WEDNESDAY 16 DECEMBER 2015 WORLD BUSINESS NEWSPAPER EUROPE

Cutting edge Martin Wolf Putin’s US fans

Young shaving upstarts challenging The Paris deal is a small step towards Why Trump supporters admire
Gillette — JONATHAN MARGOLIS, PAGE 10 tackling climate change — COMMENT, PAGE 9 Russia’s leader — NOTEBOOK, PAGE 8

Coalition warned that jihadis can Briefing

i Sanofi and Boehringer in €18bn talks

bankroll war machine for years

Sanofi has entered exclusive talks with Boehringer
Ingelheim over an €18bn asset exchange that would
see the French drugmaker swap its animal health
unit for the German company’s consumer health
business.— PAGE 13; LEX, PAGE 12

i US industry warns as Fed prepares move

FT investigation Documents and interviews reveal complexity of militant economy
SAM JONES — LONDON
ERIKA SOLOMON — BEIRUT
Bombing Isis oil infrastructure will not
be enough to cripple the financing of the
jihadi war machine, western intelli-
gence assessments indicate, as the scale
and intricacy of the economy it runs
becomes clear.
The US-led coalition against Isis last
week celebrated having killed the head
of its financial affairs, Abu Salah. Presi-
dent Barack Obama hailed the killing on
Monday as part of a concerted effort to
The Fed looks set to raise interest rates for the first
time in almost a decade today on the back of a US
recovery but the stark message from the industrial
heartland is that tough times are back.— PAGE 2
i Probe into insult against Thai king’s dog
A probe into an alleged insult against
the king of Thailand’s dog is one of a
series of cases pursued by the ruling
junta in a country where lèse-majesté
convictions can attract a prison term
of up to 15 years per offence.— PAGE 2
Inside i Top politicians targeted over Petrobras
Brazilian police have raided the homes and offices
of some of the country’s most powerful politicians

Isis
strike the jihadi group and its leadership as the probe into corruption at state-owned oil
“harder than ever”. company Petrobras takes a new twist.— PAGE 2
But in a Financial Times investigation
into Isis finances, several senior intelli- i New Rolls-Royce chief launches shake-up
gence officials and diplomats have said Warren East has tightened his grip on the UK’s
that without a ground campaign it will premier engineering group by announcing the axing
be hard to stop Isis from financing its of senior jobs in a management shake-up.— PAGE 13;
core operations — and paying the more
than 30,000 fighters who make up the
backbone of its military force.
One coalition intelligence official said
that Isis was estimated to possess suffi-
Inc. EDITORIAL COMMENT, PAGE 8; ANALYSIS, PAGE 14

i Modi branded ‘coward and psychopath’

cient reserves and a viable income
stream to keep its military operations
running at their current level for three
years. When the coalition began its
bombing campaign in October 2014, the
official said, the assessment had been
that Isis would begin to feel a squeeze on
its finances within 12 months.
Based on documents and dozens of
interviews with former Isis command-
ers, Iraqi and Syrian officials in Isis terri-
tory, and coalition diplomats, the FT has
produced its own assessment of the Isis
balance sheet.
In the past year, the jihadi terror
group has raked in almost as much reve-
nue from looting, confiscations — often
The Indian premier has been labelled “a coward
and psychopath” by Delhi’s chief minister after his
office was raided by police, prompting opposition
parties to disrupt the passage of reforms.— PAGE 3
i Praise for Zuma’s ‘bold leadership’
South Africa’s ruling ANC has praised the “bold
leadership” of president Jacob Zuma after a U-turn
which resulted in the country having three finance
ministers in a week.— PAGE 4; PETER BRUCE, PAGE 9
Rolling on: about two-thirds of that ploughed back Syria, the jihadis have amassed reserves base salary of up to $150 a month
reserves of $1bn into its war machine. of more than $1bn, according to US and topped up with benefits, ranging from Datawatch
and a viable But its core fighting force, comprising European intelligence officials. $200 a month as an emigration bonus,
income stream principally foreign recruits to the Much of the income in recent months war spoils and allowances for wives and
help to keep the “caliphate”, costs just $200m-$250m has come from sources which will be enslaved women. Inflation forecasts, 2016 The Federal
war machine on annually, underlining how the jihadis hard for the coalition to disrupt without On average, it amounts to about $800, Annual % change in CPI Reserve is
the road — Reuters could weather a big hit to their revenue. risk of civilian casualties or even according to fighters from Isis expected to raise
0 0.5 1.0 1.5 interest rates
About $20m is spent every month to humanitarian disaster. territory.
pay for the core fighters. A further A foreign fighter for Isis receives a Other priority areas of Isis spending US today. But few

thinly veiled in religious rhetoric — and $15m-$20m is spent on local fighters include its internal security apparatus, China economists are
forecasting that
taxation as it has from oil, its primary and auxiliaries. Estimates from coali- comprising the morality police, the Germany
funding resource, the investigation tion intelligence officials vary, but most
‘They are a very rich hisba, and the secret police, the amniyat. UK
consumer price
inflation next year
found. Before the coalition started agree that the core force is at least terrorist organisation. But The FT investigation indicates that Isis France will hit the 2 per
targeting Isis oil wells last month, the 30,000-strong, with 50,000-70,000 spends as much as $15m a month on Italy cent level deemed
group was estimated to earn as much as more split between local members, they are a very [bad] state’ internal security. Japan consistent with
$450m a year from oil. auxiliary and part-time forces. Senior coalition diplomat Other areas of government, such as the Fed’s mandate
Source: Consensus Economics
page 3
In total, Isis makes close to $900m a Via looting and confiscations of the healthcare and education, receive less of price stability
year, the FT’s analysis indicates, with towns they have overrun in Iraq and than $10m a month between them.

Fed ready to raise rates after almost a

decade but markets made decision harder
ity prices, depreciating emerging mar- ing August. In credit markets, investors
INSIGHT ket currencies, especially in China, and were alarmed last week by a sharp fall
stressed credit markets, have only for high-yield “junk” credit regarded as
John intensified since then. Markets have the highest risk. The Merrill Lynch
made the decision far harder. index of high-yield is now down some
Fosun deals in doubt after Authers Since September 15, market inflation 6.5 per cent over the past three months.
Guo’s mystery absence forecasts have actually fallen, with mar- Despite all these measures, market
kets now predicting average inflation of opinion remained overwhelming that
Report i PAGE 16 Barring a huge surprise, the US Federal 1.47 per cent — below the Fed’s target the long-awaited rate rise would at last
Reserve’s open market committee is rate — over the next 10 years. arrive, with the Fed Funds futures mar-
expected today to unveil its first rise in US stocks have gained since Septem- ket putting the chances at 76 per cent.
Austria €3.60 Macedonia Den220 target rates in more than nine years, ber 15, but this is almost entirely due to The main reason for this is the econ-
Bahrain Din1.7 Malta €3.50
Belgium €3.60 Morocco Dh43 three months after pressure from mar- big companies, with the Russell Top 50 omy. Unemployment has ticked down
Bulgaria Lev7.50 Netherlands €3.60
Croatia Kn27.50 Nigeria Naira715 kets forced it to abandon plans to raise index — covering the 50 largest stocks from 5.1 to 5.0 per cent since September,
Cyprus €3.50 Norway NKr34
Czech Rep Kc100 Oman OR1.50 rates at its September meeting. by market value — rising 6.4 per cent, while core inflation last month rose to 2
Denmark DKr32 Pakistan Rupee 250
Egypt E£20 Poland Zl 18 Since then, the two key measures it is while the Russell 2000 index of smaller per cent. Wage inflation reached 2.5 per
Finland €4.10 Portugal €3.50
France €3.60 Qatar QR15 mandated to target — inflation and companies has fallen by 3 per cent. cent a month, a post-crisis high. This
Germany €3.60 Romania Ron17 unemployment — have moved so as to Emerging market currencies have explains why markets expect the Fed to
Gibraltar £2.70 Russia €5.00
Greece €3.50 Saudi Arabia Rls15 give stronger justification for raising depreciated a further 2.6 per cent. And go through with a higher interest rate.
Hungary Ft990 Serbia NewD420
India
Italy
Rup170
€3.50
Slovak Rep
Slovenia
€3.60
€3.50
rates. But most of the market pressures the Chinese renminbi, after stabilising, But they did not make the task easy.
Kazakhstan
Kenya
US$5.50
Kshs300
Spain
Sweden
€3.50
SKr37
that forced the Fed to delay a rate rise in has now weakened to a lower level Editorial Comment page 8
Kuwait
Latvia
KWD1.50
€6.99
Switzerland
Tunisia
SFr5.90
Din7.50
September, including falling commod- against the dollar than at any point dur- Markets pages 22-24
Lebanon LBP7500 Turkey TL10
Lithuania €4.30 UAE Dh15.00
Luxembourg €3.60

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9 770174 736135
2 ★ FINANCIAL TIMES Wednesday 16 December 2015

INTERNATIONAL

US economy Petrobras scandal

Manufacturers uneasy as Fed rate rise looms Brazil police

Commodity price collapse
and strong dollar spur talk
of industrial recession
SHAWN DONNAN AND SAM FLEMING
WASHINGTON
LINDSAY WHIPP — CHICAGO
If the Federal Reserve proceeds as
expected and raises US interest rates for
the first time in almost a decade today it
will be an affirmation of what Janet
Yellen and her fellow policymakers see
as the strength of the US recovery.
It will also be at odds with what many
intheUS’sindustrialeconomyareseeing.
From manufacturing behemoths like
Caterpillar and Deere & Co to compa-
nies supplying the industrial sector, the
common theme in recent months has
been that, thanks to a strong dollar and
a collapse in commodity prices, tough
times are back. Some are going so far as
to declare an industrial recession.
While the Fed appears unlikely to let
that stop its well-flagged move to raise
rates for the first time since 2006, there
are signs that concerns about the dollar
and the industrial economy are likely to
influence what it does after that.
“It is something that makes us more
cautious in terms of raising rates,” Janet
Yellen, the Fed chair, said earlier this
month of the strong dollar and its drag
on the economy.
The messages emerging from the US
industrial heartland remain pretty
stark.
At WW Grainger, an Illinois-based
industrial supply company that sells
everything from lightbulbs to electric
motors and safety gear, sales in the US
are down 5 per cent on last year with
government purchases the only seg-
ment offering any growth. The company
has been warning investors for months
that it is facing a “tough industrial econ-
omy”thatmaylastinto2016.
Mexico. Monetary policy
At Fastenal, which similarly supplies
the industrial sector, management has
gone a step further. “The industrial
environment is in a recession,” Fast-
enal’s chief financial officer told ana-
lysts on an October conference call.
For Cummins, the diesel engine
maker, a collapse in US demand for
trucks has added to the woes it was
already facing from the slowdown in big
emerging economies such as Brazil and
China and forced job losses.
“It is a really tough time here now,”
Tom Linebarger, Cummins’ chief execu-
tive, said in a recent interview. “In many
of our markets we are back to 2009 lev-
els again, which is a story you are not
really reading about.”
Those sorts of anecdotes translate
into a broader view across US manufac-
turing that the Fed may be pulling the
trigger too early if it raises rates now.
In a recent survey by the National
Association of Manufacturers, 55 per
cent of companies still considered the
US economy too weak to raise rates
before 2016. Less than a third thought
the time was right.
“There clearly is a sense that this [a
Fed rise] is going to happen,” said Chad
Moutray, NAM’s chief economist. “But
there still is a lot of nervousness out
there about what that means.”
Much of the focus in the run-up to the
Fed move has been on strong employ-
ment — where the big growth has been
in professional and other services — and
inflation that is creeping back up
towards the Fed’s 2 per cent target rate.
But the data on America’s industrial
sector have been far less encouraging.
Industrial production, new figures for
which will be released today, has con-
tracted in three of the past six months
while the Institute of Supply Manage-
ment’s latest monthly survey of factory
orders pointed to a US manufacturing
contraction.
Behind those figures are the strong
dollar and falling US exports, which saw
US companies export $15bn less in Octo-
ber than at their peak in July 2014.
Jason Furman, chairman of the Presi-
dent’s Council of Economic Advisers,
predicted yesterday that net exports
would “continue to be a headwind” in
2016. “It is more likely to be taking
something off our growth rate rather
than adding to it.”
Kevin Logan, an economist at HSBC,
argues the impact of the strong dollar is
likely to be a more cautious path for-
ward for the central bank. US gross
domestic product has risen by 2.2 per
cent over the past four quarters. But, if
the drag from the decline in net exports
were stripped out, it would instead have
expanded by 2.9 per cent, he estimates.
“It suggests to me that the Fed is not
going to be very aggressive in the com-
ing year,” he said.
Editorial Comment page 8
raid offices of
Speaker as
probe deepens
JOE LEAHY — SÃO PAULO
Police have raided the home and offices
of one of Brazil’s most powerful politi-
cians as a deepening probe into missing
billions at a state oil company ratchets
up a political crisis in Latin America’s
largest economy.
As well as Eduardo Cunha, the Speaker
of Brazil’s lower house of Congress and
the leader of an impeachment process
against President Dilma Rousseff, police
targeted the minister of tourism Hen-
rique Eduardo Alves and former mining
and energy minister Edison Lobão in
the raids.
“The searches occurred in the resi-
dences of those being investigated, in
their offices, company headquarters,
offices of their lawyers and public
organs,” said the Federal Police in a
statement.
The raids, which are part of an investi-
gation into corruption at state-owned

Dilemma for economy in thrall to Uncle Sam
Central bank expected to
follow Fed’s upward move
despite record low inflation
JUDE WEBBER — MEXICO CITY
Economic theory would suggest that
you do not raise interest rates when
inflation is at a record low. But that is
precisely what Mexico is poised to do
this week.
The Bank of Mexico, known as Banx-
ico, faces the prospect of having to raise
its historically low 3 per cent bench-
mark rate at a time when inflation has
been setting record lows for each of the
past seven months and when gross
domestic product growth, while the
envy of many at 2.6 per cent, remains
far below expectations.
For months now, Banxico has been
priming the market to expect a rate rise
when the Fed goes; indeed, it even
altered its rate meeting calendar in July
to be able to synchronise moves. But
now that the time finally appears to
have come for a US rate rise, the timing
for Mexico may be less than ideal.
Many economists believe Banxico has
little choice, because consumer prices
are not the only indicator posting
records in Mexico. The peso currency,
which has slid more than 15 per cent
against the dollar this year, hit another
historic low last week, touching 17.44
per greenback.
Failure to follow US rates up could pile
more pressure on a currency pum-
melled by tumbling oil prices by encour-
aging bondholders to pile out of local
assets to chase higher US yields.
“The bank will be playing with fire if
they hold,” said Alonso Cervera at Credit
Suisse in Mexico City. “The peso could
tank and leave people wondering
‘where’s the bank’s commitment to the
peso’,” he added.
He, like most in the market, expects a
quarter-point rise from Banxico tomor-
row — its first increase since mid-2008.
Mexico’s benchmark rate has been at
a historic low of 3 per cent since June
2014, when Banxico made a shock half-
point cut, its fourth surprise cut in just
over a year, to try to kick-start persist-
Hot topic: ent flagging growth. Third-quarter GDP
dried peppers growth of 2.6 per cent, which for once
are wrapped at a outperformed expectations, prompted
market in official cheers but the government’s goal
Tepeyanco, of 5 per cent growth by 2018 still looks
south-east hopelessly out of reach.
Mexico. As the Indeed, despite robust domestic con-
peso hit another sumption, job growth and increased
historic low last bank lending that have pushed growth
week, failure to to its fastest pace in two years, things are
raise rates could not all rosy. Data published last week
pile pressure on showed industrial production grew by
the currency 0.5 per cent in October, its slowest pace
Juan Carlos/Bloomberg
for five months, with manufacturing
exports sluggish despite the cheaper
peso.
While runaway enthusiasm about
Mexico’s prospects may have subsided
into a boring holding pattern of gradual,
if unexciting, improvement, Mexico
enjoys enviable economic and political
stability compared with many emerging
peers, notably Brazil, where recession
and political turmoil are deepening by
the day, and Argentina, where a bitter
devaluation looks imminently on the
cards. Boring, by comparison, is the new
beautiful — and many economists see
Mexico as one of the brightest emerging
market stories in 2016.
Agustín Carstens, Banxico’s astute
president, has acknowledged Mexico’s
rate dilemma, telling Reuters in an
interview earlier this month that “we
are facing opposing forces”. Banxico —
which has intervened to support the
currency in recent months — had to be
ready to “take care” of the peso, he said,
while noting the Fed was not the only
factor for Mexican monetary policy.
Despite the peso pressure, Marco
Oviedo, economist at Barclays in Mexico
City, believes that those other factors
deserve to outweigh any Fed move.
“Short-term inflation expectations
have declined . . . Unemployment has
stalled and the economic recovery has
not yet consolidated,” he noted. “Manu-
facturing is facing headwinds and public
investment will likely not be a source of
growth in the near term.”
If the Fed signals that tightening will
be gradual and markets take that in
their stride, he believes Banxico might
have a breather not to raise. But a sharp
reaction would mean Banxico would
Fed news probably have to follow suit.
For the latest Whatever happens, Mexico’s econ-
news on the omy is intimately intertwined with that
US Fed rate
decision, go to of the US, the destination for the bulk of
its exports. A firmer US economy, as
ft.com/
whenratesrise
indicated by a Fed rates increase, can
only bode well for Mexico.
oil group Petrobras, come amid height-
ened tension in the capital Brasília as
congress embarks on an impeachment
process against Ms Rousseff.
Mr Cunha, a maverick politician from
the PMDB, the largest coalition ally of
Ms Rousseff’s Workers’ party, or PT,
broke with the government and
launched the impeachment proceed-
ings early this month. This followed a
move by the PT to support efforts to
remove him as Speaker over allegations
that he violated the house’s ethical
standards by lying about whether he
kept secret accounts in Switzerland.
Mr Cunha is one of many politicians
under investigation in the Petrobras
scandal, in which former company
directors are accused of conspiring with
their political masters and contractors
to extract bribes from the oil group. Mr
Cunha’s office said that he did not yet
wish to comment. He has previously
denied wrongdoing in the Petrobras
case.
The presidential palace said in a state-
ment following the raids that it hoped
the probe would “strengthen Brazil’s
institutions”.
“The federal government hopes that
the facts under investigation . . . are
cleared up as soon as possible,” it said.
The police did not provide details on
the raids yesterday except to say that
they were in relation to Lava Jato, or Car
Wash, the name of the Petrobras investi-
gation. It has become a custom for
police to give each phase of the Petro-
bras investigation a colourful name.
They dubbed yesterday’s phase Oper-
ation Catilinárias, which they said was
in reference to a series of famous
speeches given by the consul Cicero
against senator Catiline during a power
struggle in the ancient Roman republic.
“The measures . . . have as their
prime objective avoiding the destruc-
tion of important evidence by those
being investigated,” the police said.
It said that the investigations were
into suspected corruption, money laun-
dering and organised crime.
The presidential impeachment proc-
ess has been delayed awaiting an appeal
against the composition of a congres-
sional commission that will conduct the
initial hearings into the matter.
But analysts fear that the impeach-
ment could significantly alter the eco-
nomic agenda next year as Ms Rousseff
is forced to depend on her party’s far-
left factions for support.

