returns uncorrelated to global markets.
But years of mixed performance have
soured investor attitudes toward hedge
funds.
However, performance may be turn-
ing around. Hedge funds generated pos-
itive returns for five straight months
through until July, for returns this year
of 3.7 per cent, according to a Preqin
index.
Investors in most private equity funds
usually receive a preferred return of 8
per cent on funds before managers
begin earning a share of profits. Hedge
funds are adopting the measure just as
the buyout industry moves to drop it:
groups including Advent International
have raised funds without a minimum
return.
The practice is also common among
new start-up hedge funds, as they
attempt to encourage investors to take a
chance on them.
which has disrupted consumer visits.
The company continues to be
impacted by challenged consumers
across multiple income demographics,
as well as a food business that still needs
to gain traction to drive additional traf-
fic, said Moodys analyst Charlie
OShea.
The downward revision to its second
half expectations recognises that the
back-to-school/college and holiday sell-
ing seasons may not provide meaningful
sales lift, and we also believe both sea-
sons will be highly promotional.
In the second quarter, total sales
dropped 7.2 per cent to $16.17bn, includ-
ing the lost revenue from the pharmacy
divestiture, while earnings dropped 11.6
per cent to $1.07 a share. Excluding the
sale, EPS rose 0.5 per cent to $1.23.
Two particular areas of difficulty for
Target this quarter were electronics and
food. Apples sharp sales decline also
hurt Target, which said sales of the tech-
nology companys products fell 20 per
cent at its stores during the quarter.
Thursday 18 August 2016 FINANCIAL TIMES 15
16 FINANCIAL TIMES Thursday 18 August 2016

MARKET DATA

WORLD MARKETS AT A GLANCE FT.COM/MARKETSDATA

Change during previous days trading (%)
S&P 500 Nasdaq Composite Dow Jones Ind FTSE 100 FTSE Eurofirst 300 Nikkei Hang Seng FTSE All World $ $ per $ per per $ per Oil Brent $ Sep Gold $

-0.43% -0.57% -0.44% -0.50% -0.85% -0.48% -0.36% -0.159% -0.230% -0.56%
0.90% 0.178% 0.308% 0.34%
Stock Market movements over last 30 days, with the FTSE All-World in the same currency as a comparison
AMERICAS EUROPE ASIA
Jul 18 - Aug 17 Index All World Jul 18 - Aug 17 Index All World Jul 18 - Aug 17 Index All World Jul 18 - Aug 17 Index All World Jul 18 - Aug 17 Index All World Jul 18 - Aug 17 Index All World

S&P 500 New York S&P/TSX COMP Toronto FTSE 100 London Xetra Dax Frankfurt Nikkei 225 Tokyo Kospi Seoul
6,893.92 16,745.64
10,537.67 2,043.75
14,628.77 16,497.85
2,163.78 2,168.81 6,695.42 2,016.89
14,532.40
9,981.24
Day -0.43% Month 0.24% Year NaN% Day -0.51% Month 1.02% Year 2.66% Day -0.50% Month 2.89% Year 4.76% Day -1.30% Month -1.06% Year NaN% Day 0.90% Month 1.50% Year -18.39% Day -0.20% Month 1.31% Year 3.04%

Nasdaq Composite New York IPC Mexico City FTSE Eurofirst 300 Europe Ibex 35 Madrid Hang Seng Hong Kong FTSE Straits Times Singapore
5,197.37 22,799.78
48,207.03
1,341.23 8,485.20 8,487.00 2,925.35
5,036.37 47,060.57 1,332.21 21,803.18 2,843.35
Day -0.57% Month 3.34% Year 2.96% Day -0.30% Month 3.20% Year 9.68% Day -0.85% Month 0.46% Year -12.41% Day -1.56% Month -0.52% Year -21.99% Day -0.48% Month 5.27% Year -4.97% Day -0.54% Month -2.80% Year -8.70%

Dow Jones Industrial New York Bovespa So Paulo CAC 40 Paris FTSE MIB Milan Shanghai Composite Shanghai BSE Sensex Mumbai
58,248.49 3,109.55
4,417.68 16,762.73 3,036.60 28,005.37
18,559.01 16,528.36
18,469.89 56,698.06 27,746.66
4,330.13
Day -0.44% Month -0.24% Year 5.69% Day -1.03% Month 4.86% Year 23.43% Day -0.96% Month 1.03% Year -10.87% Day -1.58% Month -1.31% Year -29.39% Day -0.01% Month 1.81% Year -21.58% Day -0.21% Month 0.61% Year -0.22%

Country Index Latest Previous Country Index Latest Previous Country Index Latest Previous Country Index Latest Previous Country Index Latest Previous Country Index Latest Previous
Argentina Merval 15217.60 15230.81 CyprusCSE M&P Gen 67.38 67.76 Italy FTSE Italia All-Share 18163.99 18440.65 Philippines Manila Comp 7946.19 7983.38 Taiwan Weighted Pr 9117.70 9110.36 Cross-Border DJ Global Titans ($) 246.76 247.64
Australia All Ordinaries 5628.10 5625.70 Czech Republic
PX 850.80 856.30 FTSE Italia Mid Cap 29923.26 30245.89 Poland Wig 47973.25 48463.51 Thailand Bangkok SET 1531.63 1537.52 Euro Stoxx 50 (Eur) 2982.88 3016.19
S&P/ASX 200 5535.00 5532.00 Denmark
OMXC Copenahgen 20 990.99 996.35 FTSE MIB 16528.36 16792.96 Portugal PSI 20 4704.87 4757.88 Turkey BIST 100 77707.13 78472.57 Euronext 100 ID 870.27 877.82
S&P/ASX 200 Res 3039.80 3000.10 Egypt EGX 30 8453.53 8351.07 Japan 2nd Section 4355.32 4295.93 PSI General 2514.25 2544.28 UAE Abu Dhabi General Index 4542.84 4559.90 FTSE 4Good Global ($) 5464.13 5482.63
Austria ATX 2251.54 2276.46 Estonia
OMX Tallinn 1002.53 1001.73 Nikkei 225 16745.64 16596.51 Romania BET Index 6870.47 6865.23 UK FT 30 2979.40 2997.20 FTSE All World 276.43 277.44
Belgium BEL 20 3495.52 3524.40 Finland
OMX Helsinki General 7979.72 8001.14 S&P Topix 150 1082.52 1068.99 Russia Micex Index 1971.91 1975.80 FTSE 100 6859.15 6893.92 FTSE E300 1341.23 1352.75
BEL Mid 5880.32 5930.18 FranceCAC 40 4417.68 4460.44 Topix 1311.13 1298.47 RTX 969.66 974.82 FTSE 4Good UK 6100.59 6128.66 FTSE Eurotop 100 2637.21 2659.04
Brazil Bovespa 58248.49 58855.43 SBF 120 3503.95 3538.21 Jordan Amman SE 2108.94 2115.27 Saudi-Arabia TADAWUL All Share Index 6328.55 6357.57 FTSE All Share 3731.81 3748.86 FTSE Global 100 ($) 1359.51 1363.34
Canada S&P/TSX 60 850.40 854.28 Germany M-DAX 21469.98 21677.55 Kenya NSE 20 3485.36 3445.60 Singapore FTSE Straits Times 2843.35 2858.80 FTSE techMARK 100 4356.07 4371.28 FTSE Gold Min ($) 2011.71 2026.34
S&P/TSX Comp 14628.77 14703.44 TecDAX 1698.02 1728.67 Kuwait KSX Market Index 5507.05 5492.25 Slovakia SAX 318.62 320.30 USA DJ Composite 6410.33 6431.25 FTSE Latibex Top (Eur) 3336.30 3339.10
S&P/TSX Met & Min 670.38 688.63 XETRA Dax 10537.67 10676.65 Latvia OMX Riga 637.94 634.97 Slovenia SBI TOP 715.05 715.34 DJ Industrial 18469.89 18552.02 FTSE Multinationals ($) 1568.61 1574.18
Chile IGPA Gen 20431.52 20615.38 Greece Athens Gen 567.49 572.43 Lithuania OMX Vilnius 532.74 535.14 South Africa FTSE/JSE All Share 52309.70 52396.40 DJ Transport 7832.70 7850.79 FTSE World ($) 489.39 491.14
China FTSE A200 8483.57 8493.67 FTSE/ASE 20 1507.51 1520.98 Luxembourg LuxX 1579.07 1599.50 FTSE/JSE Res 20 31239.57 31609.93 DJ Utilities 672.74 673.38 FTSEurofirst 100 (Eur) 3764.86 3796.27
FTSE B35 9667.14 9660.33 Hong Kong Hang Seng 22799.78 22910.84 Malaysia FTSE Bursa KLCI 1694.32 1699.89 FTSE/JSE Top 40 45386.78 45392.84 Nasdaq 100 4772.62 4797.19 FTSEurofirst 80 (Eur) 4091.58 4138.73
Shanghai A 3255.33 3255.78 HS China Enterprise 9641.76 9707.99 Mexico IPC 48207.03 48351.96 South Korea Kospi 2043.75 2047.76 Nasdaq Cmp 5197.37 5227.11 MSCI ACWI Fr ($) 420.18 422.03
Shanghai B 355.24 355.28 HSCC Red Chip 3906.40 3916.09 Morocco MASI 9969.36 9948.26 Kospi 200 256.04 256.15 NYSE Comp 10758.23 10809.74 MSCI All World ($) 1730.94 1739.43
Shanghai Comp 3109.55 3109.99 Hungary Bux 27790.97 27671.68 Netherlands AEX 447.57 451.40 Spain IBEX 35 8487.00 8621.70 S&P 500 2168.81 2178.15 MSCI Europe (Eur) 1399.48 1411.50
Shenzhen A 2137.46 2130.69 India BSE Sensex 28005.37 28064.61 AEX All Share 684.86 690.59 Sri Lanka CSE All Share 6577.95 6582.60 Wilshire 5000 21224.32 21238.05 MSCI Pacific ($) 2376.62 2392.09
Shenzhen B 1173.09 1170.46 S&P CNX 500 6627.95 6634.30 New Zealand NZX 50 7355.02 7310.67 Sweden OMX Stockholm 30 1345.44 1359.14 Venezuela IBC 12272.25 12435.81 S&P Euro (Eur) 1369.78 1385.13
Colombia COLCAP 1342.69 1323.66 Indonesia Jakarta Comp 5371.85 5320.56 Nigeria SE All Share 27316.52 27246.88 OMX Stockholm AS 480.68 485.01 Vietnam VNI 660.51 658.11 S&P Europe 350 (Eur) 1378.35 1390.30
Croatia CROBEX 1789.03 1784.99 Ireland ISEQ Overall 6040.80 6035.05 Norway Oslo All Share 663.11 665.18 Switzerland SMI Index 8153.80 8215.45 S&P Global 1200 ($) 1915.32 1924.87
Israel Tel Aviv 100 12.92 12.86 Pakistan KSE 100 40057.52 40057.52 Stoxx 50 (Eur) 2848.42 2867.87
(c) Closed. (u) Unavaliable. Correction. Subject to official recalculation. For more index coverage please see www.ft.com/worldindices. A fuller version of this table is available on the ft.com research data archive.

STOCK MARKET: BIGGEST MOVERS UK MARKET WINNERS AND LOSERS

AMERICA LONDON EURO MARKETS TOKYO Aug 17 %Chg %Chg Aug 17 %Chg %Chg Aug 17 %Chg %Chg Aug 17 %Chg %Chg
ACTIVE STOCKS stock close Day's ACTIVE STOCKS stock close Day's ACTIVE STOCKS stock close Day's ACTIVE STOCKS stock close Day's FTSE 100 price(p) week ytd FTSE 250 price(p) week ytd FTSE SmallCap price(p) week ytd Industry Sectors price(p) week ytd
traded m's price change traded m's price change traded m's price change traded m's price change Winners Winners Winners Winners
Hospira 11.8 89.95 -0.01 Arm Holdings 209.0 1687.00 0.00 Nestle N 321.0 72.74 0.00 Softbank . 1739.4 6767.00 -35.00 Coca-cola Hbc Ag 1702.00 8.4 17.6 Dfs Furniture 254.40 14.3 -23.0 Gulf Marine Services 37.00 19.4 -64.3 Construction & Materials 6137.63 5.8 18.7
Apple 11.4 108.61 -0.78 Royal Dutch Shell 198.8 1927.50 -2.50 Linde Ag O.n. 267.5 154.80 0.00 Toyota Motor 560.5 6006.00 131.00 Crh 2535.00 6.7 29.1 Restaurant 420.80 13.7 -38.7 St. Ives 119.50 19.3 -47.6 Oil Equipment & Services 15012.14 2.7 15.6
Target 8.7 70.97 -4.51 Sabmiller 197.0 4378.00 -2.72 Asml Holding 242.7 93.13 -4.78 Mitsubishi Ufj Fin,. 370.5 535.90 17.90 Paddy Power Betfair 9720.00 5.8 6.1 Indivior 327.40 10.8 74.3 Premier Oil 76.50 18.2 57.1 Personal Goods 31259.22 1.8 21.0
Lowe's Companies 8.4 76.01 -5.47 Hsbc Holdings 169.4 542.90 0.40 Bayer Ag Na O.n. 218.1 97.92 0.00 Sumitomo Mitsui Fin,. 266.0 3438.00 109.00 Antofagasta 542.50 3.7 16.4 Tullow Oil 234.10 8.6 41.3 Enquest 29.50 14.6 55.3 Oil & Gas Producers 7262.34 1.8 28.4
Cisco Systems 7.0 30.36 -0.76 Shire 132.3 5030.00 -3.04 Novartis N 217.6 72.88 0.00 Komatsu 239.8 2303.00 106.50 Standard Life 353.80 3.1 -9.1 Cairn Energy 208.70 8.1 32.3 Morgan Sindall 771.50 14.0 4.3 Tobacco 57959.24 1.7 25.8
Southern (the) 6.3 50.37 -0.59 Barclays 114.1 160.15 -1.73 Roche Gs 200.7 226.10 0.00 Mizuho Fin,. 229.3 168.10 5.00 Persimmon 1748.00 3.0 -13.8 Rank 223.90 7.8 -21.4 Cambian 73.00 13.3 -49.6 Food Producers 8586.96 1.4 -3.1
Facebook 6.0 122.98 -0.32 Glaxosmithkline 111.6 1680.50 -9.00 Royal Dutch Shella 171.0 22.37 -0.05 Nissan Motor Co., 227.1 986.40 5.70 Barratt Developments 448.20 2.6 -28.5 Ibstock 169.50 7.5 -23.3 Ophir Energy 74.00 11.3 -24.8 Chemicals 12287.61 1.3 14.1
At&t 5.5 41.54 -0.42 Crh 108.1 2535.00 31.78 Total 169.9 43.34 -0.17 Sony 221.0 3253.00 -42.00 Burberry 1358.00 2.6 13.9 Clarkson 2150.00 7.5 -4.5 Trinity Mirror 100.50 8.6 -39.5 Travel & Leisure 8634.90 1.1 -4.6
Amazon.com 4.9 759.46 -4.58 Bp 106.9 432.75 -3.50 Intesa Sanpaolo 168.4 1.94 0.00 Nippon Telegraph And Telephone 202.3 4832.00 -22.00 Babcock Int 1021.00 2.6 0.5 Hill & Smith Holdings 1193.00 7.3 58.5 Severfield 55.25 8.4 -12.5 Household Goods 16519.69 0.9 0.3
Bristol-myers Squibb 4.4 58.45 -0.96 Vodafone 106.8 235.35 1.25 Daimler Ag Na O.n. 163.2 62.52 0.00 Fast Retailing Co., 193.9 36970.00 470.00 Whitbread 4035.00 2.4 -8.3 Ted Baker 2500.00 6.9 -16.3 Stv 363.75 8.4 -29.6 Mobile Telecommunications 5303.20 0.9 4.0
Bp 432.75 2.3 22.2 Savills 728.50 6.6 -17.8 Lookers 129.00 7.9 -30.3 Software & Computer Services 2010.95 0.8 21.5
BIGGEST MOVERS Close Day's Day's BIGGEST MOVERS Close Day's Day's BIGGEST MOVERS Close Day's Day's BIGGEST MOVERS Close Day's Day's
Vodafone 235.35 2.0 7.6 Britvic 650.00 6.5 -10.7 Sanne 420.00 7.7 13.5 Equity Investment Instruments 8166.26 0.5 9.3
price change chng% price change chng% price change chng% price change chng%
Ups Ups Ups Ups Losers Losers Losers Losers
Urban Outfitters 36.49 5.25 16.79 Indivior 327.40 26.40 8.77 Deutsche Wohnen Ag 28.23 1.12 4.15 Sumitomo Heavy Industries, 514.00 39.00 8.21 Admiral 2081.00 -7.7 25.1 Aldermore 133.60 -13.0 -42.3 Melrose Industries 41.00 -24.8 - Fixed Line Telecommunication 4514.14 -2.8 -15.0
Cintas 115.25 2.26 2.00 Savills 728.50 29.50 4.22 Rwe Ag 8.83 0.24 2.81 T&d Holdings, . 1136.00 82.00 7.78 Old Mutual 209.00 -7.4 16.7 Card Factory 289.50 -9.6 -20.7 Melrose Industries 138.00 -7.8 -93.1 Nonlife Insurance 2685.78 -2.6 9.2
Discovery Communications 26.75 0.40 1.52 Rank 223.90 7.20 3.32 Pandora A/s 130.53 3.02 2.37 Nippon Steel & Sumitomo Metal 2070.00 134.00 6.92 Direct Line Insurance 373.10 -5.0 -8.4 Ocado 279.90 -9.0 -8.7 Stobart Ld 163.25 -7.7 53.3 Life Insurance 6987.16 -1.7 -10.6
Micron Technology 15.71 0.22 1.39 Daejan Holdings 5625.00 170.00 3.12 Delhaize Sa 94.30 1.88 2.03 Inpex 891.60 54.10 6.46 Berkeley Holdings (the) 2491.00 -4.9 -32.6 Shawbrook 189.90 -7.3 -46.0 Mcbride 157.75 -5.5 -4.7 Food & Drug Retailers 2565.60 -1.5 2.7
Navient 14.09 0.18 1.29 Balfour Beatty 251.80 7.35 3.01 Industrivarden Ab 15.04 0.25 1.72 Fukuoka Fin,. 418.00 25.00 6.36 Standard Chartered 637.10 -4.3 12.2 Circassia Pharmaceuticals 93.40 -7.1 -70.7 Hostelworld 159.00 -4.5 -27.1 Banks 3415.26 -1.5 -10.5
Int Consolidated Airlines S.a. 385.20 -3.9 -36.7 Laird 308.00 -7.0 -12.6 Puretech Health 153.75 -4.5 -5.7 Mining 12017.11 -1.2 63.6
Downs Downs Downs Downs
Sky 856.00 -3.3 -22.8 Genus 1811.00 -6.3 16.5 Lonmin 229.50 -4.5 174.9 Pharmaceuticals & Biotech. 14766.41 -1.1 14.4
Lowe's Companies 76.01 -5.47 -6.71 Admiral 2081.00 -178.43 -7.92 Grifols Sa 14.99 -14.40 -48.99 Dainippon Screen Mfg.co., 1111.00 -51.00 -4.39
Bt 395.80 -3.1 -16.1 Bgeo 2739.00 -6.1 43.9 Headlam 436.75 -4.2 -12.9 Media 7617.20 -1.0 2.8
Staples 8.74 -0.59 -6.29 Euromoney Institutional Investor 1036.00 -73.00 -6.58 Bayerische Motoren Werke Ag 64.40 -4.15 -6.05 Hokuetsu Kishu Paper Co., 661.00 -26.00 -3.78
Lloyds Banking 53.48 -2.7 -26.1 Softcat 327.30 -6.0 -3.8 Moss Bros 92.50 -4.1 -10.2 Real Estate Investment Trusts 2938.39 -0.9 -9.7
Target 70.97 -4.51 -5.97 Laird 308.00 -20.99 -6.34 Asml Holding 93.13 -4.78 -4.88 Sumitomo Osaka Cement Co., 474.00 -18.00 -3.66
Royal Bank Of Scotland 190.30 -2.6 -37.2 Euromoney Institutional Investor 1036.00 -5.8 4.1 Lsl Property Services 218.00 -4.0 -23.5 Electronic & Electrical Equip. 5037.27 -0.9 18.9
Chesapeake Energy 5.60 -0.31 -5.25 Ibstock 169.50 -10.20 -5.65 Industrivarden Ab 16.14 -0.82 -4.81 Haseko 983.00 -36.00 -3.53
Rio Tinto 2436.50 -2.6 23.1 Riverstone Energy 975.00 -5.5 23.3 Communisis 41.13 -4.0 -1.0 Industrial Engineering 9497.76 -0.8 32.6
Alliance Data Systems 201.92 -9.93 -4.69 Hochschild Mining 294.60 -16.12 -5.14 B.popular 1.18 -0.05 -4.38 Nippon Suisan Kaisha, 510.00 -15.00 -2.86
Itv 195.40 -2.6 -29.4 William Hill 307.80 -5.2 -22.3 Fdm (holdings) 625.50 -3.8 19.7 Forestry & Paper 17223.40 -0.8 19.7
Based on the constituents of the S&P500 and the Nasdaq 100 index Based on the constituents of the FTSE 350 index Based on the constituents of the FTSEurofirst 300 Eurozone index Based on the constituents of the Nikkei 225 index
Based on last week's performance. Price at suspension.

