IPOX Schuster LLC


IPOX Global Indexes Weekly Review for 06/13/08

English Version

Chinese Version

Some notable events during last week:

1) IPOX Global Indexes fall: The IPOX Global Indexes continued to fall sharply last week, driven by weakness in Chinese Financials (with the IPOX China 20 losing 917 basis points on the week) as well as events in individual securities. French government intervention re: a rise in French utility costs as well as concerns re: its bid for British Energy pressured mega-cap Electricite de France (EDF FP) (-10.37%). Ahead of F&O expiration this coming Friday, the IPOX-30 Global (All Markets) Index lost 425 basis points on the week, its biggest relative and absolute decline since March 08 F&O expiration week.

2) Despite downside volatility, IPOX U.S. rises, Morningstar reclassifies IPOX-100 U.S. (FPX) as Large-cap Growth: The IPOX U.S. universe recorded a surprise rise this week, bucking the lower trend in other US indexes with the S&P 500, Russell 2000 and Nasdaq-100 each recording a negative week. Both the IPOX-30 U.S. (IPXT) and the broader IPOX-100 U.S. (IPXO) rose on the week, now outperforming the S&P 500 by around 700 basis points on the year. Drivers or returns were last weeks losers, with index heavyweight First Solar (FSLR) gaining 9.02%. In additional development, Morningstar (MORN) has reclassified the associated ETF linked to the IPOX-100 Index (FPX) from mid-cap growth to Large-cap growth. Morningstar has been an FPX index constituent since its IPO.

3) Global IPO and spin-offs activity soars: A record of USD 69 billion in market cap (representing 17 companies) was added to the IPOX Global Composite Universe last week. Focus remained in the emerging markets, with South America leading the way with Brazilian OGX, Mexican spin-off Telmex International and the IPO Mexican Bolsa entering the IPOX universe. At the same time, the IPOX Latin America 20 Index managed to regain some lost ground, finishing the week marginally lower and outperforming the respective benchmarks. Brazilian Bank Banco Nossa Caixa (+8.26%) continued to be the center of takeover speculation.

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