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Royal dog has its day as Thai insult law bites
Military junta tightens grip
with renewed crackdown on
perceived critics of the king
MICHAEL PEEL — BANGKOK
Investigations into people who have
allegedly insulted Thailand’s monarchy
have soared under the country’s 19-
month-old military junta, as it attempts
to maintain the grip it and its establish-
ment allies hold on power. Those con-
victed face jail terms of up to 15 years
per offence.
The probes come as Thais prepare for
the succession to the ailing 88-year-old
King Bhumibol Adulyadej, the ruler of
almost 70 years. In at least two recent
cases, people accused of lèse-majesté
have died mysteriously in custody.
The dog
The royal insult law has been used in the
past to protect the reputation of dead
kings but never before an animal. That
changed this week when Thanakorn
Siripaiboon, a factory worker, was
Monarchy. Lèse-majesté
charged over online remarks about
Tongdaeng, or Copper, a former stray
rescued by the king. The monarch (pic-
tured with his dog) even wrote a best-
selling book about Tongdaeng and her
good behaviour, in what was widely seen
as a symbol of the obedience expected in
Thai society. Mr Thanakorn is also
accused of liking a social media post that
insulted the king.
The ambassador
Police are investigating remarks last
month by Glyn Davies, the US ambassa-
dor, who criticised the long jail terms
handed down in lèse-majesté cases.
While Mr Davies enjoys diplomatic
immunity, the case highlights how
authorities feel obliged to follow up on
anycomplaintundertheroyalinsultlaw.
The Facebook sharer
Activists are lobbying for the release of
Siriwat Serithiwat, an anti-junta cam-
paigner arrested for sharing an online
infographic. The graphic alleged cor-
ruption by senior officials in a contro-
versial army-supervised project to erect
giant bronze statues of seven former
monarchs. Mr Siriwat has been charged
with sedition and also under the compu-
ter crimes act, another law that officials
have embraced.
The statue project is particularly sen-
sitive because it is a display of the gener-
als’ royalist credentials and was inaugu-
rated by Maha Vajiralongkorn, the
crown prince and heir to the throne.
The t-shirt
A participant in the “Bike for Dad” mass
cycle ride held on Friday in honour of
the king’s birthday has filed a lèse-
majesté complaint against officials
whom he claims gave him a fake version
of one of the event’s yellow T-shirts.
According to media reports, Banjong
Lueadthahan alleged authorities in
Nakhon Sawan province had dishon-
oured the king by handing out a knock-
off top that lacked the back pocket of the
real thing and carried a different mes-
sage on its collar.
The academic abroad
Pavin Chachavalpongpun, a Thai pro-
fessor at Japan’s Kyoto University, was
heckled and sworn at by royalists at a
lecture he gave about the Thai monar-
chy at Yale University this month,
according to a report on the Australian
National University website.
It is not the first time ultra-royalists
have tried to impose their creed outside
Thailand. A Thai restaurant worker
received a suspended jail sentence in the
UK last year after posting footage on
YouTube of himself brandishing a rep-
lica gun as he drove to the home of an
online critic of the monarchy.
Wednesday 16 December 2015 ★ FINANCIAL TIMES 3

INTERNATIONAL

Isis pursuit of statehood squeezes ‘citizens’

Budgets reveal fighters are well supplied while public services suffer in militant-controlled areas of Syria and Iraq
SAM JONES AND ERIKA SOLOMON
In its polished online propaganda, Isis
sometimes calls its health sector the
Islamic State Health Service — the ISHS.
The logo and typography are taken from
the NHS, the UK’s free-of-charge state
healthcare provider. The glossy pictures
of doctors in their scrubs and well-
equipped wards featured in ISHS post-
ers could be too.
It is an illusion. True to its ambitions
of statehood, Isis rakes in tens of mil-
lions of dollars each month from the
resources in the territories it controls
across half of Syria and a third of neigh-
bouring Iraq. But while it holds more
territory than some countries, and
imposes taxes and provides some serv-
ices for its “citizens”, the budget of the
self-proclaimed caliphate shows that its
priorities are still those of a militant
organisation. Isis has built an efficient
war machine that lavishes money on
loyal members while squeezing others.
When Abu Qitada, a 16-year-old from
eastern Syria, joined Isis as a fighter, he
was assured he would receive medical
care, whether that meant treatment at a
frontline clinic or smuggling him to Tur-
key. “They pay for everything,” he told
the FT a few weeks after defecting. Like
all those from Isis territory, he asked not
to be identified with his real name.
In contrast, civilians like Um Eyyad,
from Mosul, the Iraqi city that Isis seized
in June, are treated like second-class cit-
izens. She stopped going to public hospi-
tals, even though she could barely afford
private treatment for her sickly son.
“When I entered the hospital, I’d feel
scared,” says the housewife who fled to
Kurdish-controlled Erbil in northern
Iraq in June. “Everyone inside was Isis.
Other patients have to bring their own
medicine.”
An investigation based on interviews
with dozens of Iraqis and Syrians
trapped under Isis rule, as well as with
senior diplomats and intelligence offi-
cials in the coalition against Isis, under-
mines the group’s claims of governance.
“They are a very rich terrorist organisa-
tion,” says one senior diplomat in the
US-led anti-Isis coalition. “But they are a
very [bad] state.”
The ledger
The war effort dominates Isis accounts.
Over the past year, as the jihadis have
expanded the territory they control in
Syria and Iraq, they have netted at least
$900m from oil, taxation and confisca-
tions, the FT investigation has found.
But this revenue is a moving target: the
international coalition has stepped up
its air campaign against Isis oil wells in
an effort to staunch the flow of crude —
and cash — into the group’s war chest.
Constructing a full picture of Isis out-
lays is complex. While top leaders exer-
cise control over what flows into their
coffers from key resources like oil, the
group’s decentralised structure means
they have a looser grip on how locally
raised revenues are spent.
The group operates a centralised
budget, run from Mosul, and dozens of
regional budgets managed by its walis,
or governors. Taxes and fines are col-
lected and circulated within each wilaya
(province), and former members say
the funds are distributed to branches of
local government, such as fighting units
or education authorities. Income and
expenditure varies depending on prov-
inces’ resources and fighting forces.
The FT gathered payment details for
fighters, civilians and projects, first
hand and from documents, which were
then cross-checked across Isis’s dispa-
rate territories, to produce spending
bands for the biggest items of expendi-
ture in the Isis budget. The analysis
shows roughly two-thirds of the group’s
annual revenues — about $600m — are
ploughed into its fighting forces.
About $20m is spent every month to
pay for the group’s core fighting force,
addition to base pay, a fighter is paid an
The hierarchy Better pay for combatants who pledge allegiance — and foreigners get the most extra $50 for each wife and “sabaya”, or
enslaved woman. Fighters also receive
an extra $35 per child.
According to Isis defectors, every
commander receives petty cash, start-
ing at $50 a month and going up to about
$1,000, depending on his level. Fighters
say leaders use the money to receive
guests, buy meals or rent cars.
Despite the organised structure, the
system has inefficiencies. There is no
electronic accounting system and
accountability is patchy. Former Isis
fighters describe months-long periods
when salaries were paid late, sometimes
with dozens of fighters’ wages unpaid.
One Syrian rebel commander, who
fought with Isis for more than a year,
recalled times when his local financial
overseer would arrive at the wali’s office
only to find the money for wages was not
available. Instead he would be directed
to take funds from the zakat or agricul-
tural offices. “They have this great halo
from the outside that makes you think
they have rank and order,” he said.
“Inside, they don’t have proper plan-
ning. This isn’t a state. It’s a mockery.”
Financial resilience
In the early days of the international
campaign against Isis, which began in
September 2014, the coalition optimis-
Militant fighters tically gave Isis about a year until it
take part in a reached a financial “pinch point”, when
military parade in the costs of its project would overwhelm
Raqqa — Reuters the group, and those battling the jihadis
would finally gain the upper hand.
“Isis cannot possibly meet the most
MUNASIREEN MUBAYEEN MUHAJIREEN basic needs of the people it seeks to
Monthly
base salary for Average Average rule,” said David Cohen, then US Treas-
Foot soldiers for Fighters who have monthly pay monthly pay The foreign ury under secretary for terrorism and
Isis who have not all fighters pledged their fighters. They can financial intelligence, in October 2014.
pledged allegiance
to the group.
Their payments
$50- allegiance to Isis.
They receive top-
ups and bonuses
$200 $600
earn up to $1,000
a month, including
special allowances
Yet Isis remains embedded in these
communities. One reason is that they
were neglected before the jihadis took
can be delayed
and irregular $150 to boost their pay
-$300 over. Using state budget figures from
before the conflict, Syrian researcher
Aziz Hallaj, who studies Syria’s war
economy, estimates regime spending
per resident in eastern Deir Ezzor city
mostly comprised of foreign militants less than $10m a month. Deir Ezzor is was a quarter of what it was in the capi-
(muhajireen). A further $15m-$20m is Saudi Arabia one of Isis’s largest and most carefully tal, Damascus. In rural areas of eastern
spent on local fighters and auxiliaries. Riyadh and allies set up administered provinces. Yet the jihadis Syria it was only about an eighth.
Estimates from coalition intelligence run just nine hospitals there, each with Some of the services Isis provides cost
Isis Inc. officials of the size of Isis armies vary, anti-terror military body no more than 50 doctors and nurses very little. Some electricity is produced
For all articles but most agree the core force is at least paid a maximum of $300 a month. through bartering arrangements with
in the series 30,000, with 50,000-70,000 more split Saudi Arabia has unveiled a Isis spending for municipal work is the regime in Damascus. In northern
ft.com/ between local members and auxiliary “military alliance” of Muslim nations also limited, totalling roughly $10m- Iraq, the US-led coalition has allowed
inside-isis-inc
and part-time forces. to tackle terrorism, another sign of $15m a month, less than a fifth of its workers at the Mosul Dam to keep chan-
Tens of millions of dollars more are the conservative Gulf monarchy’s overall income — even taking into nelling power to Isis areas.
spent on small munitions and explo- growing interventionist approach account prominent building projects — By mid-2015, with reports of fighters
sives. A one-week offensive can cost at amid proxy conflicts with rival Iran one coalition intelligence official esti- being paid late or not at all, and charity
least $1m in munitions alone, according and the rise of Sunni militancy. mates. The estimate is supported by the services being cut, there appeared to be
to FT estimates. Millions of dollars are Deputy Crown Prince documentary record. signs of financial trouble for the jihadis
also spent buying other military assets. Mohammed bin Salman al-Saud “They are trying to put substance to in the intelligence reporting back to
Because Isis extracts tens of thousands announced yesterday the kingdom the concept of a caliphate. They want to Washington and Europe. But as more
of barrels of oil daily, fuel is free. would set up a joint operations control what happens in schools, con- becomes known about the workings of
Isis security apparatus costs $10m- centre in Riyadh to “support trol the hospitals, control the mosques; Isis-controlled areas, western officials
military operations to fight
9 $15m each month, according to one coa-
lition official. This covers the police, the terrorism” and to co-ordinate with
what people wear; how people behave;
the judicial system. That doesn’t mean
say the group’s spending reveals cyni-
cism and flexibility.
Hospitals for the hisba, or “morality” police, intelligence “friendly peace-loving nations and they have achieved the concept of state- “Things like salaries being stopped,
entire province of
Deir Ezzor
forces known as amniyat, and auxiliaries
to collect taxes and fines. Isis spending
international bodies”.
The formation of the 34-strong
hood,” says Sir John Sawers, former
head of Britain’s Secret Intelligence
$50 originally we saw that as an indication
they were under financial pressure, but
The amount a
has risen as it has become more con- Saudi-led alliance comes ahead of Service, MI6. now we see it as a means of them just
50 cerned about internal security. Amniyat international mediation efforts in
Fighters
fighter is paid for
owning a ‘sabaya’ — holding on to what they can,” says one
Maximum number agents operate beyond the caliphate, regional sectarian conflicts, such as an enslaved woman European intelligence official. “They
— according to a
of doctors and including in Turkey and Jordan. The the civil wars in Syria and Yemen. Across Isis territory, the organisation’s payment record, know that people who try to run away
nurses per group is spending to build a domestic The group is mainly formed of largesse is focused largely on its fighters. they can just shoot in the back of the
institution, each below, which also
paid up to $300 wiretapping system, says the official. Sunni-majority Muslim states, Although documents or testimony from shows sums head, if they need to, so why pay?”
a month Hospitals, healthcare and schooling including nations such as Turkey, one region do not necessarily provide a permitted for The conclusion is bleak: officials say
across Isis territory appear to receive Pakistan, Egypt, Morocco and template for the caliphate as a whole, a supporting wives, there is enough elasticity in Isis finances
children, parents
Jordan and most of the Gulf Co- picture emerges of a well-organised sys- and sisters for the group to weather a serious drop
operation Council states. tem to keep the group’s fighting in income. “They could probably go on
The creation of the alliance machine working. The FT obtained the for three years,” says Benjamin
marks another step in Saudi payslip of one fighter that shows the Bahney, who studies Isis sus-
Arabia’s quest for the role of graded scale of militants’ salaries. The tainability at the Rand Corpora-
regional policeman. Riyadh, a target authenticity of the payslip was con- tion, the US-based think-tank.
of Sunni Islamic radical group Isis, is firmed by eight Isis defectors. Rather than indicating weak-
also concerned about the Regular fighters fall into two cate- ness, the cuts, say coalition offi-
expansion of interference in the gories: local and foreign. All are paid cials, could suggest Isis is hunker-
Arab world by its Shia rival Iran. a base salary of about $50-$150 a ing down into a more mercenary,
Saudi Arabia is concerned by the month. Local fighters average about and war-oriented posture. “Will
nuclear deal between its western $200-$300 a month while foreign they divert funding to the civilian
allies and Iran and their refusal to fighters make an average of $600 a operation? I doubt it,” says one coa-
bomb the Syrian regime of Bashar month, which includes a $200 lition official. “I suspect that they
al-Assad. Simeon Kerr, Dubai migration allowance. The receipt will be [more] brutal in their
obtained by the FT also showed, in oppression.”