CURRENCIES
DOLLAR EURO POUND DOLLAR EURO POUND DOLLAR EURO POUND DOLLAR EURO POUND
Closing Day's Closing Day's Closing Day's Closing Day's Closing Day's Closing Day's Closing Day's Closing Day's Closing Day's Closing Day's Closing Day's Closing Day's
Aug 17 Currency Mid Change Mid Change Mid Change Aug 17 Currency Mid Change Mid Change Mid Change Aug 17 Currency Mid Change Mid Change Mid Change Aug 17 Currency Mid Change Mid Change Mid Change
Argentina Argentine Peso 14.6875 0.0100 16.5609 0.0340 19.1129 0.0828 Indonesia Indonesian Rupiah 13096.0000 - 14766.3811 20.2722 17041.9009 62.3290 Poland Polish Zloty 3.8086 0.0133 4.2943 0.0208 4.9561 0.0353 ..Three Month 0.7687 -0.0028 0.8663 -0.0020 - -
Australia Australian Dollar 1.3099 0.0076 1.4770 0.0106 1.7046 0.0161 Israel Israeli Shekel 3.7951 0.0093 4.2791 0.0164 4.9385 0.0301 Romania Romanian Leu 3.9702 0.0083 4.4765 0.0155 5.1664 0.0297 ..One Year 0.7695 -0.0028 0.8657 -0.0020 - -
Bahrain Bahrainin Dinar 0.3771 0.0000 0.4251 0.0006 0.4907 0.0019 Japan Japanese Yen 100.2950 -0.1600 113.0875 -0.0248 130.5143 0.2697 Russia Russian Ruble 64.0488 -0.0912 72.2181 -0.0035 83.3469 0.1864 United States United States Dollar - - 1.1275 0.0015 1.3013 0.0048
Bolivia Bolivian Boliviano 6.9450 - 7.8308 0.0108 9.0376 0.0330 ..One Month 100.2949 -0.1602 113.0875 -0.0248 130.5142 0.2696 Saudi Arabia Saudi Riyal 3.7504 - 4.2288 0.0058 4.8804 0.0178 ..One Month - - 1.1274 -0.1690 1.3014 0.0048
Brazil Brazilian Real 3.2155 0.0303 3.6256 0.0391 4.1843 0.0546 ..Three Month 100.2946 -0.1608 113.0875 -0.0248 130.5140 0.2692 Singapore Singapore Dollar 1.3443 0.0033 1.5158 0.0059 1.7493 0.0107 ..Three Month - - 1.1271 -0.1690 1.3015 0.0048
Canada Canadian Dollar 1.2861 -0.0025 1.4501 -0.0008 1.6736 0.0029 ..One Year 100.2933 -0.1633 113.0875 -0.0248 130.5142 0.2685 South Africa South African Rand 13.4438 0.1054 15.1585 0.1394 17.4944 0.2006 ..One Year - - 1.1256 -0.1690 1.3024 0.0048
Chile Chilean Peso 657.9500 8.2600 741.8704 10.3199 856.1930 13.8399 Kenya Kenyan Shilling 101.4000 -0.1000 114.3334 0.0445 131.9522 0.3528 South Korea South Korean Won 1108.4000 16.1000 1249.7746 19.8455 1442.3654 26.1480 Venezuela Venezuelan Bolivar Fuerte 9.9850 0.0050 11.2586 0.0211 12.9935 0.0540
China Chinese Yuan 6.6310 0.0050 7.4768 0.0159 8.6289 0.0380 Kuwait Kuwaiti Dinar 0.3015 - 0.3399 0.0005 0.3923 0.0014 Sweden Swedish Krona 8.4183 -0.0035 9.4920 0.0091 10.9547 0.0355 Vietnam Vietnamese Dong 22301.5000 -3.5000 25146.0356 30.5672 29021.0896 101.5525
Colombia Colombian Peso 2913.1350 -6.1700 3284.7011 -2.4348 3790.8742 5.8599 Malaysia Malaysian Ringgit 4.0140 0.0285 4.5260 0.0383 5.2234 0.0560 Switzerland Swiss Franc 0.9626 -0.0010 1.0854 0.0004 1.2526 0.0033 European Union Euro 0.8869 -0.0012 - - 1.1541 0.0026
Costa Rica Costa Rican Colon 549.0300 0.5300 619.0579 1.4472 714.4549 3.2994 Mexico Mexican Peson 18.1938 0.1880 20.5143 0.2399 23.6756 0.3303 Taiwan New Taiwan Dollar 31.4165 0.1930 35.4236 0.2660 40.8824 0.3997 ..One Month 0.8868 -0.0012 - - 1.1540 0.0026
Czech Republic Czech Koruna 23.9635 -0.0343 27.0200 -0.0015 31.1838 0.0695 New Zealand New Zealand Dollar 1.3828 0.0038 1.5592 0.0064 1.7995 0.0115 Thailand Thai Baht 34.7005 0.1185 39.1265 0.1872 45.1559 0.3187 ..Three Month 0.8864 -0.0012 - - 1.1539 0.0026
Denmark Danish Krone 6.5992 -0.0088 7.4409 0.0004 8.5876 0.0201 Nigeria Nigerian Naira 321.2500 - 362.2249 0.4976 418.0439 1.5285 Tunisia Tunisian Dinar 2.1927 -0.0026 2.4724 0.0005 2.8534 0.0071 ..One Year 0.8850 -0.0013 - - 1.1533 0.0026
Egypt Egyptian Pound 8.8784 -0.0017 10.0108 0.0118 11.5535 0.0400 Norway Norwegian Krone 8.2232 0.0052 9.2720 0.0185 10.7008 0.0458 Turkey Turkish Lira 2.9298 0.0005 3.3034 0.0051 3.8125 0.0146
Hong Kong Hong Kong Dollar 7.7543 -0.0008 8.7433 0.0112 10.0907 0.0359 Pakistan Pakistani Rupee 104.6550 -0.0150 118.0036 0.1452 136.1880 0.4785 United Arab Emirates UAE Dirham 3.6731 0.0000 4.1415 0.0057 4.7798 0.0175
Hungary Hungarian Forint 275.8991 0.7659 311.0896 1.2897 359.0286 2.3057 Peru Peruvian Nuevo Sol 3.3140 0.0036 3.7367 0.0091 4.3125 0.0204 United Kingdom Pound Sterling 0.7685 -0.0028 0.8665 -0.0020 - -
India Indian Rupee 66.7700 - 75.2864 0.1034 86.8881 0.3177 Philippines Philippine Peso 46.3835 0.1385 52.2996 0.2278 60.3590 0.4003 ..One Month 0.7685 -0.0028 0.8664 -0.0020 - -
Rates are derived from WM Reuters Spot Rates and MorningStar (latest rates at time of production). Some values are rounded. Currency redenominated by 1000. The exchange rates printed in this table are also available at www.FT.com/marketsdata
UK SERIES
FTSE ACTUARIES SHARE INDICES www.ft.com/equities FT 30 INDEX FTSE SECTORS: LEADERS & LAGGARDS FTSE 100 SUMMARY
Produced in conjunction with the Institute and Faculty of Actuaries Aug 17 Aug 16 Aug 15 Aug 12 Aug 11 Yr Ago High Low Year to date percentage changes Closing Day's Closing Day's
Strlg Day's Euro Strlg Strlg Year Div P/E X/D Total FT 30 2979.40 2997.20 3030.40 3031.40 3009.70 0.00 3038.80 2508.90 Industrial Metals & 143.34 Consumer Goods 14.31 Media 3.84 FTSE 100 Price Change FTSE 100 Price Change
Aug 17 chge% Index Aug 16 Aug 15 ago yield% Cover ratio adj Return FT 30 Div Yield 1.54 1.54 1.52 1.53 1.53 0.00 3.93 2.74 Mining 64.16 Chemicals 13.73 Electricity 3.55 3I Group PLC 621.00 -4.00 Legal & General Group PLC 210.60 -1.10
FTSE 100 (100) 6859.15 -0.50 6170.24 6893.92 6941.19 6526.29 3.68 0.68 40.10 188.99 5538.61 P/E Ratio net 28.89 29.03 29.34 29.24 29.15 0.00 19.44 14.26 Tech Hardware & Eq 55.07 Oil Equipment & Serv 13.57 FTSE 250 Index 2.82 Admiral Group PLC 2081 -173.00 Lloyds Banking Group PLC 53.48 -0.47
FTSE 250 (250) 17758.68 -0.28 15975.05 17808.50 17929.27 17616.94 2.60 1.93 19.88 298.66 12582.39 FT 30 since compilation: 4198.4 high: 19/07/1999; low49.4 26/06/1940Base Date: 1/7/35 Basic Materials 54.40 Construct & Material 13.54 Household Goods & Ho 0.68 Anglo American PLC 865.70 -24.30 London Stock Exchange Group PLC 2797 -84.00
FTSE 250 ex Inv Co (209) 19096.09 -0.34 17178.14 19161.24 19287.81 19205.05 2.64 2.06 18.40 326.83 13798.80 FT 30 hourly changes Technology 39.19 Gas Water & Multi 13.35 Automobiles & Parts -0.45 Antofagasta PLC 542.50 -16.00 Marks And Spencer Group PLC 336.40 -1.10
FTSE 350 (350) 3790.01 -0.47 3409.35 3807.81 3833.87 3631.74 3.50 0.83 34.34 97.68 6155.40 8 9 10 11 12 13 14 15 16 High Low Industrial Eng 34.77 Beverages 12.67 Financial Services -1.38 Arm Holdings PLC 1687 - Mediclinic International PLC 1091 -19.00
FTSE 350 ex Investment Trusts (309) 3762.78 -0.48 3384.85 3780.95 3806.74 3610.03 3.53 0.83 34.25 97.96 3147.45 2997.2 2989 2990 2995.1 2987.7 2987.4 2984.9 2976.5 2981.6 3006 2976.5 Oil & Gas Producers 27.59 Nonlife Insurance 11.73 Consumer Services -1.83 Ashtead Group PLC 1228 -4.00 Merlin Entertainments PLC 479.90 1.80
FTSE 350 Higher Yield (125) 3557.31 -0.48 3200.03 3574.41 3595.82 3357.44 4.85 0.40 51.46 124.49 5989.37 FT30 constituents and recent additions/deletions can be found at www.ft.com/ft30 Oil & Gas 27.11 Industrials 11.45 Telecommunications -2.35 Associated British Foods PLC 2972 -10.00 Mondi PLC 1599 -12.00
FTSE 350 Lower Yield (225) 3650.75 -0.45 3284.08 3667.44 3696.10 3556.87 1.97 2.04 24.94 55.94 3927.69 Tobacco 26.14 Aerospace & Defense 11.37 Food Producers -2.36 Astrazeneca PLC 5069 -28.00 Morrison (Wm) Supermarkets PLC 187.50 -2.10
FTSE SmallCap (279) 4886.69 -0.10 4395.89 4891.55 4903.18 4696.60 2.76 1.38 26.35 84.69 6825.77 Industrial Transport 22.06 Utilities 11.33 Travel & Leisure -3.78
FTSE SmallCap ex Inv Co (144) 4321.17 -0.05 3887.17 4323.40 4341.04 4281.63 2.81 1.87 19.07 77.11 6338.61 FX: EFFECTIVE INDICES Forestry & Paper 21.81 FTSE 100 Index 10.79 Financials -4.96
Aviva PLC 413.90 -3.10 National Grid PLC 1070 -11.00
Babcock International Group PLC 1021 7.00 Next PLC 5360 -25.00
FTSE All-Share (629) 3731.81 -0.45 3357.00 3748.86 3773.93 3576.32 3.48 0.85 33.98 95.10 6129.21 Personal Goods 21.37 Health Care Eq & Srv 9.58 Leisure Goods -7.59
Aug 16 Aug 15 Mnth Ago Aug 17 Aug 16 Mnth Ago Bae Systems PLC 522.50 1.00 Old Mutual PLC 209.00 -4.50
FTSE All-Share ex Inv Co (453) 3688.65 -0.47 3318.18 3706.17 3731.25 3541.13 3.52 0.84 33.74 95.47 3135.96 Software & Comp Serv 21.26 FTSE All{HY-}Share Index 9.23 Real Est Invest & Tr -8.24 Barclays PLC 160.15 -1.60 Paddy Power Betfair PLC 9720 65.00
FTSE All-Share ex Multinationals (565) 1131.39 -0.41 843.53 1136.05 1145.38 1243.06 3.13 1.41 22.67 24.53 1971.27 Australia 91.86 92.32 92.55 Sweden 78.68 78.80 78.65 Electronic & Elec Eq 18.75 Equity Invest Instr 9.11 Life Insurance -9.05 Barratt Developments PLC 448.20 6.50 Pearson PLC 882.50 -6.00
FTSE Fledgling (104) 8201.27 -0.45 7377.56 8238.72 8186.78 7917.00 2.51 -0.01-2744.97 123.46 15020.40 Canada 90.37 90.27 90.37 Switzerland 160.28 159.71 159.44 Pharmace & Biotech 15.35 Support Services 6.23 Banks -9.17 Berkeley Group Holdings (The) PLC 2491 -6.00 Persimmon PLC 1748 12.00
FTSE Fledgling ex Inv Co (53) 10711.25 -0.79 9635.44 10796.17 10651.38 10882.48 2.68 -1.10 -33.87 167.69 19084.08 Denmark 107.84 107.77 107.49 UK 77.15 76.88 79.80 Health Care 14.84 Mobile Telecomms 5.56 General Retailers -9.85 Bhp Billiton PLC 1046 -3.50 Provident Financial PLC 2834 -1.00
FTSE All-Small (383) 3388.85 -0.12 3048.48 3392.86 3399.35 3257.73 2.75 1.31 27.85 58.34 6077.08 Japan 152.61 152.13 145.61 USA 98.57 99.04 100.66 NON FINANCIALS Index 14.34 FTSE SmallCap Index 5.31 Fixed Line Telecomms -14.31 BP PLC 432.75 -3.50 Prudential PLC 1397.5 -18.00
FTSE All-Small ex Inv Co Index (197) 3222.06 -0.09 2898.44 3224.83 3235.34 3195.13 2.80 1.73 20.57 57.26 5987.88 New Zealand 116.30 116.01 116.51 Euro 89.62 89.53 88.67 Food & Drug Retailer 5.13 Real Est Invest & Se -21.08 British American Tobacco PLC 4947 -21.00 Randgold Resources LD 8385 -200.00
FTSE AIM All-Share Index (820) 780.52 -0.38 702.13 783.50 784.66 751.18 1.64 0.67 91.45 6.24 847.37 Norway 88.14 88.66 86.67
British Land Company PLC 651.50 -4.50 Reckitt Benckiser Group PLC 7487 -34.00
FTSE Sector Indices Source: Bank of England. New Sterling ERI base Jan 2005 = 100. Other indices base average 1990 = 100. Bt Group PLC 395.80 3.20 RELX PLC 1442 -9.00
Oil & Gas (16) 7650.06 -0.24 6881.71 7668.58 7670.37 6684.74 6.07 -0.63 -26.11 351.61 6754.06 Index rebased 1/2/95. for further information about ERIs see www.bankofengland.co.uk Bunzl PLC 2389 -22.00 Rio Tinto PLC 2436.5 -50.00
Oil & Gas Producers (9) 7303.57 -0.23 6570.02 7320.60 7324.92 6330.18 6.13 -0.66 -24.84 340.57 6672.75 Burberry Group PLC 1358 -8.00 Rolls-Royce Holdings PLC 782.50 -5.50
Oil Equipment Services & Distribution (7)15425.92 -0.51 13876.58 15504.60 15341.77 16967.62 4.14 0.50 48.56 394.46 11665.55 FTSE GLOBAL EQUITY INDEX SERIES Capita PLC 1010 - Royal Bank Of Scotland Group PLC 190.30 -1.30
Basic Materials (27) 4232.14 -1.54 3807.08 4298.48 4245.15 3724.25 2.71 0.17 223.16 67.29 4237.29 Carnival PLC 3646 23.00 Royal Dutch Shell PLC 2019.5 4.00
Chemicals (7) 13097.62 -0.05 11782.13 13103.77 13136.78 11974.29 2.26 2.07 21.37 239.20 11496.17 Aug 17 No of US $ Day Mth YTD Total
YTD Gr Div Aug 17 No of US $ Day Mth YTD Total YTD Gr Div Centrica PLC 230.00 -3.60 Royal Dutch Shell PLC 1927.5 -2.50
Forestry & Paper (1) 18793.90 -0.74 16906.29 18934.94 19040.72 18300.25 2.49 3.97 10.14 347.94 19959.28 Regions & countries stocks indices % % % retn
% Yield Sectors stocks indices % % % retn % Yield Coca-Cola Hbc AG 1702 -10.00 Royal Mail PLC 510.00 -2.00
Industrial Metals & Mining (2) 1794.46 -1.09 1614.23 1814.15 1806.12 986.91 0.00 0.00 466.93 0.00 1566.00 FTSE Global All Cap 7711 475.69 -0.5 2.2 5.5
7.4 662.62
2.5 Oil & Gas 151 349.24 0.3 0.3 14.5 547.48 17.5 3.6 Compass Group PLC 1490 -7.00 Rsa Insurance Group PLC 507.00 -4.00
Mining (17) 11574.11 -1.79 10411.64 11784.79 11603.12 10144.05 2.81 -0.23 -158.05 180.17 6068.75 FTSE Global All Cap 7079 462.39 0.3 7.3 -0.3
0.2 624.68
2.5 Oil & Gas Producers 110 325.26 0.3 0.3 14.0 519.47 17.0 3.7 Crh PLC 2535 23.00 Sabmiller PLC 4378 -4.00
FTSE Global Large Cap 1425 417.88 -0.4 2.0 4.8
6.9 596.28
2.7 Oil Equipment & Services 31 328.65 0.1 0.1 18.4 468.01 20.9 3.0 Dcc PLC 7000 10.00 Sage Group PLC 732.50 -1.00
Industrials (116) 4826.53 -0.23 4341.77 4837.78 4882.05 4558.54 2.36 1.08 39.12 74.33 4877.93
Construction & Materials (15) 6250.76 0.75 5622.95 6204.32 6151.64 5418.44 2.03 0.35 140.05 87.22 6495.65 FTSE Global Mid Cap 1642 644.42 -0.5 2.7 7.0
8.6 854.07
2.1 Basic Materials 256 408.33 0.4 0.4 16.2 610.24 18.5 2.7 Diageo PLC 2178 6.50 Sainsbury (J) PLC 234.40 -0.60
Aerospace & Defense (9) 4721.67 -0.12 4247.44 4727.28 4792.73 4755.17 2.50 -0.50 -80.07 74.36 4964.28 FTSE Global Small Cap 4644 675.13 -0.6 2.6 7.6
9.1 867.77
2.0 Chemicals 125 611.27 0.3 0.3 3.3 918.22 5.6 2.8 Direct Line Insurance Group PLC 373.10 -1.20 Schroders PLC 2749 -36.00
General Industrials (5) 4222.10 -0.50 3798.04 4243.47 4289.22 3680.45 2.87 1.12 31.20 61.94 4671.39 FTSE All-World 3067 277.44 -0.4 2.2 5.2
7.2 407.97
2.6 Forestry & Paper 16 211.66 -0.2 -0.2 8.0 350.04 11.2 3.7 Dixons Carphone PLC 364.70 1.70 Severn Trent PLC 2409 -20.00
Electronic & Electrical Equipment (10) 6272.59 -0.26 5642.59 6288.98 6417.45 5605.04 1.99 1.79 28.03 74.29 5629.89 FTSE World 2542 491.14 -0.5 2.1 5.0
7.0 969.45
2.6 Industrial Metals & Mining 62 333.93 0.3 0.3 29.8 497.55 31.3 2.2 Easyjet PLC 1047 -13.00 Shire PLC 5030 -35.00
Industrial Engineering (13) 10070.23 -1.03 9058.80 10175.47 10316.44 8557.92 2.22 1.30 34.63 190.13 12062.61 FTSE Global All Cap ex UNITED KINGDOM In 7383 492.14 -0.5 2.2 6.2
8.0 675.51
2.4 Mining 53 514.50 0.6 0.6 59.0 766.44 61.6 2.5 Experian PLC 1506 -12.00 Sky PLC 856.00 -4.00
Industrial Transportation (8) 4738.85 -0.39 4262.90 4757.49 4806.17 4242.43 3.64 1.08 25.52 123.38 4101.79 FTSE Global All Cap ex USA 5766 433.73 -0.3 3.7 4.0
6.4 644.29
3.0 Industrials 536 327.56 -0.5 -0.5 9.5 462.43 11.2 2.2 Fresnillo PLC 1927 -55.00 Smith & Nephew PLC 1264 -16.00
Support Services (56) 7021.99 -0.33 6316.72 7045.48 7114.06 6802.16 2.26 1.76 25.09 103.25 7158.39 FTSE Global All Cap ex JAPAN 6447 486.44 -0.4 2.1 6.0
8.0 683.93
2.5 Construction & Materials 111 480.05 -0.3 -0.3 14.6 710.09 16.5 2.0 Gkn PLC 307.40 -1.20 Smiths Group PLC 1342 -8.00
FTSE Global All Cap ex Eurozone 7067 493.23 -0.5 1.9 6.3
8.1 674.15
2.4 Aerospace & Defense 26 537.32 -1.1 -1.1 6.1 751.78 7.7 2.3 Glaxosmithkline PLC 1680.5 -9.00 Sse PLC 1515 -11.00
Consumer Goods (39) 20863.12 -0.14 18767.69 20893.14 20958.03 17334.68 2.64 1.79 21.11 396.88 15023.12
FTSE Developed 2094 444.82 -0.5 1.9 4.2
6.1 624.33
2.5 General Industrials 55 238.11 -0.3 -0.3 9.8 361.48 11.6 2.5 Glencore PLC 192.60 -4.30 St. James's Place PLC 954.50 -4.50
Automobiles & Parts (1) 7224.04 -0.39 6498.48 7252.24 7242.84 6930.29 2.85 1.29 27.32 205.63 6848.30
FTSE Developed All Cap 5678 467.96 -0.5 2.0 4.6
6.4 649.32
2.5 Electronic & Electrical Equipment 69 337.11 -0.7 -0.7 6.5 437.20 7.8 1.9 Hammerson PLC 563.00 -0.50 Standard Chartered PLC 637.10 -16.00
Beverages (6) 17363.04 0.12 15619.15 17342.19 17418.12 13781.57 2.26 1.54 28.75 384.95 12102.23
FTSE Developed Large Cap 898 410.00 -0.4 1.8 3.9
5.8 583.77
2.6 Industrial Engineering 106 612.88 -0.6 -0.6 14.4 853.28 16.4 2.4 Hargreaves Lansdown PLC 1311 -27.00 Standard Life PLC 353.80 -1.50
Food Producers (8) 8655.65 -0.23 7786.30 8675.86 8715.32 8496.92 1.91 1.82 28.79 94.31 7329.82
FTSE Developed Europe Large Cap 223 321.70 -0.2 2.8 -2.5
0.7 523.59
3.7 Industrial Transportation 94 548.19 0.0 0.0 10.7 773.14 12.6 2.5 Hikma Pharmaceuticals PLC 2266 -46.00 Taylor Wimpey PLC 153.00 -0.80
Household Goods & Home Construction (15)13805.96 -0.17 12419.33 13829.20 13880.58 13371.44 2.26 2.55 17.36 178.12 9513.42
FTSE Developed Europe Mid Cap 308 505.14 -0.2 4.8 -1.5
0.9 740.97
2.7 Support Services 75 290.41 -0.6 -0.6 5.3 393.08 6.6 2.0 HSBC Holdings PLC 542.90 0.40 Tesco PLC 156.25 -1.45
Leisure Goods (1) 5237.51 0.64 4711.47 5204.15 5187.47 5519.79 3.26 1.50 20.50 129.52 4540.05
FTSE Dev Europe Small Cap 704 707.22 -0.1 5.6 -3.3
-1.4 1006.41
2.6 Consumer Goods 423 440.80 -0.4 -0.4 5.8 637.42 7.6 2.4 Imperial Brands PLC 4128.5 -10.50 Travis Perkins PLC 1525 -9.00
Personal Goods (6) 27205.60 0.00 24473.15 27204.68 27400.87 22351.45 2.67 3.24 11.56 560.53 17958.41
FTSE North America Large Cap 291 464.85 -0.5 0.8 6.5
8.1 621.00
2.2 Automobiles & Parts 103 356.63 -0.8 -0.8 -6.6 497.14 -4.7 3.0 Informa PLC 707.00 - Tui AG 1028 -3.00
Tobacco (2) 57959.34 -0.37 52138.08 58175.65 58184.76 44066.90 3.22 1.18 26.24 1163.34 36172.38
FTSE North America Mid Cap 394 704.52 -0.7 1.2 10.0
11.2 879.13
1.7 Beverages 48 601.88 -0.6 -0.6 5.3 881.56 6.9 2.5 Intercontinental Hotels Group PLC 3298 -15.00 Unilever PLC 3614 3.50
Health Care (19) 10809.19 -0.57 9723.54 10871.21 11004.69 9501.26 3.15 0.40 78.36 299.10 8133.88
FTSE North America Small Cap 1474 712.09 -0.8 1.6 11.0
12.2 864.45
1.7 Food Producers 104 618.94 -0.4 -0.4 10.8 922.45 12.8 2.2 International Consolidated Airlines Group S.A. 385.20 -9.10 United Utilities Group PLC 986.50 -5.00
Health Care Equipment & Services (8) 7986.00 -1.29 7183.91 8090.41 8172.74 7127.62 1.38 2.02 36.03 64.89 6832.26
FTSE North America 685 312.09 -0.6 0.9 7.1
8.6 426.97
2.1 Household Goods & Home Construction 47 429.29 -0.6 -0.6 6.9 616.98 8.7 2.3 Intertek Group PLC 3603 -14.00 Vodafone Group PLC 235.35 -1.10
Pharmaceuticals & Biotechnology (11)14654.41 -0.50 13182.57 14728.04 14911.91 12865.53 3.32 0.34 88.47 434.85 9818.82
FTSE Developed ex North America 1409 226.85 -0.3 3.5 0.1
2.5 361.90
3.2 Leisure Goods 31 161.19 0.3 0.3 22.2 208.58 22.9 1.3 Intu Properties PLC 307.50 -2.30 Whitbread PLC 4035 34.00
Consumer Services (93) 4752.65 -0.28 4275.31 4765.78 4820.00 4977.35 2.58 1.99 19.49 83.10 4367.02 FTSE Japan Large Cap 176 325.31 -0.9 4.0 -0.7
0.5 411.86
2.4 Personal Goods 79 633.81 -0.3 -0.3 6.1 871.17 7.5 2.0
Food & Drug Retailers (7) 2677.35 -0.82 2408.45 2699.42 2710.51 3100.23 1.55 2.46 26.24 30.18 3095.32 Itv PLC 195.40 -0.50 Wolseley PLC 4223 -36.00
FTSE Japan Mid Cap 307 501.81 -0.7 4.1 2.1
3.1 612.41
2.0 Tobacco 11 1364.89 0.5 0.5 12.1 2721.44 14.4 3.5 Johnson Matthey PLC 3345 -4.00 Worldpay Group PLC 306.10 -1.40
General Retailers (31) 2596.40 -0.27 2335.63 2603.54 2641.63 3186.08 2.89 2.13 16.21 44.67 2895.80
FTSE Global wi JAPAN Small Cap 781 542.53 -0.9 2.9 3.1
4.3 684.59
2.2 Health Care 176 461.35 -0.8 -0.8 0.7 652.38 2.2 2.0 Kingfisher PLC 358.00 -1.70 WPP PLC 1760 -4.00
Media (21) 7708.34 -0.37 6934.14 7736.67 7822.27 7384.22 2.82 1.82 19.55 150.21 4643.93
FTSE Japan 483 136.13 -0.8 4.0 -0.2
1.0 193.58
2.3 Health Care Equipment & Services 63 720.04 -0.7 -0.7 10.8 830.65 11.5 1.0 Land Securities Group PLC 1076 -7.00
Travel & Leisure (34) 8412.19 -0.05 7567.29 8416.45 8517.02 8426.83 2.50 1.99 20.12 147.41 7807.21
FTSE Asia Pacific Large Cap ex Japan 549 594.70 0.1 4.1 9.9
12.4 909.67
3.1 Pharmaceuticals & Biotechnology 113 338.88 -0.8 -0.8 -2.6 499.47 -0.8 2.3
Telecommunications (6) 3851.70 -0.11 3464.85 3855.88 3905.71 4107.89 4.44 -0.23 -96.34 115.66 4159.48 FTSE Asia Pacific Mid Cap ex Japan 420 824.82 0.4 4.5 10.4
12.5 1211.94
2.7 Consumer Services 391 402.85 -0.5 -0.5 3.4 529.58 4.6 1.8
Fixed Line Telecommunications (4) 4595.42 0.66 4133.87 4565.16 4617.12 5234.72 3.70 1.74 15.52 115.79 4085.36
Mobile Telecommunications (2) 5295.18 -0.52 4763.34 5322.65 5395.78 5447.01 4.83 -1.04 -19.83 172.86 5124.06
FTSE Asia Pacific Small Cap ex Japan
FTSE Asia Pacific Ex Japan
1442 532.49
969 472.25
0.2
0.1
3.3
4.2
6.7
8.6
10.0
12.4
771.38
2.6 Food & Drug Retailers
767.43
3.1 General Retailers
53 306.83
123 564.80
-0.3
-0.8
-0.3
-0.8
2.3 420.03
6.0 723.50
3.7
7.1
1.9
1.5
UK STOCK MARKET TRADING DATA
Utilities (7) 9128.50 -0.97 8211.66 9218.26 9369.06 8396.50 4.45 1.72 13.06 303.54 10065.95 FTSE Emerging All Cap 2033 658.81 -0.2 4.8 15.3
18.0 961.38
2.9 Media 84 300.39 -0.5 -0.5 3.8 396.23 5.2 2.0 Aug 17 Aug 16 Aug 15 Aug 12 Aug 11 Yr Ago
Electricity (2) 8855.44 -0.74 7966.03 8921.64 9089.47 8868.79 5.60 1.47 12.18 484.22 12442.38 FTSE Emerging Large Cap 527 620.70 -0.2 4.8 15.2
18.0 912.05
3.0 Travel & Leisure 131 378.13 -0.2 -0.2 -0.9 502.03 0.3 1.9 SEAQ Bargains 3986.00 4096.00 4591.00 4591.00 4591.00 4462.00
Gas Water & Multiutilities (5) 8690.93 -1.03 7818.04 8781.29 8919.81 7824.73 4.18 1.80 13.29 245.09 9578.79 FTSE Emerging Mid Cap 446 852.61 -0.2 5.1 20.1
22.5 1234.42
2.6 Telecommunication 91 171.39 -1.0 -1.0 8.8 310.13 11.9 3.9 Order Book Turnover (m) 67.21 47.39 125.43 125.43 125.43 104.93
Financials (288) 4288.32 -0.64 3857.62 4315.83 4354.69 4817.18 3.97 1.38 18.28 127.88 3863.54 FTSE Emerging Small Cap 1060 681.04 0.3 4.3 10.6
13.0 955.99
2.7 Fixed Line Telecommuniations 42 144.29 -1.4 -1.4 8.8 286.47 12.3 4.4 Order Book Bargains 705793.00 609169.00 755156.00 755156.00 755156.00 734968.00
Banks (11) 3372.22 -0.53 3033.53 3390.06 3422.76 4206.83 5.02 0.82 24.41 140.22 2427.32 FTSE Emerging Europe 112 311.13 -0.3 0.6 16.5
20.3 471.89
4.1 Mobile Telecommunications 49 179.14 -0.5 -0.5 8.7 292.49 11.3 3.3 Order Book Shares Traded (m) 1222.00 1009.00 1260.00 1260.00 1260.00 1311.00
Nonlife Insurance (10) 3085.17 -1.90 2775.30 3144.88 3174.37 2673.90 2.72 2.30 15.98 68.95 5310.34 FTSE Latin America All Cap 236 824.32 -0.8 6.8 37.7
40.0 1237.92
2.9 Utilities 164 258.87 -0.9 -0.9 9.1 487.16 12.1 3.8 Total Equity Turnover (m) 8215.47 6986.83 7211.58 7211.58 7211.58 7583.72
Life Insurance/Assurance (10) 7089.79 -1.07 6377.72 7166.18 7274.86 8077.47 4.16 1.38 17.40 201.97 6695.15 FTSE Middle East and Africa All Cap 219 734.73 -0.9 6.6 18.8
20.9 1114.53
2.9 Electricity 111 281.46 -1.0 -1.0 8.7 523.80 11.6 3.7 Total Mkt Bargains 795424.00 698023.00 842037.00 842037.00 842037.00 822673.00
Index- Real Estate Investment & Services (20) 2416.49 -0.23 2173.79 2422.15 2430.00 3334.39 2.73 3.72 9.83 42.78 6313.55 FTSE Global wi UNITED KINGDOM All Cap In 328 316.30 0.0 1.7 -3.8
-1.1 514.24
3.5 Gas Water & Multiutilities 53 276.47 -0.8 -0.8 9.8 533.96 12.9 3.9 Total Shares Traded (m) 4499.00 4359.00 5729.00 5729.00 5729.00 4961.00
Real Estate Investment Trusts (28) 2672.82 -0.44 2404.37 2684.51 2713.42 3176.27 3.53 4.15 6.83 60.36 3229.23 FTSE Global wi USA All Cap 1945 535.57 -0.6 0.9 6.8
8.3 695.54
2.0 Financials 691 196.75 -0.4 -0.4 -2.0 313.11 0.4 3.3 Excluding intra-market and overseas turnover. *UK only total at 6pm. UK plus intra-market turnover. (u) Unavaliable.
General Financial (33) 7876.38 -0.99 7085.30 7955.24 7979.23 7985.98 3.32 1.86 16.15 188.62 8769.62 FTSE Europe All Cap 1422 374.03 -0.2 3.3 -1.9
1.1 588.79
3.4 Banks 247 167.87 -0.2 -0.2 -5.9 286.15 -3.1 3.9 (c) Market closed.
Equity Investment Instruments (176) 8397.48 -0.02 7554.06 8398.81 8438.66 7701.76 2.50 0.97 41.12 132.58 4494.67 FTSE Eurozone All Cap 644 351.88 -0.3 4.9 -1.9
1.0 560.09
3.4 Nonlife Insurance 68 215.11 -0.6 -0.6 0.3 305.71 2.4 2.6
Non Financials (341) 4524.89 -0.40 4070.43 4543.05 4570.28 4114.47 3.33 0.66 45.77 109.46 6507.52 FTSE RAFI All World 3000 3038 5722.53 -0.3 2.4 5.5
7.8 7370.29
3.2 Life Insurance 51 181.30 -0.8 -0.8 -8.6 281.92 -6.3 3.4
Technology (18) 1995.75 -0.44 1795.30 2004.48 2010.31 1314.07 1.10 1.63 55.62 15.01 2522.95 FTSE RAFI US 1000 998 9528.93 -0.5 0.5 7.8
9.5 12239.61
2.4 Financial Services 152 224.94 -0.4 -0.4 1.1 304.05 2.6 2.2 All data provided by Morningstar unless otherwise noted. All elements listed are indicative and believed
Software & Computer Services (12) 2219.35 -0.64 1996.45 2233.55 2249.10 1674.60 1.68 1.62 36.65 26.40 2953.02 FTSE EDHEC-Risk Efficient All-World 3067 336.76 -0.5 2.1 6.7
8.4 459.73
2.2 Technology 188 190.40 -0.4 -0.4 9.3 230.26 10.8 1.7 accurate at the time of publication. No offer is made by Morningstar or the FT. The FT does not warrant nor
Technology Hardware & Equipment (6) 2459.79 -0.30 2212.74 2467.11 2467.35 1457.25 0.70 1.65 86.60 11.42 2844.75 FTSE EDHEC-Risk Efficient Developed Europe 531 278.18 -0.3 3.9 -0.4
1.9 415.29
2.6 Software & Computer Services 92 336.31 -0.5 -0.5 8.4 389.20 9.3 1.0 guarantee that the information is reliable or complete. The FT does not accept responsibility and will not be
Technology Hardware & Equipment 96 139.36 -0.3 -0.3 10.3 174.43 12.5 2.5 liable for any loss arising from the reliance on or use of the listed information.
Hourly movements 8.00 9.00 10.00 11.00 12.00 13.00 14.00 15.00 16.00 High/day Low/day Alternative Energy 10 103.87 -0.1 -0.1 0.5 139.33 1.8 1.4 For all queries e-mail ft.reader.enquiries@morningstar.com
FTSE 100 6917.58 6888.54 6882.14 6893.25 6883.36 6878.89 6872.11 6852.87 6864.26 6917.58 6850.39 Real Estate Investment & Services 102 300.03 -1.1 -1.1 6.1 488.13 8.2 2.6
FTSE 250 17870.61 17818.31 17800.95 17831.40 17783.99 17797.59 17787.73 17753.70 17778.35 17874.81 17746.76 The FTSE Global Equity Series, launched in 2003, contains the FTSE Global Small Cap Indices and broader FTSE Global All Cap Indices (large/mid/small cap) as well as the enhanced FTSE All-World index Series (large/
mid cap) - please see www.ftse.com/geis. The trade names Fundamental Index and RAFI are registered trademarks and the patented and patent-pending proprietary intellectual property of Research Affiliates, LLC
Data provided by Morningstar | www.morningstar.co.uk
FTSE SmallCap 4889.32 4894.42 4887.26 4887.04 4890.60 4896.04 4896.45 4894.10 4892.88 4897.66 4885.99
FTSE All-Share 3761.25 3746.90 3743.33 3749.21 3743.39 3742.02 3738.73 3729.13 3734.88 3761.25 3728.69 (US Patent Nos. 7,620,577; 7,747,502; 7,778,905; 7,792,719; Patent Pending Publ. Nos. US-2006-0149645-A1, US-2007-0055598-A1, US-2008-0288416-A1, US-2010- 0063942-A1, WO 2005/076812, WO 2007/078399 A2,
Time of FTSE 100 Day's high:07:03:00 Day's Low14:00:15 FTSE 100 2010/11 High: 6941.19(15/08/2016) Low: 5536.97(11/02/2016) WO 2008/118372, EPN 1733352, and HK1099110). EDHEC is a trade mark of EDHEC Business School As of January 2nd 2006, FTSE is basing its sector indices on the Industrial Classification Benchmark - please see
Time of FTSE All-Share Day's high:07:03:00 Day's Low13:56:00 FTSE 100 2010/11 High: 3773.93(15/08/2016) Low: 3046.53(11/02/2016) www.ftse.com/icb. For constituent changes and other information about FTSE, please see www.ftse.com. FTSE International Limited. 2013. All Rights reserved. FTSE is a trade mark of the London Stock Exchange
Group companies and is used by FTSE International Limited under licence.
Further information is available on http://www.ftse.com FTSE International Limited. 2013. All Rights reserved. FTSE is a trade mark of the
London Stock Exchange Group companies and is used by FTSE International Limited under licence. Sector P/E ratios greater than 80 are not shown.
For changes to FTSE Fledgling Index constituents please refer to www.ftse.com/indexchanges. Values are negative.

