by Mushtak Parker
Bond In Investing Savings Dow Jones Indexes, a leading global index provider, seems to be
targeting the Arab and Muslim countries with the launch of a spate
of regional and local share indexes.
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Bond In Investing Stock May 8, 2005 (AXcess News) London - Dow Jones Indexes, a leading
global index provider, seems to be targeting the Arab and Muslim
countries with the launch of a spate of regional and local share
indexes over the last and next few months in markets ranging from
Dubai, to Turkey, Malaysia and Bahrain.
The USD index (USDX), a gauge of the greenback's value against six major currencies slipped to a low below 80 which has not been seen since 1992.however on contrary the Dow Jones rebounded sharply, rising 286pts (2.2%), while the NASDAQ strengthened by 36pts (1.4%).
Municipal Bonds Investment The strategy in the Muslim countries is aimed at both the
conventional and Islamic equity markets. The core business of Dow
Jones Indexes, which number more than 3,000, of course is to
develop, maintain and license market indexes for use as benchmarks
and as the basis of
investment products. Its Dow
Jones Industrial Average is perhaps the world's best known stock
indicator.In June, for instance, Dow Jones in cooperation with
the Bahrain Stock Exchange will launch the Dow Jones Bahrain
Stock Exchange Index, a broad benchmark conventional equity
index comprising all stocks that are listed at the Bahrain Stock
Exchange, and available for trading.In June also, Dow Jones, in
cooperation with RHB Research Institute, the research and equity
investment advisory arm of RHB Capital Berhad, one of the three
largest banking groups in Malaysia, will
launch the Dow Jones-RHB Islamic Malaysia Index, a
Shariah-compliant index which will include Islamic equities
listed and traded on Bursa Malaysia, the national stock
exchange.These follow the indexes launched in June and September
2004 using the same modus operandi - the DJ-DIFC Arabia Titans
50, the Kuwait-heavy Middle East conventional equity index
launched in June 2004 by Dow Jones in cooperation with the Dubai
International Financial Center (DIFC);
and the Dow Jones Islamic Turkey Index, set up in September 2004
similarly with a Turkish partner to track stocks traded on the
Istanbul Stock Exchange that are compatible with Islamic investment
guidelines.
Yesterday the JPY crosses continued to range trade as a result of high volatility in the Dow Jones Industrial Average thereby limiting trading activity. As a result of the strong relationship between carry trades and the Dow, 4.5% and was much lower than the expected figure of 1.6%. This weak machinery orders figure was supposed to extend recent gains of the yen crosses yesterday but it had little effect as a result of Dow volatility and caution by traders ahead of the Bank of Japan interest rate announcement tomorrow. No rate hike is expected but since the current account surplus hit a record high and the CGPI inflation index rose 2.0% to 2.2% year we could see a strong GDP figure and hawkish comments from the BoJ Governor Fukui at the upcoming monetary policy meeting.
Bond Terms Trading This strategy is just the beginning of the global index
provider's expansion plans for the Muslim world. In between the
objectives of promoting transparency and the quality of financial
data and reporting in these markets, there is the more important
business of generating new opportunities, and therefore profits.To
be fair to Dow Jones, some of these initiatives are being bought
and driven by the partners, perhaps more for reasons of prestige
and status, than a genuine and therefore realistic desire to
develop their capital markets.
Bond Debt High In Inside In a recent article, Rushdi Siddiqui, the Global Head of Dow
Jones Islamic Market Indexes (the Islamic index division of Dow
Jones Indexes) posed a very revealing question. He asked: "The Arab
Monetary Fund's Composite Index, and Shuaa Capital's Arab Composite
Index have neither gained traction in Western financial markets,
nor in local or regional financial markets. So
why should they accept the
DJ-DIFC Arabia Titans 50 as the benchmark and basis for
investible products in any specific region?"
Bond Greenville Greenville His answer was perhaps even more to the point. It comes down to
the identity of the offering institution; the quality of data; and
equivalent comparisons. "A global index provider like Dow Jones
Indexes," he stressed unabashedly, "has more credibility in
creating, calculating, and disseminating indexes, either
stand-alone or co-branded, than a financial institution or a
quasi-government organization."
Trading Stock And Bonds Perhaps one can excuse this pitch for new business, as long as
Dow Jones Indexes or its Islamic equity index arm, Dow Jones
Islamic Market Index, does not think that it has the right to
monopolize the equity index sector.This simply because of its
self-styled perception of a Western index provider par excellence
with greater transparency, better quality data and analysis. It was
only a year or two ago, when the US authorities and their European
counterparts were fining top Western financial institutions and
their equity research analysts for selling short their clients by
advising them to invest in stocks which they themselves privately
considered to be junk and not worth investing in.It would indeed be
both presumptuous and patronizing for any global index provider to
think that their route or a tie-up with them is the only way to
equity index bliss. Take for instance, the Dow Jones-RHB Islamic
Malaysia Index. This, in fact, is not a new index per se.It is
built on the RHB Islamic Market Index launched in 1996, well before
Dow Jones even considered an entry into the Islamic equity index
market.
Bond Investing Municipal The RHB Islamic Market Index was established by RHB Research
Institute and RHB Unit Trust Management Berhad, and driven by the
latter's CEO, Nik Ezar Nik Bolia. For almost a decade it has been
the benchmark for the Malaysian Islamic unit trust and
mutual
fund industry, which today totals more than 61 such
funds with a total estimated fund size nearing $2 billion.
Basis Bond Finance Hill Neither a lack of transparency nor dearth of quality data are
problems in Malaysia, which has one of the best capital market
reporting and regulatory regimes in the world.
Bond Explained Terms Trading In fact, some Malaysian asset managers have questioned the
necessity for this tie-up with Dow Jones, given also the fact that
there is a second Islamic equity benchmark, the Bursa Malaysia's
Syariah Index.So, perhaps in this instance Dow Jones is getting
more than it is putting in. Lars Hamich, managing director of STOXX
Ltd., the joint venture that is responsible for Dow Jones Indexes"
business development in Asia, Europe and the Middle East, stresses
that the Dow Jones-RJB Islamic Malaysia Index "is to meet the
growing demand for compliant equity indexes, and is based on
internationally acknowledged Islamic finance standards."The truth
is that this index is capitalizing on the perceived market
differences of Shariah interpretations between Malaysian scholars
and their counterparts in the Gulf and Pakistan. In the equity
sector these differences in any case are not that wide as say in
the bonds and securities sector.
Bond Business Investing Stock From a business point of view, the Malaysian unit trusts are
largely onshore and denominated in the Ringgit.If the new benchmark
is going to have the impact of widening the investment base and
attracting foreign investors, the fund promoters will have to
launch a spate of new offshore Islamic equity funds to attract
these foreign investors and which could then use the Dow Jones-RHB
Islamic Malaysia Index.
Bond Houston Houston On the other hand, according to Hamich, "the Dow Jones Bahrain
Stock Exchange Index is a natural extension of our activities
in the Gulf region to measure the performance of an Arab country.
The index will also be licensed to investment companies to be used
as underlying for financial products.
Stock Bonds Day Trading Dow Jones Indexes is committed to further expand its presence in
this region."
Bond Corporate Investing Whether the index contributes to enhancing the transparency and
attractiveness of the Bahrain market remains a moot point, for one
index and its provider alone cannot change the culture of a capital
market. But banks and organizations in the Muslim markets should
not shy away from forging alliances with other global index
providers such as the FTSE, MSCI and the Russell Group, even if
they are not as proactive as Dow Jones, if only in the interest of
diversity and competition.Source: Arabnews
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