Corruption probes Budget deficit

Modi accused of instigating raid on Delhi chief Australia downgrades growth forecast again
VICTOR MALLET — NEW DELHI
Arvind Kejriwal, chief minister of
Delhi, yesterday lambasted Narendra
Modi as “a coward and a psychopath”
in a tweet, accusing India’s prime min-
ister of instigating a police raid in
which his office was searched as part of
an anti-corruption investigation.
For the second time in a week, opposi-
tion leaders outraged by the proceed-
ings of a graft case disrupted parliament
with protests, further reducing the
chances that the current session will
pass long-awaited reforms such as the
introduction of a goods and services tax
(GST).
Sonia Gandhi, leader of the opposition
Congress party, and her son Rahul com-
plained last week of a “political ven-
detta” after a court ordered them to
appear in person to answer accusations
of cheating and misappropriation of
funds.
Yesterday, the Central Bureau of
Investigation raided the office of Mr
Kejriwal and 13 other locations in an
unrelated corruption probe into
Rajender Kumar, principal secretary in
the Delhi state government.
“When Modi [could not] handle me
politically, he resorts to this cowardice,”
tweeted Mr Kejriwal, who leads the Aam
Aadmi or Common Man party (AAP)
and is a vigorous campaigner against
corruption. The AAP complained of a
witch-hunt and said: “Narendra Modi is
following the footsteps of Adolf Hitler”.
Arun Jaitley, finance minister in Mr
Modi’s Bharatiya Janata party govern-
ment, denied that the raid had anything
to do with Mr Kejriwal.
Mr Kejriwal wrote on Twitter: “My
own office files are being looked into to
get some evidence against me. Rajender
[Kumar] is an excuse.”
As opposition parties from the Com-
munist Party of India (Marxist) to the
Trinamool Congress of Mamata Baner-
jee in West Bengal announced their sup-
port for Mr Kejriwal, it became clear the
parliamentary agenda was again being
held hostage to demands unrelated to
the legislation to be debated.
Mr Modi and Mr Jaitley are struggling
to pass several economic laws before the
end of the parliamentary session next
week, including one on the GST and
another on bankruptcy procedures.
Although the BJP won a clear majority
in the lower house in last year’s election,
opposition parties led by Congress can
block most laws in the upper house.
JAMIE SMYTH — SYDNEY
Australia’s government has down-
graded its growth forecasts for the sec-
ond time this year, warning yesterday
that its budget deficit will grow because
of a sharp drop in the value of com-
modity exports.
The economy is now expected to grow
by 2.5 per cent in the year to the end of
June, compared with a 2.75 per cent
forecast in the budget in May. The
budget deficit is forecast at A$37.4bn
($27.1bn) in 2015-16, an increase of
A$2.3bn on the previous projection.
Scott Morrison, Australia’s treasurer,
said the new forecasts represented a
“more realistic outlook” for the economy
and signalled that a government pledge
to return the budget to surplus would be
pushed back another year to 2020-21.
“We need to take a safe and careful
route and one that does not put at risk
the very important objectives we have
on growth and jobs,” said Mr Morrison.
“We continue patiently and responsibly
on the path to budget surplus,” he said.
The Liberal-National coalition was
elected in September 2013 on a platform
to tackle what former prime minister
Tony Abbott called Australia’s “debt and
deficit disaster” and restore the budget
to surplus. But failure to gain political
support for swingeing cuts outlined in
the 2014 budget and steep falls in the
value of iron ore — the country’s biggest
export — have hamstrung the govern-
ment in its drive for fiscal consolidation.
The government’s midyear economic
and fiscal outlook forecasts tax receipts
over the next four years to be A$33.8bn
lower than predicted at the time of the
May budget. It said this largely reflected
revisions to nominal growth, with
declining commodity prices resulting in
lowercompanytaxreceiptsandaweaker
outlook for wages and population growth
reducingincometaxreceipts.
The Treasury has reduced its forecast
of iron ore prices from US$48 per tonne
in May to US$39 per tonne, which is
expected to carve out A$7bn in tax
receipts over the following four years.
Citi warned in a note that while Aus-
tralia’s triple A credit rating was not
under any immediate threat, continued
budgetslippagecouldtestratingagencies
unlessfiscalreformsweredelivered.
The opposition Labor party said the
Abbott-Turnbull government had prom-
isedtoturbochargetheeconomybutthat
debtandthedeficithadinfactgotworse.
Additional reporting by Peter Wells
4 ★ FINANCIAL TIMES Wednesday 16 December 2015

INTERNATIONAL
GLOBAL INSIGHT
Migration
EUROPE

EU seeks power to impose border force Alex

Personnel would be sent
in crisis even if national
governments objected
DUNCAN ROBINSON AND PETER SPIEGEL
BRUSSELS
The European Commission has unveiled
plans for an EU border agency that
would be able to send guards to a coun-
try’s frontiers in an emergency, even if
or more than double the €143m allo-
cated for Frontex, the EU’s current,
largely powerless border agency.
The plan must be passed by EU mem-
ber states and the European Parliament,
but a commission official said it already
enjoyed the backing of France and Ger-
many. Both participate in Europe’s pass-
port-free Schengen travel zone. The UK
and Ireland, outside the Schengen,
would not be coveredbytheplan.
Frans Timmermans, the commission
Barker
from the Middle East and north Africa. Despite Mr Timmermans’ insistence
That effort has gained more urgency as the new agency’s supranational powers
the sheer number of migrants has deep-
ened concerns about EU member states
losing control of their borders. The
would be rarely used, the proposal
appears tailor-made for Greece, which
for months resisted EU demands that it
Cameron aides fear
recent Paris terror attacks have also
highlighted fears that the Schengen
invite in Frontex and other EU agencies
to help contain the influx. Athens only
worthy Brussels defeat
could be exploited by terrorists who,
after breaching the outer frontier, could
thentravelfreelyacrossEurope.
complied recently after several senior
EU officials threatened to suspend
Greece from the Schengen.
will not be enough
As part of the package, the commis- Under the new proposal, a weighted
sion also proposed a voluntary scheme majority of EU countries could vote to

the nationalgovernmentobjected.
The plan for an EU border guard is the
latest in a series of German-backed pro-
posals to try to contain Europe’s mount-
ing refugee crisis by centralising power
in Brussels.
The new agency, dubbed the Euro-
pean Border and Coast Guard, would
have 1,000 permanent staff and be able
to call on a pool of 1,500 additional per-
sonnel, who could be sent to shore up
porous borders in a crisis. The agency
would have an annual budget of €322m,
vice-president who has led Brussels’
response to the refugee crisis, defended
the plan to give the agency the ability to
trump national objections, saying such
powers were unlikelytobe used.
“I see this as a safety net, as the
ultimate measure that might be possi-
ble, theoretically,” he said. “My imp-
ression is most members who get into
difficulty would gladly accept help.”
The agency was proposed as part of
new legislation that represents Brussels’
latest effort to stem the influx of refugees
White House race. Republican caucuses
of “humanitarian admission”, which
would see tens of thousands of migrants
plucked from camps in Turkey and
resettled across willing EU members.
Officials made clear the admission
programme would be cut if Ankara does
not work to halt the uncontrolled flow.
The number making the trip from
Turkey to Greece dropped sharply last
month, probably due to the colder
weather. Still, more than 108,000 were
detected entering the EU via this route
— an all-time high for November.
override Greek objections and send in
‘I see this as assistance, even if Athens voted against
a safety net, the plan in Brussels.
Officials admitted that giving powers
as the to an EU agency to send in guards, some
ultimate of whom could be armed and able to
force migrants into registration centres,
measure over the objections of a national govern-
that might ment, could lead to tensions. But they
insisted EU law would allow them to
be possible’ impose such a decision by a weighted
Frans majority vote of other EU countries, and
Timmermans thatthecountrywould havetocomply.
A
curiosity of British public opinion is that a
prime minister can return from Brussels in
failure and still enjoy the popularity typically
reserved for a diplomatic triumph.
So it was four years ago when a sullen David
Cameron sat in an EU summit at 2am. Mr Cameron was
seeking “safeguards” to protect the City of London from
EU regulation as his price for backing a new EU treaty on
fiscal rectitude.
He was sent away empty-handed by French president
Nicolas Sarkozy, who declared: “David, we will not pay you
to save the euro!” Yet in Britain, Mr Cameron’s bravado
was called “the veto” and it earned him a 6-point poll
jump. That seeming failure confirmed the notion that the
British public respects leaders who stick to their demands
in Brussels, even in defeat.
But as Mr Cameron prepares to face EU leaders tomor-
row night at another Brussels summit, his advisers fear a
worthy failure may not be enough.

Texan senator Cruz gains momentum in Iowa
Cuban-American with strong
ground operation has won
many conservative admirers
DEMETRI SEVASTOPULO — WASHINGTON
Just after Ted Cruz arrived in Washing-
ton as a senator in 2012, he received a
visit from Bob Vander Plaats, an influ-
ential evangelical leader in Iowa, at his
basement office. The president of The
Family Leader, a group that opposes
abortion and same-sex marriage, was
courting the Texas freshman who had
come to power propelled by the anti-
establishment Tea Party.
Over the past two years, however, the
tables were turned as Mr Cruz sought an
endorsement from the Christian leader
for a potential presidential run. Those
efforts — from attending events and
office and breakfast meetings to email
chats — paid off last week when Mr
Vander Plaats lent his name, and vast
network of evangelical supporters, to
the politician.
“When you put your head on the pil-
low at night, you know you can trust
him,” Mr Vander Plaats said. “It was not
an easy decision . . . I wanted to make
him earn it and he did.”
The coveted seal of approval came
three days before a poll showed that Mr
Cruz had surged past Donald Trump,
the property mogul, in Iowa, a heavily
evangelical state that sets the stage for
the election as the first in the nation to
vote in the process that chooses the
party’s presidential nominees.
While a later poll showed Mr Trump
just ahead of Mr Cruz, the senator is
clearly gaining momentum in Iowa and
the other early voting states. This has
prompted a growing number of analysts
to argue that, assuming Mr Trump is
knocked off his perch, the race will be a
fight between the conservative Mr Cruz
and Marco Rubio, the Florida senator
who is emerging as the moderate candi-
date preferred by the establishment
with the fall of Jeb Bush.
“It is a spectacular surge. It is unprec-
edented,” said Ann Selzer, who ran the
Bloomberg/Des Moines poll that
showed 31 per cent of likely Republican
caucus-goers backed Mr Cruz, com-
pared with 21 per cent for Mr Trump.
The Canadian-born son of a Cuban
immigrant and American mother who
became a champion debater at Prince-
ton and Harvard, Mr Cruz was the first
Republican to enter the presidential
race in March. Pitching himself as the
‘When you put your head on 10
the pillow at night, you
know you can trust [Ted
Cruz] . . . He is just uniting into Iowa, according
conservatives across the
board like I have never seen
the like of.’
BOB VANDER PLAATS, EVANGELIST
antidote to Washington, he has amassed
Standing tall: a big following that has given him impe-
Ted Cruz at a tus six weeks before the Iowa caucus.
‘town hall’ event “He is just uniting conservatives
this month across the board like I have never seen
Erik Lesser/EPA the like of,” said Mr Vander Plaats, who
further called Mr Cruz a “full spectrum
conservative” whose views on the econ-
omy, social issues, foreign policy,
the constitution, and the need for small
government are in tune with evangeli-
cals in Iowa.
Mr Cruz has also built a ground opera-
tion in Iowa and beyond, that his critics
concede is impressive. Rick Tyler, his
spokesman, said he had chairmen in
each of Iowa’s 99 counties, pastors oper-
ating as supplementary chairs in 76 of
those districts, and 3,700 volunteers in
the state who will help bring voters to
the caucuses on the night of February 1.
He also has 170,000 volunteers across
the country who are being overseen by
1,300 vetted leaders.
“We have knit together the evangeli-
cals, the Tea Party conservatives and the
libertarian vote,” said Mr Tyler. “Those
three together make up a significant
portion of the people who go to the cau-
cuses.”
His rise has created a conundrum for
establishment Republicans who are des-
perate for someone to dethrone Mr
Trump but see Mr Cruz as too rightwing
to win the general election. While the
Texan is now a Washington politician,
his willingness to oppose his own party
has helped him ride an “outsider” wave
that has catapulted contenders such as
Mr Trump to centre stage.
Mr Cruz is disliked by some of his
Republican peers who see the 44-year-
old as an arrogant narcissist who
opposes his party for personal gain
rather than principle. His critics say his
only achievement in the Senate was
helping shut down the government in
2013 and a 21-hour filibuster that
included reading Dr Seuss’s Green Eggs
and Ham on the Senate floor.
But his fans compare his conserva-
tism to Ronald Reagan, who was initially
opposed by traditional Republicans.
‘We have knit together the Along with Mr Cruz, they reject the
party establishment view that he is too
Percentage point evangelicals, the Tea Party rightwing to win the White House, argu-
lead for Ted Cruz
over Donald Trump conservatives and the ing that only when the Republicans have
libertarian vote. Those three nominated conservatives such as Rich-
a Bloomberg/Des ard Nixon, Reagan or George W Bush
Moines poll together make up a significant have they beaten the Democrats.
portion of the people who go “Hillary Clinton is the greatest moti-
3,700 to the caucuses.’’ vating force that we have for conserva-
Volunteers Mr Cruz tives of all stripes to coalesce,” said Mr
has in the state RICK TYLER, CRUZ SPOKESMAN Vander Plaats. “Ted Cruz will unite all
conservatives.”
This time Mr Cameron is the demandeur — asking his
counterparts to undergo the agony of changing the bloc’s
treaties in order to improve the terms of the UK’s member-
ship. With Britain’s EU referendum nigh, Mr Cameron
needs more than public acclaim for fighting the good fight.
He needs substance too.
The “new settlement” Mr Cameron is seeking will
launch his campaign to keep Britain in the EU. Among
other contentious issues, tomorrow’s dinner must break
the political impasse over migration curbs that the UK has
been seeking and put the prime minister on course for a
final deal in February.
The theatre is crucial. Mr Cameron must appear to be
overcoming resistance, forcing change and not “bobbing
about in the back of a dinghy being towed along by a Chan-
nel ferry”, as the eurosceptic former cabinet minister
Owen Paterson witheringly described him.
On this occasion other leaders around the table will be
the ones with the luxury of wielding vetoes that win plau-
dits at home — be it the Poles over migration curbs, the
French over protections for the City of London or the
Spanish on anything that
might annoy the British.
It is revealing that
Not since Cameron
when Mr Cameron’s team let Sepp Blatter
mapped out its EU
reform negotiation strat-
cradle his baby
egy, the 2011 episode was has he swallowed
no longer seen as a suc-
cess but as a tactical mas-
so much pride
terclass in “what not to
do”. One senior British official said: “Any sane person
would realise it did not work.”
So whereas four years ago, Downing Street treated Ger-
man Chancellor Angela Merkel as “the G1 in the eurozone”,
this time Number 10 is spreading the diplomatic love to
other leaders (in part at her request).
Mr Cameron has gladhanded the nobles of euroland,
with improbable overnight stays in Bulgaria and cosy chats
with MEPs he once ignored. Not since Mr Cameron allowed
Sepp Blatter, president of Fifa, football’s world governing
body, to cradle his baby daughter during England’s World
Cup bid has he swallowed so much pride in the cause of
British diplomacy.
His demands have been softly trailed for months, rather
than brandished in the middle of the night like the 2011
City protocol. That list of half-a-dozen UK vetoes on finan-
cial services has been succeeded by “principles” on how
euro members and non-members should coexist. Similar
goals, just more palatable language.
Most significantly perhaps, that 2011 defeat has also
reinforced Mr Cameron’s distrust of the “Sherpas” and
legal ayatollahs who police the EU treaties.
Back then, Mr Cameron believed that the law was on his
side: an EU fiscal treaty was impossible without UK con-
sent, he was told. Yet on the night Hubert Legal, the
respected legal adviser to EU leaders, offered a more
nuanced view that allowed them to agree a side-pact,
bypassing Mr Cameron.
One furious British official used ice-skating terminology
to describe Mr Legal’s opinion as “a couple of triple somer-
saults and a double Salchow”. A more restrained Mr Cam-
eron remarked to the Financial Times that EU legal advice
was “a strange beast”.
Mr Cameron is betting he can convince fellow leaders
when they gather around the table tomorrow night. If he is
right, then they might prod Mr Legal to perform another
late-night legal pirouette — this time in Britain’s favour.
alex.barker@ft.com

President under pressure. Appointments

ANC stands by Zuma despite finance debacle weakening South Africa’s credibility
Ruling party praises ‘bold
leadership’ after key economy
post changed twice in a week
ANDREW ENGLAND — JOHANNESBURG
South Africa’s ruling African National
Congress rallied round President Jacob
Zuma yesterday in the wake of a debacle
that saw three MPs take charge of the
finance ministry in less than a week.
Mr Zuma has come under intense
pressure following his shock decision to
replace Nhlanhla Nene, the respected
finance minister, with David van
Rooyen, a little known parliamentarian,
on Wednesday last week. The move
wiped billions of dollars off the coun-
try’s capital markets and plunged South
Africa into one of the worst economic
crises of the post-apartheid era.
After a meeting of the ANC’s senior
leadership, officials said there had been
no discussions to remove Mr Zuma from
his post.
Instead, the ANC said Mr Zuma had
demonstrated “bold leadership” with
the dramatic U-turn of replacing Mr van
Rooyen with Pravin Gordhan, a former
finance minister, late on Sunday.
But the sombre tone of the media
briefing illustrated the pressure the cri-
sis has piled on the ANC, which faces
tough battles at local elections next
year, and Mr Zuma, whose leadership
has been weakened by the scandal.
The president appointed Mr Gord-
han, who was finance minister from
2009 to 2014, only after his decision to
remove Mr Nene sparked an angry
backlash from within his party, power-
ful unions and the business community.
On Friday night Mr Zuma held four
hours of talks with the Congress of
South African Trade Unions, the power-
ful trade union federation — which
spoke out against Mr Van Rooyen’s
appointment — and the Communist
party. Both groups are part of the ANC-
led governing alliance.
On Sunday, senior ANC officials met
with banking and business executives,
including the chief executives of Bar-
clays Africa, Investec and Goldman
Sachs’s South Africa office. Top ANC
officials, including Cyril Ramaphosa,
deputy president, then met Mr Zuma
for just over an hour on Sunday after-
noon. The announcement that Mr Gord-
han was replacing Mr van Rooyen was
released just before 10pm that night.
Jessie Duarte, the ANC’s deputy secre-
tary-general, said the president
accepted that “a change was needed and
the president himself offered to make a
change because of the impact” of the
appointment.
Ms Duarte said that when Mr Van
Rooyen’s name was mentioned as
finance minister before his appoint-
ment “we thought there would be an
After a meeting of
the ANC’s senior
leadership, officials
said there was no
talk of removing
Jacob Zuma
impact”, adding: “What we didn’t antici-
pate is the enormity of that impact.”
The damaging saga has led to calls for
the ANC to ditch Mr Zuma, who is in his
second and final term as head of state.
Ben Turok, a veteran of the former
liberation movement, said it was a
“moment of truth for the ANC”.
“We have a leader of the ANC and the
country whose judgment is faulty and
who if he continues to behave the way
he has, if he’s not either reined in or sent
packing, then we are in very serous
trouble as a country and the ANC,” he
said. “Everybody is grumbling.”
Demonstrations against Mr Zuma’s
leadership, organised over social media,
are planned for today, which is a public
holiday in South Africa. Mr Zuma has
yet to speak publicly on the saga.
The appointment of Mr Gordhan
eased investor concerns while the rand
— which hit all-time lows against major
currencies last week — and markets
recovered some ground. But South
Africa’s credibility has been severely
damaged at a time when the economy
was already under severe stress.
“It is very odd that the ANC has kind
of made out that van Rooyen’s appoint-
ment was a well thought-out choice,”
said Peter Attard Montalto, an analyst at
Nomura.
“It makes no sense that they would
think the market would react only in a
minor way to someone totally unquali-
fied taking the job. This doesn’t add up
and shows the lack of understanding of
markets and investors.”
High price page 9
Wednesday 16 December 2015 ★ FINANCIAL TIMES 5
6 ★ FINANCIAL TIMES Wednesday 16 December 2015