UK RIGHTS OFFERS UK COMPANY RESULTS UK RECENT EQUITY ISSUES

Amount Latest Company Turnover Pre-tax EPS(p) Div(p) Pay day Total Issue Issue Stock Close Mkt
Issue paid renun. closing Access Intelligence Int 5.535 2.024 1.175L 0.471L 0.03L 0.17 - - - - - date price(p) Sector code Stock price(p) +/- High Low Cap (m)
price up date High Low Stock Price p +or- Admiral Group Int 511.5 447.7 189.5 181.7 55.9 54.8 36.8 25.1 Oct 7 70.217 47.6 07/27 11.00 WDC WideCells Group PLC 12.50 0.60 13.00 11.00 675.7
95p Nil 23-08-16 140.00 136.00 Melrose Industries PLC 138.00 0.00 Ashley (Laura) Holdings Pre 400.9 303.6 23.9 23.5 2.34 2.51 - 1 - 2 2 07/26 151.00 AIM SECG SEC SpA 153.50 0.50 155.00 151.00 1876.1
Balfour Beatty Int 3323 3466 21L 150L 1.6L 21.9L 0.9 - Dec 5 0.9 - 07/08 161.00 AIM DAR Dorcaster PLC 162.50 0.00 168.00 160.00 1625.0
CLS Holdings Int 51.2 49.8 33.1 80.2 71 160.5 - - - - -
Imaginatik Pre 3.893 3.336 1.11L 1.582L 1.15L 2.46L - - - - -
Lookers Int 2340.5 1746.8 46.7 39.9 9.44 8.08 1.28 1.07 Nov 25 3.319 2.94
Murray International Trust Int 321.861 29.663L 30.3 28.7 10.5 10.5 Nov 17 25.418 25.5
Newmark Security Pre 21.823 22.854 1.196 2.252 0.26 0.48 0.1 0.1 Oct 10 0.1 0.1
Robinson Int 12.762 13.637 0.284 0.081L 1 2L 2.5 2.5 Oct 3 5.484 5.25

Figures in m. Earnings shown basic. Figures in light text are for corresponding period year earlier. Placing price. *Intoduction. When issued. Annual report/prospectus available at www.ft.com/ir
For more information on dividend payments visit www.ft.com/marketsdata For a full explanation of all the other symbols please refer to London Share Service notes.
Thursday 18 August 2016 FINANCIAL TIMES 17

MARKET DATA

FT500: THE WORLD'S LARGEST COMPANIES

52 Week 52 Week 52 Week 52 Week 52 Week 52 Week
Stock Price Day Chg High Low Yld P/E MCap m Stock Price Day Chg High Low Yld P/E MCap m Stock Price Day Chg High Low Yld P/E MCap m Stock Price Day Chg High Low Yld P/E MCap m Stock Price Day Chg High Low Yld P/E MCap m Stock Price Day Chg High Low Yld P/E MCap m
Australia (A$) Finland () Japan () Sweden (SKr) AT&T 41.54 -0.42 43.89 30.97 4.48 18.39 255720.24 Lilly (E) 79.71 -0.13 92.85 67.88 2.47 35.29 87987.36
ANZ 26.77 0.19 29.88 21.86 8.81 13.20 59823.26 Nokia 5.02 -0.07 7.11 4.48 3.06-139.32 33030.83 AstellasPh 1625.5 -8.50 1977 1358 1.87 16.98 34907.42 AtlasCpcoB 215.90 -1.70 222.70 162.60 2.76 24.97 10007.81 AutomData 88.95 -0.61 96.00 64.29 2.28 28.12 40576.94 Lockheed 253.46 -3.31 266.93 181.91 2.25 24.77 76774.5
BHPBilltn 20.91 0.66 25.88 14.06 9.17 29.54 51267.23 SampoA 36.63 -0.41 47.67 34.42 4.87 14.16 23079.61 Bridgestne 3360 35.00 4620 3089 3.97 10.53 27239.88 Ericsson 61.25 -0.75 89.85 59.60 5.84 15.19 22332.49 Avago Tech 172.03 -0.37 175.81 100.00 0.901760.55 68041.69 Lowes 76.01 -5.47 83.65 62.62 1.31 28.56 67352.82
CmwBkAu 74.04 -1.96 85.85 69.79 7.69 14.73 96943.44 France () Canon 2918 36.50 4076 2780 4.89 16.78 38804.74 H&M 267.80 -5.40 362.00 234.50 3.28 26.26 46466.66 BakerHu 50.86 -0.35 58.23 37.58 1.30 -7.44 21760.93 Lyondell 76.49 -0.31 98.25 69.10 4.06 8.44 31798.57
CSL 110.84 -5.91 121.25 87.11 1.77 32.31 38625.48 Airbus Grpe 50.69 -0.80 68.50 48.07 2.46 14.13 44162.77 CntJpRwy 17105 -220.00 22935 16840 0.70 10.21 35132.66 Investor 296.30 -0.20 332.80 256.80 3.26 -16.21 16031.83 BankAm 15.14 -0.03 18.09 10.99 1.20 13.17 154500.65 Marathon Ptl 42.07 -0.06 59.99 29.24 2.96 11.91 22244.93
NatAusBk 27.45 0.41 32.76 23.82 9.40 12.81 55675.92 AirLiquide 98.43 -0.83 123.65 88.25 2.53 20.61 38355.77 Denso 4075 117.00 6115 3317 2.80 15.70 35919.84 Nordea Bk 77.20 -0.70 105.30 66.30 7.20 10.71 37140.29 Baxter 47.61 -0.64 49.49 32.18 0.97 5.64 26290.47 Marsh&M 66.86 -0.20 68.69 50.81 2.06 24.61 34646.76
Telstra 5.44 0.01 6.22 4.98 7.73 18.60 50771.8 AXA 17.92 -0.30 26.02 16.11 5.89 7.70 48969.49 EastJpRwy 8713 -70.00 12545 8659 1.42 14.57 33829.31 SEB 77.65 -0.25 104.40 67.75 5.27 11.23 20016.28 BB & T 37.56 0.06 40.43 29.95 2.83 14.90 30592.63 MasterCard 95.35 -0.28 101.76 74.61 0.75 28.72 102729.53
Wesfarmers 43.22 0.58 44.12 36.65 5.56 23.47 37155.72 BNP Parib 43.41 -0.62 60.00 35.27 5.10 8.46 60999.62 Fanuc 17325 160.00 22790 15300 2.69 25.52 35251.61 SvnskaHn 105.70 -1.20 130.10 90.25 4.12 13.01 23874.88 BectonDick 172.14 -0.64 177.78 128.87 1.46 33.75 36528.45 McDonald's 116.62 -1.32 131.96 87.50 2.94 22.95 99519.08
Westpc 30.16 0.45 33.74 27.57 8.05 13.61 77042.58 ChristianDior 162.00 -1.20 187.50 133.75 1.68 22.29 33194.78 FastRetail 36970 470.00 55940 25305 0.79 95.93 39100.09 Swedbank 187.30 1.10 200.20 150.80 5.53 11.76 25186.31 BerkshHat 222330 1525 222865 186900 - 16.47 175394.8 McKesson 194.49 -0.52 216.91 148.29 0.56 19.55 43896.77
Woolworths 23.57 0.20 28.03 20.30 7.09-329.53 23009.13 Cred Agr 8.07 -0.10 13.04 6.79 7.13 6.61 25556.29 Fuji Hvy Ind 3839 145.00 5223 3252 3.03 8.49 29965.82 Telia Co 38.22 -0.43 50.50 35.56 3.80 16.20 19659.19 Biogen 312.49 -0.93 333.65 223.02 - 21.20 68473.05 Medtronic 86.54 -0.73 89.27 55.54 1.56 39.28 120595.63
Belgium () Danone 68.53 -0.72 70.45 51.73 1.86 38.37 50681.35 Hitachi 490.10 11.40 766.50 400.00 2.33 10.88 23619.11 Volvo 87.50 -1.45 101.90 72.20 3.22 12.98 16868.95 BkNYMeln 40.05 0.06 44.73 32.20 1.54 15.99 42760.36 Merck 62.65 -0.39 64.00 45.69 2.63 42.45 173240.29
AnBshInBv 111.50 0.05 124.20 87.73 3.07 54.49 202190.83 EDF 11.25 -0.30 20.94 9.13 13.90 195.42 25526.58 HondaMtr 3028 99.00 4256.5 2417 2.77 17.21 54688.73 Switzerland (SFr) BlackRock 367.52 0.45 375.95 275.00 2.37 20.12 59787.02 Metlife 40.11 -0.29 54.67 35.00 3.70 10.81 44075.77
KBC Grp 49.65 -0.40 62.10 39.35 3.69 15.41 23403.31 Engie SA 14.36 -0.32 17.40 12.34 6.68 -7.72 39431.14 JapanTob 3969 -22.00 4850 3551 3.07 17.22 79146.52 ABB 21.16 -0.13 21.60 15.94 - 28.56 48684.77 Boeing 134.44 -0.56 150.59 102.10 2.90 25.16 83867.16 Microsoft 57.29 -0.15 58.50 39.72 2.36 28.02 446422.31
Esslr Intl 113.50 -0.85 125.15 95.01 0.94 32.69 27911.28 KDDI 3241 51.00 3446 2519 1.62 20.31 84680.41 CredSuisse 11.51 -0.14 27.81 9.76 5.44 -5.06 24989.32 BrisMySq 58.45 -0.96 77.12 51.82 2.51 35.11 97661.68 Mnstr Bvrg 158.93 -0.69 166.50 113.08 - 48.76 30253.39
Brazil (R$)
Hermes Intl 393.55 -0.45 399.00 281.20 0.64 49.99 46846.07 Keyence 74020 640.00 75820 50500 0.15 - 44873.21 Nestle 78.35 -0.60 80.05 65.70 2.38 31.92 253311.59 CapOne 68.03 -0.59 82.08 58.03 2.13 10.94 34428.39 MondelezInt 42.57 -0.13 47.42 35.88 1.55 9.42 66219.13
Ambev 19.85 -0.15 20.46 15.99 2.12 27.46 97029.87
LOreal 173.80 -0.75 177.90 140.40 1.71 35.39 109699.07 MitsbCp 2073 58.50 2441.5 1565 2.30 -28.52 32865.35 Novartis 78.55 -0.55 101.30 67.00 3.00 32.42 214377.59 CardinalHlth 82.31 -0.37 91.23 73.25 1.90 19.57 26223.06 Monsanto 103.88 -1.57 114.26 81.22 1.85 35.31 45453.16
Bradesco 29.37 -0.51 32.00 16.27 2.90 11.80 25363.36
LVMH 156.05 -1.10 174.30 130.55 2.18 22.17 89337.96 MitsubEst 1951.5 -8.00 2968 1724 0.78 32.51 27053.79 Richemont 59.30 -1.25 86.75 55.75 2.45 20.02 32157.28 Carnival 46.64 0.06 55.77 40.52 2.30 20.99 25693.57 MorganStly 30.19 -0.07 38.21 21.16 1.93 14.22 57707.95
Cielo 34.14 -0.63 37.78 23.36 1.35 21.28 24038.13
Orange 13.61 -0.18 16.98 12.21 3.75 21.33 40821.04 MitsubishiEle 1319 29.50 1409.5 947.00 1.95 13.22 28238.28 Roche 244.00 -1.40 281.40 229.90 3.19 24.07 178085.71 Caterpillar 83.89 -0.40 84.73 56.36 3.57 55.24 49011.15 MylanNV 48.57 0.04 56.44 37.59 - 33.53 25980.65
ItauHldFin 30.95 -0.11 31.50 21.49 2.32 7.28 29328.98
PernodRic 104.95 -0.85 110.25 88.00 1.46 34.18 31408.98 MitsuiFud 2202 43.50 3864.5 2031.5 1.21 19.64 21766.96 Swiss Re 81.75 -1.35 99.75 76.85 5.45 7.67 30579.61 CBS 51.66 0.07 58.22 38.51 1.05 18.34 21019.15 Netflix 95.82 0.70 133.27 79.95 - 307.60 41080.47
Petrobras 14.73 0.07 14.88 5.67 - -5.67 34093.96
Renault 73.43 -1.00 98.14 59.59 2.20 8.39 24484.58 MitUFJFin 535.90 17.90 883.10 425.80 2.71 11.53 75707.59 Swisscom 479.50 -3.00 568.00 445.00 4.18 19.85 25804.1 Celgene 111.69 -0.48 132.00 92.98 - 48.21 86572.56 NextEraE 124.05 0.06 131.98 93.74 2.57 22.80 57307.74
Vale 18.65 -0.33 22.19 8.60 1.63 -3.93 18660.08
Safran 61.31 -0.08 72.45 48.87 1.72 -70.67 28829.25 Mizuho Fin 168.10 5.00 266.80 142.00 4.25 5.43 42104.09 Syngent 382.50 1.50 420.00 288.50 2.79 31.77 36786.97 CharlesSch 30.05 -0.10 34.52 21.51 0.81 26.61 39749.65 Nike 56.58 -0.31 68.20 47.25 0.98 29.30 76283.86
Canada (C$) Murata Mfg 12930 280.00 19820 10365 1.55 14.77 29040.91 Charter Communications 255.50 -1.64 261.75 156.13 - 14.32 69222.06 NorfolkS 89.08 -0.04 98.75 64.51 2.58 17.14 26149.41
Sanofi 70.05 -0.82 95.87 62.50 4.01 23.01 101804.22 UBS 13.11 -0.18 21.83 12.44 - 10.99 52438.33
BCE 61.83 -0.41 63.41 51.56 4.16 20.30 41801.5 NipponTT 4832 -22.00 5419 4005 2.17 13.51 100999.84 ChevrnTx 101.46 -0.09 107.58 69.58 4.11-267.25 191221.9 Northrop 216.94 -0.16 224.12 152.31 1.34 21.76 38739.99
Sant Gbn 38.73 -0.31 43.16 31.47 1.36 68.98 24229.43 Zurich Fin 248.00 -1.60 289.40 194.70 - 28.41 38782.01
BkMontrl 83.56 -0.01 85.50 64.01 3.62 13.78 41869.75 Nissan Mt 986.40 5.70 1321.5 893.10 4.05 8.52 43182.64 Chubb 125.60 -0.47 131.00 96.00 2.09 20.68 58413.98 NXP 87.43 0.02 98.09 61.61 - 21.85 30251.13
Schneider 60.01 -0.28 61.90 45.32 2.72 28.68 40038.52 Taiwan (NT$)
BkNvaS 66.60 0.10 67.40 51.17 3.83 13.13 62296.87 Nomura 461.20 12.30 857.30 338.80 2.68 16.38 17577.79 Cigna 132.25 0.42 149.86 121.87 0.03 17.62 33931.4 Occid Pet 76.25 0.24 78.31 58.22 3.83 -6.96 58249.38
SFR Group 22.26 -0.24 48.99 19.51 - -32.19 11061.29 Chunghwa Telecom 113.50 -1.50 125.50 93.10 4.06 21.49 28025.72
Brookfield 44.69 -0.12 46.52 37.11 1.40 27.67 34305.41 Nppn Stl 2070 134.00 2802 1773.5 2.07 34.75 19613.79 Cisco 30.36 -0.76 31.25 22.46 2.60 16.92 152697.03 Oracle 41.10 -0.22 42.00 33.13 1.31 22.21 169444.2
SocGen 30.79 -0.61 47.75 25.00 3.57 7.39 28034.83 Formosa PetChem 99.40 1.60 100.50 63.90 3.82 17.29 30139.57
CanadPcR 192.71 0.86 208.33 140.02 0.78 20.42 22648.46 NTTDCMo 2703.5 -5.00 2946 1961 2.46 18.58 106704.43 Citigroup 46.58 -0.04 57.92 34.52 0.42 10.05 135332.32 Pepsico 107.97 -0.03 110.94 76.48 2.36 34.07 155385.87
Total 43.35 -0.17 47.40 35.21 5.06 32.32 122336.89 HonHaiPrc 85.00 -1.20 92.50 72.50 4.04 10.32 42310.64
CanImp 99.89 -0.11 104.65 82.19 4.15 12.01 30659.56 Panasonic 1027 30.50 1466 799.00 1.43 16.21 25118.75 CME Grp 104.59 0.61 104.94 81.87 2.05 27.13 35418.34 Perrigo 88.69 0.03 198.42 82.50 0.46 106.43 12707.58
UnibailR 244.05 -1.40 257.85 212.05 3.81 9.94 27329.89 MediaTek 250.50 1.00 307.00 192.00 8.33 17.81 12531.06
CanNatRs 41.43 -0.11 42.17 21.27 2.14-110.20 35376.14 Seven & I 4387 34.00 5879 4051 1.42 29.67 38773.82 Coca-Cola 43.92 0.09 47.13 36.56 3.01 25.93 189538.43 Pfizer 34.86 0.07 37.39 28.25 3.24 31.69 211448.64
Vinci 66.99 -0.61 69.80 51.11 2.63 18.16 44961.25 TaiwanSem 177.00 1.50 182.00 112.50 3.21 17.19 146091.25
CanNatRy 82.29 0.79 85.43 66.62 1.61 18.84 49563.67 ShnEtsuCh 7169 231.00 7509 5160 1.46 20.50 30886.61 Cognizant 56.43 -0.87 69.80 51.22 - 22.71 34249.78 Phillips66 77.39 -0.59 94.12 69.79 2.91 13.83 40463.31
Vivendi 17.67 -0.18 23.57 14.87 15.54 16.65 25634.25
Enbridge 53.34 -0.38 57.84 40.03 3.60 39.52 38538.99 Softbank 6767 -35.00 7772 4133 0.56 18.10 81009.71 Thailand (THB) ColgtPlm 74.10 -0.22 75.38 50.84 2.01 48.80 66059.64 PhilMorris 99.64 0.17 104.20 76.54 3.99 24.49 154574.22
GtWesLif 31.14 -0.10 37.10 30.42 4.16 11.93 24039.93 Germany () PTT Explor 342.00 -2.00 348.00 197.00 2.61 54.17 28151.03
Sony 3253 -42.00 3568 2199 0.50 34.27 40952.17 Comcast 67.17 -0.15 68.36 50.01 1.38 22.48 161355.94 PNCFin 85.62 -0.05 99.28 77.40 2.32 12.13 42074.45
ImpOil 40.29 -0.33 47.96 37.25 1.36 119.41 26552.96 Allianz 131.45 -1.35 170.00 118.35 4.43 10.62 67734.81
SumitomoF 3438 109.00 5564 2766.5 4.15 6.50 48472.24 United Arab Emirates (Dhs) ConocPhil 42.79 -0.07 57.24 31.05 4.50 -7.73 52995.64 PPG Inds 102.96 -0.69 117.00 82.93 1.40 19.55 27393.89
Manulife 17.09 0.01 22.65 15.32 4.01 14.07 26209 BASF 72.08 -0.77 79.20 56.01 3.55 17.28 74648.14
Takeda Ph 4690 38.00 6609 4098 3.65 24.97 36958.05 Emirtestele 19.85 -0.10 20.20 11.40 3.91 19.97 46999.87 Corning 22.46 -0.29 23.13 15.42 2.00 70.86 23283.08 Praxair 119.74 -1.53 125.00 95.60 2.38 22.41 34153.64
Potash 20.80 -0.34 35.27 19.93 8.37 20.51 13576.09 Bayer 95.65 -2.27 131.20 83.45 2.51 18.75 89186.31
TokioMarine 3885 147.00 5438 3063 2.29 14.27 29343.26 United Kingdom (p) Costco 167.36 -1.05 169.73 117.03 0.88 35.39 73314.65 Priceline 1407.58 -1.08 1476.52 954.02 - 30.75 69572.39
RylBkC 80.01 0.07 80.97 64.52 3.60 13.19 92389.11 BMW 78.55 -0.94 104.85 63.38 3.38 8.69 53318.06
Toyota 6006 131.00 7986 4917 3.33 8.90 199890.44 AscBrFd 2972 -10.00 3606 1910 1.14 41.65 30617.8 CrownCstl 94.43 -0.37 102.82 75.71 3.58 97.01 31875.76 ProctGmbl 86.77 0.19 87.57 65.02 2.77 30.23 231577.68
Suncor En 36.15 -0.44 40.35 27.32 3.09 -19.23 46782.82 Continental 190.50 -2.55 231.90 162.05 1.89 13.61 42960.87
Mexico (Mex$) AstraZen 5069 -28.00 5505 3680 3.99 38.72 83429.93 CSX 27.85 -0.12 30.53 21.33 2.34 16.02 26345.85 Prudntl 76.70 -0.03 89.77 57.19 3.40 8.09 33517.9
ThmReut 53.27 0.22 57.66 47.56 3.17 25.79 31004.72 Daimler 61.77 -0.75 85.50 50.83 5.05 8.64 74512.74
AmerMvl 11.05 0.01 15.66 10.40 2.26 26.76 25519.98 Aviva 413.90 -3.10 522.50 290.00 5.03 34.49 21857.79 CVS 97.30 -0.26 108.85 81.37 1.55 23.08 103742.72 PublStor 226.92 -0.62 277.60 196.61 2.71 40.23 39348.24
TntoDom 56.88 -0.03 58.13 47.75 3.34 14.21 81995.37 Deut Bank 12.29 -0.39 29.47 11.06 - -2.17 19105.59
FEMSA UBD 178.72 0.99 180.47 28.35 1.18 42.53 - Barclays 160.15 -1.60 277.20 121.10 3.43 -34.82 35251.78 Danaher 80.60 -0.10 82.19 61.58 0.71 21.07 55657.4 Qualcomm 61.91 -0.17 62.82 42.24 3.10 18.54 91226.2
TrnCan 60.97 -0.40 62.44 40.58 3.43 -31.31 37906.36 Deut Tlkm 15.31 -0.19 17.57 13.39 2.99 13.71 80709.91
WalMrtMex 43.86 -0.05 47.44 35.50 1.23 29.36 42094.55 BP 432.75 -3.50 464.40 249.44 6.95 -20.26 105775.38 Deere 77.47 -0.68 94.35 70.16 2.75 17.48 24346.36 Raytheon 141.10 -0.11 143.39 96.68 1.94 20.36 41637.87
ValeantPh 39.00 4.81 329.98 24.32 - -10.60 10402.13 DeutsPost 27.76 -0.36 28.65 19.55 2.94 19.17 37960.09
BrAmTob 4947 -21.00 5135 3231.5 3.11 21.36 120017.75 Delphi 64.73 0.20 88.89 55.59 1.45 16.63 17656.06 Regen Pharm 409.13 -4.51 592.59 329.09 - 65.57 42297.11
E.ON 8.20 -0.31 11.75 7.08 5.85 -2.38 18501.05 Netherlands ()
China (HK$) BSkyB 856.00 -4.00 1134 560.00 3.83 23.78 19148.22 Delta 37.15 0.21 52.77 32.60 1.41 6.22 27821.92 ReynoldsAm 50.76 0.11 54.48 35.70 2.99 14.81 72451.84
Fresenius Med 81.79 -1.59 85.65 63.10 0.94 26.24 28248.95 Altice 13.92 -0.21 27.41 9.98 - -13.11 12889.28
AgricBkCh 3.11 0.02 3.46 2.50 6.45 5.31 12328.42 BT 395.80 3.20 502.60 359.60 3.26 13.42 51132 Devon Energy 42.83 0.36 48.68 18.07 1.77 -1.51 22425.79 S&P Global 119.12 -0.52 122.75 78.55 1.03 31.25 31542.98
Fresenius SE 66.52 -1.23 70.00 52.39 0.61 28.44 40932.92 ASML Hld 93.13 -4.78 100.50 70.25 0.69 37.15 45503.62
Bk China 3.46 -0.01 4.13 2.83 6.05 5.79 37312.26 Compass 1490 -7.00 1521 963.00 1.97 27.09 31855.7 DiscFinServ 57.65 -0.35 58.55 42.86 1.76 12.25 23269.1 Salesforce 76.37 -1.59 84.48 52.60 - -4299.44 51740.68
HenkelKgaA 98.86 -0.88 102.15 75.76 1.41 22.21 28959.3 Heineken 79.66 -0.26 86.95 64.54 1.26 28.38 51736.84
BkofComm 5.70 0.01 6.70 4.24 5.22 5.83 25736.52 Diageo 2178 6.50 2218 1592.5 2.64 24.44 71364.09 Disney 96.56 -0.32 120.65 86.25 1.28 19.64 155181.69 Schlmbrg 81.71 -0.21 83.85 59.60 2.38 -65.58 113633.57
Linde 150.25 -4.55 170.55 113.50 1.92 26.40 31465.83 ING 10.46 -0.03 14.63 8.30 2.93 8.91 45710.8
BOE Tech 1.76 -0.06 2.68 1.55 1.00 33.74 45.16 GlaxoSmh 1680.5 -9.00 1716.5 1227.5 4.76-16805.00 106603.97 DominRes 75.11 0.43 78.97 64.54 3.49 24.04 47001.06 Sempra Energy 104.83 0.03 114.66 86.72 2.70 28.41 26186.68
MuenchRkv 158.80 -1.95 193.65 140.90 4.47 10.41 28837.45 Unilever 41.22 -0.03 42.84 32.86 2.85 24.84 79686.65
Ch Coms Cons 9.41 -0.35 11.06 5.77 1.98 8.94 5372.86 Glencore 192.60 -4.30 200.97 66.67 6.34 -7.67 36077.68 DowChem 52.24 -0.12 57.10 35.11 3.05 11.27 58865.62 Shrwin-Will 287.09 -3.60 312.48 218.27 1.02 24.89 26475.93
SAP 77.70 -0.29 79.34 53.91 1.42 27.19 107629.87 Norway (Kr)
Ch Evrbrght 3.77 0.01 4.08 3.07 5.44 5.51 3339.44 HSBC 542.90 0.40 561.20 392.37 7.11 15.12 140740.04 DukeEner 80.16 -0.29 87.31 65.50 4.01 21.67 55222.53 SimonProp 212.14 0.57 229.10 173.09 2.91 38.71 65637.99
Siemens 105.35 -0.50 107.95 77.91 2.66 19.66 100969.13 DNB 94.55 -1.85 127.80 90.10 4.55 7.16 18727.98
Ch Rail Cons 10.06 -0.30 12.64 6.72 1.64 9.46 2693.66 Imperial Brands 4128.5 -10.50 4154 2926 3.42 34.99 51506.1 DuPont 67.87 -0.16 75.72 47.11 2.18 28.23 59340.44 SouthCpr 25.90 -0.24 31.31 21.55 0.94 34.89 20039.32
Volkswgn 128.40 -2.15 182.70 95.00 3.42 -32.18 42722.28 Statoil 132.50 -2.80 150.20 97.25 5.19-200.94 51673.68
Ch Rail Gp 6.10 -0.16 8.24 4.21 1.41 10.66 3309.79 LlydsBkg 53.48 -0.47 80.63 47.10 4.21 25.47 49671.84 Eaton 67.14 -0.13 68.01 46.19 3.25 17.03 30529.97 Starbucks 55.46 0.09 64.00 42.05 1.33 32.01 81337.64
ChConstBk 5.71 -0.03 6.26 4.31 5.81 5.78 177036.1 Hong Kong (HK$) Telenor 142.30 -0.80 173.40 116.80 5.04 153.36 25982.43 eBay 30.53 -0.30 31.79 21.52 - 20.56 34468.95 StateSt 69.01 0.02 78.65 50.60 1.78 17.44 26914.95
Natl Grid 1070 -11.00 1148 806.40 4.03 15.57 52419
China Vanke 20.30 -0.65 24.10 14.56 2.70 11.29 3442.42 AIA 48.75 0.15 50.30 36.85 0.94 33.06 75753.12 Qatar (QR) Ecolab 121.76 -0.48 123.44 98.62 1.10 39.21 35712.84 Stryker 112.91 -0.57 123.55 86.68 1.28 27.36 42226.21
Prudential 1397.5 -18.00 1578.5 1045.99 2.77 19.55 46901.81
ChinaCitic 5.15 -0.04 5.42 4.00 - 5.39 9883.99 BOC Hold 26.05 -0.35 29.30 18.82 3.80 13.01 35518.52 QatarNtBk 168.50 10.50 169.40 122.50 1.87 13.72 38866.92 EMC 28.63 -0.06 28.77 22.66 1.56 27.49 56024.39 Sychrony Fin 27.25 -0.05 35.46 23.25 - 10.68 22724.47
RBS 190.30 -1.30 370.00 148.40 - -4.42 29111.08
ChinaLife 18.96 -0.38 31.15 16.00 2.29 18.01 18194.34 Ch OSLnd&Inv 26.55 -0.35 28.25 20.45 1.83 8.33 33761.74 Emerson 54.60 0.03 56.82 41.25 3.38 19.89 35137.14 Target 70.97 -4.51 84.62 65.50 2.75 15.19 42295.97
Russia (RUB) ReckittB 7487 -34.00 7786 5403 1.86 34.53 68545.58
ChinaMBank 18.54 -0.08 21.95 12.72 3.99 7.30 10976.52 ChngKng 54.00 -1.00 65.85 38.20 0.57 13.79 26779.59 EOG Res 90.04 -0.22 92.00 57.15 0.72 -9.85 49546.9 TE Connect 60.90 0.19 67.99 51.70 2.17 14.32 21778.83
Gzprm neft 137.60 -0.39 170.43 122.75 4.54 4.75 50859.23 RELX 1442 -9.00 1473 631.02 2.06 27.78 37589.61
ChinaMob 96.95 -1.05 102.30 79.00 2.57 17.35 255999.64 Citic Ltd 12.62 -0.04 15.06 10.02 2.10 9.10 47343.82 EquityResTP 65.23 -0.76 82.39 61.90 3.15 5.85 23841.7 Tesla Mtrs 223.41 -0.20 271.57 141.05 - -27.10 33219.41
Lukoil 2929 -3.50 2979 2040.1 4.71 10.54 38896.93 RioTinto 2436.5 -50.00 2621 1557 6.42 835.28 43586.12
ChinaPcIns 28.65 -0.30 34.25 23.70 1.84 13.86 10253.96 Citic Secs 18.12 -0.82 21.95 12.82 1.71 11.16 5323.93 Exelon 34.00 -0.23 37.70 25.09 3.30 19.46 31377.66 TexasInstr 69.63 -0.19 72.58 43.49 2.07 24.17 69853.5
MmcNrlskNckl 9787 -188.00 11284 7840 14.33 14.21 24180.78 RollsRoyce 782.50 -5.50 875.50 497.00 2.09 -7.00 18723.32
ChMinsheng 8.46 0.06 8.67 6.13 2.40 6.09 7564.6 CK Hutchison 98.40 0.60 114.10 80.60 3.34 9.40 48978.28 ExpScripts 76.26 -0.71 91.37 65.55 - 22.34 48060.5 TheTrvelers 116.78 -0.20 119.30 95.21 2.08 11.59 33665.49
Novatek 676.60 8.60 683.70 535.10 1.95 12.82 32075.02 RylDShlA 1927.5 -2.50 2127.4 1256 7.30 -31.81 108504.94
ChMrchSecs RMB 18.40 -0.15 24.95 13.45 3.88 12.43 13327.88 CNOOC 9.76 -0.03 10.38 6.41 4.99 20.43 56195.97 ExxonMb 87.87 -0.05 95.55 66.55 3.26 35.82 364366.14 ThrmoFshr 153.88 -1.09 160.68 117.10 0.35 34.14 60669.17
Rosneft 345.25 1.75 356.95 224.10 3.32 13.99 57128.74 SABMill 4378 -4.00 4590.8 2773 1.83 37.91 92523.83
Chna Utd Coms RMB 4.44 -0.04 8.11 3.75 1.41 39.46 14192.82 HangSeng 137.00 0.80 154.00 121.10 4.05 17.78 33777.71 Facebook 122.98 -0.32 128.33 72.00 - 83.33 285677.46 TimeWrnr 80.78 -0.27 81.33 55.53 1.63 18.06 62834.1
Sberbank 138.48 0.38 142.00 66.75 0.27 17.79 46673.14 Shire 5030 -35.00 5562.83 2707.19 0.36 32.15 58923.13
ChShenEgy 14.86 -0.14 15.52 10.12 5.41 18.28 6512.91 HK Exc&Clr 191.20 -9.40 219.40 160.10 2.42 32.60 30017.76 Fedex 165.94 -0.79 169.30 119.71 0.53 49.23 44064.93 TJX Cos 78.06 0.09 83.64 63.53 0.96 25.78 51604.18
Surgutneftegas 30.69 0.18 41.16 30.02 - 3.11 17115.97 StandCh 637.10 -16.00 866.60 373.40 1.62 -6.59 27219.35
ChShpbldng RMB 6.92 0.09 16.40 5.66 0.51 -48.46 18740.46 MTR 42.60 -0.10 44.50 33.10 2.18 21.73 32403 FordMtr 12.24 -0.10 15.84 10.44 4.77 5.93 47765.24 T-MobileUS 45.70 -0.54 48.11 33.23 - 34.34 37599.22
Saudi Arabia (SR) Tesco 156.25 -1.45 205.90 137.00 - 56.61 16620.6
ChStConEng RMB 6.58 0.15 7.53 4.88 2.43 8.34 29715.71 SandsCh 31.80 0.15 33.70 20.75 5.53 25.69 33095.22 Franklin 35.98 -0.07 43.94 30.56 1.66 14.35 20728.85 UnionPac 93.71 0.82 98.28 67.06 2.13 19.35 78052.35
AlRajhiBnk 57.50 - 63.25 44.70 2.35 13.56 24914.01 Vodafone 235.35 -1.10 241.27 197.70 4.80 -15.61 81495.51
ChUncHK 8.40 0.01 11.36 7.70 2.62 23.60 25941.15 SHK Props 109.20 0.80 113.50 79.00 1.94 11.85 40770.65 GenDyn 152.06 -0.34 153.80 121.61 2.10 18.10 46420.7 UPS B 109.55 -0.26 111.83 87.30 2.45 22.00 75728.81
Natnlcombnk 37.00 0.20 59.50 36.60 4.06 8.29 19731.22 WPP 1760 -4.00 1798 1204 2.41 19.91 29416.54
CNNC Intl RMB 6.87 -0.03 11.78 6.58 - 30.33 4394.1 Tencent 193.00 -2.40 197.90 124.00 0.16 54.01 235611.11 GenElectric 31.21 0.02 33.00 19.37 2.67 53.86 279680.08 USBancorp 43.16 0.14 45.86 37.07 2.30 13.90 73861.23
SaudiBasic 84.50 - 92.75 59.50 5.87 15.38 67592.79 United States of America ($)
CSR 7.43 -0.13 10.72 6.45 1.75 15.92 4188.27 India (Rs) GenMills 70.41 -0.09 72.95 47.43 2.26 28.43 42214.54 UtdHlthcre 140.81 -0.27 144.48 95.00 1.47 22.64 134106.23
SaudiTelec 58.25 -1.25 69.75 52.75 6.66 14.23 31063.36 21stC Fox A 25.38 -0.08 31.40 22.66 1.07 23.17 27004.5
Daqin RMB 6.50 -0.03 11.09 5.98 6.86 9.45 14573.02 Bhartiartl 345.65 3.20 398.65 282.30 0.62 37.69 20693.46 GenMotors 31.56 -0.15 36.88 24.62 4.19 5.26 49294.25 UtdTech 108.27 -0.23 109.83 83.39 2.32 24.66 90616.68
Singapore (S$) 3M 178.91 0.77 182.27 134.00 2.32 23.44 108130.23
Gree Elec Apl 0.18 - 0.30 0.16 - -3.92 270.79 HDFC Bk 1234.9 7.60 1258.95 928.00 0.74 26.50 46948.21 GileadSci 80.00 0.75 117.70 77.92 2.14 7.25 105572.68 ValeroEngy 54.85 0.35 73.88 46.88 3.73 9.02 25304.55
DBS 14.75 -0.06 19.04 13.01 3.68 9.07 27670.51 AbbottLb 44.52 -0.41 50.60 36.00 2.19 35.45 65436.85
GuosenSec RMB 18.00 -0.10 23.41 13.28 1.03 13.85 5958.53 Hind Unilevr 913.20 -13.00 951.45 766.40 1.55 53.04 29599.96 GoldmSchs 164.83 -0.82 203.10 138.20 1.43 20.50 68469.4 Verizon 52.50 -0.26 56.95 38.06 4.19 15.23 214005.85
JardnMt US$ 60.18 0.63 61.03 45.00 2.35 11.16 42801.07 Abbvie 66.38 -0.37 69.82 45.45 2.86 22.02 108094.5
HaitongSecs 13.88 -0.48 15.50 10.00 1.98 10.66 6103.03 HsngDevFin 1366.9 8.35 1410 1011.45 1.13 21.10 32387.41 Halliburton 44.89 0.27 46.69 27.64 1.45 -17.40 38654.89 VertexPharm 98.81 -1.19 142.49 75.90 - -89.83 24483.04
JardnStr US$ 31.97 -0.03 32.50 25.24 0.87 8.25 35438.38 Accenture 112.43 -0.55 120.78 88.43 1.75 21.24 91625.04
Hngzh HikVDT RMB 26.50 0.61 32.06 19.77 2.57 26.57 18808.82 ICICI Bk 247.60 -0.95 306.75 180.75 1.84 15.58 21572.19 HCA Hold 73.94 -2.17 91.58 43.91 - 13.12 28914.53 VF Cp 63.61 -0.31 76.64 52.21 1.96 25.16 26381.47
OCBC 8.44 -0.03 9.68 7.41 4.15 10.06 26259.91 Adobe 99.68 -0.92 101.93 71.27 - 62.99 49669.64
Hunng Pwr 5.06 -0.06 9.89 4.43 10.55 6.14 3067.19 Infosys 1033.3 -18.50 1279.3 1011.25 2.29 17.47 35546.39 Hew-Pack 14.40 -0.02 14.82 8.91 3.70 6.70 24624.18 Viacom 43.01 0.17 53.35 30.11 3.62 8.55 14934.13
SingTel 4.21 -0.06 4.36 3.38 4.04 17.84 49931.14 AEP 65.44 -0.24 71.32 52.29 3.02 21.56 32177.47
IM Baotou Stl RMB 2.97 0.03 5.07 2.66 - -20.49 7050.85 ITC 253.70 -1.40 262.00 178.67 1.50 33.95 45938.92 HiltonWwde 24.18 -0.12 26.27 16.16 1.13 14.96 23932.79 Visa Inc 80.43 -0.24 81.73 60.00 0.59 31.50 151727.76
UOB 17.56 0.01 20.78 16.80 3.88 9.31 20995.36 Aetna 119.92 0.99 125.47 92.42 0.81 18.06 42067.94
In&CmBkCh 4.88 0.03 5.21 3.72 5.78 5.84 54622.1 L&T 1502.5 -3.85 1820 1016.05 0.89 31.31 20972.62 HomeDep 135.07 -1.16 139.00 92.17 1.62 26.72 168028.07 Walgreen 81.92 -0.88 95.74 71.50 1.57 32.26 88664.53
Aflac 72.32 0.12 74.14 51.41 2.00 13.14 29620.48
IndstrlBk RMB 16.06 -0.09 17.63 11.90 3.29 6.48 46144 OilNatGas 237.80 2.60 270.15 187.75 3.64 11.86 30470.21 South Africa (R) Honywell 115.18 -0.46 120.02 87.00 1.95 18.72 87780.46 WalMartSto 72.69 -0.20 74.80 56.30 1.81 18.10 226561.83
AirProd 152.93 0.16 154.91 114.64 2.13 23.55 33116.95
Kweichow RMB 308.16 -1.36 326.80 166.20 1.32 26.02 58378.82 RelianceIn 1013.3 -11.60 1089.75 818.00 0.88 12.58 49214.95 Firstrand 48.98 -0.91 54.18 34.08 3.28 16.03 20437.22 HumanaInc 178.48 -1.16 192.49 150.00 0.63 28.12 26604.79 WellsFargo 48.40 -0.04 57.72 44.50 2.81 13.13 244204.48
Alexion 132.77 -0.99 193.45 110.56 - 454.63 29773.41
Midea 1.74 0.01 2.13 1.64 5.07 11.50 48.25 SBI NewA 246.25 -0.50 288.00 148.25 1.02 23.28 28629.35 MTN Grp 127.81 -1.29 199.84 109.56 9.16 92.28 17531.41 IBM 160.03 -0.67 164.95 116.90 2.94 13.34 152963.75 Williams Cos 25.90 -0.39 55.42 10.22 8.77 -30.43 19442.03
Allegran 250.54 -2.65 325.00 195.50 - -42.33 99201.86
New Ch Life Ins 32.35 0.30 37.50 22.00 0.70 11.12 4314.17 SunPhrmInds 785.00 2.30 966.00 704.00 0.34 54.49 28294.97 Naspers N 2230 95.00 2334.11 1521.98 0.18 85.41 72659.83 IllinoisTool 118.42 0.06 119.84 78.79 1.81 22.65 42034.4 Yahoo 42.57 0.08 43.29 26.15 - -8.39 40517.38
Allstate 68.76 -0.19 70.38 54.12 1.78 17.97 25541.65
PetroChina 5.38 -0.01 7.36 4.16 3.22 61.92 14638.63 Tata Cons 2624.55 -67.15 2770 2115 1.60 21.60 77452.24 South Korea (KRW) Illumina 167.01 -2.64 213.27 127.10 - 66.35 24483.67 Yum!Brnds 89.35 -0.45 90.68 64.58 1.95 27.65 34836.41
Alphabet 798.39 -2.81 813.88 593.09 - 31.76 234465.84
PingAnIns 39.70 -0.40 46.70 30.50 1.88 11.99 38129.66 Indonesia (Rp) HyundMobis 258500 500.00 272000 190500 1.19 15.68 22702.44 Intcntl Exch 279.84 1.73 283.25 220.28 1.11 23.72 33338.41 Venezuela (VEF)
Altria 66.10 -0.16 70.15 47.41 3.03 26.36 129149.79
PngAnBnk RMB 9.55 0.03 11.15 7.75 1.56 7.45 21071.97 Bk Cent Asia 15125 - 15300 11000 1.02 20.35 28474.81 KoreaElePwr 58400 -500.00 63700 45600 4.66 3.00 33824.16 Intel 34.82 -0.39 35.93 24.87 2.55 16.44 164733.42 Bco de Vnzla 103.00 -4.00 137.00 85.00 - - 582.05
Amazon 759.46 -4.58 773.75 451.00 - 194.07 360039.89
Pwr Cons Corp RMB 6.36 -0.02 11.18 5.40 1.46 17.83 9207.65 SK Hynix 33550 -150.00 38100 25650 1.31 8.60 21369.87 Intuit 112.20 -0.27 116.97 79.63 0.91 44.63 28708.76 Bco Provncl 2400 -100.00 4400 2200 - 0.36 400.96
Israel (ILS) AmerAir 36.24 -0.51 47.09 24.85 1.07 3.66 19204.06
SaicMtr RMB 23.67 0.09 24.36 14.00 5.10 9.29 39356.86 SmsungEl 1566000-2000.00 1580000 1033000 1.05 14.04 200157.15 John&John 120.19 -0.15 126.07 81.79 2.26 24.18 328811.36 Mrcntl Srvcs 4875 - 6200 4300 0.27 16.49 448.67
TevaPha 205.90 4.40 269.80 189.40 2.39 37.77 54983.92 AmerExpr 65.10 -0.20 81.66 50.27 1.61 14.37 60138.14
ShenwanHong 0.17 0.00 0.25 0.12 - -0.26 119.30 Spain () JohnsonCn 43.96 -0.17 47.32 33.62 2.50 94.08 28035.31
Italy () AmerIntGrp 59.03 -0.29 64.50 48.41 1.98 606.31 63195.7
ShgPdgBk RMB 16.64 -0.06 18.29 10.83 3.01 - 51490.54 JPMrgnCh 65.57 -0.14 69.03 50.07 2.67 11.42 236837.68 Closing prices and highs & lows are in traded currency (with variations for that
Enel 3.93 -0.07 4.29 3.33 3.26 17.91 45097.05 BBVA 5.18 -0.09 9.14 4.50 6.54 16.25 37827.92 AmerTower 113.28 -0.84 118.26 83.07 1.71 72.28 48199.42
Sinopec Corp 5.70 0.02 5.88 3.86 3.83 17.10 18754.42 Kimb-Clark 127.17 -0.36 138.87 103.04 2.76 24.24 45734.92 country indicated by stock), market capitalisation is in USD. Highs & lows are
ENI 13.57 -0.17 15.85 10.93 5.65 -5.22 55606.05 BcoSantdr 3.71 -0.10 6.04 3.15 5.17 9.98 60431.3 Amgen 172.45 0.29 176.50 130.09 2.02 18.13 129051.1
Sinopec Oil RMB 4.00 -0.03 11.58 3.60 - -48.44 1075.76 KinderM 21.51 -0.27 34.81 11.20 5.661104.92 48000.77 based on intraday trading over a rolling 52 week period.
Generali 11.43 -0.32 18.09 9.76 6.04 10.10 20103.59 CaixaBnk 2.35 -0.05 3.99 1.82 4.90 19.30 15647.25 Anadarko 53.86 -0.29 77.26 28.16 1.16 -5.40 27493.24
Denmark (kr) Iberdrola 5.90 -0.07 6.71 4.80 0.49 16.37 42323.92 Kraft Heinz 88.67 -0.29 90.49 61.42 2.32 699.58 107969.1 ex-dividend
IntSPaolo 1.89 -0.05 3.47 1.52 3.40 13.48 33726.34 Anthem 128.99 -0.34 154.50 115.63 1.92 15.23 33946.43
DanskeBk 182.60 -0.50 218.00 161.80 4.20 14.21 27219.35 Inditex 30.93 -0.27 35.38 26.00 1.29 36.72 108693.46 Kroger 31.59 -0.51 42.75 27.32 1.15 16.62 29975.44 ex-capital redistribution
Luxottica 42.65 -0.81 65.90 41.90 2.00 27.62 23269.98 Aon Cp 109.13 -0.04 111.60 83.83 1.10 21.23 28984.93
MollerMrsk 9090 -135.00 12650 7355 - -60.25 13857.71 Repsol 12.03 -0.19 14.72 7.95 6.04 -11.02 19880.6 L Brands 73.10 -0.51 101.11 60.00 2.55 21.05 21016.43 # price at time of suspension
Unicred 2.06 -0.05 6.30 1.70 5.34 7.97 14335.57 Apple 108.61 -0.78 123.82 89.47 1.73 13.30 585211.85
NovoB 309.30 -0.50 402.90 304.20 1.89 25.18 94327.51 Telefonica 8.83 -0.14 13.69 7.45 8.09 -57.54 49534.33 LasVegasSd 52.10 -0.26 54.80 34.88 4.64 25.80 41406.66
ArcherDan 43.37 -0.10 48.17 29.86 2.60 18.11 25231.07
LibertyGbl 32.40 -0.16 52.68 26.16 - -110.57 8565.56

FT 500: TOP 20 FT 500: BOTTOM 20 BONDS: HIGH YIELD & EMERGING MARKET BONDS: GLOBAL INVESTMENT GRADE
Close Prev Day Week Month Close Prev Day Week Month Day's Mth's Spread Day's Mth's Spread
price price change change % change change % change % price price change change % change change % change % Red Ratings Bid Bid chge chge vs Red Ratings Bid Bid chge chge vs
New Ch Life Ins 32.35 32.05 0.30 0.94 3.85 13.5 13.71 Firstrand 48.98 49.89 -0.91 -1.82 -4881.02 -99.0 5.59 Aug 17 date Coupon S* M* F* price yield yield yield US Aug 17 date Coupon S* M* F* price yield yield yield US
Linde 154.80 154.80 0.00 0.00 16.15 11.6 8.37 MTN Grp 127.81 129.10 -1.29 -1.00 -12289.19 -99.0 -11.06 High Yield US$ US$
Petrobras 14.66 14.66 0.00 0.00 1.50 11.4 11.50 Naspers N 2230.00 2135.00 95.00 4.45 -210770.00 -99.0 -1.87 Navient Corporation 06/18 8.45 BB- Ba3 BB 108.58 3.57 0.00 -1.10 2.82 Cummins Inc. 02/27 6.75 A+ A2 A 127.53 3.61 0.00 0.08 2.03
GuosenSec 18.00 18.10 -0.10 -0.55 1.64 10.0 7.33 Altice 13.92 14.13 -0.21 -1.49 -1.11 -7.4 6.75 High Yield Euro Korea Electric Power Corporation 08/27 6.75 AA Aa2 AA- 107.05 5.95 0.00 -0.27 4.38
ChMrchSecs 18.40 18.55 -0.15 -0.81 1.63 9.7 5.20 Bridgestne 3360.00 3325.00 35.00 1.05 -256.00 -7.1 -4.92 Kazkommerts Intl BV 02/17 6.88 B Caa1 B 97.50 - 0.00 0.00 - Archer Daniels Midland Company 12/27 6.75 A A2 A 126.37 3.89 0.00 -0.14 2.31
Softbank 6767.00 6802.00 -35.00 -0.51 566.00 9.1 12.82 Gree Elec Apl 0.18 0.18 0.00 0.00 -0.01 -6.9 2.94 SouthTrust Bank 12/27 6.57 A Aa3 A+ 128.19 3.55 0.00 -0.10 1.98
Devon Energy 42.83 42.47 0.36 0.85 3.26 8.2 11.86 Lowes 76.01 81.48 -5.47 -6.71 -4.97 -6.1 -6.92 Emerging US$ SunTrust Banks, Inc. 01/28 6.00 BBB+ Baa1 A- 119.63 3.89 0.00 0.03 -
ChStConEng 6.58 6.43 0.15 2.33 0.44 7.2 18.35 CmwBkAu 74.04 76.00 -1.96 -2.58 -4.37 -5.6 -2.50 Mexico 09/16 11.40 BBB+ A3 BBB+ 106.80 1.49 0.03 0.01 0.44 FleetBoston Financial Corp. 01/28 6.88 BBB Baa3 A- 125.65 4.08 0.00 -0.06 -
Ch Evrbrght 3.77 3.76 0.01 0.27 0.24 6.8 9.28 HonHaiPrc 85.00 86.20 -1.20 -1.39 -4.90 -5.5 0.59 Brazil 01/18 8.00 BB Ba2 BB 105.07 4.22 -0.07 -0.16 3.47
Russia 07/18 11.00 BB+ Ba1 BBB- 116.73 2.09 0.01 0.33 1.33 Euro
Yahoo 42.57 42.49 0.08 0.19 2.64 6.6 12.83 SunPhrmInds 785.00 782.70 2.30 0.29 -44.35 -5.3 1.90 Credit Agricole S.A. 03/27 2.63 BBB Baa2 A- 105.07 2.09 0.00 -0.29 0.51
In&CmBkCh 4.88 4.85 0.03 0.62 0.30 6.6 12.44 SampoA 37.04 37.04 0.00 0.00 -2.03 -5.2 -2.16 Peru 03/19 7.13 BBB+ A3 BBB+ 128.75 1.95 0.00 0.00 1.20
Peru 03/19 7.13 BBB+ A3 BBB+ 114.01 2.60 0.00 0.20 0.84 Electricite de France (EDF) 03/27 4.13 A A2 A- 122.21 1.91 0.00 0.00 0.33
BakerHu 50.86 51.20 -0.35 -0.67 3.12 6.5 10.71 ChngKng 54.00 55.00 -1.00 -1.82 -2.90 -5.1 2.76 Telia Company AB 09/27 3.00 A- Baa1 A- 120.16 1.06 -0.01 -0.05 -0.52
Pwr Cons Corp 6.36 6.38 -0.02 -0.31 0.38 6.4 7.43 ASML Hld 93.13 97.91 -4.78 -4.88 -4.87 -5.0 1.23 Colombia 07/21 4.38 BBB Baa2 BBB 112.75 2.64 0.00 0.00 1.47
Brazil 01/22 12.50 BB Ba2 BB 108.22 10.43 -0.05 -0.39 9.26 Philip Morris Intl, Inc. 05/29 2.88 A A2 A 122.09 1.02 0.00 -0.08 -
ChinaMBank 18.54 18.62 -0.08 -0.43 1.10 6.3 7.42 Salesforce 76.37 77.96 -1.59 -2.04 -3.87 -4.8 -6.20
Poland 03/22 5.00 BBB+ A2 A- 117.38 2.80 0.00 0.00 1.63 Yen
Hunng Pwr 5.06 5.12 -0.06 -1.17 0.30 6.3 9.52 Infosys 1033.30 1051.80 -18.50 -1.76 -50.10 -4.6 -3.66
Turkey 09/22 6.25 - Baa3 BBB- 111.33 4.17 0.01 -0.31 3.00 Wal-Mart Stores, Inc. 07/15 0.94 NR WR NR 100.00 0.31 0.00 0.00 -
Citic Secs 18.12 18.94 -0.82 -4.33 1.04 6.1 4.50 KoreaElePwr 58400.00 58900.00 -500.00 -0.85 -2800.00 -4.6 -3.15
AmerAir 36.24 36.75 -0.51 -1.39 2.06 6.0 1.03 NovoB 309.80 309.80 0.00 0.00 -14.70 -4.5 -16.83 Turkey 10/26 4.88 - Baa3 BBB- 104.46 4.37 0.00 -0.47 2.80 Sterling
PingAnIns 39.70 40.10 -0.40 -1.00 2.20 5.9 8.47 ValeantPh 34.19 34.19 0.00 0.00 -1.56 -4.4 32.24 Emerging Euro IPIC GMTN Limited 03/26 6.88 AA Aa2 AA 122.65 4.11 0.06 0.12 1.82
AgricBkCh 3.11 3.09 0.02 0.65 0.16 5.4 9.12 BOE Tech 1.76 1.82 -0.06 -3.30 -0.08 -4.3 -7.41 Brazil 02/15 7.38 BBB- Baa2 BBB 111.75 0.73 0.00 0.00 0.09 B.A.T. Intl Fin plc (Re - British American Tobacco) 09/26 4.00 A- A3 A- 104.67 3.47 0.06 0.29 1.18
ConocPhil 42.79 42.86 -0.07 -0.16 2.19 5.4 -0.29 DukeEner 80.16 80.45 -0.29 -0.36 -3.63 -4.3 -5.67 Mexico 07/17 4.25 BBB+ A3 BBB+ 111.13 1.50 0.00 0.00 0.74 Data provided by SIX Financial Information. US $ denominated bonds NY close; all other London close. *S - Standard & Poors, M -
Mexico 02/20 5.50 BBB+ A3 BBB+ 121.63 2.06 0.00 0.00 0.89 Moodys, F - Fitch.
Based on the FT Global 500 companies in local currency Based on the FT Global 500 companies in local currency
Bulgaria 09/25 5.75 BB+ - BBB- 123.05 2.88 0.00 -0.30 1.30
Data provided by SIX Financial Information & Tullett Prebon Information. US $ denominated bonds NY close; all other
London close. *S - Standard & Poors, M - Moodys, F - Fitch.

INTEREST RATES: OFFICIAL BOND INDICES VOLATILITY INDICES GILTS: UK CASH MARKET
Aug 17 Rate Current Since Last Mnth Ago Year Ago Day's Month's Year Return Return Aug 17 Day Chng Prev 52 wk high 52 wk low Red Change in Yield 52 Week Amnt
US Fed Funds 0.25-0.50 16-12-2015 1.00 0.25-0.50 0.00-0.25 Index change change change 1 month 1 year VIX 13.70 1.06 12.64 53.29 11.02 Aug 17 Price Yield Day Week Month Year High Low m
US Prime 3.50 16-12-2008 3.50 3.50 3.50 Markit IBoxx VXD 12.91 0.81 12.10 56.32 10.30 Tr 4pc '16 100.21 0.13 -13.33 -27.78 -58.06 -72.34 102.23 100.00 0.35
US Discount 0.75 16-12-2015 0.75 1.00 0.75 ABF Pan-Asia unhedged 190.04 0.44 1.48 9.67 1.72 10.55 VXN 16.01 1.09 14.92 46.72 13.48 Tr 1.75pc '17 100.67 0.18 5.88 12.50 0.00 -66.67 101.75 100.67 0.29
Euro Repo 0.00 10-09-2014 0.05 0.05 0.05 Corporates( ) 343.23 -0.44 2.80 16.28 4.66 16.38 VDAX - - - - - Tr 5pc '18 107.61 0.10 0.00 66.67 11.11 -85.92 111.02 107.61 0.35
UK Repo 0.25 05-03-2009 0.25 0.50 0.50 Corporates($) 270.91 -0.14 -0.07 8.60 -0.07 8.60 CBOE. VIX: S&P 500 index Options Volatility, VXD: DJIA Index Options Volatility, VXN: NASDAQ Index Options Volatility. Tr 4.5pc '19 111.30 0.07 16.67 600.00 -46.15 -93.00 112.71 110.85 0.36
Japan O'night Call 0.00-0.00 05-10-2010 0.00 0.00-0.10 0.00-0.10 Corporates() 223.83 -0.11 0.04 5.94 0.74 5.63 Deutsche Borse. VDAX: DAX Index Options Volatility. Tr 4.75pc '20 116.57 0.08 33.33 700.00 -68.00 -93.55 117.12 114.45 0.33
Switzerland Libor Target 0.00-0.25 15-01-2015 0.00-0.75 -1.25--0.25 0-0.25 Eurozone Sov() 239.13 -0.32 -0.37 6.14 0.65 7.01 Tr 1.5pc '21 105.73 0.20 17.65 42.86 -50.00 -86.01 137.11 99.91 0.32
Gilts( ) 334.92 -0.57 2.09 16.75 3.84 16.66 BONDS: BENCHMARK GOVERNMENT Tr 4pc '22 120.91 0.21 10.53 31.25 -48.78 -86.27 121.31 114.48 0.38
INTEREST RATES: MARKET Global Inflation-Lkd 258.74 0.03 1.05 8.56 2.22 4.04 Red Bid Bid Day chg Wk chg Month Year Tr 5pc '25 137.29 0.53 10.42 12.77 -30.26 -70.88 138.11 126.02 0.35
Over Change One Three Six One Markit iBoxx Non-Gilts 338.62 -0.40 2.42 14.81 4.15 14.77 Date Coupon Price Yield yield yield chg yld chg yld Tr 4.25pc '27 137.50 0.78 4.00 6.85 -23.53 -61.76 138.26 121.91 0.31
Aug 17 (Libor: Aug 16) night Day Week Month month month month year Overall ($) 239.61 -0.16 -0.31 6.48 -0.31 6.48 Australia 10/18 3.25 103.85 1.44 0.00 0.00 -0.11 -0.53 Tr 4.25pc '32 146.67 1.04 5.05 8.33 -25.71 -54.98 148.92 124.00 0.35
US$ Libor 0.41778 -0.001 -0.001 0.000 0.50744 0.80128 1.19456 1.49822 Overall( ) 332.98 -0.52 2.18 16.18 3.93 16.10 11/27 2.75 107.38 2.01 0.00 0.06 -0.02 0.00 Tr 4.25pc '36 153.03 1.20 4.35 7.14 -23.08 -50.62 155.77 125.16 0.30
Euro Libor -0.40000 0.000 0.000 0.000 -0.37143 -0.32157 -0.20214 -0.07271 Overall() 233.08 -0.24 -0.23 5.61 0.61 6.13 Austria 10/19 0.25 99.98 0.26 0.00 0.00 0.00 0.00 Tr 4.5pc '42 171.26 1.29 3.20 4.03 -22.29 -47.77 174.65 134.26 0.27
Libor 0.22938 0.000 -0.003 0.004 0.27688 0.38438 0.50588 0.72225 Treasuries ($) 228.80 -0.20 -0.54 5.54 -0.54 5.54 10/26 0.75 106.40 0.12 -0.03 0.07 -0.10 0.00 Tr 3.75pc '52 172.57 1.24 5.08 5.08 -21.02 -48.97 177.28 125.74 0.24
Swiss Fr Libor 0.000 -0.80300 -0.74160 -0.65720 -0.48500 FTSE Belgium 06/18 0.75 99.89 0.81 0.00 -0.01 0.05 0.69 Tr 4pc '60 195.16 1.19 5.31 5.31 -20.13 -50.00 201.27 136.28 0.23
Yen Libor 0.022 -0.04814 -0.01329 0.01036 0.10214 Sterling Corporate () 123.53 0.05 - - 3.89 10.62 06/26 1.00 108.30 0.15 -0.04 0.04 -0.10 0.00 xd Ex dividend. Closing mid-prices are shown in pounds per 100 nominal of stock. Red yield: Gross redemption yield.
Euro Euribor 0.000 -0.36900 -0.29900 -0.18900 -0.05000 Euro Corporate () 111.18 0.08 - - 0.34 3.48 Canada 08/18 0.50 99.81 0.60 0.02 0.08 -0.02 0.00 This table shows the gilts benchmarks & the non-rump undated stocks.
Sterling CDs 0.000 0.25000 0.37000 0.52500 Euro Emerging Mkts () 880.53 -0.81 - - -5.69 -0.08 06/26 1.50 103.92 1.08 0.01 0.09 -0.04 -0.47
US$ CDs
Euro CDs
0.000
0.000
0.46000
-0.42500
0.65000
-0.32500
0.91000
-0.23500
Eurozone Govt Bond 118.94 0.11 - - 0.58 4.43 Denmark 11/18 0.25 101.85 -0.57 0.00 0.00 0.00 0.00 GILTS: UK FTSE ACTUARIES INDICES
CREDIT INDICES Day's Week's Month's Series Series 11/25 1.75 115.54 0.06 -0.02 0.04 -0.06 -0.77
Price Indices Day's Total Return Return
Short 7 Days One Three Six One Index change change change high low Finland 05/18 1.00 100.08 0.95 0.00 0.02 0.00 -0.20
Fixed Coupon Aug 17 chg % Return 1 month 1 year Yield
Aug 17 term notice month month month year Markit iTraxx 04/26 0.50 104.07 0.08 -0.03 0.06 -0.06 0.00
1 Up to 5 Years 99.23 0.06 2431.40 0.31 3.26 0.13
Euro -0.45 -0.35 -0.45 -0.35 -0.50 -0.35 -0.40 -0.25 -0.31 -0.16 -0.12 0.03 Crossover 5Y 369.26 -12.07 35.21 40.34 390.04 288.69 France 05/19 1.00 104.32 -0.54 0.00 0.00 0.00 0.00
2 5 - 10 Years 192.59 0.11 3541.13 1.53 10.33 0.41
Sterling 0.18 0.28 0.20 0.30 0.32 0.42 0.45 0.60 0.61 0.76 Europe 5Y 85.00 -1.98 7.21 7.01 90.43 67.59 11/20 0.25 102.99 -0.44 0.00 0.00 0.00 0.00
3 10 - 15 Years 230.50 0.07 4366.71 2.81 15.80 0.85
Swiss Franc - - - - - - - - - - - - Japan 5Y 70.05 -2.51 2.21 -0.87 93.03 64.22 05/26 0.50 103.16 0.17 -0.02 0.07 -0.05 0.00
4 5 - 15 Years 202.02 0.10 3748.12 1.93 12.06 0.60
Canadian Dollar - - - - - - - - - - - - Senior Financials 5Y 111.86 -3.89 10.86 12.50 121.66 80.36 05/45 3.25 157.93 0.94 -0.03 0.06 -0.06 -0.96
5 Over 15 Years 374.43 -0.13 5536.40 6.68 28.41 1.24
US Dollar 0.40 0.50 0.40 0.50 0.45 0.55 0.80 0.90 1.15 1.25 1.45 1.55 Germany 04/19 0.50 103.04 -0.63 0.00 0.00 0.00 0.00
Markit CDX 7 All stocks 194.41 -0.01 3711.29 3.42 15.56 1.06
Japanese Yen -0.10 0.10 -0.10 0.10 -0.30 0.00 -0.30 0.00 -0.25 0.05 -0.15 0.15 10/20 0.25 103.57 -0.59 0.00 0.00 0.00 0.00
Emerging Markets 5Y 236.95 0.32 -2.02 -17.99 313.33 236.63 02/26 0.50 105.81 -0.11 0.00 0.00 0.00 0.00
Libor rates come from ICE (see www.theice.com) and are fixed at 11am UK time. Other data sources: US $, Euro & CDs: Day's Month Year's Total Return Return
Nth Amer High Yld 5Y 385.62 2.89 -2.66 -4.73 476.69 382.73 08/46 2.50 157.18 0.46 -0.02 0.07 -0.08 -0.87
Tullett Prebon; SDR, US Discount: IMF; EONIA: ECB; Swiss Libor: SNB; EURONIA, RONIA & SONIA: WMBA. Index Linked Aug 17 chg % chg % chg % Return 1 month 1 year
Nth Amer Inv Grade 5Y 71.04 0.63 -0.21 -0.22 91.05 70.01 Greece 04/19 4.75 91.15 8.59 -0.08 -0.21 -0.55 -1.66
Websites: markit.com, ftse.com. All indices shown are unhedged. Currencies are shown in brackets after the index names. 1 Up to 5 Years 314.81 0.07 1.04 1.68 2437.03 1.04 3.52
02/26 3.00 71.51 8.03 -0.02 -0.12 0.17 -1.16 2 Over 5 years 710.16 -0.18 8.61 20.88 5264.39 8.61 21.66
Ireland 10/17 5.50 106.88 -0.38 0.00 0.00 0.00 0.00 3 5-15 years 479.33 0.07 4.11 10.74 3675.08 4.11 12.02
05/26 1.00 105.85 0.39 -0.02 0.06 -0.11 0.00 4 Over 15 years 910.64 -0.26 10.20 24.69 6614.47 10.20 25.25
COMMODITIES www.ft.com/commodities BONDS: INDEX-LINKED Italy 04/19 0.10 100.34 -0.03 0.00 0.00 0.00 0.00 5 All stocks 642.64 -0.16 7.98 18.61 4830.87 7.98 19.57
06/21 0.45 101.01 0.24 -0.01 0.02 -0.08 0.00
Energy Price* Change Agricultural & Cattle Futures Price* Change Price Yield Month Value No of
12/26 1.25 100.85 1.17 -0.01 0.03 0.00 0.00 Yield Indices Aug 17 Aug 16 Yr ago Aug 17 Aug 16 Yr ago
Crude Oil Aug 46.36 -0.26 Corn Sep 328.25 0.00 Aug 16 Aug 16 Prev return stock Market stocks
03/47 2.70 112.73 2.14 0.02 0.11 -0.14 0.00 5 Yrs 0.14 0.16 1.29 20 Yrs 1.30 1.30 2.45
Brent Crude Oil 49.42 0.30 Wheat Sep 422.25 -1.50 Can 4.25%' 21 124.34 -0.310 -0.331 -0.20 5.18 76458.68 7
Japan 08/18 0.10 100.56 -0.18 0.00 0.00 0.00 0.00 10 Yrs 0.69 0.70 1.94 45 Yrs 1.20 1.19 2.40
RBOB Gasoline Aug 1.41 -0.01 Soybeans Sep 1023.25 2.75 Fr 2.25%' 20 113.56 -1.101 -1.112 0.13 20.31 211628.24 14
09/21 0.05 101.02 -0.15 0.00 0.00 0.00 0.00 15 Yrs 1.12 1.12 2.29
Heating Oil Aug 1.46 0.02 Soybeans Meal Sep 335.70 -1.30 Swe 0.25%' 22 113.80 -1.700 -1.700 0.36 29.10 226993.43 7
06/26 0.10 101.81 -0.08 0.00 0.00 0.00 0.00
Natural Gas Aug 2.60 -0.03 Cocoa (ICE Liffe)X Sep 2496.00 11.00 UK 2.5%' 20 372.27 -2.495 -2.396 0.79 6.58 627021.36 27
06/46 0.30 98.44 0.36 -0.01 -0.03 0.15 0.00 inflation 0% inflation 5%
Ethanol - - Cocoa (ICE US) Sep 3040.00 -23.00 UK 2.5%' 24 370.64 -2.098 -2.040 2.52 6.82 627021.36 27
Netherlands 01/19 1.25 104.46 -0.58 0.00 0.00 0.00 0.00 Real yield Aug 17 Dur yrs Previous Yr ago Aug 17 Dur yrs Previous Yr ago
Uranium Aug 26.00 0.00 Coffee(Robusta)X Sep 1748.00 -29.00 UK 2%' 35 269.77 -1.716 -1.712 4.50 9.08 627021.36 27
07/25 0.25 102.74 -0.06 0.00 0.00 0.00 0.00 Up to 5 yrs -2.19 2.72 -2.16 -0.72 -2.79 2.72 -2.77 -1.34
Carbon Emissions - - Coffee (Arabica) Sep 136.70 -0.60 US 0.625%' 21 104.04 -0.192 -0.241 -0.65 35.84 1186873.37 37
White SugarX 530.80 -13.50 New Zealand 03/19 5.00 108.07 1.78 0.01 0.03 -0.10 -0.89 Over 5 yrs -1.68 25.07 -1.69 -0.91 -1.71 25.17 -1.72 -0.93
Diesel - - US 3.625%' 28 137.30 0.356 -0.241 -0.98 16.78 1186873.37 37
Sugar 11 20.01 -0.21 04/27 4.50 121.89 2.19 0.01 0.03 -0.05 -1.18 5-15 yrs -1.91 9.17 -1.90 -0.77 -2.05 9.19 -2.04 -0.86
Unleaded (95R) - - Representative stocks from each major market Source: Merill Lynch Global Bond Indices Local currencies. Total market
Norway 05/19 4.50 110.76 0.56 0.00 0.03 0.09 -0.14 Over 15 yrs -1.66 30.23 -1.67 -0.93 -1.68 30.28 -1.69 -0.94
Base Metals ( LME 3 Months) Cotton Oct 68.23 0.27 value. In line with market convention, for UK Gilts inflation factor is applied to price, for other markets it is applied to par
02/26 1.50 104.12 1.04 -0.02 0.02 0.11 0.00 All stocks -1.68 23.29 -1.69 -0.91 -1.72 23.41 -1.73 -0.94
Aluminium 1690.00 -3.00 Orange Juice Sep 177.35 -0.40 amount.
Aluminium Alloy 1575.00 15.00 Palm Oil - - Portugal 06/19 4.75 110.51 0.95 0.05 0.15 -0.24 0.10 See the FTSE website for more details: http://www.ftse.com/products/indices/gilts
Copper 4771.00 -42.00 Live Cattle Aug 115.30 -0.58 BONDS: TEN YEAR GOVT SPREADS 07/26 2.88 100.09 2.86 0.03 0.12 -0.20 0.00
Spain 01/19 0.25 100.86 -0.10 0.00 0.00 0.00 0.00 All data provided by Morningstar unless otherwise noted. All elements listed are indicative and believed accurate
Lead 1876.00 1.00 Feeder Cattle Aug 147.00 -1.55
Nickel 10215.00 -30.00 Lean Hogs Oct 60.15 0.00 Spread Spread Spread Spread 10/26 1.30 102.43 1.05 -0.01 0.02 0.00 0.00 at the time of publication. No offer is made by Morningstar or the FT. The FT does not warrant nor guarantee
Tin 18300.00 20.00 Bid vs vs Bid vs vs Sweden 10/18 1.00 100.02 0.99 0.01 0.04 0.03 0.00 that the information is reliable or complete. The FT does not accept responsibility and will not be liable for any
Zinc 2258.00 0.50 % Chg % Chg Yield Bund T-Bonds Yield Bund T-Bonds 05/25 2.50 123.36 -0.15 0.00 0.00 0.00 0.00 loss arising from the reliance on or use of the listed information. For all queries e-mail
Precious Metals (PM London Fix) Aug 16 Month Year Australia 2.01 2.12 0.44 Italy 1.17 1.27 -0.41 Switzerland 05/19 3.00 110.95 -0.94 0.00 0.00 0.00 0.00 ft.reader.enquiries@morningstar.com
Gold 1344.00 4.60 S&P GSCI Spt 363.45 0.61 -0.46 Austria 0.12 0.23 -1.46 Japan -0.08 0.03 -1.66 05/26 1.25 117.53 -0.50 0.00 0.00 0.00 0.00
Silver (US cents) 2003.50 13.50 DJ UBS Spot 85.67 -1.19 -5.19 Belgium 0.15 0.26 -1.43 Netherlands -0.06 0.05 -1.63 United Kingdom 07/18 1.25 102.10 0.16 -0.03 0.06 -0.02 -0.81 Data provided by Morningstar | www.morningstar.co.uk
Platinum 1124.00 12.00 R/J CRB TR 187.27 -1.29 -5.65 Canada 1.08 1.18 -0.50 Norway 1.04 1.15 -0.53 07/22 0.50 100.97 0.33 -0.03 0.06 0.00 0.00
Palladium 701.00 17.00 M Lynch MLCX Ex. Rtn 231.14 -9.84 -33.05 Denmark 0.06 0.17 -1.51 Portugal 2.86 2.97 1.29 07/26 1.50 108.03 0.66 -0.02 0.04 -0.29 0.00
Bulk Commodities UBS Bberg CMCI TR 13.43 -0.56 -2.28 Finland 0.08 0.18 -1.50 Spain 1.05 1.16 -0.53 12/46 4.25 173.34 1.31 0.00 0.07 -0.39 -1.20
Iron Ore (Platts) 62.15 1.65 LEBA EUA Carbon 5.83 0.00 -22.37 France 0.17 0.28 -1.40 Switzerland -0.50 -0.39 -2.07 United States 07/18 0.75 99.99 0.75 0.01 0.07 0.00 0.00
Iron Ore (The Steel Index) 61.10 -0.70 LEBA CER Carbon 0.40 0.00 -18.37 Germany -0.11 0.00 -1.68 United Kingdom 0.66 0.77 -0.91 07/21 1.13 99.79 1.17 0.02 0.10 0.00 0.00
GlobalCOAL RB Index 67.50 -0.50 LEBA UK Power 2703.00 59.47 107.29 Greece 8.03 8.13 6.45 United States 1.58 1.68 0.00 08/26 1.50 99.30 1.58 0.01 0.00 0.00 0.00
Baltic Dry Index 685.00 -2.00 Ireland 0.39 0.49 -1.19 08/46 2.25 99.30 2.28 -0.01 0.00 0.00 0.00
Sources: NYMEX, ECX/ICE, CBOT, X ICE Liffe, ICE Futures, CME, LME/London Metal Exchange.* Latest prices, $ Data provided by SIX Financial Information & Tullett Prebon Information Data provided by SIX Financial Information & Tullett Prebon Information
unless otherwise stated.
18 FINANCIAL TIMES Thursday 18 August 2016