FT BIG READ. CLIMATE CHANGE

The hard-won pact in Paris will not be enough to solve global warming. But many predict it will spur
further investment in renewable energy while dealing a long-term blow to the fossil fuel industry.
By Pilita Clark

Carbon dated?
I
f there was one sound that captured
the frantic nature of the talks that Emission control The gap between ‘business as usual’ and keeping global warming below 2C
led to the Paris climate change deal
last weekend, it was the ping of an
incoming WhatsApp message. CO2 emissions,
The instant messaging smartphone billion tonnes
app was used by dozens of delegations a year
from the 195 countries involved in the
two-week negotiations. Among them
were the representatives from Saudi
Arabia, the world’s largest oil exporter
and one of the countries with most to
lose from a robust accord. As haggling
over the agreement spilled into a series
of private meetings, delegates from
more than 20 Arab nations received a Historical emissions
stream of WhatsApp messages advising Business as usual
them on what to say in each session.
“A lot of it was intended to marshall INDC scenario*
the troops to make sure the Saudi posi-
tion was backed up by at least one other 2C limit scenario
country in the room at all times,” says
one delegate who saw the messages. 50
“Otherwise their arguments could have
been viewed as those of an isolated
country.” Dec 2015
The Saudis were deeply opposed to 45
something that many other countries Countries sign
insisted should be in the pact: a goal to Dec 2009 Paris accord
Nov 1988
stop global temperatures rising more Copenhagen 40
than 1.5C above pre-industrial revolu- International 2005
talks fail
tion levels. Panel on China overtakes
Riyadh’s unease was understandable. Climate Change US as largest
Temperatures have already risen by established carbon emitter 35
nearly 1C and meeting the 1.5C target Dec 1997
would require heat-trapping carbon
dioxide emissions from burning fossil Kyoto protocol
Jun 1992 adopted 30
fuels, a lifeblood of the Saudi economy,
to come down much faster than if gov-
Rio earth
ernments stuck to a 2C warming target Summit
agreed at UN climate talks in 2010. 25
Reaching the 2C goal means energy-
related emissions would need to be cut
Jan 2005
Any targets in those climate EU emissions 20
trading starts
plans are not legally
binding, but the plans 15
themselves are mandatory, 1990 95 2000 05 10 15 20 25 30
as is a stronger UN system FT graphic. Source: Moody’s Shanghai photo: Reuters * INDC = Individual country commitments

to zero by around 2060 or 2070, accord-
ing to Niklas Höhne, an author of the
latest report from the UN’s Intergovern-
mental Panel on Climate Change. “For
1.5C, you have to be at zero at around
2050,” he says.
In the end, the Paris agreement said
countries should aim to keep tempera-
tures “well below 2C” and “pursue
efforts” to limit warming to 1.5C. It was
one of a series of compromises made in
such as the US goal to cut emissions by at
2C
Target above which global
least a quarter from what they were in
2005 by 2025, or China’s aim to get its
emissions to peak by 2030, are not
temperatures should not rise, legally binding for signatories to the
agreement. But the plans themselves
agreed at UN talks in 2010 are mandatory, as is a stronger UN sys-
tem for monitoring countries’ emissions
1.5C-2C
The target range agreed in
and assessing how they are being
curbed.
We have already seen what happens
tion targets. This was a legally problem-
atic change for the Obama administra-
tion, which wants to sign up to the new
deal by executive agreement rather
than submitting it to a hostile Senate for
consent.
Mr Kerry took one look and said: “We
cannot do this and we will not do this,
and either it changes or President
[Barack] Obama and the United States
will not be able to support this agree-
The relief in the convention hall was
profound. The most important immedi-
ate outcome of the Paris agreement is
that it was not another flop like Copen-
hagen. In the aftermath of that failure
governments continued to launch cli-
mate policies, but opponents were bol- Grand bargain The UN has been trying
stered by the absence of a global agree- to orchestrate an agreement to limit
ment committing all countries to take
similar action.
The paradox of UN climate negotia-
emissions for more than 20 years

Scant commitments France said it will

the final fevered hours of the COP21
talks that eventually produced a grand
bargain among nations with vastly dif-
ferent economies on the fairest way to
tackle global climate change.
The question now is, can this pact —
born out of such compromises and rid-
dled with non-binding conditions —
Paris after some countries when countries are merely invited to
publish voluntary plans, as they were in
blocked a proposal of 1.5C the run-up to the Paris meeting. More
than 180 nations did this, including
Saudi Arabia. But it only plans to reduce
187
Countries, including major
emissions if its economy continues to
grow and there is a “robust contribution
from oil export revenues”.
ment.”
A group of developing country dele-
gates, still nervous about the accord,
seized the chance to declare they would
not accept any changes.
But as envoys huddled on the confer-
ence floor to try to iron out the problem,
Xie Zhenhua, China’s top climate nego-
tions, where all countries have an equal revise its climate targets before 2020,
vote, is that they are destined to pro- but few others have joined it so far
duce deeply compromised agreements
with a limited chance of having a posi- Clean energy catalyst Investments to
tive impact on lowering emissions. But deliver genuine competition to the
they can easily have a negative effect on
such efforts if they fail in the way the
Copenhagen conference did in 2009.
fossil fuels sectors are set to increase