MANAGED FUNDS SERVICE

Fund Bid Offer D+/- Yield Fund Bid Offer D+/- Yield Fund Bid Offer D+/- Yield Fund Bid Offer D+/- Yield Fund Bid Offer D+/- Yield Fund Bid Offer D+/- Yield Fund Bid Offer D+/- Yield Fund Bid Offer D+/- Yield

Bond Global 1431.10 - -10.29 0.00 Crediinvest SICAV Fixed Income Eur 10.91 - -0.01 0.00 EU Multi-Strategy Managed 2.95 3.18 0.04 0.00 Invesco Global Leisure A $ 39.50 - -0.42 0.00 Sterling Bond 1.6220xd - -0.0100 3.14

ACPI Global UCITS Funds Plc (IRL)

Eurocroissance 904.09 - 15.42 0.00 Crediinvest SICAV Fixed Income Usd $ 10.77 - 0.00 0.00 Global Bond USD $ 3.60 3.88 0.03 0.00 Invesco Global Smaller Comp Eq Fd A $ 59.55 - -0.54 - UK 7.3290 - -0.0580 1.26
Mirabaud Asset Management (LUX)
www.acpishard.com www.mirabaud.com, marketing@mirabaud.com
Regulated Lloyds Gilt Fund Limited Regulated
Far East $ 733.40 - 12.21 0.00 Crediinvest SICAV Spanish Value 258.55 - -1.74 - Invesco Global Structured Equity A $ 46.42 - -0.26 1.13
ACPI Emerging Mkts FI UCITS Fund USD A $ 122.84 - 0.17 0.00 Lloyds Gilt Fund Quarterly Share 1.4240 - -0.0090 1.46 Mir. - Conv. Bds Eur A EUR 133.45 - -0.38 0.00
Crediinvest SICAV International Value 241.59 - -0.98 -
Genesis Asset Managers LLP Invesco Global Total Ret.(EUR) Bond Fund A 13.50 - 0.00 -
Other International Funds
ACPI Global Credit UCITS Funds USD A $ 14.80 - 0.00 0.00 Monthly Share 1.3690xd - -0.0090 1.46 Mir. - Conv. Bds Glb A USD $ 113.08 - -0.08 0.00
Bank of America Cap Mgmt (Ireland) Ltd (IRL)
Crediinvest SICAV Big Cap Value 15.72 - -0.07 0.00 Invesco Gold & Precious Metals A $ 7.18 - -0.02 0.00
Regulated EnTrustPermal Ltd. Emerging Mkts NAV 6.83 - -0.08 0.00
ACPI Global Fixed Income UCITS Fund USD A $ 159.09 - -0.04 0.00 Lloyds Money Fund Limited Mir. - Eq Asia ex Jap A $ 183.53 - -1.01 0.00
www.entrustpermal.com
Global Liquidity USD $ 1.00 - 0.00 0.61 Crediinvest SICAV US American Value $ 18.75 - -0.09 - Invesco Greater China Equity A $ 49.15 - -0.05 -
Other International Funds Sterling Class 52.6550 - 0.0000 0.08
Q ACPI India Fixed Income UCITS Fund USD A $ 10.62 - -0.01 0.00 Mir.- EqEurope ExUK Sm&Mid 128.13 - -0.14 -
Offshore Fund Class A US $ Shares HPB Assurance Ltd
Crediinvest SICAV Sustainability 15.68 - -0.04 0.00 Invesco India Equity A $ 57.63 - -0.02 - Lloyds Multi Strategy Fund Limited
ACPI India Fixed Income UCITS Fund USD A3 $ 90.70 - -0.04 0.00 Investment Holdings N.V. $ 4992.53 - 101.58 0.00 Anglo Intl House, Bank Hill, Douglas, Isle of Man, IM1 4LN 01638 563490 Mir. - Eq Glb Emrg Mkt A USD $ 97.48 - -0.27 0.00
Barclays Investment Funds (CI) Ltd (JER)
International Insurances Invesco Japanese Equity Adv Fd A 3405.00 - 17.00 - Conservative Strategy 1.2060 - -0.0050 1.67
39/41 Broad Street, St Helier, Jersey, JE2 3RR Channel Islands 01534 812800
ACPI International Bond UCITS Fund USD A $ 18.72 - -0.02 0.00 Macro Holdings Ltd $ 4141.38 - -15.30 0.00 Mir. - Eq Global Focus A USD $ 97.51 - -0.28 0.00
FCA Recognised DAVIS Funds SICAV (LUX) Holiday Property Bond Ser 1 0.53 - 0.02 0.00
Invesco Japanese Value Eq Fd A 1100.00 - 2.00 0.00 Growth Strategy 1.6590 - -0.0110 1.22
Bond Funds Regulated
Fixed Income Holdings N.V. $ 336.20 - 6.33 - Mir. - EqPanEuropeSm&Mid 116.79 - -0.56 0.00
Holiday Property Bond Ser 2 0.63 - 0.02 0.00 Aggressive Strategy 2.0950 - -0.0210 0.00
Sterling Bond F 0.51 - 0.00 2.96 Davis Value A $ 41.74 - 0.17 - Invesco Latin American Equity A $ 7.11 - -0.08 -
ACPI Select UCITS Funds PLC (IRL)
Mir. - Eq Spain A 25.35 - -0.06 0.00
EnTrustPermal Absolute Return Fund $ 153.10 - -0.04 0.00
Regulated Global USD Growth Strategy $ 1.4380 - -0.0050 0.00
Davis Global A $ 30.52 - 0.07 - Invesco Nippon Small/Mid Cap Equity A 1080.00 - -15.00 -
ACPI Balanced UCITS Fund USD Retail $ 14.66 - 0.03 0.00 Haussmann Dealing Daily Mir. - Eq Swiss Sm/Mid A SFr 362.95 - -1.47 0.00
BlackRock (JER) Other International Funds Invesco Pan European Equity A EUR Cap NAV 16.69 - -0.16 -
ACPI Balanced UCITS Fund EUR Retail 10.95 - 0.02 0.00 Regulated Equinox Fund Mgmt (Guernsey) Limited (GSY)
Mir. - Glb High Yield Bds A $ 114.06 - 0.27 -
Regulated Haussmann Cls A $ 2585.52 - 25.82 0.00 Invesco Pan European High Income Fd A 13.99 - -0.04 2.74
BlackRock UK Property 41.10 - -0.98 3.41 M & G Securities (1200)F (UK)
ACPI Balanced UCITS Fund GBP Retail 11.12 - 0.02 0.00 Equinox Russian Opportunities Fund Limited $ 116.66 - 5.99 0.00 PO Box 9039, Chelmsford, CM99 2XG Mir. - Glb Eq High Income A USD $ 99.94 - 0.12 0.00
Haussmann Cls C 2242.92 - 21.10 0.00 Invesco Pan European Small Cap Equity A 20.36 - -0.20 0.00
Blackrock UK Long Lease 1077.05 - -1.88 0.00 www.mandg.co.uk Enq: 0800 390 390, Dealing: 0800 328 3196
ACPI Balanced UCITS Fund USD Institutional $ 10.00 - - - Authorised Inv Funds Mir. - Glb Strat. Bd A USD $ 109.26 - 0.03 0.00
Haussmann Cls D SFr 1181.76 - 10.83 0.00 Invesco Pan European Structured Equity A 16.84 - -0.13 0.00
BLK Intl Gold & General $ 7.83 8.25 -0.10 0.00 Euronova Asset Management UK LLP (CYM)
ACPI Balanced UCITS Fund EUR Institutional 10.00 - - - M&G Episode Growth A Inc 52.10 - -0.06 2.33 Mir. - US Shrt Term Credit Fd $ 102.60 - -0.03 -
Regulated Invesco UK Eqty Income A 32.68 - -0.20 0.00
Dodge & Cox Worldwide Funds (IRL)
M&G Global High Yield Bond A Inc 50.33 - 0.04 4.03
ACPI Balanced UCITS Fund GBP Institutional 10.00 - - - 6 Duke Street,St.James,London SW1Y 6BN Smaller Cos Cls One Shares 35.81 - 0.12 0.00 Heartwood Wealth Management Limited (IRL)
BLI - Banque de Luxembourg Investments S.A. Regulated
Invesco UK Investment Grade Bond A 1.11 - -0.01 2.40
www.dodgeandcox.worldwide.com 020 3713 7664 MW Japan Fund Plc (IRL)
ACPI Horizon UCITS Fund $ 13.23 - -0.02 0.00 FCA Recognised M&G Global High Yield Bond A Acc 122.01 - 0.08 4.02
FCA Recognised Smaller Cos Cls Two Shares 24.92 - 0.08 0.00 FCA Recognised
Heartwood Caut Multi Asset B Acc 139.55 - 0.30 0.00 Invesco US Structured Equity A $ 22.90 - -0.21 -
BL-Equities Europe B 6128.74 - -27.57 0.00 Dodge & Cox Worldwide Funds plc - Global Bond Fund M&G Managed Growth A Inc 91.02 - -0.38 0.34 MW Japan Fund PLC A $ 25.30 - 0.15 0.00
Smaller Cos Cls Three Shares 12.52 - 0.05 0.00
EUR Accumulating Class 12.28 - -0.09 0.00 Invesco US Value Eq Fd A $ 32.22 - 0.01 0.00
BL-Equities America B $ 5899.27 - -16.91 -
Smaller Cos Cls Four Shares 16.12 - 0.04 0.00 MW Japan Fund PLC B $ 25.42 - 0.15 0.00
EUR Accumulating Class (H) 9.82 - 0.00 0.00 Invesco USD Reserve A $ 87.10 - 0.00 0.00
BL-Equities Japan B 14903.00 - 46.00 0.00 M & G (Guernsey) Ltd (GSY)
Regulated MW Japan Fund PLC C $ 81.14 - 1.07 0.00
BL-Emerging Markets B 168.32 - -0.87 0.00 EUR Distributing Class 11.40 - -0.09 4.05 The M&G Offshore Fund Range
Invesco Global Asset Management Ltd (IRL)
BL-Global Equities B 771.20 - -4.83 0.00 EUR Distributing Class (H) 9.11 - 0.00 4.06 Corporate Bond A 1421.13 1465.09 -6.99 3.88
Dublin 00 353 1 439 8100 Hong Kong 00 852 2842 7200 Morant Wright Funds (Ireland) PLC (IRL)
Algebris Investments (IRL) FCA Recognised FCA Recognised
Regulated BL-Global 30 B 1434.26 - -5.12 0.00 GBP Distributing Class 12.01 - -0.14 3.66 Hermes Investment Funds Plc (IRL) Global Basics X 2952.93 3044.25 -26.45 0.17
Hermes Investment Management Limited, 1 Portsoken Street, London E1 8HZ +44 (0) 207 680 2121 Invesco Stlg Bd A QD F 2.73 - -0.01 3.50 Morant Wright Fuji Yield EUR Acc Hedged 9.95 - 0.08 -
Algebris Financial Credit Fund - Class I EUR 138.17 - 0.05 0.00 GBP Distributing Class (H) 9.25 - 0.00 4.11 FCA Recognised Global Dividend A 139.49 145.30 -1.26 2.72
BL-Global 50 B 1722.96 - -7.67 0.00
Invesco Asian Equity A $ 6.93 - -0.03 0.00 Morant Wright Fuji Yield EUR Dist Hedged 8.95 - 0.07 2.78
Algebris Financial Income Fund - Class I EUR 113.62 - 0.01 0.00 Eurobank Fund Management Company (Luxembourg) S.A. Hermes Abs Return Credit Fund Class F Acc 1.20 1.20 0.00 0.00
BL-Global 75 B 2341.32 - -12.17 0.00 USD Accumulating Class $ 9.99 - 0.01 0.00 Global Leaders A 3997.39 4163.95 -31.61 0.90
Regulated
Invesco ASEAN Equity A $ 99.28 - -0.78 0.26 Morant Wright Fuji Yield GBP Acc Hedged 9.37 - 0.08 0.00
Algebris Financial Equity Fund - Class B EUR 90.13 - -0.52 0.00 Dodge & Cox Worldwide Funds plc-Global Stock Fund (LF) Absolute Return 1.31 - 0.00 0.00 Hermes Abs Return Credit Fund Class R Acc 1.96 1.96 -0.01 0.00 Global High Yield Bond X 989.51 1020.11 0.59 4.04
BL-Global Flexible EUR B 156.64 - -1.30 -
Invesco Bond A $ 28.69 - -0.13 1.95 Morant Wright Fuji Yield GBP Dist Hedged 8.61 - 0.07 7.00
USD Accumulating Share Class $ 16.80 - -0.01 0.00 Hermes Asia Ex-Japan Equity Fund Class F Acc 1.98 1.98 -0.03 0.00
Algebris Asset Allocation Fund - Class B EUR 97.77 - 0.18 0.00 (LF) Eq Emerging Europe 0.77 - 0.00 - Global Macro Bond A 13339.46 13752.02 -52.30 1.03
Invesco Continental Eurp Small Cap Eqty A $ 202.69 - -2.41 - Morant Wright Fuji Yield USD Acc Hedged $ 9.21 - 0.08 0.00
GBP Accumulating Share Class 21.19 - -0.28 0.00 Hermes Asia Ex-Japan Equity Fund Class R Acc 3.61 3.61 -0.04 0.00
BONHOTE (LF) Eq Flexi Style Greece 0.94 - -0.05 0.00 North American Dividend A 194.51 202.62 -1.55 2.04
Other International Funds Invesco Emerging Markets Equity A $ 39.24 - -0.25 0.00 Morant Wright Fuji Yield USD Dist Hedged $ 9.10 - 0.07 2.73
Amundi Funds (LUX) GBP Distributing Share class 15.34 - -0.20 0.82 Hermes Global Emerging Markets Fund Class F Acc 1.49 1.49 -0.01 0.00
(LF) Eq Mena Fund 13.27 - 0.10 0.00 Optimal Income A 145.84 150.35 -0.27 2.11
5 Allee Scheffer L-2520 Luxembourg + 44 (0)20 7074 9332 Bonhte Alternative - Multi-Arbitrage (USD) Classe (EUR) 6403.00 - -54.00 1.97 Invesco Emerging Markets Bond A $ 22.34 - 0.03 - Morant Wright Fuji Yield YEN Acc 959.44 - 7.48 0.00
www.amundi-funds.com EUR Accumulating Share Class 22.37 - -0.19 0.00 Hermes Global Emerging Markets Fund Class R Acc 3.17 3.17 -0.02 0.00
(LF) Greek Government Bond 19.34 - 0.04 - Recovery A 10630.30 11073.22 -64.93 0.75
FCA Recognised Bonhte Alternative - Multi-Performance (USD) Classe (EUR) 9545.00 - -1.00 0.84 Dodge & Cox Worldwide Funds plc-International Stock Fund Invesco Continental European Equity A 7.86 - -0.09 1.23 Morant Wright Fuji Yield B YEN Acc 847.85 - 6.62 0.00
Bd. Euro Corporate AE Class - R - EUR 19.46 - -0.04 0.00 (LF) Greek Corporate Bond 12.60 - 0.03 - Hermes Global Equity Fund Class F Acc 1.84 1.84 -0.01 0.00 Strategic Corproate Bond A 141.89 147.80 -0.54 2.44
USD Accumulating Share Class $ 13.87 - 0.01 0.00 Invesco Gilt A 17.18 - -0.19 1.16 Morant Wright Fuji Yield YEN Dist 925.55 - 7.22 2.75
Bd. Global AU Class - R - USD $ 28.07 - 0.03 0.00 (LF) FOF Dynamic Fixed Inc 12.12 - -0.13 0.00 Hermes Global Equity Fund Class R Acc 4.06 4.06 -0.02 0.00 UK Inf Lkd Corp Bd A Inc 108.56 111.92 0.04 0.92
CG Asset Management Limited (IRL)

Asset Management
EUR Accumulating Share Class 14.47 - -0.12 0.00 Invesco Global Small Cap Equity A NAV $ 123.96 - -1.03 0.00
Northern Trust, George's Court, 54-62 Townsend Street, Dublin 2, Rep of Ireland Morant Wright Sakura Fund Sterling Acc Hedged 11.40 - 0.15 0.00