It was “bizarre” to think coal compa-

actually deliver a big enough cut in
emissions to curb temperatures that are
on track to warm the world by around
3C or more by the end of this century.
An increase of that size, say scientists,
would intensify the risk of fierce storms,
intolerable heatwaves, higher sea levels
and melting ice caps.
The UN has been trying to orchestrate
a global agreement to limit emissions
for more than 20 years, starting with a
1992 accord struck in Rio de Janeiro.
This was followed by the 1997 Kyoto
protocol, a treaty that required only rich
countries to cut their carbon pollution,
and a failed attempt to produce a new
pact at Copenhagen in 2009.
Fuel for activists
The Paris agreement differs from earlier
efforts in several ways. Its new 1.5C tar-
get is only aspirational and meeting it
would require substantial cuts in emis-
sions and unprecedented growth in
existing renewable energy technologies.
But its implications will be seized on by
advocates who have already translated
the 2C goal into a string of campaigns
highlighting the amount of coal, gas and
oil that needs to stay unburned if such a
target is to be met.
The same goes for another goal in
the agreement to achieve a balance
in the second half of the century
between man-made greenhouse
gases and carbon-absorbing “sinks”,
such as forests. Another big differ-
ence between the Paris pact and its
predecessors is that it
requires virtually every
country in the world,
not just wealthy ones,
to publish a climate
plan every five years,
probably from 2020.
Any targets in
those climate plans,
polluters, that submitted Still, Riyadh did submit a plan and
under the new accord, it will have to
climate plans ahead of COP21 table a new one every five years that
cannot be any weaker, using a more
98.6%
The percentage of total
stringent set of reporting rules. The
same applies to the largest emitter,
China, which accounts for 27 per cent of
global emissions contributed global carbon pollution.
Like Saudi Arabia, it was reluctant to
by those countries support the 1.5C target and other meas-
ures backed by a group of countries led
by small island states — those most at
$10bn
Funds committed by countries
risk as sea levels rise — that labelled
itself the “high ambition coalition” at
COP21.
ranging from China to the US Only a day before the agreement was
adopted, Liu Zhenmin, deputy head of
to invest in ‘clean energy’ China’s delegation, dismissed this coali-
tion as “a kind of performance” or stunt.
27%
Of global carbon pollution is
But the group included the US, the
second-largest emitter. Its diplomacy
under John Kerry, secretary of state and
produced by China, which a life-long climate action advocate, led
to Washington and Beijing jointly
played a key role in the deal announcing climate plans late last year
— a move that at the time raised hopes
that a Paris agreement could be sealed.
Xie Zhenhua:
despite critical Breakthrough of the Big Two
rhetoric from In the end the US-China relationship
Beijing, China’s proved crucial to Saturday’s accord. In
top climate the tense moments before the deal was
negotiator signed it almost came unstuck, but
stepped in to China showed that, despite its officials’
push a deal public rhetoric, it wanted the agree-
through — Thierry ment to go ahead.
Chesnot/Getty Images
As France’s foreign minister, Laurent
Fabius, was preparing to bang the gavel
on the agreement’s adoption on Satur-
day, panic set in after the US delegation
saw the final text, drawn up in the early
hours of the morning by exhausted offi-
cials.
Unlike previous versions, which said
developed countries “should” take the
lead in fighting climate change, it said
they “shall” undertake emission reduc-
tiator, stepped in. Paul Marty, a senior credit officer at
“He said, ‘Stop it now, we want this Moody’s, the rating agency, says that if
agreement, don’t play games with this, it Paris had been another Copenhagen, it
isn’t fair’,” says Laurence Tubiana, might have affected even climate policy
France’s COP21 ambassador. The text
was duly changed — “should” replaced
“shall”. “Without Xie, we would not
pioneers such as the EU, home of the
world’s largest carbon market and some
of the earliest solar power subsidies.
have had an agreement,” Ms Tubiana “It’s likely it would have undermined
told the Financial Times. the EU’s long-term decarbonisation pol-
icies and targets on the grounds that if
the rest of the world isn’t doing much,
Global carbon emissions why would EU economies need to make
Billion tonnes of CO2 from energy
production
the effort,” he says.
Declarations of intent
Reduction commitments
made at Paris The immediate impact of the agreement
0 2 4 6 8 was mixed. France’s President François
China Hollande was the first leader to say his
North America government would revise its existing cli-
EU
India
Other Asia
Russia
mate targets before 2020 in the wake of
the Paris agreement, but few other
nations have shown any sign of being
Middle East willing to join him.
Latin America
Shares in a number of European and
Japan
Africa North American solar and wind compa-
Australia and New Zealand nies ticked up on Monday; Elon Musk’s
No commitment SolarCity, the biggest residential
installer in the US, jumped 12 per cent.
Many market specialists said the rise
Sectors with credit exposure
to carbon regulations was likely to be temporary. But Barclays
analysts predict that the deal would
Rated debt “speed up the deployment of renewable
($bn) Very high exposure
High exposure and other zero and low-carbon energy
sources”.
0 200 400 600 The initial response from oil and gas
Unregulated utilities/ companies was a broad shrug, but some
power companies
Coal mining
coal industry groups were more per-
turbed about its implications, and espe-
Oil & gas - IOCs cially its 1.5C goal.
Regulated utilities Brian Ricketts, secretary-general of
Automobile manufacturers Euracoal, a trade body representing the
Oil & gas - independent E&P EU coal industry, says: “That 1.5C might
Steel be a target, but it means NGOs will be
Building materials striving for the complete phase-out of
Airlines fossil fuels very quickly, which means
Sources: Moody’s; WRI
we will be hated and vilified in the same
way slave traders were.”
nies could change their business models
to adapt to such goals, he says, adding
that he feared climate activists’ “mob
rule” was already replacing the rule of
law in some countries and the Paris
agreement would exacerbate the trend.
Other coal industry executives say the
accord ought to bolster their argument
that tougher climate targets should
translate into more support for technol-
ogies such as carbon capture and stor-
age systems that allow fossil fuels to be
burnt without harming the climate.
But it may not be long before such sys-
tems are competing against newer tech-
nologies that eliminate the need for
coal, oil and gas altogether.
That is the hope of Bill Gates, Micro-
soft’s co-founder, who announced at
COP21 that he had teamed up with other
billionaires to get nascent clean energy
innovations out of the lab and into the
market. This group will work with 20
countries, including the US and China,
pledging to double their $10bn com-
bined spending on clean energy
research and development over the next
five years. It is initiatives like this that
could end up doing more to meet the
Paris agreement’s goals than the accord
itself.
Ultimately, it is impossible to know if
the pact will make this century the last
to be powered by fossil fuels. Even Mr
Obama, one of the agreement’s strong-
est proponents, conceded on Saturday
that global warming “is not solved
because of this accord”. But it does cre-
ate “the architecture for us to continu-
ally tackle this problem in an effective
way”, he argued.
Perhaps that is all that can be
expected from UN talks that have taken
more than 20 years to get to this
stage, and may take another 20 to start
fixing a problem that has so far proved
insoluble.
Wednesday 16 December 2015 ★ FINANCIAL TIMES 7
8 ★
WEDNESDAY 16 DECEMBER 2015
The Federal Reserve may
be jumping the gun
The argument for an interest-rate rise now is not a compelling one
Just because it seems inevitable does
not mean it is a good idea. The Federal
Reserve’s Open Market Committee,
which today announces its decision on
interest rates, has widely telegraphed
that it will raise borrowing costs for the
first time since 2006 after seven years
on hold.
Janet Yellen, the Fed chair, has
apparently overcome opposition from
some more dovish members on the
central bank’s governing board. Hav-
ing in effect deferred a rate rise in the
autumn in response to the interna-
tional financial turmoil at the time, the
calmer external environment has
seemingly persuaded the Fed to hike.
Although the decision is a marginal
one, the Fed will, on balance, be mov-
ing too early if it raises rates this week.
Even (correctly) looking past the
renewed stress haunting financial mar-
kets, this time in junk bonds, the value
of waiting outweighs that of acting now.
On the face of it, the decision to raise
the federal funds rate looks strong. The
US economy has been growing steadily
and sometimes robustly for nearly five
years, and unemployment, at 5 per
cent, has halved from its 2009 peak.
Even after the extraordinary turmoil of
the past decade, the Fed still sets inter-
est rates according to the same basic
model as before the global financial cri-
sis, assessing the growth of nominal
demand and the economy’s supply
constraints. Under normal circum-
stances and by historical standards, the
economy would by now have elimi-
nated the output gap, and be on the
point of generating inflation in both
wages and consumer prices.
Circumstances, however, are not
normal, and historical standards are
not necessarily applicable. Year after
year, the Fed — along with most fore-
casters — has overestimated inflation-
ary pressure, suggesting either a mis-
calculation about the economy’s out-
Rolls-Royce’s future and
the UK national interest
Activist investor’s arrival should put the government on alert
Britain has one of the most liberal take-
over regimes in the world. Foreign
companies face few obstacles if they
wish to invest in UK businesses or buy
them outright. Barring the preserva-
tion of competition, it is generally up to
shareholders in a target company to
decide whether they wish to sell.
This simple regime has many virtues
and has arguably secured for the coun-
try a larger share of foreign direct
investment than its economic heft
would otherwise permit. But it should
not preclude the assertion of strong
national interests in the case of sensi-
tive sectors. Not every UK company
should be up for grabs.
When it comes to Rolls-Royce, few
would dispute Britain’s right to take a
close interest in the ownership of the
business. The aerospace group is not
only one of the country’s most impor-
tant defence contractors; it is also at the
centre of some of its most secret pro-
grammes, such as the renewal of the
UK’s independent nuclear deterrent.
Shareholders have long understood
that their ownership rights are subject
to national constraint. Bids, and even
significant asset sales, require White-
hall’s consent under the terms of a
“golden share” inserted by the
Thatcher government when the group
was privatised in 1987. Questions of
nationality also matter in the board-
room. Should the chief executive not be
a UK citizen, parts of the group must be
sequestered beyond their sight.
The arrival of a so-called activist
shareholder on the register need not of
itself trigger alarm bells. ValueAct, a
San Francisco-based fund run by
Jeffrey Ubben, is not, after all, a poten-
tial purchaser. But its emergence as a
shareholder comes at a time when
Rolls-Royce is reeling from a string of
profit warnings rooted in the poor
performance of its defence operations
and latterly slowdowns at its marine
put capacity or something even more
fundamental going wrong.
While American unemployment is
low, so is the US’s number of economi-
cally inactive people — those neither
with a job nor looking for one — both by
international and historical standards.
Many of the new additions to this total
may be discouraged workers who have
left the labour market never to return,
or they may be people who would start
looking for a job if the offers were there.
If the latter is the case, the economy
could be run above its long-run growth
rate for some time without generating
excessive inflation.
Normally, the Fed does not wait to
see the whites of inflation’s eyes before
pulling the trigger. But with consumer
price inflation having undershot its
informal 2 per cent target for so long,
there is a good case for remaining
behind the curve until it is quite clear
which way the curve is moving.
Having come this far in signalling
that interest rates are about to rise, it
would probably be more disruptive if
the Fed sat on its hands today than if it
moved. Financial markets — and, most
likely, policymakers in the rest of the
world — have priced in an increase with
near-certainty.
Yet at the very least it should do its
utmost to make clear that this is not the
first in a series of preordained interest
rate rises. In that sense, too, it needs to
make a break with historical precedent
in which the first US rate rise is reliably
followed by a string of further moves. If
it does raise rates, the Fed should signal
that it stands ready to reverse course at
signs of economic weakening.
The world has changed very radi-
cally since the US last increased inter-
est rates. The latitude the Fed gives
itself within its framework should
change too. On balance, a fine one to be
sure, the central bank should leave
interest rates on hold this week.
turbine and aircraft engine servicing
businesses. The setbacks have left
Warren East, the newly appointed chief
executive, struggling to restore both
the confidence of investors and a share
price that has more than halved in the
past two years.
ValueAct claims to come in peace.
Although the fund has made some sug-
gestions of remedies, including the dis-
posal of the group’s marine business, it
has not insisted on their implementa-
tion. Rather it seeks a seat on the board
from which it can offer the group the
benefit of its wisdom and advice.
It is up to Mr East to decide what role
ValueAct can usefully play in any turn-
round. But he and Mr Ubben cannot
ignore the interest of the British state in
any deals they might propose as a
result of their collaboration. Questions
would arise should they seek structural
fixes for Rolls-Royce’s problems, such
as a merger or break-up of the group.
Nor should the government’s con-
cerns be limited purely to safeguarding
the most sensitive defence interests of
the group. Rolls-Royce’s wider aero
engine and turbine businesses also sit
at the heart of the UK’s high-tech man-
ufacturing effort. The state should not
allow facilities and capabilities built up
over many years — often with signifi-
cant public support — to be neglected
or stripped for financial advantage
through the short-sightedness of inves-
tors. Once lost these are almost impos-
sible to restore.
ValueAct’s energy and commitment
are welcome. Like any other investor,
the fund should hold the existing man-
agement to account. What it should not
be allowed to do, however, is to induce
the group to focus excessively on short-
term returns, whether by selling assets
or running down development activity.
Should its actions outrage both the let-
ter and spirit of the golden share, they
can and should be stopped.
FINANCIAL TIMES
More than labour markets or piggy banks
Sir, Simon Tilford, in “The policy
failures masked by scapegoating
migrants” (December 10), makes some
telling points about recent immigration
from the EU and the plight of the white
working class, but then smudges the
picture with some dubious claims and
hyperbolic language. Britain, he claims,
has an “admirable” record of
integrating migrants. Mixed record
would be a more accurate description,
as a visit to Tower Hamlets, Southall,
Luton, Bradford, Oldham, east
Birmingham and several other British
towns would indicate.
It is true that a few EU countries
have had comparable levels of
immigration in the past 15 years but
the UK is well above the average.
Moreover, while EU migrants do have a
slightly higher employment rate than
the UK born — and are responsible for
most of the recent employment
increase — it is not true to say that
Climate accord is
a global ‘code red’
Sir, As a participant in the very first
climate negotiations, in February 1991,
I have to confess to a certain dreary
sense of déjà vu. With the ink barely
dry on the Paris climate accord, we see
a familiar pattern of reactions. These
range from the rallying and
inspirational, such as your balanced
editorial (“The world, together, will
fight climate change”, December 14), to
the dismissive defaults to business as
usual (“Big polluters see no short term
change” and “Obstacles to climate deal
as business plays down impact”,
FT.com).
Business, and markets in particular,
need to understand that the Paris
agreement is not just another
aspirational, but essentially
meaningless, global road map. The
agreement, between nearly 200
countries (almost all of which
underlined in their speeches the very
real dangers of continued warming to
the future of their societies, landscapes
and economies), amounts — in security
terms — to a global “code red”. It needs
to be understood and acted on as such.
No other threat on the radar stands to
affect so many, so much, and for so
long.
Paul Hohnen
Amsterdam, The Netherlands
Has free trade been worth
the huge costs, Mr Biden?
Sir, In response to Edward Luce’s
column “Trump is not America but he
could be” (December 14):
Dear Mr Biden, I appreciated —
enjoyed is probably the wrong word —
your letter to Americans about a
disappearing middle class. I grew up in
Bethlehem, Pennsylvania — about 75
miles south of Scranton. The
Bethlehem Steel plant stretched for
miles along the Lehigh river and
employed 25,000 people. Now it stands
empty, a victim of foreign competition
as well as insular management and a
bloated unionised workforce where
new hires were taught how to walk
very slowly.
I live now in Sturgeon Bay,
Wisconsin, where a local shipyard,
owned by Italy’s Fincantieri, employs
hundreds of skilled and semi-skilled
workers year-round. In the winter,
Strongman
Putin offers
Trump fans
a glimpse of
the possible
Washington
Diary
Courtney Weaver
Letters
they are “big” net contributors to the
UK finances (£1bn to £2bn a year at
most, with east Europeans probably
negative).
But there are two bigger points here
that Mr Tilford misses. Countries are
not just labour markets or piggy banks,
they are collections of communities
with a club-like ethos, and people
object not to “welfare tourism” as such,
for which he is right to say there is not
much evidence, but rather to the fact
that non-citizens from EU states have
full rights to the UK club almost
immediately. And the people who
object most are the white working
class, for whom this equal treatment is
a further diminution of an already
declining status that Mr Tilford notes.
Finally, he rather fatuously accuses
politicians of both main parties of
“scapegoating” immigrants by merely
proposing popular policies to reduce
high levels of net immigration. But
‘I wonder if anyone in a galaxy far,
far away is queueing to watch the
premiere of a film about us’
when other jobs are scarce in this
summer resort area, the shipyard has
repair work on lakers, the 1,000ft bulk
carriers that were built on the Great
Lakes, many of them here. Their size
protects them from foreign
competition — they are too big for the
locks on the St Lawrence Seaway.
The year-round work — such as tugs,
ferries and service vessels for the Gulf
of Mexico oilfields — are protected by
the Jones Act, which requires that ships
travelling between US ports be built in
the US. No doubt they would be
cheaper from South Korea or China,
but that would wipe out many of these
local jobs. The question you don’t raise,
much less answer, is whether free trade
has been worth the huge costs it has
imposed on residents of cities such as
Bethlehem, Gary, Detroit and
Pittsburgh and a number of cities
across Ohio. And if the costs have been
too high, what’s the solution?
Tom Groenfeldt
Sturgeon Bay, WI, US
We get used to nouns
being turned into verbs
Sir, Lucy Kellaway’s Guffipedia website
is an excellent idea (“Introducing
Guffipedia, an outlet for all victims of
BS”, December 14). But she protests too
much in railing against the
longstanding tradition of turning nouns
into verbs, describing “to solutionise”,
“to mindshare” and “to role model” as
examples of “new linguistic lows”. We
On a blustery evening, a crowd of
thousands gather at a political rally,
many eager to explain to me why their
country needs a strong leader, is right
to take a more aggressive stance on
the world stage and should be
respected and feared by other nations.
It’s a scene not unlike those I have
covered over the past five years as a
correspondent for the Financial Times
in Russia. Only this time I have not
come to see the adoring fans of
Vladimir Putin. I am in Macon,
Georgia, and the man we are waiting
for is Donald Trump.
One month into a new job covering
the US presidential campaign, I am
starting to find that the Trump
phenomenon is more understandable
when viewed through the lens of a
Putin-Trump Venn diagram — or,
rather, the Venn diagram of their
supporters.
Two weeks ago in Macon at a
stadium full of diehard Trump
supporters, I met Tal Wollschlaeger, a
law student, who declared apropos of
nothing and with no knowledge of my
background that he wanted to see a
US president more like . . . Mr Putin.
“I think Putin is brilliant!” the
twenty-something Mr Wollschlaeger
told me as two of his friends nodded in
agreement. “He’s taking care of
business the way he has to. His
country loves him. He’s done well for
them. He does what he says and he
gets the job done.”
He continued: “We just have to
reassert ourselves. We’ve got to the
point where Britain and France can’t
Mr Tilford goes in for scapegoating
of his own by claiming that the
problem lies not with the unpopular
high inflows but with politicians and
planners who have failed to adjust
infrastructure spending fast enough to
take account of the inflows. But they
are not gods. How could they have
known so many were going to come?
In 2004 it was famously predicted
that only about 13,000 people from
central and eastern Europe would
come each year when in fact more than
1m came over the next four years. And
more recently, too, numbers have
swung sharply. In 2012 net
immigration from the EU was just
72,000; this year it was 180,000. Such
uncertainty is an inevitable
consequence of an open border in a
period of economic turbulence.
David Goodhart
Director,
Integration Hub
all have our pet language hates, but
Michael Skapinker provided a more
balanced view on the verbs-from-noun
phenomenon in his column “Emoji,
Brexit, ad blocker and my notable
words of 2015” (November 26), saying
rightly that “some people dislike these
verbs, but, in time, we get used to
them”. Indeed, as Mr Skapinker
pointed out, “to role model” is widely
used, particularly in the US, and its
usage is not new.
Ian McMaster
Munich, Germany
We should decide on taxes
and spending, not the EU
Sir, David London (Letters, December
11) argues persuasively that taxpayer-
funded benefits should be paid for the
children of immigrants who work in
this country even if those children are
not resident here. There is, of course,
an equally valid argument against this
policy.
This issue, like others relating to
taxation and spending priorities,
should be decided by our government
and parliament, not by the European
Commission or other officials who are
not accountable through the ballot box.
It is reasonable to be told that there is a
case for this expenditure but not to be
told that this is going to happen
whether we like it or not — so we may
as well support it! We should adhere to
the principle of “no taxation without
representation”.
John S Burton
Cheltenham, Glos, UK
VW’s scandalous omission
Sir, According to its new chief
executive, Matthias Müller,
Volkswagen’s new strategy will focus on
three things — digitalisation,
sustainability and integrity (“VW tries
to get a grip after emissions scandal”,
December 11).
Why should I trust a company for
which integrity is no longer seen as a
timeless value guiding all behaviours,
but instead as one feature of a newly
launched strategy?
To me that’s not an emissions
scandal but a scandalous omission.
Mark Goyder
Founder and chief executive,
Tomorrow’s Company,
London EC4, UK
look to us for advice because we can’t
make the first move any more,
because really we’re too weak. We
need to get our seat back at the table.”
At first it seemed like a one-off, a
random Putin fan sprouting up like a
unicorn in a southern US city
nicknamed the Heart of Georgia. But I
don’t think Mr Wollschlaeger is an
outlier. In Dubuqe, Iowa, a crucial
primary state, the Associated Press
recently spoke to Duane Ernster, a
local Trump supporter who also
offered the Putin comparison. “Maybe
we need a warrior instead of a
politician,” he said. “People compare
Mr Trump to Putin. There’s something
to be said about the man who takes
care of the Russian people.”
In a Gallup survey last year — a period
marked by Russia’s annexation of
Crimea, the war in Ukraine and
western sanctions — Mr Putin ranked
as the 10th most admired man in
America, beating among others vice-
president Joe Biden, the Dalai Lama
and the actor George Clooney.
To Mr Putin’s admirers in the US, he
offers a tantalising view of what it
might be like to have a president
stymied by neither Congress nor two-
term limits — and one who treats the
delicate art of diplomacy more like
judo than chess. To many of these
people, Mr Trump represents the
quixotic tsar who will rid Washington
of its gridlock, reverse failed foreign
policies and end years of perceived
economic decline. If he is Trump the
Terrible, so much the better.
In his campaign, Mr Trump appears
Wednesday 16 December 2015
Email: letters.editor@ft.com or
Fax: +44 (0) 20 7873 5938
Include daytime telephone number and full address
Corrections: corrections@ft.com
End Doha by keeping
its original promise
Sir, US Trade Representative Michael
Froman is correct in saying that “Doha
was designed in a different era, for a
different era, and much has changed
since” (“Doha has failed; we need a
new type of global trade deal”,
December 14). Unfortunately, what he
offers ignores the status quo and
history, especially the legacy of the
previous Uruguay Round of trade talks.
Instead, he favours plurilateralism,
bilateralism and an à la carte
multilateralism consisting of what
developed countries deem to be in
developing countries’ interest, while
ignoring the latter’s own aspirations. As
Professor Jagdish Bhagwati has shown,
bilateral and plurilateral trade
agreements undermine trade
multilateralism regardless of the gloss
of complementarity that almost
everyone involved gives lip service to.
Most developing countries want the
Round to continue in order to fulfil the
promises made in 2001 to revive
multilateral trade negotiations after
the Seattle ministerial walkout. The
Doha “Development” Round began
with expectations of rectifying the anti-
developmental outcomes of the
previous Uruguay Round in order to
realise at least some of their
developmental aspirations. Since the
Round began, some OECD countries
have been unwilling to make any
meaningful concessions, thus
effectively undermining the Round.
Ending it now without any acceptable
concessions for development is thus
seen as enabling developed countries to
effectively renege on earlier promises
made to get developing countries back
to the negotiating table.
The threat to abandon the Doha
Round is already being used to extract
more concessions from developing
countries. Instead, the fastest and
surest way to end the current Round is
to keep the promises that brought
developing countries back to the
negotiating table at Doha in order to
enable trade policy to better contribute
to development including food security.
The WTO Agreement on Agriculture
was concluded after half a century of
generally declining cereal prices at
time when most developing countries
were subject to structural adjustment
measures requiring spending cuts.
Hence, developing countries secured
little if any of the allowed aggregate
measurement of support (AMS)
compared with developed economies
then. Since then, many countries,
including the US and developing
countries, have increased support to
farmers while developed countries can
afford to ensure that their support is
WTO-compliant. Greater food price
volatility and higher levels from a
decade ago have seen renewed
government policy responses to ensure
national food security.
Support measures that distort the
international food trade can easily be
checked with appropriate regulation.
With serious commitments to jointly
overcome this major stumbling block
in negotiations and to realise the Doha
Round’s original development
promises, progress can be made to
deliver on its development potential
and to restore the trust so necessary for
multilateralism to thrive again.
Jomo Kwame Sundaram
Coordinator for Economic and Social
Development,
UN Food and Agriculture Organization,
Rome, Italy
to be taking chapters out of Mr Putin’s
handbook. There is the creation of a
perceived external threat (in Mr
Putin’s case, the US and its
encroachment into Russia’s sphere of
influence; in Mr Trump’s, it is
Muslims and illegal immigrants); the
salty language; and the stranglehold
on national television. Both men are
credited with being spontaneous,
unpredictable and counter-intuitive,
qualities that make it difficult for
opponents to outmanoeuvre them.
The two men’s ratings appear to
defy logic. Mr Putin’s remains strong
despite a worsening economy on the
back of westerns sanctions, lower oil
prices and the plunging rouble. Mr
Trump’s support improves the more
offensive or outlandish his comments
become.
The comparisons to Mr Putin seem
to suit Mr Trump just fine, perhaps
because he knows they suit part of his
base. In the past few months, Mr
Trump has declared that he would
“get along” with Mr Putin in a way
that President Barack Obama has not,
and he has been one of the few
candidates to express his approval of
Moscow’s military campaign in Syria.
Mr Trump likes to joke that he and
the Russian president are
“stablemates” because they both
appeared (separately) on the same
episode of the US news programme 60
Minutes.
As for Mr Putin’s impression of Mr
Trump? He has yet to comment.
courtney.weaver@ft.com
Wednesday 16 December 2015
OPINION
Peter
Bruce
T
oday should end better for
Jacob Zuma than last
Wednesday. Then, hours
after a cabinet meeting
dominated by his country’s
economic difficulties, the South African
president fired Nhlanhla Nene, his
respected finance minister, replacing
him with an unknown and inexperi-
enced MP, David van Rooyen.
Market reaction was pitiless: the rand
plummeted and there was a sell-off of
government bonds. So savage was the
onslaught that by Sunday Mr Zuma had
buckled. The president recalled Pravin
Gordhan, Mr Nene’s predecessor, whom
he had banished 18 months ago to the
obscurity of the ministry of local gov-
ernment. All told, Mr Zuma fired and
One small step
forward for
humankind
ECONOMICS
Martin
Wolf
I
s the Paris agreement a break-
through in the struggle to limit the
risks of climate change, as weary
negotiators claim? Or is it just
another way station on the road to
calamity, as critics insist. At this stage it
is neither. It is far more than the world
could have reasonably expected a year
or two ago. But it is also far less than the
world needs.
As it stands, it will at best slow the
pace at which the world reaches a possi-
ble disaster. Whether it averts disaster
depends partly on how the climate sys-
tem works, on which much uncertainty
remains. But it also depends on what
happens in the near future. Is the agree-
ment the beginning of revolutions in
policy, as well as the energy system? Or
is it yet another piece of paper that
promises far more than it delivers? The
answer depends on what happens now.
The achievements of the negotiators,
ably chaired by the French government,
are far from nothing. They showed it is
possible to get countries to agree to
action in response to a shared danger,
even one that seems remote and uncer-
tain to many now living. These agreed
that all countries must participate in the
effort. They agreed that the rich should
help the poor meet their decarbonisa-
tion objectives. They also agreed on the
goal of keeping global temperature rises
well below 2C and even to “pursue
efforts” to keep them below 1.5C
Yet these are, on the face of it, largely
hollow achievements. The provision of
needed finance is an aspiration, not a
bankable commitment. No limits are to
Messy complexity that separates ‘Serial’ from crime fiction
OPINION
Helen
Lewis
B
y chance, I caught a cab the
day last week it was an-
nounced that Serial, the
American true-crime pod-
cast, was returning for a sec-
ond series — to demand so great that the
website crashed in the first few hours.
I was returning from interviewing a
woman who often serves as an expert
witness in murder cases. She told me
juries did not understand forensic sci-
ence and could not deliver an infallible
judgment. Even with DNA, there is a one
in 1bn chance of a false match. My cab
driver told me about a court case he had
The high price of Zuma’s politicking
appointed three finance ministers
inside four days.
Investors may have welcomed the
move — the rand recovered slightly —
but the political damage Mr Zuma has
brought upon himself is hard to over-
state. It has weakened his presidency
and threatens to undermine further the
international standing of a country and
economy that has long been looked to as
a regional leader.
Criticism of the president has centred
on the way he dispenses patronage
through a network of business cronies,
selected provincial power brokers in the
ruling African National Congress, tradi-
tional rural leaders and friends over-
promoted into senior jobs. They are all
called on to advise on cabinet appoint-
ments, and the cronies secure contracts
from government-controlled compa-
nies. South Africans call it “state cap-
ture”. Mr Nene was fired for crossing a
Zuma favourite, Dudu Myeni, head of
South African Airways.
This network has been dealt a blow,
be imposed on emissions from aviation
or shipping. No mechanism is to be
established for setting a global carbon
price. Countries are above all commit-
ted only to communicate and maintain
plans — described, in slippery language,
as “nationally determined contribu-
tions”. No sanctions will fall on any
country that fails to live up to these
intentions. Worse, the intentions them-
selves, even if implemented (on which
much doubt must be expressed) fall far
short of what is needed to deliver the 2C
goal, let alone a lower one. Average glo-
bal temperatures have already risen by
nearly 1C since the industrial revolution
and limiting warming to 1.5C would
require another revolution.
So why should an agreement that is
not only toothless, but falls far short of
what is needed to reduce the risks to
manageable proportions, be taken seri-
ously? One answer is that it forces each
country into a process of peer review.
Every country will need to resubmit
their plans every five years. Moreover,
the reporting and monitoring system is
to be more transparent and comprehen-
sive than ever before. In particular,
emerging and developing countries that
now dominate emissions (China, above
all) will be part of that system. In the
end, it was decided, monitored aspira-
tions would be more effective than any
binding commitments that could (or,
more probably, could not) be achieved.
Above all, with everybody committed
to producing a plan (because everybody
agrees the challenge is important), it
will be far more difficult for any country
to argue that failure to meet its promises
does not matter. Or so it should, pro-
vided the next US president is not a
Republican.
Nevertheless, the case for scepticism
is strong. Recall that over the past quar-
ter of a century of climate negotiations,
emissions of carbon dioxide, stocks of
carbon dioxide in the atmosphere and
observed, which involved a boy accused
of stabbing another teen he said had sto-
len his phone. My driver could tell the
accused was a “good lad”, the driver
said, because he studied hard and had
character witnesses. The phone thief, by
contrast, was clearly a “no good”.
Those themes — the complexity of
evidence and our tendency to make
snap character judgments — were what
made Serial such a success. Over 12 epi-
sodes released last year, the first season
explored the case of Adnan Syed, a Balti-
more teen accused of killing his former
girlfriend, Hae Min Lee, in 1999. The
podcast was downloaded 100m times.
The evidence was patchy and some-
times contradictory; ultimately the case
hinged on whether the jurors believed
the testimony of Jay Wilds, who claimed
Syed had shown him Lee’s body in the
boot of his car on the day she disap-
★ FINANCIAL TIMES
Comment
which will in turn limit Mr Zuma’s
power. Mr Gordhan, meanwhile, has
returned to the Treasury like an aveng-
ing angel, warning: “It is high time indi-
viduals stop playing with state enti-
ties . . . as if they were a personal toy.”
The finance minister is more power-
ful than in his first term in 2009-14. Mr
Zuma cannot afford to remove him. But
All told, the president
fired and appointed
three finance ministers
inside four days
the job is also much tougher. The end of
the commodity supercycle, high wage
costs and souring investor sentiment
towards emerging markets have con-
tributed to an economy blighted by
unemployment and low growth.
The president will no doubt quickly
move to shore up his power base. But he
Global emissions
Total Per capita Tonnes of CO2 per million $ real GDP*
(bn tonnes (tonnes of CO2
of CO2) per person)
40 5.0
30 4.5
20 4.0
10 3.5
1980 85 90 95 2000 05 10 14
Sources: CDIAC; Conference Board
even emissions per head have been ris-
ing. The task now is far bigger than it
would have been if action could have
been taken sooner. But growth of the
world economy has overwhelmed the
fall in emissions per unit of output. If
growth is not to be sacrificed (which
humanity will not tolerate), this rate of
decline must accelerate hugely. That is a
daunting challenge. (See charts.)
What really matters is not the Paris
agreement, but what follows. The
national plans must be ambitious and
become more so, swiftly. The world also
needs a new pattern of investment and
The accord goes further
than the world could have
expected a year ago but not
as far as the world needs
peared. (They did: Syed was given a life
sentence in 2000 and is still in prison.)
Serial’s initial attraction was the same
as television cold-case dramas: here is a
shocking crime nobody has solved —
let’s find out what really happened.
Except we did not. The podcast ended
The podcast refused to tie up
the tale with a neat little bow.
In real life, legal process is
never that clear
without a clear resolution; Sarah
Koenig, its host, was unwilling to state
definitively whether she believed Syed
was innocent. He is appealing against
his conviction but it will be months or
years before we know the outcome.
has lost the support of the ANC middle
classes and the cities. To what extent
will become clear in local elections next
year. If the ANC does badly his position
may become untenable.
Mr Zuma has been plagued by per-
sonal and financial scandal almost his
entire public life. He became president
in 2009 only after charges of fraud
against him were dropped following the
removal of the head of the national pros-
ecution service. Those charges could be
reinstated by a new administration. In
order to protect himself, for when his
term ends in 2019, Mr Zuma has sig-
nalled that he could try to ensure that
Nkosazana Dlamini-Zuma, his former
wife, becomes the ANC nominee for
president while he remains party
leader. But he will face opposition on
this as party practice is for the same per-
son to do both jobs in order to avoid
competing centres of power.
Mr Zuma still has a long list of prom-
ises to keep. He has undertaken to end
South Africa’s chronic energy supply
Improved efficiency
Global India US
China UK
1500
1000
500
0 0
1980 85 90 95 2000 05 10 14
*Converted using PPPs
new sources of finance, backed by
changed incentives. One way or the
other, a global carbon price will be
needed. So will increasing technological
innovation. The announcement in Paris
of “mission innovation” to accelerate
advances in clean energy — based on the
idea of “a global Apollo programme”,
launched in June — could be a game
changer. But it will turn out to be one
only if enough financial and human
resources are devoted to the task.
Not surprisingly, the reaction of many
in the fossil fuel industry shows that it
does not, as yet, feel threatened. Politi-
cal leaders have huffed and puffed
before, but demonstrably failed to blow
their house down. The immediate
threat for them is low prices of the fuels
they produce and sell, not a high price
on carbon dioxide emissions. Both the
industry and the big users are politically
powerful. They may well feel that when
Serial refused to tie up the tale with a
neat little bow.
This is much closer to a real criminal
case than anything you see on a TV show
such as CSI: Crime Scene Investigation. As
David Simon, creator of The Wire — the
series about Baltimore gangs — wrote in
his book, Homicide: “In Baltimore, at
least, the average juror doesn’t want to
spend time contemplating inconsisten-
cies in a defendant’s statement . . .[they
want] three upstanding citizens to say
they were eyeball witnesses to the crime
and another two who can assure them of
the killer’s motivation.” In real life, legal
process is never so clear.
Just as importantly, Serial’s listeners
heard the evidence without seeing those
involved, depriving them of the kind of
information we all use to make snap
judgments. We do not learn for several
episodes, for example, that Wilds is
problems by building nuclear power
stations, probably with Russian help,
and the introduction of a national
health system.
Critics say he does not grasp the com-
plexities of running a modern economy.
An hour after firing Mr Nene, Mr Zuma
attended a gathering of business leaders
where, having praised President Robert
Mugabe of Zimbabwe, he challenged the
idea that supply and demand determine
the value of a commodity, arguing that
“the labour time taken in [the] produc-
tion” was more decisive.
His domestic audience are used to
such claims. International investors are
less impressed. The president has long
displayed a thick skin, making him
blithely indifferent to his part in the eco-
nomic destruction around him. But, as
the latest market shock should have
taught him, the cost of such an attitude
could be ruinous for South Africa.
The writer is editor-in-chief of Business Day
and Financial Mail
Emerging industrialisation
Share of global CO2 emissions (%)
China US
Other non-OECD Other OECD
100
80
60
40
20
1990 2014
it comes to creating national plans and
setting priorities, they remain in an
excellent position to see off any ambi-
tious commitments, particularly ones
instigated by so undemanding a process.
In some countries, notably the US, the
opposition will be open and fierce. Else-
where it will be more genteel. But the
results might not be so different.
I sympathise with the enthusiasm of
many of those in Paris. This agreement
was hard won. But it is only a small step,
even if one in the right direction. It is far
too early to feel confident that the curve
of emissions will now bend decisively
downwards. Laozi, the ancient Chinese
sage, said: “The journey of a thousand
miles must begin with a single step.”
The question is whether humanity
has the will or even the time to finish a
journey that it has started so late.
martin.wolf@ft.com
African-American — an important fact
in the highly unequal city of Baltimore.
We also do not see the characters’ fea-
tures, clothes or demeanour, which are
known to influence juries. Deprived of
the ability to draw on stereotypes and
superficial details, fans had to deal with
the evidence, and only the evidence.
The second series does not revisit
Syed’s case but focuses instead on Bowe
Bergdahl, a US soldier who walked off
his base in Afghanistan in 2009 and was
captured by the Taliban. That might feel
disappointing at first but it is part of
what the podcast was trying to teach us.
Trials are not about certainty. They are
about doubt, reasonable or otherwise.
And it is good to be reminded that real
life is always messier than a story.
The writer is deputy editor of the New
Statesman
9
There is
no money
behind the
fiscal tree
BUSINESS
John
Kay
R
ussell Long, the southern
Democrat who was long-
serving chair of the US Sen-
ate finance committee, com-
posed the ditty “Don’t Tax
You, Don’t Tax Me, Tax the Fellow
Behind that Tree”. His point was that,
when politicians explain that public
budgets will be balanced without pain
through the elimination of waste or an
assault on tax avoidance, you know they
are not serious. There is plenty of waste
and avoidance — but if eliminating them
were painless, it would have happened.
Researcher Maya Forstater has done
valuable service in puncturing the
extravagant claims of campaigners that
the lives of the poorest people could be
transformed by money from behind the
tree. Some of these arguments are sim-
ply laughable. Christian Aid, a charity,
has claimed the import of 66m refriger-
ators to Spain from China in 2007 at an
average cost of 38 cents represents a
shift of €8bn out of China (through
trade mispricing). According to the
Christian Aid report: “The money lost
could be used to provide schools, hospi-
tals and better living conditions world-
wide.” I have always tried to teach stu-
dents that the most likely explanation of
a startling statistic is that it is wrong:
but, it seems, to no avail. There are only
18m households in all Spain.
Winnie Byanyima, executive director
of the Oxfam International charity, has
asserted that the UN’s Millennium
Development Goals could be achieved
“twice over” using the proceeds of an
attack on multinational corporations
avoiding tax in developing countries.
This is barely more plausible than the 38
cent fridge. Most tax avoidance by mul-
tinational companies reduces revenue
in developed countries, not developing
ones — the biggest victim of these strate-
gies is the US. The main impact of such
avoidance on lower income economies
is felt, not by the poorest countries, the
sub-Saharan Africa states where global
If eliminating waste and
avoidance of tax were
painless, it would have
happened already
poverty is concentrated; but in the large
emerging economies active in global
trade — Brazil, China, South Africa.
George Osborne, the UK chancellor of
the exchequer, is right to attack both
artificial avoidance schemes and out-
right evasion, although his fine words
are undermined by less publicised
measures to beggar our neighbours by
encouraging multinationals to report
profits in Britain rather than elsewhere.
But the fantasy of Jeremy Corbyn,
leader of the opposition Labour party,
that austerity could be avoided by
money currently behind the tree is
indeed a fantasy. Calculations of the
scale of tax avoidance and evasion — like
estimates of “tax expenditures” from
reliefs and allowances — assume that, in
all other respects, behaviour would
remain unchanged if tax that is cur-
rently avoided or evaded were collected.
It would not. Many relevant transac-
tions would not occur at all. It is an open
question how much additional com-
pany tax could actually be collected by
poor countries without discouraging the
external investment essential to their
development.
But one need not believe in pots of
gold behind the tree to be concerned
about tax avoidance. More thoughtful
tax campaigners — and the UK’s HM
Revenue & Customs — have defined
avoidance as a situation where most rea-
sonable people would agree that, if the
facts are as described, tax should paya-
ble whether or not it is legally payable.
Tax is thus a moral issue. Not because
we should take pleasure in paying tax
but because the behaviour of well off
people, and large companies, should
conform to the expectations of most
reasonable people. It is not just the rule
of law but also a sense of shared values
that makes economic and social life pos-
sible in the modern state. That is why
multinational businesses should not
engage in transactions without com-
mercial substance; and why celebrities
faced with large tax bills as a result of
failed avoidance schemes deserve what
they get.
johnkay@johnkay.com
10 ★ FINANCIAL TIMES Wednesday 16 December 2015