Asset Management Asset Management

Eq. Emerging Europe AE Class - R - EUR 26.83 - -0.24 0.00 (LF) FOF Real Estate 17.49 - -0.38 - Hermes Global ESG Equity Fund Class F Acc 1.39 1.39 -0.01 0.00 UK Select A 1509.02 1571.90 -7.91 1.09
00 353 1 434 5098 Dodge & Cox Worldwide Funds plc-U.S. Stock Fund
FCA Recognised Invesco Global High Income A NAV $ 12.43 - 0.02 6.29 Morant Wright Sakura Fund Euro Acc Hedged 11.48 - 0.14 0.00
Eq. Emerging World AU Class - R - USD $ 91.38 - 0.48 0.00 USD Accumulating Share Class $ 19.32 - -0.04 0.00 Hermes Global High Yield Bond Fund Class F Acc 1.36 1.36 0.00 -
Capital Gearing Portfolio Fund Plc 29476.38 29476.38 205.59 - Invesco Gbl R/Est Secs A GBP F F 9.83 - -0.13 0.78 Morant Wright Sakura Fund Yen Acc Unhedged 1189.78 - 14.62 0.00
Eq. Greater China AU Class - R - USD $ 600.80 - 2.67 0.00 GBP Accumulating Share Class 23.05 - -0.34 0.00 FIL Investment Services (UK) Limited (1200)F (UK) Hermes Global High Yield Bond Fund Class R Acc 2.96 2.96 0.00 - MFS Investment Funds (LUX)
CG Portfolio Fund Plc 130, Tonbridge Rd, Tonbridge TN11 9DZ FCA Recognised
Invesco Global Health Care A $ 122.22 - -1.26 0.00 Morant Wright Sakura Fund Dollar Acc Hedged $ 11.43 - 0.14 0.00
GBP Distributing Share Class 14.59 - -0.22 0.63 Callfree: Private Clients 0800 414161 Hermes Global Small Cap Fund Class F Acc 1.20 1.20 -0.01 0.00
Eq. Latin America AU Class - R - USD $ 395.74 - 0.42 - Real Return Cls A 203.37 203.37 2.95 1.48 Blend.Research Gb.Eq.Fd. 104.03 - -1.02 0.00
Broker Dealings: 0800 414 181
Invesco Global Select Equity A $ 12.64 - -0.07 0.07 Morant Wright Sakura Fund Swiss Franc Acc HedgedSFr 11.31 - 0.14 0.00
Gl. Macro Bds & Curr Low Vol AHG - GBP 99.05 - -0.03 0.00 Dollar Fund Cls D 156.90 156.90 -1.36 1.39 EUR Accumulating Share Class 22.22 - -0.24 0.00 OEIC Funds Hermes Global Small Cap Fund Class R Acc 1.98 1.98 -0.01 0.00
Blend.Research Gb.Eq.Fd. 121.38 - -0.62 0.00
Invesco Jap Eqty Core A $ 1.84 - 0.01 -
Target 2020 A-ACC-GBP 0.63 - 0.00 0.48 Hermes Multi Asset Inflation Fund Class F GBP Acc 1.03 1.03 0.00 0.00
Capital Value Fund Cls V 143.27 143.27 1.03 0.25 Blend.Research Gb.Eq.Fd. $ 103.41 - -0.26 0.00
Invesco Japanese Equity A $ 19.39 - -0.11 -
The Antares European Fund Limited Target 2025 A-ACC-GBP 1.48 - -0.01 0.30 Hermes Multi Strategy Credit Fund Class F Acc Hed 1.09 1.09 0.00 0.00
Blend.Research U.S.Core Eq.Fd. 106.97 - -1.07 -
Other International Invesco Korean Equity A $ 30.39 - -1.11 0.00
Cedar Rock Capital Limited (IRL) Target 2030 A-ACC-GBP 1.62 - -0.01 0.37 Hermes Sourcecap EU Alpha Fund Class F Acc 1.51 1.51 -0.01 -
AEF Ltd Usd (Est) $ 580.96 - 4.54 - Blend.Research U.S.Core Eq.Fd. 118.94 - -0.63 -
Regulated
Institutional OEIC Funds Invesco PRC Equity A $ 54.47 - -0.49 -
Cedar Rock Capital Fd Plc $ 402.03 - 6.91 0.00 Hermes Sourcecap EU Alpha Fund Class F Dis 1.44 1.44 -0.02 1.32
AEF Ltd Eur (Est) 581.96 - 4.42 0.00 Blend.Research U.S.Core Eq.Fd. 9022.00 - -66.00 0.00
Europe (ex-UK) Fund ACC-GBP 4.48 - -0.05 1.32 Invesco Pacific Equity A $ 50.58 - -0.11 0.07
Hermes Sourcecap EU Alpha Fund Class R Acc 3.07 3.07 -0.02 - Morgan Stanley Investment Funds (LUX)
Cedar Rock Capital Fd Plc 488.06 - 20.82 0.00 Dragon Capital Group Blend.Research U.S.Core Eq.Fd. $ 106.43 - -0.30 -
Reduced Duration UK Corp Bond Gross 11.21 - -0.02 3.31 6b Route de Trves L-2633 Senningerberg Luxembourg (352) 34 64 61
1501 Me Linh Point, 2 Ngo Duc Ke, District 1, Ho Chi Minh City, Vietnam Invesco Global Technology A $ 15.88 - -0.16 0.00
www.morganstanleyinvestmentfunds.com
Arisaig Partners Cedar Rock Capital Fd Plc 374.39 - 6.55 0.00 Fund information, dealing and administration: funds@dragoncapital.com
Hermes Sourcecap EX UK Fund Class F Acc 1.61 1.61 -0.02 0.00
Em.Mk.Eq.Fund Euro 119.63 - -0.43 0.00
Reduced Duration UK Corp Bond Inc 10.09 - -0.02 3.31 FCA Recognised
Other International Funds Invesco UK Eqty A 8.05 - -0.05 -
Other International Funds Hermes Sourcecap EX UK Fund Class R Acc 3.17 3.17 -0.05 0.00
Em.Mk.Eq.Fund Sterling 122.15 - 0.13 0.00 US Advantage A F $ 61.22 - -0.41 0.00
Arisaig Africa Consumer Fund Limited $ 12.77 - -0.05 - Reduced Dur UK Corp Bond Gross Inc 10.10 - -0.02 3.31
Vietnam Property Fund (VPF) NAV $ 0.80 - -0.11 0.00
Charles Schwab Worldwide Funds Plc (IRL) Hermes US All Cap Equity Class F Stg Acc 1.24 1.24 -0.01 0.00 Asian Equity A F $ 44.33 - -0.43 0.00
Em.Mk.Eq.Fd.US Dollar $ 102.88 - 0.37 0.00
Arisaig Asia Consumer Fund Limited $ 67.58 - -0.04 0.00 Regulated UK Gilt Fund Inc 1.44 - -0.02 -
Vietnam Enterprise Inv. (VEIL) NAV $ 4.30 - -0.02 0.00
Hermes US All Cap Equity Class R Acc 2.04 2.04 -0.01 0.00 Asian Property A F $ 19.19 - -0.09 -
Schwab USD Liquid Assets Fd $ 1.00 - 0.00 - Gb.Conc.Eq.Fd.Euro 297.26 - -0.71 0.00
Arisaig Global Emerging Markets Consumer Fund $ 10.59 - -0.04 0.00 UK Long Corporate Bond - Gross Inc 12.81 - -0.13 -
Hermes US SMID Equity Fund Class F Acc 2.07 2.07 -0.02 0.00 Diversified Alpha Plus A F 27.43 27.43 -0.01 0.00
Gb.Conc.Eq.Fd.Sterl.UK T 216.02 - 0.50 0.00
Arisaig Global Emerging Markets Consumer UCITS 12.18 - -0.11 0.00 DSM Capital Partners Funds (LUX)
Chartered Asset Management Pte Ltd www.dsmsicav.com Hermes US SMID Equity Fund Class R Acc 3.71 3.71 -0.02 0.00 Emerg Europ, Mid-East & Africa Eq A F 71.63 - -0.49 0.00
Arisaig Global Emerging Markets Consumer UCITS STG 13.35 - -0.13 0.00 Regulated
Findlay Park Funds Plc (IRL) Gb.Conc.Eq.Fd.Sterling 326.89 - 0.75 0.00
Other International Funds
30 Herbert Street, Dublin 2, Ireland Tel: 020 7968 4900 GAM
CAM-GTF Limited $ 303036.29 303036.30 -1427.74 0.00 Global Growth I2 Acc 139.09 - -0.80 - FCA Recognised funds@gam.com, www.jbfundnet.com Gb.Conc.Eq.Fd.US $ 211.91 - 1.01 0.00 Emerging Markets Debt A F $ 85.04 - 0.08 0.00
Arisaig Latin America Consumer Fund $ 25.34 - -0.19 0.00
American Fund USD Class $ 86.61 - -0.47 -
INDIA VALUE INVESTMENTS LIMITED (INVIL) Regulated
CAM GTi Limited $ 791.62 - 38.82 0.00 Global Growth I1 Eur 103.92 - -0.60 0.00 www.invil.mu Gb.Eq.Hdg Fd.Euro IRE T 194.72 - -0.32 0.00 Emerging Markets Domestic Debt AX F 13.25 13.25 0.07 4.25
Ms EF Special Val. EUR/A 145.95 - -1.01 1.08
American Fund GBP Hedged 47.00 - -0.26 0.00 Other International Funds
Artisan Partners Global Funds PLC (IRL) Raffles-Asia Investment Company $ 1.64 1.64 0.04 5.24 DSM US Large Cap Growth $ 103.70 - 0.02 - Gb.Eq.Euro Hdg Fd. 275.88 - -0.44 0.00 Emerging Markets Equity A F $ 37.40 37.40 0.19 0.00
Beaux Lane House, Mercer Street Lower, Dublin 2, Ireland NAV 9.24 - -0.01 0.00 Strategy Balanced-CHF/B SFr 153.09 - -0.68 0.00
American Fund GBP Unhedged 66.52 - -0.81 0.00 Euro Bond A F 16.54 16.54 -0.04 0.00
Tel: 44 (0) 207 766 7130 Gb.Eq.Fund Euro 296.74 - -1.42 -
FCA Recognised Strategy Balanced-EUR 158.45 - -0.63 0.00
Edinburgh Partners Limited (IRL) Latin American Fund USD Class $ 15.00 - -0.16 - Euro Corporate Bond AX F 26.98 26.98 0.13 -
Artisan Partners Global Funds plc Gb.Eq. Fd Euro IRE T 187.78 - -0.89 0.00
27-31 Melville Street, Edinburgh EH3 7JF Intrinsic Value Investors (IVI) LLP (IRL) Strategy Balanced-USD/B $ 134.37 - -0.18 0.00
Artisan Global Equity Fund Class I USD Acc $ 14.97 - -0.09 0.00 Tel: +353 1 434 5143 Dealing - Fax +353 1 434 5230 Latin American Fund GBP Unhedged 11.69 - -0.20 0.00 1 Hat & Mitre Court, 88 St John Street, London EC1M 4EL +44 (0)20 7566 1210
Gb.Eq.Fd.Sterling UK T 260.80 - -0.01 - Euro Strategic Bond A F 45.93 45.93 -0.12 -
FCA Recognised FCA Recognised Strategy Growth-CHF/B SFr 94.31 - -0.51 0.00
Artisan Global Opportunities I USD Acc $ 13.34 - -0.04 0.00 Edinburgh Partners Opportunities Fund PLC IVI European Fund EUR 18.99 - -0.12 0.00 Gb.Eq.Fd.US Dollar $ 333.97 - 0.82 - European Currencies High Yield Bd A F 22.96 22.96 0.05 0.00
Strategy Growth-EUR 118.59 - -0.57 0.00
Emerging Opportunities I USD $ $ 1.20 - -0.01 0.88 The First Investor QSCC
Artisan Global Value Fund Class I USD Acc $ 16.75 - 0.02 0.00 5th Floor, Barwa Bank Building, Grand Hamad Street IVI European Fund GBP 22.22 - -0.17 0.56 Gb.Eq.Fund Sterling 257.77 - -0.01 - European Equity Alpha A F 40.16 - -0.33 0.00
Cheyne Capital Management (UK) LLP (IRL) Strategy Inc-CHF/B SFr 121.28 - -0.41 -
European Opportunities I EUR 2.28 - -0.02 1.63 , P.O. Box 16034, Doha, State of Qatar
Artisan US Value Equity Fund Class I USD Acc $ 12.36 - -0.02 0.00 Regulated European Property A F 33.97 33.97 -0.31 0.00
+ 974 4459 6111 Gb.Val.Ex-Jap.Fd.USD $ 128.37 - -0.07 0.00
Cheyne Convertibles Absolute Return Fund 1354.56 - 1.94 0.00 Strategy Inc-EUR/B 162.89 - -0.51 0.00
European Opportunities I GBP 1.97 - -0.02 1.59 http://www.tfi.com.qa/
Artisan Global Opportunities Class I EUR Acc 17.77 - -0.21 0.00 Gb.Val.Ex-Japan Fd.Yen 12680.00 - -64.00 0.00 Eurozone Equity Alpha A F 11.05 11.05 -0.10 0.00
Other International Funds
Cheyne Global Credit Fund 122.54 - 0.03 0.00 Strategy Inc-USD/B $ 151.50 - -0.22 -
European Opportunities I USD $ 2.57 - -0.02 1.74
TFI GCC Equity Opportunities Fund (Q)QAR 1245.70 - 11.19 0.00 Gb.Val.Fd. Euro 141.24 - -1.27 0.00 Global Bond A F $ 41.86 41.86 0.04 0.00
Ashmore Sicav (LUX) Cheyne European Mid Cap Fund 1085.10 - -3.53 0.00 European Opportunities A EUR 2.23 - -0.02 1.05
Gb.Val.Fd.Sterling 149.09 - -0.63 0.00 Global Brands A F $ 105.38 - -0.21 -
2 rue Albert Borschette L-1246 Luxembourg
FCA Recognised Global Opportunities I USD $ 1.62 - 0.00 1.22 Foord Asset Management
Gb.Val.Fd.USD $ 114.41 - -0.20 0.00 Global Convertible Bond A F $ 41.98 - -0.06 0.00
Cheyne Capital Management (UK) LLP Other International Funds Invesco (LUX)
Ashmore SICAV Emerging Market Debt Fund $ 102.14 - 0.56 -
Global Opportunities I GBP 1.25 - -0.01 1.29 Dublin 00 353 1 439 8100 Hong Kong 00852 3191 8282
Other International Funds Foord International Trust $ 35.83 - 0.00 0.00 Low Volatility Gb.Eq.Fd.Euro 112.13 - -1.60 0.00 Global Property A F $ 29.36 - -0.20 0.00
FCA Recognised
Ashmore SICAV Emerging Market Frontier Equity Fund $ 151.20 - 1.17 1.12
Cheyne European Event Driven Fund 126.18 - -0.62 0.00 Global Opportunities A GBP 1.17 - -0.01 0.77 Invesco Management SA
Foord Global Equity Fund_Class B $ 13.04 - -0.04 0.00 Low Volatility Gb.Eq.Fd.Sterl 130.89 - -1.25 0.00 Indian Equity A F $ 38.18 - -0.16 -
Ashmore SICAV Emerging Market Total Return Fund $ 88.67 - 0.52 6.31 Invesco Active Multi-Sector Credit Fund A 3.05 - 0.00 - Kames Capital VCIC (IRL)
Cheyne Real Estate Credit Holdings Fund 168.24 - 0.22 0.00 Pan European Opportunities I EUR 1.36 - -0.01 -
1 North Wall Quay, Dublin 1, Ireland +35 3162 24493 Low Volatility Gb.Eq.Fd.USD $ 111.53 - -0.78 0.00 Latin American Equity A F $ 48.34 - -1.06 -
Ashmore SICAV Global Small Cap Equity Fund $ 135.32 - -0.29 0.00 Invesco Asia Balanced A dist $ 14.62 - -0.01 3.56 FCA Recognised
Cheyne Real Estate Credit Holdings Fund III 111.42 - 0.44 0.00 Franklin Templeton International Services Sarl (IRL) Short Maturity Euro Bond A F 20.43 20.43 0.01 0.00
Low Volatility Gb.Eq.Fd.Yen 8738.00 - -101.00 0.00
EM Mkts Corp.Debt USD F $ 91.07 - 0.44 8.12 JPMorgan House - International Financial Services Centre,Dublin 1, Ireland Absolute Return Bond B GBP Acc 1096.07 - 0.18 1.69
Cheyne Real Estate Debt Fund Class A1 129.44 - -0.61 0.00 Invesco Asia Consumer Demand Fund A income $ 13.31 - -0.10 0.23
Other International Funds
US Dollar Liquidity A F $ 13.03 - 0.00 -
EM Mkts Loc.Ccy Bd USD F $ 85.94 - 0.40 3.79 Franklin Emerging Market Debt Opportunities Fund Plc Eq Market Neutral B Acc 988.95 - 0.77 -
Cheyne Total Return Credit Fund - December 2017 Class $ 200.42 - 8.05 0.00 Invesco Asia Infrastructure (A) $ 13.58 - 0.04 0.73
MMIP Investment Management Limited (GSY) US Growth A F $ 70.75 - -0.53 0.00
Franklin Emg Mkts Debt Opp CHFSFr 17.49 - 0.28 8.75 Regulated
Eq Market Neutral Plus B Acc 946.28 - -8.53 -
Cheyne Total Return Credit Fund 2020 $ 104.83 - 0.58 - Invesco Asia Opportunities Equity A $ 111.96 - -0.95 0.00
Multi-Manager Investment Programmes PCC Limited US Growth AH F 49.03 49.03 0.14 0.00
Franklin Emg Mkts Debt Opp EUR 12.38 - 0.21 6.72
High Yield Global Bond A GBP Inc 532.59 - 0.50 3.80
Invesco Balanced Risk Allocation Fund A 16.14 - -0.10 - UK Equity Fd Cl A Series 01 2316.48 2343.11 53.41 0.00
EFG Hermes US Growth AX F 54.93 54.93 0.15 0.00
Franklin Emg Mkts Debt Opp GBP 10.78 - 0.23 6.58
Cohen & Steers SICAV (LUX) DIFC, The Gate Building, West Wing Level 6, PO BOX 30727, Dubai UAE High Yield Global Bond B GBP Inc 1110.34 - 1.07 4.36
Invesco Emerging Europe Equity Fund A $ 8.75 - -0.12 0.00 Diversified Absolute Rtn Fd USD Cl AF2 $ 1495.98 - -47.16 0.00
Regulated Contact: Telephone + 971 4 363 4029 Email AMsales@EFG-HERMES.com US Property A F $ 75.94 - -0.49 0.00
Franklin Emg Mkts Debt Opp SGD S$ 22.85 - 0.41 5.26
Other International Funds Investment Grade Global Bd A GBP Inc 586.50 - -1.04 2.05
European Real Estate Securities 23.1419 - -0.2841 1.71 Invesco Emerging Local Currencies Debt A Inc $ 7.31 - -0.04 6.08 Diversified Absolute Return Stlg Cell AF2 1509.55 - -51.81 0.00
The EFG-Hermes Egypt Fund $ 29.93 - - 0.00 Franklin Emg Mkts Debt Opp USD $ 17.64 - 0.33 6.73
Kames Global Equity Income B GBP Acc 1403.40 - -12.57 -
Aspect Capital Ltd (UK) Europ.RealEstate Sec. IX 31.5363 - -0.3867 0.00 Invesco Emerging Mkt Quant.Eq. A $ 10.59 - -0.10 0.00 Global Equity Fund A Lead Series 1189.14 1193.30 61.34 - Morgens Waterfall Vintiadis.co Inc
Other International Funds EFG-Hermes Frontier Equity UCITS Fund Class I $ 1064.62 - 14.63 - Kames Global Equity Income B GBP Inc 1302.57 - -11.66 - Other International Funds
Gbl Listed Infrastructure I $ 10.8512 - -0.1196 - Invesco Energy A $ 18.33 - 0.01 0.00
Aspect Diversified USD $ 433.56 - 14.49 0.00 Frontier Capital (Bermuda) Limited Phaeton Intl (BVI) Ltd (Est) $ 371.15 - 2.87 0.00
EFG-Hermes MENA Equity UCITS Fund Class A $ 983.46 - -2.30 - Strategic Global Bond A GBP Inc 1123.86 - 2.56 0.56
Other International Invesco Euro Corporate Bond Fund (A) 17.75 - -0.02 0.00 Marlborough International Management Limited (GSY)
Gbl Listed Infrastructure IX $ 10.9781 - -0.1209 -
Aspect Diversified EUR 258.96 - 8.56 0.00 Tudor House, Le Bordage, St Peter Port, Guernsey, CI, GY1 1DB +44 1481 71520
Middle East & Developing Africa Fund (Final) $ 19.81 - - 0.00 Commercial Property-GBP Class 71.42 - -0.53 - Strategic Global Bond B GBP Inc 637.78 - 1.47 1.03
Invesco Euro Inflation Linked Bond A 16.07 - -0.04 0.00 FCA Recognised
Gbl RealEstate Sec. I $ 11.7446 - -0.1074 1.85
Aspect Diversified GBP 134.49 - 4.55 0.00
Saudi Arabia Equity Fund SR 11.56 - 0.12 0.00 Global Real Estate-GBP C Class 45.26 - -0.50 - Marlborough North American Fund Ltd 39.13 41.69 -0.21 0.00
Gbl RealEstate Sec. IX $ 14.1678 - -0.1294 0.00 Invesco Euro Reserve A 322.15 - 0.00 0.00
Aspect Diversified CHF SFr 123.03 - 4.07 0.00 Lloyds Investment Fund Managers Limited (1000)F (JER) Marlborough Tiger Fund Ltd F 28.30 30.15 -0.27 0.00
Invesco Euro Bond A 7.48 - -0.02 0.00 PO Box 311, 11-12 Esplanade, St Helier, Jersey, JE4 8ZU 01534 845555
Aspect Diversified Trends USD $ 127.06 - -0.24 0.00 Ennismore Smaller Cos Plc (IRL) GYS Investment Management Ltd (GSY) Other International Funds
5 Kensington Church St, London W8 4LD 020 7368 4220 Regulated Invesco European Growth Equity A 23.66 - -0.15 -
Aspect Diversified Trends EUR 126.54 - -0.25 0.00 FCA Recognised Lloydstrust Gilt 13.6500xd - -0.0900 1.94 Marwyn Asset Management Limited (CYM)
Taurus Emerging Fund Ltd $ 185.93 189.73 12.79 0.00 Regulated Natixis International Funds (Lux) I SICAV (LUX)
Invesco Global Absolute Return Fund A Class 10.91 - -0.01 0.00 Lloyds Investment Funds Limited
Ennismore European Smlr Cos NAV 113.42 - -0.52 0.00 Cannon Bridge House, 25 Dowgate Hill, London, EC4R 2YA 0044 20 3216 9000
Aspect Diversified Trends GBP 132.74 - -0.25 0.00
Marwyn Value Investors 418.32 - 9.05 0.00 FCA Recognised
Invesco Global Bond A Inc $ 5.60 - -0.01 0.59 Euro High Income 1.6840xd - -0.0030 2.65
Ennismore European Smlr Cos NAV 130.59 - -0.45 0.00
Generali Worldwide Harris Global Equity R/A (USD) $ 246.26 246.26 0.23 0.00
PO Box 613, Generali House, Hirzel Street, St Peter Port, Guernesy, GY1 4PA 01481 714108 Invesco Global Conservative Fund 90 (EUR) A 11.70 - -0.02 0.00 European 8.7130 - -0.0870 1.10
Atlantas Sicav (LUX)
Crdit Andorr Asset Management (LUX)
International Insurances Meridian Fund Managers Ltd Harris US Equity Fund R/A (USD) $ 218.85 218.85 0.61 -
Regulated www.creditandorra.com Ennismore European Smlr Cos Hedge Fd Invesco Global Equity Income Fund A $ 58.46 - -0.33 0.00 High Income 0.9365xd - -0.0045 4.56 Other International Funds
American Dynamic $ 3685.00 - 45.71 0.00 FCA Recognised Other International Funds Global Multi-Strategy Managed $ 4.85 5.23 0.06 0.00 Harris Concentrated US Equity R/A (USD) $ 166.21 166.21 0.35 0.00
International 4.9400 - -0.0350 0.52 Global Gold & Resources Fund $ 224.00 - -10.18 -
Crediinvest SICAV Money Market Eur I 11.21 - 0.00 0.00 Invesco Global Inc Real Estate Sec A dist $ 9.76 - -0.06 2.18
American One $ 3481.25 - 27.80 0.00 NAV 478.29 - -2.54 0.00 UK Multi-Strategy Managed 5.08 5.47 0.10 0.00 Loomis Sayles Strategic Alpha R/A (USD) $ 113.59 113.59 0.12 0.00
North American 19.1200 - -0.1500 0.00 Global Energy & Resources Fund $ 31.95 - 0.00 -
Crediinvest SICAV Money Market Usd A $ 10.08 - 0.00 - Invesco Global Inv Grd Corp Bond A Dist $ 12.40 - -0.06 2.98
Thursday 18 August 2016 FINANCIAL TIMES 19

MANAGED FUNDS SERVICE

Fund Bid Offer D+/- Yield Fund Bid Offer D+/- Yield Fund Bid Offer D+/- Yield Fund Bid Offer D+/- Yield Fund Bid Offer D+/- Yield Fund Bid Offer D+/- Yield Fund Bid Offer D+/- Yield Fund Bid Offer D+/- Yield

OEI Mac Inc GBP B 148.06 - -4.10 0.00 Pictet-Global Emerging Debt-I USD F $ 397.76 - -2.26 0.00 UK Sterling Long Average Duration - Inst Acc 23.19 - 0.00 - Glob.Consumer Trends Equities (EUR) 153.15 - -1.49 0.00 Japan Synthetic Warrant GBP Hedged Class 134.52 - 36.47 0.00 Yuki Japan Low Price 25230.00 - -213.00 0.00

Natixis International Funds (Dublin) I plc (IRL)

OEI MAC Inc USD $ 1274.57 - -68.14 0.00 Pictet-Global Env.Opport-I EUR 169.54 - -1.90 - Unconstrained Bond - Inst Acc $ 12.20 - -0.01 0.00 High Yield Bonds (EUR) 137.31 - 0.11 - Japan Synthetic Warrant USD Class $ 14.40 - -2.07 0.00 Yuki Japan Value Select 12800.00 - -165.00 -
Cannon Bridge House, 25 Dowgate Hill, London, EC4R 2YA +44 (0)20 3216 9000
Regulated YMR Umbrella Fund
Odey European Inc EUR 562.54 - -30.09 0.00 Pictet-Global Megatrend Selection-I USD F $ 232.37 - -1.16 - US High Yield Bond Fund Inst Acc $ 30.04 - 0.04 - Lux -O- Rente (EUR) 149.07 - -0.06 - Japan Synthetic Warrant USD Hedged Class $ 136.70 - 37.58 0.00
Loomis Sayles Global Opportunistic Bond R/D (USD) $ 13.49 13.49 0.03 1.27 YMR N Growth 10931.83 - -2753.17 -
Odey European Inc GBP A 221.47 - -12.13 0.00 Pictet-Greater China-I USD F $ 468.43 - -0.90 0.00 New World Financials (EUR) 49.33 - -0.55 0.00 Renminbi Bond Fund AUD Cls A A$ 129.48 - 0.91 3.21
Loomis Sayles High Income R/D (USD) $ 8.72 8.72 0.02 - Yuki Asia Umbrella Fund
Odey European Inc GBP B 125.66 - -6.86 0.00 Pictet-Health-I USD $ 269.27 - -2.28 0.00 US Premium Equities (EUR) 191.64 - -0.97 0.00 Renminbi Bond Fund AUD Cls B A$ 131.47 - 0.92 3.00
TreeTop Asset Management S.A. (LUX) Yuki Japan Rebounding Growth Fund JPY Class 22060.00 - -404.00 0.00
Loomis Sayles Multisector Income R/D (GBP) $ 12.67 12.67 0.02 5.43 Regulated
Odey European Inc USD $ 261.59 - -13.59 0.00 Pictet-High Dividend Sel I EUR F 163.63 - -1.60 0.00 US Premium Equities (USD) $ 215.79 - -1.07 0.00 Renminbi Bond Fund CHF Cls A SFr 123.46 - 0.86 3.34
TreeTop Convertible Sicav Yuki Japan Rebounding Growth Fund USD Hedged Class $ 849.97 - -15.45 -

Giano Capital EUR Inc 4398.20 - 4.97 0.00 Pictet-India Index I USD $ 103.44 - -0.32 0.00 Renminbi Bond Fund CHF Cls B SFr 123.28 - 0.87 3.10 International A 278.04 - -0.23 0.00

Pictet-Indian Equities-I USD F $ 478.39 - 0.25 -

Platinum Capital Management Ltd Renminbi Bond Fund CNH Cls A CNH 139.36 - 0.88 3.09 International B $ 361.68 - -0.15 0.00 Zadig Gestion (Memnon Fund) (LUX)
FCA Recognised
Odey Asset Management LLP (IRL)
Pictet-Japan Index-I JPY F 13933.13 - 168.01 -
Other International Funds
Renminbi Bond Fund CNH Cls B CNH 139.08 - 0.88 2.87 International C 119.17 - -0.11 3.36
FCA Recognised Memnon European Fund I GBP 138.49 - 0.36 0.00
Platinum All Star Fund - A (Est) $ 117.78 - - -
Odey Pan European EUR R 290.14 - -2.30 - Pictet-Japanese Equities Opp-I JPY F 8424.37 - 101.52 - Renminbi Bond Fund Euro Cls B 125.73 - 0.87 3.02 International D 250.09 - -0.19 3.18
New Capital Fund Management Ltd (IRL) Platinum Global Dividend Fund - A (Est) $ 49.89 - - -
Odey Absolute Return Focus Fund $ 95.67 - -1.76 - Pictet-Japanese Equity Selection-I JPY F 12205.56 - 166.20 - Renminbi Bond Fund GBP Cls B 128.82 - 0.90 3.07 TreeTop Global Sicav
Leconfield House, Curzon Street, London, W1J 5JB S W Mitchell Capital LLP (CYM)
FCA Recognised
Odey Allegra European EUR O 251.77 - -2.09 0.00 Pictet-LATAM Lc Ccy Dbt-I USD F $ 130.15 - 0.21 0.00
Platinum Maverick Enhanced Fund Limited (Est) $ 92.36 - - 0.00 Regulated
Renminbi Bond Fund SGD Cls B S$ 128.51 - 0.90 2.99
Global Opp.A 142.26 - -0.67 0.00 Data Provided by
New Capital UCITS Funds S W Mitchell European Fund Class A EUR 237.47 - -46.61 -
Global Opp.B $ 144.27 - -0.32 0.00
Asia Pac Bd USD Inst Inc $ 97.01 - 0.14 3.28 Odey Allegra International EUR O 155.54 - -1.45 0.00 Pictet-Multi Asset Global Opportunities-I EUR 119.08 - -0.29 0.00 Renminbi Bond Fund USD Cls B $ 128.64 - 0.91 2.86
S W Mitchell Small Cap European Fund Class A EUR 201.02 - -17.42 -
Global Opp.C 204.25 - -1.81 2.78
Asia Pac Bd USD Ord Inc $ 99.07 - 0.13 2.60 Odey Allegra Developed Markets USD I $ 134.60 - -0.29 0.00 Pictet-Pacific Ex Japan Index-I USD F $ 364.61 - -1.04 0.00 Renminbi Bond Fund YEN Cls B 14481.32 - 100.82 0.00
The Charlemagne Fund EUR 254.81 - 4.13 -
Sequoia Equity A 138.81 - -0.31 0.00
Asia Pac Eq EUR Ord Inc 92.84 - -0.27 2.76 Odey European Focus Fund 16.86 - -0.07 0.00 Pictet-Premium Brands-I EUR F 145.14 - -1.35 0.00 Renminbi Bond Fund USD Cls A $ 177.30 - 1.25 3.10
Sequoia Equity B $ 146.20 - 0.04 0.00
Asia Pac Eq GBP Ord Inc 96.19 - -0.28 3.40 Odey Giano European Fund EUR R 112.80 - -0.20 0.00 Pictet-Quality Global Equities I USD $ 146.81 - -0.60 0.00 Renminbi Bond Fund GBP Cls A 171.64 - 1.21 3.31
S W Mitchell Capital LLP (IRL)

Odey Naver Fund EUR I 113.78 - -0.51 0.00 Pictet-Russia Index I USD $ 58.28 - -0.19 -
Polar Capital Funds Plc (IRL) Regulated
Renminbi Bond Fund SGD Cls A S$ 170.17 - 1.20 3.23
Sequoia Equity C 186.19 - -1.23 - www.morningstar.co.uk
Asia Pac Eq USD Ord Inc $ 98.01 - -0.27 2.72 Regulated
SWMC European Fund B EUR 13366.99 - -98.95 0.00 Data as shown is for information purposes only. No
Asia Pac Eq USD Inst Acc $ 107.73 - -0.29 0.00 Odey Odyssey USD I $ 122.97 - -0.39 0.00 Pictet-Russian Equities-I USD F $ 55.45 - -0.30 - Asian Financials I USD $ 319.00 319.00 -1.45 - Renminbi Bond Fund YEN Cls A 21433.00 - 150.00 0.00 offer is made by Morningstar or this publication.
SWMC UK Fund B 11457.22 - -18.44 0.00 UBS Asset Management (UK)
Asia Pac Eq USD Inst Inc $ 109.31 - -0.30 3.29 Odey Swan Fund EUR I 64.95 - -0.12 0.00 Pictet-Security-I USD F $ 210.83 - -0.70 - Biotechnology I USD $ 16.65 16.65 -0.24 0.00 Renminbi Bond Fund EUR Cls A 115.60 - 0.81 3.26 21 Lombard Street, London, EC3V 9AH
SWMC Small Cap European Fund B EUR 12584.92 - -7.75 0.00 Client Services 0800 358 3012, Client Dealing 0800 358 3012
Dyn Europ Eq EUR Ord Inc 166.33 - -1.33 1.09 Odey European Absolute Return GBP S 90.93 - -0.36 0.00 Pictet-Select-Callisto I EUR 103.44 - 0.18 0.00 European Income Acc EUR 11.10 11.10 -0.10 0.00 www.ubs.com/retailfunds
SWMC Emerging European Fund B EUR 10037.46 - 35.37 0.00 Authorised Inv Funds
Dyn Europ Eq GBP Ord Inc 174.96 - -1.40 1.58 Pictet-Small Cap Europe-I EUR F 1084.57 - -10.44 0.00 European Ex UK Inc EUR Acc 9.71 9.71 -0.09 - OEIC

Dyn Europ Eq USD Ord Inc $ 167.14 - -1.34 1.03

Odey Wealth Management (CI) Ltd
www.odey.com/prices
(IRL)
Pictet-ST.MoneyMkt-I 140.26 - 0.00 0.00 Financial Opps I USD $ 11.08 - 0.00 1.80 UBS Global Emerging Markets Equity C Acc 0.61 - -0.01 1.39 Guide to Data
FCA Recognised UBS Global Optimal C Acc 0.80 - -0.01 1.04
China Equity EUR Ord Acc 130.94 - 0.92 0.00 Pictet-ST.MoneyMkt JPY I USD 101423.46 - -2.35 0.00 GEM Growth I USD $ 9.58 - 0.03 0.00
The fund prices quoted on these pages are supplied by
Odey Opportunity EUR I 217.66 - -1.26 0.00
UBS UK Opportunities C Acc 0.70 - -0.01 - the operator of the relevant fund. Details of funds
China Equity GBP Ord Acc 137.03 - 0.96 0.00 Pictet-ST.MoneyMkt-ICHF SFr 123.58 - -0.01 0.00 GEM Income I USD $ 10.54 - 0.02 0.00
E.I. Sturdza Strategic Management Limited (GSY) published on these pages, including prices, are for the
Regulated UBS US Equity C Acc 0.97 - -0.01 0.47 purpose of information only and should only be used
China Equity USD Ord Acc $ 134.39 - 0.97 0.00 Pictet-ST.MoneyMkt-IUSD $ 135.97 - 0.00 - Global Alpha I USD $ 13.14 13.14 -0.07 0.00 as a guide. The Financial Times Limited makes no
Omnia Fund Ltd Nippon Growth Fund Limited 80677.00 - 2700.00 - representation as to their accuracy or completeness
Other International Funds
RobecoSAM (LUX)
UBS S&P 500 Index C Acc 0.67 - -0.01 1.58
China Equity USD Inst Acc $ 138.94 - 1.00 0.00 Pictet-Timber-I USD F $ 149.99 - -1.05 - Global Convertible I USD $ 11.66 11.66 0.02 0.00 Tel. +41 44 653 10 10 http://www.robecosam.com/ and they should not be relied upon when making an
Strat Evarich Japan Fd Ltd JPY 65297.00 - -1310.00 0.00 investment decision.
Estimated NAV $ 875.65 - 16.02 0.00 Regulated
Pictet Total Ret-Agora I EUR 115.68 - -0.07 0.00 Global Insurance I GBP 5.04 - -0.04 0.00 UBS Targeted Return C Acc 12.32 - -0.06 1.71
Europ. Equity Fd EUR 100.63 - -0.81 -
RobecoSAM Sm.Energy/A 13.67 - -0.09 1.44 Strat Evarich Japan Fd Ltd USD $ 637.39 - -12.76 0.00 The sale of interests in the funds listed on these pages
UBS Sterling Corporate Bond Indexed C Acc 0.63 - 0.00 2.93 may, in certain jurisdictions, be restricted by law and
Europ. Equity Fd GBP 98.46 - -0.79 - Pictet Total Ret-Corto Europe I EUR 136.51 - -0.44 0.00 Global Technology I USD $ 26.47 - -0.13 0.00
the funds will not necessarily be available to persons
RobecoSAM Sm.Energy/N 11.98 - -0.14 0.00
in all jurisdictions in which the publication circulates.
Pictet Total Ret-Divers Alpha I EUR 105.64 - 0.03 0.00 Healthcare Blue Chip Fund I USD Acc $ 10.96 10.96 -0.10 0.00 UBS Multi Asset Income C Inc Net 0.50 - 0.00 -
Europ. Equity Fd USD $ 100.03 - -0.80 - E.I. Sturdza Funds PLC (IRL) Persons in any doubt should take appropriate
RobecoSAM Sm.Materials/A 152.44 - 0.47 1.21 professional advice. Data collated by Morningstar. For
Regulated UBS UK Equity Income C Inc Net 0.60 - -0.01 4.43
Global Val.Cr.Fd GBP Ord Inc 113.42 - 0.00 3.61 Pictet Total Ret-Kosmos I EUR 110.34 - 0.05 0.00 Healthcare Opps I USD $ 36.87 - -0.39 0.00 other queries contact reader.enquiries@ft.com +44
RobecoSAM Sm.Materials/N 151.95 - -0.23 0.00 Nippon Growth (UCITS Fund Euro Hedged Class EUR) 842.00 - -12.50 0.00 (0)207 873 4211.
Pictet Total Ret-Mandarin I USD $ 119.26 - -0.26 0.00 Income Opportunities B2 I GBP Acc 1.82 1.82 -0.01 0.00 UBS Corporate Bond UK Plus C Inc Net 0.56 - 0.00 3.75
Global Val.Cr.Fd USD Inst Acc $ 130.39 - 0.01 0.00 The fund prices published in this edition along with
RobecoSAM Sm.Materials/Na 104.89 - -0.16 0.00 Nippon Growth (UCITS Fund Euro Hedged Institutional Class EUR) 994.51 - -14.80 0.00
additional information are also available on the
Global Val.Cr.Fd GBP Ord Acc 187.34 - 0.01 0.00
Optima Fund Management Pictet-US Equity Selection-I USD $ 194.64 - -1.18 0.00 Japan Alpha I JPY 169.61 169.61 2.04 0.00 UBS Global Allocation (UK) C Acc 0.70 - 0.00 2.24
Financial Times website, www.ft.com/funds. The
Other International Funds RobecoSAM Gl.Small Cap Eq/A 93.46 - -0.30 1.12 Nippon Growth (UCITS) Fund JPY Class A shares 79387.00 - -1184.00 0.00 funds published on these pages are grouped together
Pictet-US High Yield-I USD F $ 151.98 - 0.14 0.00 Japan I JPY 1626.50 - 14.50 1.25 UBS Global Enhanced Equity Income C Inc 0.46 - 0.00 10.75 by fund management company.
Global Val.Cr.Fd USD Ord Acc $ 175.93 - 0.00 0.00 Cuttyhunk Fund II Limited $ 1360.70 - 16.66 0.00
Asset Management
RobecoSAM Gl.Small Cap Eq/N 161.30 - -1.28 0.00 Nippon Growth (UCITS) Fund JPY Class B Acc shares 66602.00 - -994.00 0.00
UBS US Growth C Acc 1.00 - -0.01 0.00 Prices are in pence unless otherwise indicated. The
Asset Management
Global Val.Cr.Fd EUR Ord Acc 162.42 - -0.01 0.00 Pictet-USA Index-I USD F $ 194.09 - -1.05 - North American I USD $ 18.33 18.33 -0.10 0.00
JENOP Global Healthcare Fund Ltd $ 12.24 - -0.07 0.00 RobecoSAM Sustainable Gl.Eq/B 182.34 - -1.36 0.00 change, if shown, is the change on the previously
Nippon Growth (UCITS) Fund JPY Class C Dis shares 82212.00 - 968.00 0.00
UBS Emerging Markets Equity Income C Inc 0.46 - -0.01 4.89 quoted figure (not all funds update prices daily). Those
Swiss Select Equity Inst Acc SFr 122.25 - -0.98 0.00 Pictet-USD Government Bonds-I F $ 667.49 - -1.10 0.00 UK Absolute Equity I GBP 14.74 14.74 -0.06 0.00
OPTIKA Fund Limited - Cl A $ 93.80 - -0.86 0.00 designated $ with no prefix refer to US dollars. Yield
RobecoSAM Sustainable Gl.Eq/N 158.10 - -1.17 0.00 Nippon Growth (UCITS Fund Class D Institutional JPY) 43293.00 - -645.00 0.00
percentage figures (in Tuesday to Saturday papers)
Pictet-USD Short Mid-Term Bonds-I F $ 131.51 - -0.06 0.00 UBS FTSE RAFI Dev 1000 Index J Acc 119.99 - -1.36 1.65
Swiss Select Equity Ord Acc SFr 120.34 - -0.96 0.00 Optima Fd NAV $ 84.43 - 0.13 0.00 allow for buying expenses. Prices of certain older
RobecoSAM S.HealthyLiv/B 183.06 - -2.83 - Strategic China Panda Fund USD $ 2225.21 - -1.27 - insurance linked plans might be subject to capital
Pictet-USD Sov.ST.Mon.Mkt-I $ 103.00 - 0.01 -
Polar Capital LLP (CYM) UBS MSCI World Min Vol Index J Acc 139.15 - -2.01 - gains tax on sales.
US Growth USD Ord Acc $ 205.37 - -1.59 0.00 Optima Discretionary Macro Fund Limited $ 84.76 - 0.26 0.00 Regulated RobecoSAM S.HealthyLiv/N 171.45 - -2.64 0.00 Strategic China Panda Fund Hedged EURO 2146.80 - -1.55 0.00
Pictet-Water-I EUR F 298.59 - -3.13 0.00 ALVA Convertible A USD $ 130.31 - 1.64 0.00 Guide to pricing of Authorised Investment Funds:
US Growth EUR Ord Acc 194.71 - -1.51 0.00 The Dorset Energy Fd Ltd NAV $ 34.50 - 0.92 0.00 RobecoSAM S.HealthyLiv/Na 129.88 - -1.38 - Strategic China Panda Fund Hedged Sterling 2182.25 - -1.53 0.00 (compiled with the assistance of the IMA. The
Unicapital Investments (LUX) Investment Management Association, 65 Kingsway,
US Growth GBP Ord Acc 205.13 - -1.58 0.00 European Conviction A EUR 142.38 - 3.03 0.00 Regulated London WC2B 6TD.
Platinum Fd Ltd $ 84.74 - -0.18 0.00 RobecoSAM S.Water/A 215.67 - -1.04 0.98 Strategic Euro Bond Accumulating Class CHFSFr 990.28 - -0.22 0.00 Tel: +44 (0)20 7831 0898.)
Pimco Fds: Global Investors Series Plc (IRL) Investments III 5.03 - -22.38 -
US Growth USD Inst Acc $ 190.67 - -1.47 0.00 European Forager A EUR 160.78 - 2.31 0.00
Platinum Fd Ltd EUR 16.23 - -0.03 0.00 PIMCO Europe Ltd,11 Baker Street,London W1U 3AH RobecoSAM S.Water/N 179.64 - -1.70 0.00 Strategic Euro Bond Institutional Class EUR 1025.71 - -0.18 0.00 OEIC: Open-Ended Investment Company. Similar to a
http://gisnav.pimco-funds.com/ Investments IV - European Private Eq. 210.25 220.76 -4.08 - unit trust but using a company rather than a trust
Wealthy Nat Bd EUR Inst Inc 115.48 - 0.06 3.28 Platinum Japan Fd Ltd $ 54.05 - -1.13 0.00 Dealing: +44 20 3640 1000
Strategic Euro Bond Fund Accumulating Class Shares 1147.70 - -0.21 0.00 structure.
PIMCO Funds: +44 (0)20 3640 1407 Private Fund Mgrs (Guernsey) Ltd (GSY) Investments IV - Global Private Eq. 311.03 326.58 -10.79 -
Wealthy Nat Bd GBP Inst Inc 120.56 - 0.07 3.41 Optima Partners Global Fd $ 13.97 - 0.04 0.00 Different share classes are issued to reflect a different
FCA Recognised Regulated Strategic Euro Bond Fund Distributing Class Shares 1036.42 - -0.19 0.00
currency, charging structure or type of holder.
Wealthy Nat Bd EUR Ord Inc 114.77 - 0.07 3.01 Capital Securities Inst Acc $ 15.43 - -0.01 0.00 Monument Growth 16/08/2016 509.43 514.80 9.24 1.22
Optima Partners Focus Fund A $ 14.98 - 0.00 0.00
Strategic European Smaller Companies Fund EUR Class 1036.78 - 16.49 0.00 Selling price: Also called bid price. The price at which
Value Partners Hong Kong Limited (IRL)
Wealthy Nat Bd GBP Ord Inc 121.38 - 0.06 3.16 Commodity Real Return Fund Inst Acc $ 6.38 - 0.03 0.00 www.valuepartners.net, fis@vp.com.hk units in a unit trust are sold by investors.
Strategic Global Bond RMB Acc $ 1085.01 - 2.20 0.00
Prusik Investment Management LLP (IRL) Regulated
Oryx International Growth Fund Ltd Credit Absolute Return Fund Inst Acc $ 11.50 - 0.00 0.00 Buying price: Also called offer price. The price at
Wealthy Nat Bd USD Ord Inc $ 118.71 - 0.08 2.97
Enquiries - 0207 493 1331 Strategic Global Bond USD Acc $ 1077.11 - -0.89 0.00 Value Partners Asia Dividend Stocks Fund $ 9.37 - 0.00 0.00 which units in a unit trust are bought by investors.
Other International Funds
Regulated
Schroder Property Managers (Jersey) Ltd Includes managers initial charge.
New Capital Alternative Strategies Diversified Income - Inst Acc $ 21.40 - 0.01 0.00 Other International Funds
NAV (Fully Diluted) 6.92 - -0.25 0.00 Strategic US Momentum and Value Fund $ 737.63 - -5.06 0.00 Value Partners Classic Equity Fund USD Z Unhedged $ 11.53 - -0.04 0.00
All Weather Fd USD Cls $ 114.06 - -1.24 0.00 Prusik Asian Equity Income B Dist $ 176.81 - -0.90 - Single price: Based on a mid-market valuation of the
Diversified Income Durat Hdg Fund Inst Acc $ 11.96 - 0.01 0.00 Indirect Real Estate SIRE 125.50 134.94 -1.50 2.38 underlying investments. The buying and selling price
Prusik Asia A $ 204.31 - -1.59 0.00 Strategic US Momentum & Value Fund USD I Class $ 491.64 - -3.37 0.00 Value Partners Classic Equity Fund CHF HedgedSFr 11.90 - -0.04 0.00 for shares of an OEIC and units of a single priced unit
All Weather Fd EUR Cls 101.95 - -1.24 0.00
Emerging Asia Bond Fund Inst Acc $ 10.59 - -0.01 0.00 trust are the same.
Prusik Asian Smaller Cos A $ 160.59 - 0.65 0.00 Strategic US Momentum and Value EUR Hedged Class EUR 511.24 - -3.53 0.00 Value Partners Classic Equity Fund EUR Hedged 12.07 - -0.04 0.00
All Weather Fd GBP Cls 110.01 - -1.27 0.00 SIA (SIA Funds AG) (CH) Treatment of managers periodic capital charge:
Emerging Local Bond - Inst Acc $ 12.38 - 0.00 0.00
Other International Fds Strategic US Momentum and Value CHF Hedged Class CHFSFr 506.10 - -3.50 0.00 Value Partners Classic Equity Fund GBP Hedged 12.38 - -0.03 0.00 The letter C denotes that the trust deducts all or part
Tactical Opps USD Cls $ 143.11 - 1.84 0.00 of the managers/operators periodic charge from
Emerging Markets Bond - Inst Acc $ 43.43 - 0.06 - LTIF Stability Growth SFr 191.10 - -1.70 - capital, contact the manager/operator for full details
Purisima Investment Fds (CI) Ltd (JER) Value Partners Classic Equity Fund GBP Unhedged 14.74 - -0.02 0.00
Tactical Opps EUR Cls 119.36 - 1.46 0.00 of the effect of this course of action.
Regulated
Emerging Markets Corp.Bd Fund Inst Acc F $ 13.90 - 0.01 0.00 LTIF Stability Inc Plus SFr 164.10 - -1.40 0.56 The Hartford International Funds (IRL)
Value Partners Classic Equity USD Hedged $ 14.14 - -0.05 0.00
Pictet Asset Management (Europe) SA (LUX) PCG B 172.68 - 0.16 0.00 Exit Charges: The letter E denotes that an exit charge
Tactical Opps GBP Cls 133.82 - 1.72 0.00 Regulated
15, Avenue J.F. Kennedy L-1855 Luxembourg Emerging Markets Short-Term Local Currency Fund $ 12.73 - 0.01 0.00 may be made when you sell units, contact the
Gbl Govt Bond (Ex Japan) Index (GBP) 1965.16 - -12.55 0.00 Value Partners Greater China Equity Fund $ 8.81 - -0.01 0.00 manager/operator for full details.
Tel: 0041 58 323 3000 PCG C 170.08 - 0.16 0.00
FCA Recognised Euro Bond - Inst Acc 23.87 - -0.08 0.00 Standard Life Wealth (JER)
PO Box 189, St Helier, Jersey, JE4 9RU 01534 709130 Value Partners Health Care Fund RMB Class Z UnhedgedCNH 10.46 - 0.00 0.00 Time: Some funds give information about the timing of
UK Corporate Bond 1776.54 - -9.91 0.00
Pictet-Absl Rtn Fix Inc-HI EUR 108.55 - -0.05 0.00 price quotes. The time shown alongside the fund
Euro Credit - Inst Acc 15.59 - -0.02 - FCA Recognised
managers/operators name is the valuation point for
Putnam Investments (Ireland) Ltd (IRL) Standard Life Offshore Strategy Fund Limited Gilt 1810.95 - -18.73 - Value Partners Health Care Fund HKD Class A UnhedgedHK$ 9.80 - 0.03 0.00 their unit trusts/OEICs, unless another time is
Pictet-Agriculture-I EUR F 186.83 - -2.56 0.00 Regulated indicated by the symbol alongside the individual unit
Euro Income Bond - Inst Acc F 13.76 - 0.00 0.00
Bridge Fund 1.7829 - -0.0164 2.00 Value Partners Health Care Fund USD Class A Unhedged $ 9.83 - 0.03 0.00 trust/OEIC name.
Putnam New Flag Euro High Yield Plc - E 1020.31 - 0.26 3.72 Global Eq (Ex Japan) Index Fund 1.44 - -0.01 0.00
Pictet-Asian Equities Ex Japan-I USD F $ 227.34 - -1.36 0.00
Euro Long Average Duration - Inst Acc 25.59 - -0.18 0.00
Diversified Assets Fund 1.2391 - -0.0077 3.32 The symbols are as follows: 0001 to 1100 hours;
Global Eq (ex Japan) Class HJ4 1.51 - -0.01 0.00
Northwest Investment Management (HK) Ltd Pictet-Asian Local Currency Debt-I USD F $ 167.40 - 1.27 - 1101 to 1400 hours; 1401 to 1700 hours; # 1701 to
Euro Low Duration Fund Inst Acc 11.38 - -0.01 0.00 Waverton Investment Funds Plc (1600)F (IRL) midnight. Daily dealing prices are set on the basis of
11th Floor, Kinwick Centre, 32, Hollywood Road, Central Hong Kong +852 9084 4373 Global Equity Fund 2.1412 - -0.0250 1.38
Global Eq (ex Japan) Class JP5 1.36 - -0.01 0.00 the valuation point, a short period of time may elapse
Pictet-Biotech-I USD F $ 707.64 - -10.69 0.00 waverton.investments@citi.com
Other International Funds Euro Real Return - Inst Acc 14.06 - -0.06 0.00
Global Balanced Fund - Income Units 1.5241 - -0.0148 2.37 FCA Recognised before prices become available. Historic pricing: The
Global Eq Ex Japan Index Fund (Hedge) 1.24 - -0.01 0.00 letter H denotes that the managers/operators will
Northwest $ class $ 2350.49 - 24.22 0.00 Pictet-CHF Bonds I CHF SFr 514.05 - -0.56 0.00
Euro Short-Term Inst Acc 12.26 - 0.00 - Waverton Asia Pacific A USD $ 19.58 - -0.11 5.45 normally deal on the price set at the most recent
Global Balanced Fund - Accumulations Units 1.8150 - -0.0176 2.32 valuation. The prices shown are the latest available
Gbl Govt Bond (Ex Japan) Index 1.18 - 0.00 -
Pictet-China Index I USD $ 110.95 - 0.16 0.00 Waverton Global Equity Fund A GBP 16.67 - -0.16 0.45 before publication and may not be the current dealing
Euro Ultra Long Duration - Inst Acc 34.81 - -0.28 0.00
Global Fixed Interest Fund 1.0397 - 0.0000 4.41 levels because of an intervening portfolio revaluation
Gbl Govt Bond (ex Japan) Class JP4 1.15 - -0.01 -
Pictet-Clean Energy-I USD F $ 80.65 - -0.12 0.00 Ram Active Investments SA or a switch to a forward pricing basis. The
Global Advantage - Inst Acc $ 13.12 - 0.02 0.00 Waverton Global Strategic Bond Fund A USD $ 8.63 - -0.02 5.06
www.ram-ai.com Sterling Fixed Interest Fund 0.9267 - -0.0059 3.60 managers/operators must deal at a forward price on
Japan Equity Index Fund 0.91 - 0.01 0.00 request, and may move to forward pricing at any time.
Pictet-Digital Communication-I USD F $ 294.13 - -1.57 0.00 Other International Funds Waverton UK Fund A GBP 13.97 - -0.11 1.70
Global Advantage Real Return Fund Inst Acc $ 9.23 - 0.00 0.00 Forward pricing: The letter F denotes that that
UK Equity Fund 1.9960 - -0.0170 2.85
RAM Systematic Emerg Markets Core Eq $ 88.13 - 0.38 - Japan Equity Class JP3 1.11 - 0.01 0.00 managers/operators deal at the price to be set at the
Pictet-Em Lcl Ccy Dbt-I USD F $ 175.92 - 0.21 0.00 Waverton Equity Fund A GBP 16.50 - -0.06 0.33 next valuation.
Global Bond - Inst Acc $ 29.67 - -0.06 0.00
RAM Systematic Emerg Markets Eq $ 160.41 - 0.38 -
Oasis Crescent Management Company Ltd Pictet-Emerging Europe-I EUR F 297.09 - -1.89 0.00
Global Bond Ex-US - Inst Acc $ 20.96 - -0.05 0.00 Waverton Sterling Bond Fund A GBP 9.77 - -0.03 5.06 Investors can be given no definite price in advance of
Other International Funds the purchase or sale being carried out. The prices
RAM Systematic European Eq 384.65 - -2.69 - appearing in the newspaper are the most recent
Pictet-Emerging Markets-I USD F $ 540.39 - -3.77 0.00
Oasis Crescent Equity Fund R 9.97 - -0.02 0.00 Global High Yield Bond - Inst Acc $ 21.59 - 0.02 0.00 provided by the managers/operators. Scheme
RAM Systematic Global Shareholder Yield Eq $ 105.45 - -0.58 0.00 WA Fixed Income Fund Plc (IRL) particulars, prospectus, key features and reports: The
Pictet-Emerging Markets Index-I USD F $ 241.31 - -0.06 0.00 most recent particulars and documents may be
Global Investment Grade Credit - Inst Income $ 12.74 - -0.01 3.86 Regulated
RAM Systematic Long/Short Emerg Markets Eq $ 119.88 - 0.15 - obtained free of charge from fund
Oasis Global Mgmt Co (Ireland) Ltd (IRL) Pictet-Emerging Corporate Bonds I USD $ 117.65 - 0.09 0.00 European Multi-Sector 123.44 - -0.47 0.00 managers/operators. * Indicates funds which do not
Global Investment Grade Credit Fund Inst Acc 12.33 - -0.06 0.00
Regulated Stenham Asset Management Inc price on Fridays.
RAM Systematic Long/Short European Eq 146.09 - -0.54 - Toscafund Asset Management LLP (UK)
Pictet-Emerging Markets High Dividend I USD $ 105.16 - -0.82 0.00 www.stenhamassetmanagement.com
Oasis Global Investment (Ireland) Plc Global Investment Grade Credit Fund Inst Acc $ $ 17.95 - -0.02 - www.toscafund.com Charges for this advertising service are based on the
RAM Systematic North American Eq $ 250.83 - -0.29 - Other International Funds Authorised Funds number of lines published and the classification of the
Oasis Crescent Global Short Term Income Fund $ 0.99 - 0.00 1.14 Pictet-Emerging Markets Sust Eq I USD $ 96.05 - -0.21 0.00 Yapi Kredi Asset Management (TUR)
Global Multi-Asset - Inst Acc $ 14.89 - -0.03 0.00 Yapi Kredi Plaza A Blok Kat:13 Levent 34330 Istanbul / Turkey fund. Please contact data@ft.com or
Stenham Asia USD $ 122.25 - 2.31 0.00 Aptus Global Financials B Acc 2.95 - -0.05 -
RAM Tactical Convertibles Europe 143.35 - -0.47 - call +44 (0)20 7873 3132 for further information.
Oasis Global Equity $ 28.16 - -0.10 0.33 Pictet-EUR Bonds-I F 591.57 - -2.56 - Email: info@ykportfoy.com.tr; Tel: + 90 (212) 385 48 48
Global Real Return - Inst Acc $ 19.76 - -0.04 0.00
Stenham Credit Opportunities A Class USD $ 101.21 - 0.85 0.00 www.yapikrediassetmanagement.com
RAM Tactical Global Bond Total Return 144.69 - -0.17 - Aptus Global Financials B Inc 2.48 - -0.04 -
Oasis Crescent Global Investment Fund (Ireland) plc Pictet-EUR Corporate Bonds Ex Fin i EUR 151.84 - -0.21 0.00 Other International Funds
Income Fund Inst Acc $ 13.01 - -0.01 0.00
Stenham Equity UCITS USD $ 140.83 - 1.76 0.00
Oasis Crescent Global Equity Fund $ 29.12 - -0.10 0.11 RAM Tactical II Asia Bond Total Return $ 136.29 - 0.43 - Private Sector Bonds and Bills FundTRY 0.014740 - 0.000010 -
Pictet-EUR Corporate Bonds-I F 210.11 - -0.22 0.00
Inflation Strategy Fund Inst Acc $ 9.56 - -0.02 0.00 Toscafund Asset Management LLP
Oasis Crescent Variable Balanced Fund 10.70 - -0.06 1.39 Stenham Growth USD $ 202.01 - 4.32 -
Eurobond (Dollar) Bonds and Bills FundTRY 0.081510 - -0.000410 -
Pictet-EUR Government Bonds I EUR 167.64 - -0.56 0.00 www.toscafund.com
Low Average Duration - Inst Acc $ 15.00 - -0.01 0.00
Stenham Healthcare USD $ 172.55 - 7.58 0.00 Other International Funds
OasisCresGl Income Class A $ 10.86 - 0.03 2.52 Fourth Variable Fund TRY 0.011620 - -0.000010 -
Pictet-EUR High Yield-I F 254.70 - 0.04 0.00
PIMCO RAE Fundam.PLUS Em.Mkts Inst Acc $ 10.29 - -0.03 - Tosca A USD $ 241.71 - -41.64 -
OasisCresGl LowBal D ($) Dist $ 12.06 - -0.02 0.00 Stenham Managed Fund USD $ 108.76 - 1.95 0.00
Koc Affiliate and Eq. Fund (Eq. Intense Fund)TRY 0.769430 - -0.002450 -
Pictet-EUR Short Mid-Term Bonds-I F 137.55 - -0.03 0.00
PIMCO RAE Fundam.PLUS Gl.Dev.Inst Acc $ 11.42 - -0.05 0.00 Tosca Mid Cap GBP 258.90 - 1.75 0.00
OasisCresGl Med Eq Bal A ($) Dist $ 12.34 - -0.01 0.60 Stenham Macro UCITS USD $ 96.15 - -0.94 0.00
Istanbul Hedge Fund TRY 0.021280 - - -
Pictet-EUR Short Term HY I EUR 124.23 - 0.00 0.00
PIMCO RAE Fundam.PLUS US Inst Acc $ 13.26 - -0.08 0.00 Tosca Opportunity B USD $ 358.22 - 2.84 0.00
Oasis Crescent Gbl Property Eqty $ 10.02 - -0.02 1.60 Stenham Multi Strategy USD $ 107.79 - -1.69 -
Pictet-EUR Sov.Sht.Mon.Mkt EUR I 102.65 - 0.00 0.00 Robeco Asset Management (LUX)
Socially Resp.Emerg.Mkts Bd Fd Inst Acc F $ 14.29 - 0.01 - Pegasus Fund Ltd A-1 GBP 61.34 - 0.22 0.00
Weena 850, 3014 DA Rotterdam, The Netherlands Stenham Quadrant USD A $ 399.21 - 0.09 -
Pictet-Euroland Index IS EUR 127.53 - -1.17 - www.robeco.com/contact
StocksPLUS{TM} - Inst Acc $ 25.02 - -0.13 -
FCA Recognised Stenham Trading Inc USD $ 115.60 - 0.03 -
Pictet-Europe Index-I EUR F 164.03 - -1.29 -
Total Return Bond - Inst Acc $ 28.36 - -0.05 0.00 Asia-Pacific Equities (EUR) 137.18 - -0.26 0.00
Stenham Universal USD $ 410.76 - 4.05 -
Pictet-European Equity Selection-I EUR F 613.90 - -2.81 -
UK Corporate Bond - Inst Acc 19.65 - -0.08 0.00 Chinese Equities (EUR) 76.47 - -0.60 -
Stenham Universal II USD $ 151.67 - 1.44 0.00
Pictet-European Sust Eq-I EUR F 239.34 - -2.47 0.00 Yuki International Limited (IRL)
UK Long Term Corp. Bnd Inst-Inst Acc 23.21 - -0.14 - Em Stars Equities (EUR) 182.07 - 0.40 0.00 Tel +44-20-7269-0207 www.yukifunds.com
Odey Asset Management LLP (CYM) Pictet-Global Bds Fundamental I USD $ 128.53 - 0.18 0.00 Regulated
Regulated UK Low Duration - Inst Acc 14.38 - -0.03 0.00 Emerging Markets Equities (EUR) 156.95 - -0.89 0.00 Stratton Street Capital (CI) Limited (GSY)
Yuki Mizuho Umbrella Fund
Regulated
OEI Mac Inc GBP A 242.51 - -13.69 0.00 Pictet-Global Bonds-I EUR 179.00 - -1.07 0.00
UK Real Return - Inst Acc 22.94 - -0.04 0.00 Flex-o-Rente (EUR) 109.11 - 0.11 0.00 Yuki Mizuho Japan Dynamic Growth 6618.00 - -110.00 0.00
Japan Synthetic Warrant Yen Class 1310.29 - 367.92 0.00
Pictet-Global Emerging Currencies-I USD F $ 102.24 - 0.22 0.00
20 FINANCIAL TIMES Thursday 18 August 2016

MARKETS & INVESTING

INSIGHT Commodities

Amy
Myers Jaffe Bolivia ships its first lithium to China
Global demand surges five years, with prices rising sharply in Last week Glencore, the commodity
$70,000 combined with other materials to make
the past 12 months amid short supplies. trader, said it would start arbitration cathodes for batteries.
for the metal used in Electric cars such as the Nissan Leaf against Bolivia over the nationalisation Pricetag of the The state-owned miner, Comibol,
largely symbolic
Investors will need to batteries of electric cars and Tesla Model S use lithium-ion bat-
teries because of their low weight and
higher energy density.
of its assets.
When Evo Morales, the leftwing presi-
dent, launched a plan to develop lithium
shipment of almost
10 tonnes
produces lithium carbonate and potas-
sium chloride at a $19m pilot plant on
the edges of the Salar de Uyuni desert.
be nimbler if peak oil HENRY SANDERSON LONDON
ANDRES SCHIPANI BOGOT
Chile and Australia have become the
largest suppliers to battery makers in
in 2008, he made it clear he did not want
simply to export the raw material. $790 m
Bolivia aims to export 10,000 tonnes of
lithium carbonate and 168,000 tonnes

demand is reached Bolivia has made progress in its aim to
become the biggest exporter of lithium
with its first shipment to China.
But the impoverished South Ameri-
can country faces challenges if it is to set
Asia. Argentina is rapidly investing in its
lithium industry.
Bolivias estimated 9m tonnes of
potential resources far exceed those of
the US, China and Australia. But its
Bolivia wanted partners, not owners
to help it make batteries and cars.
The government has held talks with
French, Japanese and South Korean
companies among others but little has
Comibols planned of potassium chloride by 2021.
investment in the
extracting process Comibol said it expected to ship an
over next four years additional 16 tonnes this year and would
invest $790m in the extracting of evapo-
rates in the next four years. From 2021 it

T
iming is everything when it comes to investing
in commodities.
In 2014, oil was considered one of the safest
bets. The reasoning among big financial inves-
tors was straightforward. Regulation and
technology might crimp demand in the industrialised
west, but as more of the developing worlds poor moved
into the middle class, oil demand and prices would remain
strong. Skip forward to 2016, and many analysts, including
those in strategic planning departments of big oil groups,
are starting to warm to the idea of peak oil demand glo-
bally, not just in the OECD.
In part the exercise has been driven by shareholders and
activists who say the companies are ignoring the risks to
their business from a global climate accord. A number of
organisations, notably the International Energy Agency
but including oil companies such as Statoil, Shell, BP, Total
and ConocoPhillips, are modelling outcomes based on a
breakthrough in battery technology or that global temper-
atures rise by no more than 2 degrees Celsius.
These scenarios include rising solar energy and natural
gas use, cheaper car batteries, urbanisation supported by
millennial ride sharing and public transport, and
advanced, digital energy-saving technologies. Many of the
studies project a fall in oil demand to 75m barrels per day
by 2040, from about 95m b/d today.
At the University of California, Davis, we have tested oil
demand sensitivities and found that a combination of fac-
tors slower-than-expected growth in the developing
world, improved logistics, advances in vehicle efficiency
could, perhaps with a push from policy, see demand for oil
peak, at least for a decade or two.
The implications are bigger than they might seem given
the number of ifs that surround the idea that oil demand
could peak. For the past three decades, investors have
assumed that oil under the
ground today will be more
valuable in the future. That
All investable oil
has led them to seek compa- assets will not be
nies best positioned to deliver
growth. But if the rise in oil
equal in a more
demand is uncertain, all bets competitive
might be off. That means
investors do not simply want
world
exposure to crude. They will
need to select a management team that is nimble, no mat-
ter whether demand rises, falls or remains flat.
Moreover, in a more competitive world where producers
might have fewer opportunities to sell its product, all
investable oil assets will not be equal. Investors will have to
know what the production cost basis is for a companys
reserves or how well positioned their refinery network is to
beat global competitors. Location of assets will matter.
Owning a refining and marketing network in California or
Germany, where demand will almost certainly fall off,
might be less attractive than in India or Malaysia.
The use of automation and other emerging technologies
to drive returns will matter. Pioneer Natural Resources
chief executive Scott Sheffield said recently that technol-
ogy advancements had lowered the companys production
costs excluding taxes to $2.25 a barrel for horizontal com-
pletions in the Permian Basin of Texas, low enough to com-
pete with Saudi Arabia. By contrast, operating costs in
Canadas oil sands are estimated at $37 a barrel.
For 30 years, the industry has operated under the princi-
ple that it will have difficulty meeting demand. Against
that backdrop, adding reserves to the balance sheet was an
end unto itself, sometimes more important to manage-
ment than if those reserves could be profitably produced.
The thesis was that oil would become increasingly scarce
as easy-to-reach reserves were depleted; the value of
booked, warehoused reserves would appreciate with glo-
bal prices and a day would come when even ridiculously
expensive assets would be profitable to produce.
But if oil demand declines before those expensive
reserves are needed, mindlessly booking reserves is not a
strategy Wall Street will want to reward. Investors might
ask more critically what a companys revenues outlook
will be this quarter or next, like most other ventures.
Understanding which companies can pivot best to new
realities will be key to smart investing in oil.
Amy Myers Jaffe is executive director of energy and sustainabil-
ity at University of California, Davis. She served as chair to the
World Economic Forum (Davos) Global Agenda Council on the
Future of Oil and Gas, which recently published a study on the
Implications of Peak Oil Demand
the benchmark for the lightest metal,
which is used in smartphones and the
batteries of electric cars.
The shipment of almost 10 tonnes of
lithium carbonate, with a price tag of
$70,000, is considered symbolic.
Bolivias salt flats hold the worlds
largest potential resources of lithium,
for which demand has surged in the past
Investors grapple with the great resource shift
A transition is under way
but many portfolios remain
worryingly long on fossil fuels
HENRY SANDERSON
Tom Nelson, head of commodities and
resources at Investec Asset Manage-
ment, spends almost as much time
tracking Tesla Motors as he does Exxon-
Mobil or BP.
Why? If the electric carmaker lives up
to its pledge to upend the car industry, it
will have serious implications for oil
demand.
Navigating profound industry transi-
tions is particularly hard for fund man-
agers. Getting on the right side of history
isnt enough, they have to pick emerging
winners, judge which of the dominant
incumbents can successfully adapt
and maintain returns for there own
investors as the landscape changes.
Nowhere is the challenge currently
more acute than for energy and com-
modity investors.
You could have lost your shirt bet-
ting that the internal combustion engine
would replace the horse and cart, says
Mr Nelson, whose interest in one of the
great technological transformations of
the last century is more than academic.
How oil demand pans out over the
next fifteen years will wield a massive
influence on investment portfolios,
since oil and gas companies globally
comprise more than four trillion of dol-
lars of stock market value.
Energy companies constitute 7 per
cent of the S&P 500, while around one-
third of the FTSE 100 is represented by
oil, gas and mining companies such as
Rio Tinto, Glencore and BHP Billiton.
The Energy Select Sector SPDR Fund,
one of the most popular natural
resources exchange traded funds, still
has 83 per cent of its holdings in oil and
gas companies.
The gap between a future that looks
increasingly based on renewable energy
and investment portfolios still long on
fossil fuels sharpens the pressure on
fund managers to correctly model how
radical the change in the energy mix will
prove.
Over the past five years, the share of
electricity that the worlds 20 major
economies are generating from the sun
and the wind has jumped by more than
70 per cent, according to data compiled
for the FT by Bloomberg New Energy
Finance.
Money managers are devouring long
research reports from consultants and
deposits have three times the level of happened. Analysts say Bolivia needs to hopes to export 5,000 tonnes of lithium
magnesium of those in Chile, which clinch deals quickly to develop technol- cathodes.
makes them harder to refine. ogy and gain market share. Marcelo Castro, who this week
It might be quite difficult to scale up In the so-called lithium triangle of stepped down as manager of the Uyuni
to anything large-scale without outside Chile, Argentina and Bolivia, brine is plant, said the shipment to China was a
help, said Robert Baylis, an analyst at pumped from under the desert salt flats reward for years of Bolivian efforts.
the Roskill consultancy. But its diffi- and allowed to evaporate in large ponds Alberto Echaz, Comibols head of
cult for corporates in Bolivia because for several months. It is then refined evaporates, said Bolivia was on the
you can get your assets stripped off you. into lithium carbonate, which can be right path.
Analysis. Commodities
Future shocks
Oil era is not over - but the peak could be in 15-20 years Stock performance
Oil demand (million barrels) Rebased
WilderHill New Energy Global Innovation Index
Oil demand will peak
120 Bloomberg World Oil & Gas index
around 2030-45 at Solactive Global Lithium index 120
100 million barrels/day Forecasts
100
100
80
Oil embargo 80 60
and rise of Opec
40
2011 12 13 14 15 16
60
Current oil demand: Commodity prices
96 million barrels/day Log scale (Jan 1934=100)
10,000
40
Nominal prices*
Discovery of oil
in Titusville, Texas ( CAGR = +2.7%)
G7 pledge to 1,000
end fossil fuel 20
era by 2100
100
0
Real prices*
1850 1900 1950 2000 2050 2100
( CAGR = -1.0%) 10
Sources: BP Statistical Review; Bernstein estimates (2016 and beyond) 1934 50 60 70 80 90 2000 14
and analysis; Bloomberg; RobecoSAM * Bloomberg Commodity Index (formerly DJ-UBS Commodity Index)
analysts on the concept of peak oil US solar company SunEdison, which rial for lithium-ion batteries are
You could demand. had a valuation of $10bn last year, filed attractive because it is too early to pre-
have lost One produced this year by McKinsey for bankruptcy in April. dict the precise battery chemistry that
estimates that if market penetration of And at Investec, Mr Nelson and his will ultimately be successful.
your shirt electric, autonomous and shared cars team are taking developments in the Demand for lithium as the base raw
betting that accelerates, oil demand will peak at electric car industry so seriously that material in battery cathodes has
around 2030 at less than 100m barrels hired an energy scenario modeller with jumped by 30 per cent in the past five
the internal per day. Thats not far from current lev- a PhD to help forecast the future, coun- years, and there is now a shortage of
combustion els of 95.9m b/d. try by country, out to 2050. supply, according to London-based
However, the rapid advance of renew- The Investec Global Energy Fund Benchmark Mineral Intelligence.
engine able technologies underlines that suc- has about 5 per cent invested in A cut in the cost of lithium-ion batter-
would cessfully predicting the trends does not battery technology and renewable ies to a range of $100 to $120 kWh from
automatically mean investors will reap energy stocks such as First Solar, and an estimated $300 kWh will be a tipping
replace the returns from them. Mr Nelson expects that proportion to point, Mr Busscher reckons, that could
horse and The amount of solar power installed grow. prompt a spike in demand for electric
over the past few years, for example, has Weve done a huge amount of work vehicles and start affecting oil demand
cart exceeded experts optimistic predic- on this in terms of infrastructure, bat- within ten years.
tions, according to Poppy Allonby, who tery technology, economics, range His fund has holdings in lithium min-
runs a new energy fund for BlackRock. safety and consumer confidence, he ers Albemarle and FMC, battery mate-
Its a lesson in disruption, in that says. Those trends have very profound rial supplier Umicore, and carbon fibre
things can happen very quickly, says implications both for the likely direc- maker Hexcel.
Ms. Allonby. And its quite difficult to tion of oil and gas prices but also for the Even if picking the raw material is
build into most traditional forecasting. capital allocation decisions that our easier, its no time for energy investors
Were now in a situation where the [portfolio] companies are making to sit back and relax.
cleaner, alternative technologies are today. When it comes to the future of the
actually comparable or in some cases If picking the companies that will be transport system Blackrocks Ms
cheaper than the incumbent technolo- successful in producing renewable tech- Allonby says they are always looking at
gies so thats a dramatic change from a nologies can be particularly treacher- those disruption models and thinking
few years ago. ous, some investors say that betting on where could we be wrong and where
Yet share prices in solar companies the natural resources with a bright could we be wrong on both sides.
have been notoriously volatile. Despite future can be a safer option. Where could we be wrong in think-
the boost to renewable energy from the Pieter Busscher, who manages the ing oil demand is going to continue to
global climate accord struck in Paris in Smart Materials Strategy fund at asset grow forever and where could we be
December, shares of solar makers have manager RobecoSAM in Zurich, says wrong in thinking theres going to be
fallen 30 per cent this year. that miners of lithium the raw mate- massive disruption.