BUSINESS LIFE

The start-up
In early 2006, I happened to go into a
US drugstore the day Gillette released
challengers the first five-blade razor, the now
ubiquitous Fusion. Ever the mug, or so
I felt, I bought one, rather liked it and
on the cutting wrote an article for the UK, where it
had yet to launch, about this
edge of a shave nonetheless amusing escalation in the
arms race around shaving.
It had started in 1971 with Gillette’s
twin-blade Trac II, followed by its
three-blade Mach3. In 2003, Gillette’s
rival Schick (Wilkinson Sword in
Britain) had countered with the four-
blade Quattro.
Gillette’s five-blade debutante was
greeted with scepticism by the
Raider, who had applied an innovative
model to the spectacle business to
build a $1.2bn company, Warby Parker.
Mr Raider’s approach to innovation
essentially involves the application of
extreme intelligence to a status quo.
He takes a product, makes a
competing version the same or better,
has it look more stylish and grown-up,
avoids gimmickry and complication —
then sells it a great deal cheaper than
the market leader, promoting it by
social media.
So two years ago, the young blades
launched Harry’s, an upmarket men’s
razor line that cuts the cost of shaving
by half or more. They designed a five-
‘
in the eight-year-old boy bracket, a
brilliant promotional video with 21m Let’s launch in . . .
hits on YouTube and a six-blade (yes,
really) Executive model. In the UK,
there’s Cornerstone, a start-up that Brighton, UK
seems modelled on Harry’s, and in
Australia there’s Oscar, which bears
Jeff Raider’s
approach to
striking similarities.
I find most fascinating, though, the
Harry’s idea of making the premium
innovation product in a category also among the
involves cheapest, so I went to meet Mr Raider
at his HQ in SoHo, New York.
applying “Guys today are not upset about the
extreme price of razor blades in the abstract,”
he explains. “Our customers tend to be
intelligence reasonably affluent. But they know big Simon Dack/Alamy Live News

“shaving professionals” I spoke to at blade cartridge (Mr Raider says five to a status brands are deliberately trying to take Rise in digital companies started (2010-2013) 91%
the time, such as Roger Hamby, really is best), bought an established advantage of them and they do not like

managing director of the Cutlery and
Allied Trades Research Association in
Sheffield, England, who was
“unexcited”.
I used the Fusion, but eventually got
irritated by the price and by Gillette’s
transparent attempts to over-innovate
with gimmicks, ever-higher prices and
flashy, plasticky products stylistically
aimed, it seemed, at eight-year-old
boys. So I changed to the equally ugly,
but cheaper, Schick five-blade entrant,
the Hydro 5.
Yet I found Schick’s similar adoption
of the confusion pricing model, loved
by mobile phone providers, equally
insulting. I also loathe asking shop
Jonathan Margolis assistants to unlock blade packs just
because they are regularly shoplifted.
Oninnovation The same irritation lately struck a
young American, Andy Katz-Mayfield,
as a business opportunity. He called a
friend from his college days, Jeff
Start-up. Sphero
German factory and began selling
online in North America only; visitors
can, however, buy Harry’s in selected
trendy US stores.
Along with, I’m told, a million other
men, I am now a Harry’s customer. I
may have been unduly influenced by
the design and feel of the product and
its cleverly judged marketing noise, but
I’d still say their razors are the best I’ve
used. My wife, who maddeningly
borrows my razors for her own
appalling purposes, agrees.
There are similar competitive
tremors coming from other youthful
newcomers in men’s shaving, which by
rights should be earthquakes, but
probably aren’t yet registering on the
seismograph at Gillette, with its 70 per
cent global share of the 1.3bn men who
wet-shave. In California, there’s Dollar
Shave Club, with an unabashed
downmarket appeal, a style definitely
’
quo that in life.” Harry’s will not stick, for
simplicity’s sake, with one design, he
says. The razors will improve. “But we
will not increase the price. That’s how
we think about innovation.”
Even challengers such as Harry’s
need to be aware, however, that
shaving may soon be changing a
whisker more. There’s already a seven-
blade (really) instrument available in
the US from a Korean maker, Dorco.
More ominously — well maybe, if it
can be developed successfully — is
Skarp, a product mooted from
California. Skarp has no blades at all.
It cuts facial hair by laser. It looks
quite startling, like something out of
a UFO, manned by unexpectedly
hirsute aliens. I’m just not quite sure
I’d like to be a prototype tester for the
earthling version.
Twitter: @TheFutureCritic
Student population 30,000
Employees in digital companies 7,458
Brighton goes by many
labels: the hippest town in
the UK and the happiest
town in the UK. It elected
the country’s first Green
MP, Caroline Lucas, and also
has one of the highest
densities of digital start-ups
of any British region.
The case for: Brighton and
its sister town Hove fuse
tech know-how with a
leaning towards the arts and
media. “One of the strengths
is the integration of
business and creativity,”
says Phil Jones, managing
director of Wired Sussex, a
business support
organisation. Local
enterprises tend to focus on
digital, creative, marketing
and advertising.
Helped by the short
journey time from the
capital, just under an hour
response, Wired Sussex and
local broadband providers
have formed a co-operative
solution, called Brighton
Digital Exchange.
“Workspace is at a
premium because you
cannot move south into the
sea or north into the South
Downs,” says Mr Jones.
Talent is not scarce but is
snapped up fast.
Support for start-ups:
Brighton boasts The Skiff,
which claims to be the
biggest co-working space
south of London, plus other
spaces to rent at The Werks,
Hove Media Centre and the
Dock Hub. The Farm is a
network of digital and
technical freelancers who
work for many of the tech
start-ups and larger digital
companies in the area.
Brighton has a Digital

Far, far away from Hollywood

by train, Brighton is
sometimes called London-
by-the-Sea. But residents
consider its more laid-back
attitude an important
characteristic; the cost of
living is less than London,
The BB-8 toy based on although still not cheap.
Gatwick airport is midway
the droid in the new between the two.
‘Star Wars’ film was made A recent study by the
University of Sussex and the
by a Colorado start-up, University of Brighton
writes Tim Bradshaw estimated that the digital
and creative sector
contributes £1bn a year to
the local economy.
Catapult, one of a network
of UK centres built to boost
collaboration between
scientists, engineers and
business. The Brighton
centre is focused on
innovation that uses real-
time location-based data
and is hosted at The
Fusebox, another work
space for the creative and
digital industries. The city is
also home to the Happy
Startup School for founders
who want to measure
success in “happiness as
well as profits”.