Capital markets

Portuguese yields rise after crucial rating agency warns on growth prospects
MEHREEN KHAN
Portuguese debt came under further
pressure yesterday, after the rating
agency that is crucial to the countrys
eligibility for the European Central
Banks bond-buying plan warned of
mounting pressures.
The benchmark 10-year yield jumped
11 basis points to 2.94 per cent, up from
2.68 per cent at the start of the week,
after DBRS, the rating agency, cast
doubt on how long Portugal would keep
its investment-grade rating.
Fridays second-quarter gross
domestic product release (which
showed growth at just 0.2 per cent)
raised our concerns about growth pros-
pects, which appear to be slowing into
the third quarter, said Fergus McCor-
mick, DBRS head of sovereign credit rat-
ings, according to Reuters. Therefore,
the outlook remains stable, but pres-
sures appear to be mounting from these
various fronts.
DBRS is the only recognised institu-
tion that rates the former bailout coun-
try investment grade which allows it
to qualify for the ECBs mass bond-buy-
ing scheme.
The status also grants Portuguese
banks access to cheap loans from the
central bank.
Portuguese banks have borrowed
24.8bn from the ECB, according to
Rabobank, with sovereign bonds mak-
ing up a large proportion of the
collateral.
If [the governments] bonds were no
longer eligible, it would be a problem for
Portuguese banks, said Richard
McGuire, a strategist at Rabobank.
UK long bonds
Investors swoop on fresh
tranche of 2055 gilts
The UK governments second sale of
debt since the Bank of England
launched a fresh quantitative easing
programme was met with healthy
demand as investors snapped up the
long bonds on offer.
Some 1.25bn of a reopened 2055
gilt was sold at a yield of 1.214 per cent
yesterday.
In the UK government bond market
long-dated debt is always in hot
demand from pension funds and
insurance companies, which need to
match future liabilities.
The bonds sold with a lower yield
than 30-year gilts, which trade in
secondary markets at 1.33 per cent.
Investors offered bids of more than
2.1bn for the securities.
Some of the buyers are likely to
have sold longer-dated gilts to the
BoE as part of the UKs post-Brexit
vote stimulus plan.
The BoE bought 1.17bn of long-
dated gilts on Tuesday after investors
failed to offer up enough debt the
previous week.
Andy Tunningley at BlackRock, the
investment manager, said pension
funds had accelerated, rather than
reduced, their demand for UK
bonds since the Brexit vote as yields
had fallen.
Portugals five-year bond yields are at
their highest since late July.
The ratings of the other three recog-
nised credit agencies, S&P, Moodys and
Fitch, would not allow the ECB to keep
buying Portuguese debt.
Portuguese yields are still well below
the 4.4 per cent hit in February, when
peripheral eurozone debt came under
heavy selling pressure amid market
tremors about global growth. Although
they recovered as concern about a glo-
bal recession receded, Portuguese yields
shot up after the Brexit vote in late June,
hitting 3.6 per cent.
DBRSs next rating decision will be on
October 21, a week after Lisbon is set to
present fiscal consolidation plans to the
European Commission as it seeks to
reduce its budget deficit to 2.5 per cent
of GDP this year.
Brussels has avoided imposing what
would be its first fines for budgetary
non-compliance but is demanding that
the government cut spending cuts and
raise taxes to the tune of 0.25 per cent of
GDP this year.
DBRS lists Portugal as BBB (low), its
lowest investment-grade rating, with a
stable outlook. That suggests the agency
will not junk the country in October.
But analysts cite persistently sluggish
growth, looming austerity and a trou-
bled banking sector as concerns.
After the disappointing second quar-
ter, Portugals GDP growth is set to fall
below 1 per cent this year, according
estimates from Citigroup.
A move for more austerity could well
shake the fragile stability of the Social-
ist-led minority government, said ana-
lysts at the US bank.
Thursday 18 August 2016
TRADING POST
Jamie
Chisholm
Just last week we noted how a strong
auction of US Treasuries pointed to
continued sturdy foreign demand.
With 10-year bonds yielding more
than 1.5 per cent a year, but German
and Japanese equivalents providing a
loss if held to redemption, there is little
wonder US assets are popular.
But there is a problem. As Capital
Economics notes: A sharp increase in
the cost of hedging has diminished the
appeal of Treasuries to many foreign
investors, especially those whose
funds are denominated in yen and
euros.
John Higgins at CapEco says that in
2014 a yen-based investor could buy a
10-year Treasury, hedge the currency
risk for three months and receive an
annualised yield of more than 2.5 per
cent. That yield has collapsed to about
zero not much different from what
is now available from a 10-year JGB.
Why have hedging costs increased?
First, three-month US dollar Libor
has risen, mainly due to upcoming
changes in money market fund rules
rather than any underlying financial
problems or expectations of tighter
Fed policy, Mr Higgins said.
Second, three-month yen and euro
Libor have fallen, as the Bank of Japan
and the ECB have cut interest rates.
Finally, the ongoing unconventional
policy easing of those central banks,
no longer matched by the Fed, has
resulted in investors having to pay
more of a premium in order to obtain
dollars in exchange for their yen and
euros. If the Fed raises rates quicker
than forecast then hedging costs will
increase, Mr Higgins said.
jamie.chisholm@ft.com
10-year government bond yields
Per cent
Japan US 3
2
1 West Texas Intermediate was 0.5 per
0 cent lower at $46.37.
-1
2012 13 14 15 16
Source: Thomson Reuters Datastream
Wall Street
Lowes hammered after
earnings fall far short
of Home Depots
Richard Blackden
Lowes disappointed investors
yesterday with sales and earnings that
suggested it was yielding ground to
Home Depot.
The USs second-biggest home
improvement chain reported sales and
earnings that badly undershot the high
bar set by Wall Street, prompting a
share price tumble of nearly 7 per cent
to $76, reducing its market
capitalisation to $67bn.
Its performance, the worst on the S&P
500, put the shares in negative territory
for 2016 and cut their gain over the past
12 months to 4.7 per cent.
Home Depot shares are up more than
13 per cent over the past year, giving a
market value of about $168bn.
London
Schroders and Jupiter
knocked by concerns
over regulation
Bryce Elder
Schroders and Jupiter Fund
Management were among yesterdays
sharpest fallers on fears that regulation
could squeeze their profit margins.
Macquarie turned cautious on the UK
asset managers ahead of a Financial
Conduct Authority review of the sector,
scheduled for the fourth quarter. It
expected the watchdog to push for more
pricing transparency in the retail
Global overview
Dollar steadies while US stocks
fall further ahead of Fed minutes
US and European indices
retreat amid oscillating
views on the timing of a
US rate rise as Nikkei has
a brighter session
DAVE SHELLOCK
US stocks fell further from Mondays
record highs as oil prices had a volatile
session and participants awaited the
release of the minutes of the Federal
Reserve policy meeting.
As the markets looked for fresh clues
about the outlook for US monetary pol-
icy, the dollar steadied against the yen
and the euro following the previous ses-
sions steep falls.
Sterling gave back some of Tuesdays
rise against the US currency, but man-
aged to hold above the $1.30 level.
By midday in New York, the S&P 500
equity index was down 0.4 per cent at
2,169, leaving it 1 per cent below Mon-
days record close of 2,190.15.
The Dow Jones Industrial Average and
the Nasdaq, which also hit record peaks
on Monday, were down 0.4 per cent and
0.5 per cent respectively.
In Europe the Stoxx 600 fell 0.8 per
cent, leaving it 2 per cent below a seven-
week intraday high hit at the start of the
week. But the pounds weaker tone
failed to lift the UKs FTSE 100 index,
which fell 0.5 per cent.
Energy stocks on both sides of the
Atlantic drifted lower as oil prices were
buffeted by bullish US inventories data
and reports that Saudi Arabia would
raise output to record levels this month.
The ensuing tug of war left Brent, the
international crude benchmark, up
0.4 per cent at $49.42 a barrel, while US
It was a brighter session for equity
bulls in Tokyo as the Nikkei 225
rebounded 0.9 per cent following Tues-
Lowes and Home Depot
Rebased
Lowes Companies
Home Depot
Aug 2015 2016 Aug
Source: Thomson Reuters Datastream
Indices Close
change
S & P 500
DJ Industrials
2168.81
18469.89
Nasdaq Comp
Russell 2000
5197.37
1204.70
VIX 13.70
US 10 yr Treas Bd 1.58
US 2 yr Treas Bd 0.75
Both companies have benefited from
a rebound in the US housing market
since prices touched bottom in the
middle of 2012. They have been
reporting steadily rising sales in
contrast to the wider gloom that has
enveloped the US retail sector.
However, Lowes second-quarter
results suggest it might be falling behind
its larger rival when it comes to
capitalising on homeowners appetite
for spending on residential renovation
projects.
For the quarter to the end of July, like-
for-like sales rose 2 per cent well
below the 4.1 per cent analysts were
predicting and the 4.7 per cent gain
reported by Home Depot this week.
market, where comparisons were
clouded by disclosure and the amount
of choice.
With an average operating margin in
excess of 35 per cent, more competition
would create material earnings risk for
Aberdeen, Henderson, Jupiter,
Liontrust and Schroders, the broker
said. This is not a defensive sector.
Macquarie advised selling Aberdeen
Asset Management, off 1.8 per cent to
324.3p, Jupiter, down 3.3 per cent to
411p, and Schroders, 1.3 per cent lower
at 27.49.
The wider market drifted for a second
day, pulling the FTSE 100 lower by 0.5
per cent, or 34.77 points, to 6,859.15.
Car insurer Admiral dropped 7.7 per
cent to 20.81 after warning that excess
capital returns would be about 50m
lower than expected.
Standard Chartered faded 2.5 per
cent to 637.1p after HSBC downgraded
to hold. While credit quality had been
rising, oil services exposure remained a
risk and unless group revenues
rebounded by $3bn the bank was
unlikely to meet 2018 returns target, the
broker said.
Heroin substitute maker Indivior rose
8.8 per cent to 327.4p after reporting
positive top-line results for a pivotal
FINANCIAL TIMES 21
MARKETS & INVESTING
Markets update
S&P 500 index
Change on day 0.40%
2200
2180
2160
2140
Jul 2016 Aug
ceived as generally hawkish as the Fed US equities Wall Street drifted further
noted that near-term risks to the eco- back from the record highs achieved
nomic outlook have diminished. The on Monday as caution set in ahead of
market focus is likely to be on whether the release of the minutes of the
some, many or a few officials think a Federal Reserves July policy meeting
hike is on the horizon, though our econ-
omists expect to learn more at the late- FTSE 100 index
August Jackson Hole symposium. Change on day 0.50%
Meanwhile the yens strength 7000
prompted a bout of verbal intervention 6900
from the Japanese authorities, which 6800
warned they would have to act if there 6700
were extreme moves. 6600
Verbal intervention may help tem- Jul 2016 Aug
porarily to damp yen strength but it will
not reverse the stronger yen trend, said UK equities The FTSE 100 retreated
Lee Hardman, currency analyst at Bank further from Mondays 14-month high,
of Tokyo-Mitsubishi UFJ. with Admiral tumbling 7.7 per cent
We still believe that direct interven- amid worries over the insurers capital
tion remains unlikely in the near term position and underwriting profits
given strong opposition from the US.
The upcoming US presidential elec- Eurofirst 300 index
tion could make Japan even more sensi-
Change on day 0.85%
tive about intervening given the focus 1380
on protectionism.
Sterling was down 0.3 per cent against 1360
Mark Wilson/Getty Images
the dollar at $1.3005, and 0.2 per cent 1340
New York Minute: Banged up buck at FT.com/video softer versus the euro at 1.1542. The
1320
John Authers on how dollar weakness might have been pound had hit $1.3070 after UK jobs
Jul 2016 Aug
exaggerated and sterlings rise on possible policy changes data showed the labour market to have
been resilient in the immediate after- European equities Carlsberg fell 5.2
math of the Brexit vote in late June per cent after its half-year results
days 1.6 per cent tumble, helped by an participants scaled back expectations although there were doubts whether missed forecasts, while Wienerberger
early slide for the yen against the dollar. for when US interest rates might rise this would continue. shed 6.2 per cent after it gave a more
Indeed the US currency climbed as only to pare its decline as hawkish com- The vote to leave the EU should cautious forecast for full-year profits
high as 101.15 up 0.9 per cent from ments from Fed officials such as vice- cause some firms to put hiring decisions
Tuesdays close although it subse- chair William Dudley appeared to put a on hold or cut back headcounts alto-
quently gave back all of that rise to stand September move back on the table. gether, resulting in the unemployment Nikkei 225 index
barely changed at 100.26 as European The picture was further clouded by rate drifting up over the coming quar- (000) Change on day 0.90%
17.0
trading drew to a close. the release of tame US inflation data and ters, said Scott Bowman at Capital
The euro was down 0.1 per cent versus more encouraging figures for industrial Economics.
16.5
the dollar at $1.1265, leaving the dollar production and housing starts. Most moves in government bond
index a measure of the US unit against With the implied probability of a markets were muted, with the 10-year
a weighted basket of peers 0.1 per cent near-term Fed hike oscillating in a wide Treasury yield flat at 1.57 per cent, the 16.0
higher at 94.91. range recently currently 51 per cent 10-year German bond yield slipping Jul 2016 Aug
Gold almost always sensitive to by year-end the [July] Federal Open 2 basis points to minus 0.5 per cent and Japanese equities The yens retreat
moves in the dollar recouped an early Market Committee minutes will be a the 10-year gilt yield down 2bp at 0.57 against the dollar helped the Nikkei
$5 fall to trade flat at $1,345 an ounce. key focus, said Adam Cole, strategist at per cent. But Portugals 10-year yield recoup some of Tuesdays decline, with
On Tuesday the dollar fell to a seven- RBC Capital Markets. jumped 11bp amid concerns over the miners among the biggest risers
week low versus the yen of 99.53 as The statement at the time was per- countrys sovereign rating.
Net sales also disappointed, climbing
5.2 per cent to $18.2bn, against Trading Directory
120 expectations for a rise to $18.4bn. Net
income came in at $1.16bn, or $1.31 per
110
100 diluted share.
The results failed to match those from
90
Home Depot, which met analysts
expectations and raised its full-year
earnings guidance on Tuesday.
Day's
Lowes is not the only high flyer whose
-9.34
-82.13
shares are suffering a reversal of
fortunes. Target, another recent
-29.74
-8.35
outperformer in the retail sector, fell
6.5 per cent to a six-week low of
1.06
$70.54 after it cut earnings guidance
0.01
0.01
for the year.
Urban Outfitters, by contrast, surged
nearly 16 per cent to $36.17 as investors
cheered signs that the markdowns the
group had been using to draw in
shoppers could finally be abating. The
company was the days biggest riser on
the S&P 500 after it reported a bigger
than expected rise in second-quarter
sales and profit on Tuesday.
The wider stock market remained
preoccupied with the timing of the
next interest rate rise, with
telecommunications and consumer
discretionary stocks leading the decline.
US stocks retreated from record highs
struck on Tuesday for a second day. At
midday the S&P 500 was down 0.4 per
cent to 2,169.39 while the Dow Jones
Industrial Average had declined by a
similar percentage to 18,476.96. The
Nasdaq Composite had ceded 0.6 per
cent to 5,198.02.
trial of RBP-6000, a monthly injection
that is the most important product in its
pipeline. Indivior said it was on track to
launch by the end of 2017.
Analysts reckon Indivior can charge
three times as much for RBP-6000 as
for its current film formulation, which
needs to be taken daily. RBC forecast
that the injection could take a third of
the market for opioid addiction
treatments, where Indivior has a 61 per
cent share, while Deutsche Bank
predicted peak annual sales of $700m
based on a 20 per cent share.
Savills rose 4.2 per cent to 728.5p after
Citigroup turned positive on the estate
Trading Directory
agent. Worries about UK property had
contributed to Savills 20 per cent fall
this year, yet UK transaction advisory
generated just 14 per cent of group
revenues, said the broker, which put an
815p target on the stock.
We retain the view that Savills is an
extremely well managed operation with
true global reach underpinned by a
significant proportion of non-
transactional revenues, said Citi.
Laird tumbled 6.9 per cent to 308p Trading Directory
after Cobham poached David Runs Daily
Lockwood, its fellow electronics .....................................................................................................................................................................................................................................................................................................................................................................................................................
makers chief executive for four years. Classified Business Advertising
UK: +44 20 7873 4000 | Email: acs.emea@ft.com
Cobham edged up 0.4 per cent to 160.9p.
22 Thursday 18 August 2016

SMART MONEY Analysis. Equities

John
Authers
China opens door wider with Shenzhen link
Hong Kong trading connection Exchange traded funds are due to be
added to the connect schemes in 2017,

Optimism over US points to Beijings confidence

as international buyers hover
providing mainland investors their first
direct exposure to global markets.
The current cap on aggregate quota
earnings multiples is JENNIFER HUGHES HONG KONG
for the Shanghai Connect was abolished
on Tuesday. The Shenzhen southbound

bet against history CHRISTIAN SHEPHERD BEIJING

Hong Kongs Exchange Square was rain-
swept and deserted on Tuesday night.
route will be subject to the same
Rmb10.5bn daily limit as is Shanghai,
although in effect that doubles the flow
Inside the exchange, however, over 100 able to reach Hong Kong.
reporters turned up to hear chief execu- Strategists were busy publishing lists

M
arkets are extravagantly confident that bro- tive Charles Li talk through the go- of stock suggestions yesterday, with key
kers are too bearish, and that their profit ahead of a trading link with Shenzhen. ideas involving picking Shenzhen
forecasts for US companies are too low. The The Shenzhen Connect was duly names familiar to international inves-
multiple of 18 times next years projected splashed across local front pages yester- tors and small-caps in Hong Kong likely
earnings at which the S&P 500 currently day. Stock trading is important in a city to appeal to mainland money. Midea,
trades, according to Bloomberg data, allows little other where 20 per cent of turnover is still the electronics group bidding for Ger-
interpretation. It is at its highest since 2002, outstripping generated by retail investors, and banks manys Kuka, was a common pick in
any level it reached during the credit bubble, or when the display live quotes outside their Shenzhen. Hikvision, the surveillance
Federal Reserve was pumping up asset prices with QE. branches. For international investors, camera systems provider, was another.
There are other signs that optimism on earnings is tak- the Shenzhen links significance lies in Dual-listed mainland companies have
ing hold. For a while, the S&P has been dominated by high opening access to a range of mainland long traded at a discount offshore and
dividend-yielding stocks. In the past few weeks, however, companies considered far more exciting
the S&P 500 Dividend Aristocrats index has started to lag than much of the Shanghai market.
behind the market. Classic income-producing sectors, All three bourses were subdued in
Smaller Chinese groups command North and southbound Connect flows The trading link with
such as utilities, have also ceded leadership. early trading yesterday as profit-taking higher valuations Quarterly quota utilisation (Rmb bn) Shenzhen creates the
And companies that take a lead in buying back their own set in after a rally in anticipation of the Forward P/E ratio (%)
stocks are underperforming after years of outstripping the news, which lifted Shenzhen and Shang-
60 80 largest equity market by
Northbound
market. For some years, corporates have been the mar- hai to their best levels since January and A Share valuation* 50 Southbound 60 cash turnover globally
ginal buyer of US stocks, and so the news that buybacks are Hong Kong to its highest in nine months. H Share valuation
falling might have been taken as a sign that the good times Analysts, meanwhile, were looking at 40 valuation gaps are more obvious
40
were over. Instead, a poor earnings season for buybacks, the broader implications. The exten- between Shenzhen and Hong Kong than
implying a shortage of corporate cash with which to pay sion of connect to Shenzhen effectively 30 with Shanghai.
them, has coincided with a breakout rally to new highs creates the second-largest equity mar- 20 The smaller they are, the higher the
20
hard to justify unless the good times for earnings are back. ket by market cap and the largest by average premium, according to Citi-
One other reason why implicit optimism on earnings cash turnover globally, said Kinger Lau 10 0 group. Some, such as Weichai Power, a
runs high: such optimism is necessary to justify what is at Goldman Sachs. It offers interna- car parts maker, trade at only a 6 per
otherwise a bet against history. S&P earnings have now tional investors almost full access to the 0 -20 cent premium in Shenzhen compared
declined for four consecutive quarters historically, earn- A-share market through Hong Kong. Top 25% 25-50% 50-75% Bottom 25% Nov-Dec Q2 Q3 Q4 Q1 Q2 Jul- with Hong Kong. But others are much
ings declines this protracted are always accompanied by The timing of the announcement, * A-shares by percentile based on market cap 2014 15 16 Aug higher, such as Zhejiang Shibao, maker
bear markets. During this slump in earnings, which the including a statement from Chinese pre- Sources: Citigroup; HSBC of car steering systems, which trades at
numbers cited most widely by brokerages tend to under- mier Li Keqiang, also suggested confi- four times its offshore valuation.
state, the US stock market has twice registered corrections dence by Beijing in its control of its mar- Hong Kongs of capital outflows are not as high, which have access to 417 Hong Kong-listed The link will also open access to the
of more than 10 per cent, but has avoided a bear market. kets and capital account after a year in exchange will makes it a good time to launch [this]. stocks; a third more than now as small- 200 stocks listed on ChiNext, the
Much, therefore is running on earnings. And indeed, an which outflows surged and its market provide access The link, due to be operational by caps will be added. Southbound flows start-up bourse. Those stocks, however,
earnings recovery is widely ructions triggered global turmoil. to an additional year end, will add 880 companies to the through the Shanghai Connect have will be available only to fund managers
cited as the prime reason to At the beginning of this year there 880 stocks when 567 already available to northbound totalled almost Rmb100bn ($15bn) so for the time being.
buy into US stocks at a time
A breakout rally was a lot of pressure on foreign the link begins investors through the Shanghai link that far this year, according to HSBC, helping Nonetheless that leaves 700 stocks in
when they look too pricey. is hard to justify exchange and the capital outflow was AFP/Anthony Wallace
opened in 2014. Combined, the con- narrow the premium of mainland Hong Kong and Shenzhen for investors.
The argument goes as follows. serious, said Ming Ming, chief analyst nects will cover about 70 per cent of A-shares over their Hong Kong H-share The deluge of analyst comment yester-
First, it is the direction of
unless the good at Citic Securities. This situation is now mainland market capitalisation. counterparts to about 25 per cent this day will only be the start.
change that matters to mar- times for starting to stabilise . . . so the pressures Mainlanders trading southbound will week, the lowest since October. See Lex
kets, and on this basis it looks
like US earnings have reached
earnings are back
an inflection point. Earnings
were down in the second quarter compared with a year Commodities
earlier but the extent to which they are declining
reduced.
Added to this, energy companies have driven the awful
numbers for the S&P as a whole, and this can be explained
Palm oil holds its gains
almost entirely by the huge fall in the oil price. However,
exclude energy, and second quarter numbers were positive
despite traders return
earnings rose 1.8 per cent, backed by a rise of 2.5 per cent
in sales, according to Thomson Reuters.
In the final quarter of this year, the adjustment in the oil EMIKO TERAZONO doesnt come back soon in
price will at last drop out of year-on-year calculations, and the market, said one trader.
energy earnings are projected to rise. The oil fall also Sustainable palm oil buyers Palm oil is used in prod-
helped to drive a stronger dollar, which weakened the dol- are still struggling with a ucts from toothpaste to lip-
lar-denominated foreign earnings of multinationals. With squeeze in supplies despite stick to ice cream, and years
the dollar weakening of late, currency should help compa- the return to the market of of demand growth have led
nies in the second half of the year. IOI Corporation, a leading to tropical forests being
So, the bullish argument has it, the inflection point in US Malaysian palm oil pro- destroyed for plantations.
earnings has been reached, a bear market has been averted, ducer and trader. Leading consumer groups
andbrokers havebeenslow to catch up with reality. In April, prices for sustaina- including Unilever, Nestl,
Against this, estimates for the third quarter are actually ble palm oil and palm kernel P&G, Kelloggs, and Mon-
still falling, and including energy, the brokers still call for a oil surged after IOIs sustain- delez, as well as commodity
slight fall of 0.4 per cent. Earnings in the second quarter ability certification was sus- traders Cargill and Bunge,
were better than expected, but they always are. If this is an pended by the industry body, which cut their business ties
inflection, the turn it signals is not at an acute angle. Roundtable on Sustainable with IOI, have not resumed
Company managements tended to be downbeat when Palm Oil, on claims that the trading with the group.
guiding questioners during their earnings conference calls. company failed to prevent its Nestl said RSPOs deci-
Margins tended to fall. There are nerves about the effect of subsidiaries involvement in sion will not change our
US electoral uncertainty and on the fallout from Brexit. deforestation in Indonesia. approach until we see IOIs
Further, it is unusual for top-down strategists to be more The RSPOs suspension upgraded policies enacted,
bullish than bottom-up analysts. Analysts have inbuilt came as Felda, another large with improvements verified
incentives to be over-bullish, and they are not remotely palm oil group, withdrew its on the ground by an inde-
bearish. Thomson Reuters finds they have written solid sustainable products due to pendent group of experts.
double-digit percentage gains throughout next year. issues in its supplies. Betw- Environmental campaign-
Add to this US retail sales data that suggest a sluggish een them, the two producers ers say that given this was the
economy, meaning little reason for a big rise in revenues; accounted for about 18.5 per second time IOIs certifica-
that margins will be hard to expand; and that core inflation cent of RSPO-certified sus- tion had been suspended,
and earnings data suggest at least a whiff of inflation and a tainable palm oil and 21 per many of the large consumer
risk of higher rates from the Fed. Put all these together, and cent of palm kernels, accord- companies were loath to
the highest prospective earnings multiples since the dot- ing to Bob Norman, general restart their relationship
com boom look like irrational exuberance. manager at GreenPalm, the with the Malaysian group.
company behind sustainable Many sustainable palm oil
john.authers@ft.com palm oil certificate-trading. buyers had to rapidly find
The supply shortage alternative suppliers to avoid
meant prices shot up. The reputational risk, said Rich-
premium commanded by ard George at Greenpeace.
sustainable palm oil over Deborah Lapidus, cam-
More comment and data on ft.com ordinary palm oil jumped paigns director at non-
from $25 a tonne to $30-$35, government organisation the
while that of palm kernel oil, Center for International Pol-
Y Fast FT Our global economies, headed made from the fruits seed, icy, said: This demonstrates
team gives you market- by Brazil, Russia, India has more than doubled, with that IOI has yet to regain the
moving news and views, and China. premiums on processed pro- trust of the marketplace.
24 hours a day, five days ft.com/beyondbrics ducts rising from $80-$100 a NGOs have questioned
a week. ft.com/fastft tonne to more than $200, RSPOs move to lift IOIs sus-
Y Podcast The Hard
Y Alphaville Our Currency podcast takes a according to traders. pension. The world is
irreverent financial blog. look at what is driving These premiums have not watching how this story with
Join Paul Murphy and the global currency fallen even after IOI was rein- IOI unfolds. After two sus-
Bryce Elder for the daily market. ft.com/podcasts stated by RSPO this month. pensions of IOI already,
Markets Live session at Most consumers are still RSPOs credibility is firmly
Y Lex Video Analysis trying to avoid IOI and on the line, said Ms Lapidus.
11am. ft.com/alphaville
and opinion from the observe them for [the] next RSPO said in the next year an
Y beyondbrics News and team on the hot issues couple of months and thus independent verification
comment from more affecting companies and premiums may stay firm for team would monitor IOIs
than 40 emerging markets. ft.com/lexvideo [the] next three to six progress. IOI did not respond
months, especially if Felda to requests for comment.