F
or nearly 40 years, Star Wars
merchandise has been big bus-
iness. But as the latest instal-
ment arrives in cinemas this
week, a droid made by a five-
year-old start-up is challenging the likes
of Hasbro and Lego for the title of most-
sought after toy.
Sphero’s BB-8 droid is just 4in tall but,
head bobbling atop its spherical body, it
has an outsized personality. The device
is controlled by a smartphone or tablet
or can be left to roam a room by itself,
poking into corners and finding its way
out from under chairs. Next to the lunch
boxes, plastic figures and chewing gum,
BB-8 stands out among the thousands of
licensed products accompanying the
release of Star Wars: The Force Awakens.
“We are a very different product for
Lucasfilm and Star Wars,” says Paul Ber-
berian, Sphero’s chief executive. At
$150, Sphero is much more expensive
than most film merchandise. Yet in
terms of overall sales value, Mr Berbe-
rian says, “we are selling better than
any other product out there” in the
Star Wars universe. The company’s sales
are on track to be more than five times
its original revenue targets for the year,
he adds.
“If you gave me a billion dollars to sell
as many Spheros as possible, I’d create a
sci-fi movie that had a main character as
a robot ball,” Mr Berberian says, speak-
ing by phone from Sphero’s HQ in Boul-
der, Colorado — a start-up galaxy far, far
away from Hollywood or Silicon Valley.
Founded as Gearbox in 2010, Sphero’s
‘Story matters’: for BB-8, which is made in China, helped
BB-8 caught up win suppliers’ attention. “Now we are
in the plot of getting the A-team because they see we
‘Star Wars: The can shop in volume,” Mr Berberian says.
Force Awakens’, It was not just manufacturing that
above. Below, had to ramp up to Star Wars scale. Cus-
Sphero’s Paul tomer service had been dealing with
Berberian hundreds of thousands of people
Lucasfilm
visiting its website daily. Sphero’s head-
count has doubled to more than 100
since work began on BB-8 and Mr Ber-
berian plans to double staff again in the
sometimes pushes creativity beyond
what you could have done otherwise.”
Working with a Hollywood studio in
its Silicon Valley incubator was a big
change for a start-up based in Boulder.
Sphero’s two original co-founders, Ian
Bernstein and Adam Wilson, are
described by investor Brad Feld of the
Foundry Group as “mad geniuses”. But
the two engineers — Mr Bernstein had
worked in robotics while Mr Wilson pro-
vides the software and wireless net-
Brighton start-ups talk of
a sense of community and Local heroes: When search
mutual support, and 84 per engine specialist
cent say they feel part of a Spannerworks was bought
digital cluster, according to for £10m in 2007, it brought
the Tech Nation Powering the Hearst-owned digital
the Digital Economy report, marketing agency iCrossing
by TechCity UK. to Brighton. Brandwatch, a
social media company, is one
The case against: “Brighton of the standout successes. It
is a victim of its own success has raised $64m and
in three areas: workspace, recently acquired London-
connectivity and skills,” says based PeerIndex for £10m.
Mr Jones. Crunch is an online
The growth in digital accountancy service.
business has put a strain on
broadband connectivity. In Richard Newton
Innovation to watch
Amy, the virtual scheduler
LESLIE HOOK
the companies enrolling in Disney’s
accelerator, it was that TechStars con-
nection that helped Mr Berberian to be
accepted. Licensing seemed a good way
to supercharge growth and “Disney is
the ultimate entertainment company”.
Sphero has always tried to imbue its
products with personality. But through
the Disney association, Mr Berberian
says: “What we have learnt is story mat-
ters. People identify with characters,
not technology.” Dreamstime

first toy was a baseball-sized, app-ena-
bled robot. Released in December 2011,
updated in 2013 and joined by the two-
wheeled Ollie last year, Sphero’s prod-
ucts seem with hindsight to have led
inevitably towards BB-8. Yet the Star
Wars tie-up was happenstance, thanks
to Sphero joining Walt Disney’s Acceler-
ator scheme last year. Disney acquired
Lucasfilm in 2012.
Disney CEO Bob Iger was visiting the
10 companies in the programme — run
in association with TechStars, a start-up
accelerator — and showed the Sphero
team pictures of the set for The Force
Awakens on his iPhone. “He said, ‘That’s
the new droid, the new R2-D2, and it
looks a lot like what you are making’,”
says Mr Berberian. “In the course of 60
seconds, you process that this could be
huge. We even knew how to do the head,
we already had the technology.”
But even with that head start, getting
a finished product to market within 10
months was a challenge. Many hard-
ware start-ups struggle to ship their
products on time but with the release of
the movie already scheduled, Sphero
had a deadline it could not miss.
As a product whose first prototype
was built out of a smartphone’s spare
parts, Sphero is competing for elec-
tronic components and manufacturing
capacity with some of the biggest tech
companies in the world. But scaling up
next year.
Adding to the challenge was the
secrecy and quality control applied by
Disney, which Mr Berberian likens to “a
classified government programme”.
Neither Sphero staff nor many Dis-
ney employees they worked with
were allowed to know the film’s
plot, or BB-8’s role. Yet every
detail, from how BB-8’s head
moves to the design of its app
icon, had to be checked with Dis-
ney. It is not easy, says Mr Berbe-
rian. “But having constraints
At the base of the Rocky Mountains,
Colorado Boulder is an outdoorsy place with an
entrepreneurial spirit that runs through
health foods and sporting goods
companies, as well as a tech community
A mountain that has included large telecoms and
view of the disk-drive businesses.
Valley “It’s very collaborative,” says Paul
Berberian, Sphero CEO. “I have never
run a business in the [San Francisco]
Bay Area but from what I hear, it’s cut-
throat and mercenary.”
The downside is that investors with
Valley venture capital firms are more
reluctant to invest outside their local
area. “We didn’t get money from the
west coast because it was more of a
burden for a partner to sit in a board
meeting, etc,” Mr Berberian says.
working expertise — had little experi-
ence running a company before they
joined the TechStars incubator in 2010.
Mr Berberian, who had led six compa-
nies as co-founder or CEO, had been a
mentor at TechStars since the boot
camp-style scheme began in 2007. In
2010, he threw himself into mentoring
full-time and wound up being asked to
join Sphero as CEO.
“We all worked very hard to make
sure it was a mutual partnership, so I
wasn’t above them and they weren’t
above me — we all had separate roles to
play in the organisation,” Mr Berberian
says. “They possess the DNA of our cus-
tomer — it’s important to have that at
the founder level.”
Despite a generational divide, the
partnership seems to be working. Even
before BB-8 came out, more than half a
million Sphero robots had been sold and
the company made $20m in revenue
last year. After raising a total of $45m in
venture capital funding, Sphero is now
profitable, too.
“I’ve delivered the money and
they delivered the product,” he
laughs. “I can’t say there haven’t
been tense moments and harsh
feedback in both directions. But
like any relationship, you grow
from that.”
Despite becoming much bigger
and more established than most of
He sees the company as set apart from
the rest of the toy industry. Alongside
other smartphone-powered robotics
start-ups focusing on children, such as
Anki’s racing cars and Wonder Work-
shop’s Dash and Dot toys for teaching
coding, Sphero is pioneering a new kind
of “connected play”.
The time children spend glued to
their parents’ phones and tablets is a
cause of concern for some, but Mr Ber-
berian argues that rather than fight the
pullofthescreen,devicessuchasSphero’s
can “co-opt it in the realm of play”.
One key difference between Sphero
and offline toys is that new functions
can be unlocked with software updates.
Dozens have already been issued for
Sphero’s earlier products and its BB-8
droid will receive new content after The
Force Awakens has been released.
This week, the Sphero team will final-
ly find out what happens to their little
droid in the movie. The company has
rented two screens at the local movie
theatre, before taking all its employ-
ees for a “giant brainstorming ses-
sion” to work out how to develop
BB-8.
“If you want to be an ever-
green product, you have to
keep supporting it and keep
the content fresh,” Mr Berbe-
rian says. “The challenge is not
to be a one trick pony.”
Everyone knows how
tedious it is to set up a
meeting — the email ping-
pong, the quest for a venue
and the inevitable
rescheduling.
But what if there was a
piece of computer software
that could send those
emails, find a venue and add
items to your calendar
instead? That is the
proposition behind Amy
Ingram, a virtual personal
assistant created by New
York start-up x.ai.
When I first met Amy I
thought she was real. I was
emailing the founder of a
small start-up, and he
copied Amy in, instructing
her to find a time for us to
meet. But something about
Amy’s rigid language was
unusual, and her email
signature, “x.ai — artificial
intelligence that schedules
meetings”, gave it away.
Amy (and her brother
Andrew) work through
email, corresponding with
you and your guest. Dennis
Mortensen, founder and
chief executive of x.ai, came
up with the idea when
working at a previous
company after scheduling
more than 1,000 meetings
one year and having to
reschedule nearly 700.
Using Amy sounds
slightly better in theory than
it works in practice — there
was some occasional
awkwardness. For example,
when I was setting up a
phone interview with Mr
Mortensen, Amy’s invitation
email confusingly said I
would be speaking with the
head of PR; the call was with
both Mr Mortensen and the
PR head.
Despite the foibles, there
is still something a bit
magical about a virtual
assistant who can take
scheduling off your hands.
The deeper challenge for
Amy will be the same as for
any personal assistant —
knowing which meetings can
be cancelled or rescheduled,
and which cannot.
Scheduling is ultimately
about priorities, and there is
no algorithm that can help
with that.
Wednesday 16 December 2015 ★ FINANCIAL TIMES 11

ARTS

A dash of Hollywood glamour in south London DA N C E

The Hard Nut

POP
Lianne La Havas
Brixton Academy, London
aaaaa
Ludovic Hunter-Tilney
The setting evoked a 1940s Hollywood
nightclub, or as close to it as a beer-
sticky rock venue in south London
could get. Large vases of exotic-looking
flowers were placed around the Brixton
Academy stage, on to which Lianne La
Havas in a sparkling sheath dress shim-
mered into view. With a long pair of
gloves — and without the guitar — she
might have been Rita Hayworth vamp-
ing it up in Gilda.
Her first song, “Green & Gold”,
swapped mystique for memoir. It
opened with an image of the six-year-
old La Havas looking at herself in a mir-
ror and wondering “Who’s that girl?”
The singer-songwriter, 26, grew up near
the venue in a mixed-race family with a
Jamaican mother and Greek father.
“Now I’m fully grown,” she went on to
sing, spotlights trained on her like film
cameras, no longer looking at herself
quizzically in a mirror but instead
courting the public gaze.
Ironically for a song celebrating
her mixed background, the sound
mix was clumsy, muffling La Havas’s
singing with thudding drums. But
the levels were soon righted, and her
voice assumed its place at the centre of
the action.
Playing guitar on most of the songs —
she began on bass, then moved to elec-
tric and acoustic guitars — she was
joined by a band and backing vocalist
who performed their supporting roles
without fuss, subtly fleshing out the
soulful, jazzy textures of her music.
A former backing vocalist herself,
La Havas is a seriously impressive
singer. Drawing on her first album,
2012’s Is Your Love Big Enough?, and
this year’s follow-up, Blood, she moved
from the dreamy crooner of “Au
Cinéma” to neo-soul romantic lead
in “Unstoppable”.
Between songs, she joked about try-
ing to stay calm at her homecoming gig.
“I find singing helps,” she joked, and so
A seriously impressive
singer: Lianne La Havas
on stage in Brixton.
Right: Billy Smith (rear)
and Aaron Loux in ‘The
Hard Nut’
Angela Lubrano/Livepix
Julieta Cervantes
it proved. As a performer, she held the
audience in the palm of her hand.
“No Room for Doubt” told the story of
a break-up with understated drama, La
Havas lingering wistfully over the
words. A fake ending fooled the audi-
ence into applause, underscoring the
theme of emotional confusion. Even
better was “Gone”, in which she paid
her “last goodbye” to another failed
relationship over a simple piano accom-
paniment, a torch singer sparkling in
the dark.
It ended with her in silhouette, turn-
ing towards her keyboardist with an un-
Rita Hayworth-like double thumbs-up.
Tour continues from February 1
liannelahavas.com
C L A S S I CA L M U S I C
Arcadi Volodos
Barbican, London
aaaaa
Harriet Smith
The bear-like Russian pianist Arcadi
Volodos knows how to hold an audi-
ence’s attention: by playing more and
more quietly. Even between pieces,
everyone seemed to be holding their
breath. He began with a rarity,
Brahms’s arrangement of the theme-
and-variations slow movement of his
String Sextet No. 1. From the grave
opening theme onwards, Volodos
sucked you into his own world, one in
which there was no place for hectoring,
even at the loudest dynamics and in
which pianissimo came in 100 flavours.
More Brahms followed: the Op. 76
Piano Pieces, which find the composer
developing an inwardness that would
become characteristic of his late style.
Volodos’s creamy sound, combined with
tremendous delicacy of phrasing, illu-
minated Brahms’s sometimes dense
textures and his penchant for alto and
tenor registers.
The ending of the third piece was
utterly radiant, contrasting with the
grumbling passions of the opening
number, while in the grim Second Capr-
iccio Volodos made much of Brahms’s
gruffly eccentric wit. His prodigious
technique came in handy in the storm-
tossed fifth piece, too, its tumultuous cli-
maxes given due drama.
For the second half we got Schubert’s
final B flat Sonata, written months
before his early death. Volodos’s
opening was little more than a sighing
aside, yet the way this vast edifice
unfolded had an inevitability found only
in the very greatest performances. This
was the most humane of readings, a sort
of wordless Winterreise, and Volodos’s
singing tone and highly nuanced colour
palette subtly underlined every
harmonic shift.
His slow movement was rapt without
overtly seeking to be beautiful, and he
breathed Schubert’s long lines like a true
singer. “With delicacy”, writes the com-
poser over the crystalline scherzo;
Volodos complied but there was fire-
power too. And then the pianist
launched straight into the finale,
unearthing lines that had long lain
hidden, giving accentuation due
weight without any metallic edge,
culminating in a final shattering
burst of energy.
The encores perfectly summed
up Volodos’s remarkable range. A
grave Schubert Minuet, D600, was fol-
lowed by two of his own transcriptions,
by turns rapt and effervescent — a Mom-
pou song and Lecuona’s Malagueña.
Finally, a return to Brahms, and a vision-
ary account of the Intermezzo, Op. 118
No. 6; a fitting end to a sublime evening.
barbican.org.uk
Brooklyn Academy of Music, New York
aaaaa
Apollinaire Scherr
“Nobody can listen to The Nutcracker
any more,” Mark Morris once
exclaimed, because “it’s used to get you
to buy everything you can imagine.” His
hilarious and deeply touching Hard Nut
may return the magic to the score but it
also revels in the junk the music has
driven us to consume.
The Nutcracker doll (a transporting
Aaron Loux) is modelled on the mascot
of Big Boy Burgers. Delirium-inducing
snowflakes have Mister Softee swirls for
headpieces (thanks to costumier Martin
Pakledinaz). The soldiers battling well-
manicured rats are muscly GI Joes. As
for cheap notions, the exotic delectables
(Arabian Coffee, Chinese Tea) amount
to a Team America spectacular of obnox-
ious stereotypes: fully robed Arabs
prostrating themselves backwards;
floppy Russian folk dancers in riotous
patchwork grinning so widely that you
worry their faces will crack in half.
Out of this American imagery, our
young heroine Marie (a pellucid Lauren
Grant) fashions a fantasy realm suf-
fused with feeling. In this, she resembles
her creator. Morris made The Hard Nut
in 1991, at the end of his troupe’s pro-
ductive but lonely stay in Brussels,
where audiences rejected him for being
too American, too lacking in European
refinement. The ballet responds, “who
cares if your sources are tacky as long as
you know what to make of them”.
In counterpoint to the costumes, the
dancing is homely, accentuating pliés
more than flight, muscle more than
extravagant stretch. The human
flowers and snow, with everyone
else, prime Marie and the Nut-
cracker for each other — lift-
ing them and backing them
up, actually and otherwise
— and us for their romance.
The pas de deux ends,
though, with a populist, echt-
American move: the classic
Hollywood kiss, the ever
after of movieland, in
a never-ending loop.
To December 20
bam.org

On a rollercoaster with Shostakovich

Ambiguity:
CLAS SICAL MUSIC pianist
Alexander
Shostakovich Day Melnikov
Milton Court, London with
aaaae Cuarteto
Casals
Hannah Nepil Mark Allan

It’s easy to think we “know” Shostakov-

ich: as the composer of mostly tortured,
large-scale works. We often forget
how much he communicated in music
of more modest dimensions. So it
was good to be reminded in this
day-long Milton Court event, devoted
to Shostakovich’s chamber and
piano pieces.
And it was inspired to punctuate
them with rarely seen footage of the
composer, along with readings from
his letters, performed by Gerard
McBurney, which challenged our pre- disconcerting of all is Shostakovich’s Quartet or the Eighth — Shostakovich’s
conceptions. We were left wondering tendency to conceal one quality behind autobiographical response to Commu-
which view of Shostakovich to sub- another. Pianist Alexander Melnikov nist party membership. Both works
scribe to: the tragic victim, oppressed revelled in that sense of ambiguity, featured in the day’s final concert,
under Stalinism, who specialised in wringing out the dark undercurrents in drawing haunting playing from the
music of unadulterated bleakness? the ostensibly playful No. 17, and sitting Cuarteto Casals. They refused to shy
Or the wry humorist, who once con- somewhere between triumph and trag- away from emotional extremes, giving
fessed that while writing his Eighth edy at the culmination of No. 24. He is a us passages of startling violence, but
Quartet, his tears “flowed as freely as surprisingly unshowy performer, scur- also deathly stillness.
water passed after half a dozen beers”? rying offstage at the first opportunity. Then, as the final notes of the Eighth
The music supported both readings, But that makes for compellingly honest died away, we were left only to stare at a
and others. interpretations and here he readily photo of the composer, close up, and
Take the 24 Preludes and Fugues, exposed the music’s flesh. without his trademark Harry Potter-
which were spread throughout the day. Still, the chamber works left the esque spectacles: another unfamiliar
Here we find works full of self- deepest impression; after all, for music perspective on a highly familiar face.
contradiction, lurching between bom- that seems to chill our very bone
bast, bareness and biting wit. Most marrow, it’s hard to beat the Third gsmd.ac.uk/miltoncourt

OPERA
Artaserse
Staatstheater Kassel, Germany
aaeee
Shirley Apthorp
The gender-bending in baroque operas
is confusing at the best of times. Pieces
written for Rome during the 18th-
century ban on having women onstage
add to the muddle, since female roles
had to be taken by men in drag.
Leonardo Vinci’s 1730 Artaserse was
an enormous hit at the time, with a lively
libretto by Pietro Metastasio, rollicking
tunes and toe-tapping rhythms, and
extravagant roles for no fewer than
five castrati. We would probably still
not know about Artaserse if Max
Emanuel Cencic had not realised the
opera’s potential as a vehicle for
glory. Along with Philippe Jaroussky,
Franco Fagioli and Concerto Köln, he
recorded the opera for Virgin Classics in
2011. And it is simply amazing music.
Kassel’s production, the first German
staging, has cast all the castrato parts
with women except for the title role, and
Sonja Trebes has updated the action to a
futuristic political thriller. She leaves the
women as women and changes the gen-
der of the surtitles, so that there are new
Restrained: Yuriy Mynenko
lesbian subplots, while we lose the gay
tension between Artaserse and Arbace.
Good countertenors have come a long
way towards recreating the ambivalent
erotic charisma of the castrato voice.
That was the thrill of Cencic’s revival.
Kassel’s female cast, most of them
clearly not baroque specialists, lose
much of this. Lin Lin Fan gives a brave
and impressive performance as Arbace.
Ani Yorentz sings with beguiling sweet-
ness as Semira, while lone countertenor
Yuriy Mynenko is restrained from dis-
playing any real heroics by a concept
that shows him as weak.
It is music director Jörg Halubek,
conducting instrumentalists in two plat-
forms on the stage, who makes the most
convincing case for Vinci’s blockbuster,
drawing his players into a plausible
approximation of baroque style. In
all, though, it is hard to walk away
from this attempt without the convic-
tion that Vinci’s music is best left in the
hands of specialists.
staatstheater-kassel.de
12 ★ FINANCIAL TIMES Wednesday 16 December 2015

Liberty, fraternity, parsimony

If Vodafone and Liberty Global were to combine, the key countries of overlap would be the UK
and Germany in terms of profits. Otherwise the two could well make a nice fit, at the right price

Markets Profit* by region

Twitter: @FTLex Email: lex@ft.com Switzerland/ 10
Latest fiscal year ($bn) Austria

Vodafone Liberty Belgium

Global Germany 5
Aveva: roughly flat out to 2018). Aveva needs Albania Qualcomm:
to find a route away from overreliance Greece
UK & Ireland
sweetener turns sour on customers in the energy sector and Italy chipping away
towards new sources of growth. This Malta
Portugal Czech Republic Austria Others
When someone offers cash to be your false step shakes confidence in its 0 It is never a shocking conclusion.
Spain Germany Belgium
friend, look hard at the value of the ability to find one. Australia (JV) Hungary Poland Liberty Global Activists want a company to consider a
friendship. Consider the deal between Egypt Ireland Slovakia break-up; company promises to think
energy systems group Schneider Ghana about it really, really hard; it then
India Netherlands Switzerland India 20
Electric and Aveva, which makes Sanofi/Boehringer: Kenya (associate) Romania Chile UK
announces months later that it would
software for designing industrial 15 rather not. Thank you anyway.
swap shop New Zealand UK Puerto Rico South Africa**
structures. In July Schneider agreed to Qatar
Italy 10 In the case of Qualcomm, managers
fold into Aveva its own software assets, Turkey
Germany appear to have taken the no-expense-
which according to Citi Research Swapping assets was a form of trade South Africa & other** 5 spared route (Goldman and Boston
Other
generate £68m in earnings before long before bankers and their fees 0 Consulting were among the advisers
interest, tax, depreciation and arrived on the scene. In Vodafone used) to the obvious result.
amortisation (ebitda). Aveva’s ebitda pharmaceuticals at least, it is making a Jana Partners had included a break-
* Earnings before interest, tax, depreciation and amortisation
being slightly lower, Schneider was to comeback. GlaxoSmithKline and up in a list of possible remedies to
FT graphic Sources: Companies, S&P Capital IQ ** Vodacom: South Africa, DRC, Lesotho, Mozambique, Tanzania
gain 53.5 per cent of the company. So Novartis swapped oncology and boost the chipmaker’s sagging share
far so normal. vaccine assets this year; yesterday, price. It would have meant separating
Yet to sweeten the deal, Schneider Sanofi and Boehringer Ingelheim said Yield or growth. Safety or sex appeal. assets to its wireless networks would Vodafone’s leverage would rise. If the company into a patent licensing
needed to offer £8.60 per share in cash they were in talks about swapping their It is a near religious division among allow Vodafone to sell a big bundle of the offer was 60 per cent in shares, business and a chip set business. Well
to Aveva’s current shareholders — quite animal and consumer health divisions. investors. And Vodafone might cross products, increasing customer net debt would rise from about twice before yesterday’s publication of the
a sweetener, given its then share price It looks a sensible deal on many it. For years, it has offered a retention, while taking out costs. A big earnings before interest, tax, results of the review, the idea had been
of £17.50. No wonder the stock surged counts. It gets the French company out diversified bet on European mobile slug of growth, then, with higher depreciation and amortisation, to roundly criticised. Hiving off the chip
in July, and no wonder too that when of animal health, which had limited telecoms: a profitable business that, margins to follow. closer to 4 times. set business would deprive the
the deal was called off yesterday, synergy with the rest of the group. in aggregate, hardly grows. Liberty’s market value and debt With interest rates expected to licensing business of an important
Aveva’s shares slumped. Schneider’s Privately-held Boehringer, with a A multiyear network investment combined come to $80bn. Buying it rise, Vodafone and its shareholders stream of new intellectual property as
hardly budged. substantial animal health division of its programme that has been depressing would reduce Vodafone’s earnings per should consider whether the market well as creating tax problems.
Aveva’s shareholders appear to have own, is a better owner. It allows Sanofi free cash flow, an ex-growth share — that is, its dividend-paying will become leery of indebted The conclusion makes sense. What
lost both a handsome dowry and a tie- to bulk up in consumer healthcare, company’s reason for being, is power — for several years. This is fine, companies. sticks in the craw is the assertion from
up that had promised to offer much- creating a business with annual concluding. Now what? Increase cash if the ultimate pay-off is big enough. But whatever its ultimate capital chief executive Steve Mollenkopf that
needed diversification. Its fabulously revenue of more than €5bn. distributions? Sensible, consistent — Assume Vodafone offered a 35 per structure, the imperative for the company has “delivered substantial
complicated software has wide-ranging Asset swaps generate goodwill on a and uninspiring. Vodafone’s high- cent premium for Liberty’s equity, Vodafone is not overpaying. There stockholder value over time”.
industrial uses — marine, food balance sheet just like acquisitions, so yielding shares trail European paying mostly in its own shares. Cost has long been a wide gap between Technically, this is true; anyone who
processing, mining — but the slumping the sums have to add up. Sanofi is telecoms broadly by 17 percentage savings of at least £1bn annually, taxed Liberty’s growthy valuation and bought at the 1991 initial public
oil and gas sector provides the greatest divesting Merial for €11.7bn, an points over two years. and capitalised, would be needed to Vodafone’s yieldy one. It has begun to offering has enjoyed an 8,000 per cent
chunk. Schneider would have provided enterprise value of about 4.6 times its Buying John Malone’s Liberty earn the premium back. That, in turn, narrow as Liberty’s price falls. Even if return. More recent investors have
a quicker route to new sales, such as in sales, roughly in line with the price Global could effect the conversion to would require cutting Liberty’s its goal is to grow, Vodafone should been bitterly disappointed. A total
the chemicals, water and waste sectors. Novartis obtained from Eli Lilly for a growth. Adding Liberty’s fixed-line operating costs by a tenth. wait for the right price. shareholder return of 5.5 per cent in
But the break was by mutual similar business. It is paying €6.7bn, five years leaves Qualcomm at the
consent, with Aveva citing about the same multiple of sales, for bottom of its peer group; this year the
insurmountable integration difficulties the consumer products. Bayer forked stock is down more than a third.
that might have left the combination a out 50 per cent more for Merck’s reward decisiveness and strategic Too true: the same day, data from the to-be-jettisoned UK bank, Clydesdale). Jana may not have won structural
badly organised mess. Just 2,000 of consumer health unit in 2014. direction. This is a smart deal, but not Australian Bureau of Statistics showed This, too, has largely been down to change by holding Qualcomm’s feet to
Schneider’s 186,000 staff work in There are niggles. The Boehringer financial alchemy. residential property prices in property. The financial crisis, as broker the fire but it has improved the
software, and they are closely business excludes fast-growing China. September up 11 per cent year on year. CLSA points out, made it hard for company. A new goal of saving $1.4bn
integrated into the group’s other There are no forecasts for cost savings; Australia’s banks have been regional banks to fund mortgages. The from expenses of $7.7bn is ambitious.
businesses. So cost savings were always the Bayer/Merck deal yielded savings Australian banks: benefiting. In recent months, the four big banks have had the run of the The stock is now underpinned by a
likely to be tricky to extract. Aveva also equivalent to 10 per cent of the big lenders, led by Westpac and market since. Housing loan returns on 4 per cent dividend yield.
complained of a lack of senior level acquired unit’s sales. A €4.7bn cash bad good news Commonwealth Bank of Australia, equity can reach a unsustainable Most encouraging is the promise to
attention from Schneider: payment to Sanofi equalises the have lifted mortgage lending rates. 30 per cent or more. talk in January about “progress” in
disappointing, no doubt, but little transaction values, to be partly spent Things could hardly be going better for They say this is in response to This oligopoly will not be safe from China. Some Chinese device
surprise given how small Aveva is buying back shares to restore earnings, Australians. Despite the weak mining increased costs stemming from higher competition forever. Global banks are manufacturers had stopped paying for
compared with Schneider. since Merial generated more profit sector, the country’s growth spell is capital requirements imposed by the still retrenching, but those returns will licences while new agreements were
Aveva’s fans note how the shares than the consumer products division. approaching 100 recession-free regulators. Since May, they have raised attract new entrants eventually. negotiated. Xiaomi has now cut a new
have fallen only by the amount of the The deal will not actually add to quarters. Unemployment remains low about $10bn to shore up equity, as Another concern is regulators, already deal; Lenovo is rumoured to have
lost sweetener, leaving the rest trading earnings until 2018. and broader inflation is benign. The increased risk weightings on mortgages sensitive to banks’ pricing practices. followed suit. It would not be shocking
on the same implicit growth multiple it Until then, investors can still expect Reserve Bank of Australia’s November pushed down capital adequacy ratios. There are limits to how far mortgage if 2016 were much brighter.
enjoyed before yesterday. Nothing a fallow period as sales of Lantus, meeting minutes released yesterday Despite this, they are still making rates can rise while policy rates remain
fundamental has changed. Well, quite. Sanofi’s insulin blockbuster, slow. said there was room to cut rates if good money. Returns on equity have flat or fall. And if policy rates do rise,
Aveva is roughly back where it was in Statutory earnings per share are set to required. The RBA also noted that low been resilient, in the mid to high teens bad debts may follow. Things may look Lex on the web
For notes on today’s breaking
July: in a downswing (brokers Panmure rise about 6 per cent in 2016 and 2017. interest rates had bolstered consumer (except at National Australia Bank, good for Australians; they look far stories go to www.ft.com/lex
Gordon sees its earnings per share A 5 per cent share price pop appears to spending and investment in property. which has been hampered by its soon- more uncertain for the banks.

Today’s temperatures
1000
O 1010 Abu Dhabi Sun 24 Malta Fair 17
1010 1010
2 Amsterdam Rain 13 Manila Thunder 30
LOW Ankara Fair 6 Miami Cloudy 29
1 Athens Sun 14 Milan Fair 11
1 0
1 0 2 0 Bahrain Sun 20 Montreal Fair 3
Barcelona Fair 18 Moscow Snow 0
1 1030 Beijing Sun 2 Mumbai Sun 31
Belfast Cloudy 13 Munich Rain 9
14 OW Belgrade Fog 3 Naples Sun 15
3 0 HIGH Berlin Cloudy 8 New York Fair 11
1 8 Brussels Rain 14 Nice Sun 17
16 Budapest Cloudy 4 Nicosia Fair 18
Cairo Fair 19 Oslo Cloudy 1
8 Cardiff Rain 14 Paris Cloudy 15
1020 15 4 Chicago Shower 11 Prague Cloudy 6
10 Cologne Rain 12 Reykjavik Cloudy 4
2
Copenhagen Cloudy 6 Riga Cloudy 3
4 Delhi Sun 20 Rio Thunder 30
49
7 6 Dubai Sun 24 Rome Fair 15
Dublin Cloudy 14 San Francisco Sun 14
GH Edinburgh Drizzle 11 Singapore Thunder 31
17 5 40
0 Frankfurt Shower 11 Stockholm Cloudy 2
21 Geneva Cloudy 12 Strasbourg Rain 13
1030 18
1020 Hamburg Cloudy 9 Sydney Thunder 25
LOW Helsinki Cloudy 2 Tokyo Fair 16
18
Hong Kong Sun 17 Toronto Cloudy 7
HIGH Istanbul Cloudy 10 Vancouver Fair 6
4
Lisbon Sun 20 Vienna Fog 4
Wind speeds in PH 18
London Cloudy 16 Warsaw Cloudy 3
Forecasts by Los Angeles Sun 18 Washington Sun 15
Wind speed Luxembourg Rain 12 Zagreb Fog 5
in KPH Madrid Sun 17 Zurich Rain 10

CROSSWORD Eight down clues lack a common 5 In Tennessee, man suppresses

afterthought (8)
No. 15,115 Set by CHALMIE
definition
6 The French feed line is
        ACROSS misdirected (3-7)
1 Guarantee backing for some 7 Vistas regularly include objects
 further US sanctions (6) (3)
4 Delay 10, bearing breeder (8) 8 Very modern books about sheep
  10 Damage almost concerning stork (6)
(7) 9 His verdict: magician must drop
11 Kept an eye on spare tool (7) trick (5)
   12 Austrian city essentially ruling 14 Endlessly evoking uprising after
country (4) King Henry goes outside. What a
 13 American reptiles shook aspen shame! (11)
badly (4,6) 15 Complex game doesn’t quite
  16 Appropriate to return with some finish during the season (10)
fish as a meal (6) 18 Those seeking a way into
 
17 Soldier captures another puzzling essentially satisfied (8)
  completely regressive ape (7) 19 Men exist in a terrible state (1-7)
20 Sauce boat winning (7) 22 Meerkats are usually seen eating
  21 There’s power in high-quality rhubarb tops (6)
fasteners (6) 23 Is aware bouquet is announced
 
24 Sadder about having to celebrate (5)
speaking (10) 26 Bottom half of well-known tale-

25 You finally delete operating teller (4)
   system (4) 28 Festival of the Inverted Cube (3)
27 Woman worried about her first
wrap (7) Solution 15,114
29 Sign of ageing shellfish 6 8 3 3 5 ( 6 6 6 7 5 2 3 6
 
overcoming resistance (7) ( 2 ( $ 5 7 &
30 Medical helpers embarrassed and 7 $ . ( ) , 5 ( + $ / 7 ( 5
CROSSWORD
No. 14,845 Set by NEO
        ACROSS
1 Important Viking one among best
friends (5,4)
 
6 Socialite with appeal makes left-
side entry (5)
9 Brazilian city as far as we’re
concerned ungovernable (7)
   10 Obscure English knight against
European rebuffed (7)
11 Poor nation’s little island in hot
   current (5)
12 Caught flamboyant cardinal in
Seventh Heaven? (5,4)
   14 Notice flock encircles houses (3)
15 Alarmist financier reversed into
second vehicle bearing right (11)
17 German poet’s the writer
   
embracing pub vocalist (11)
19 Moggy fur with hole concealed? (3
20 Earl, King and Queen on
   Hampshire river’s banks (9)
22 Ambassador in temple finds grain
(5)
  24 Ardent Green must change leader
(7)
26 As one’s despicably mean, small
tips for servants materialise (2,5)
JOTTER PAD 27 Sauce unfortunately knocked over
contains sulphur (5)
28 Related martial artist stops at
Bedouin residence (9)
Solution to Saturday’s prize pu
Solution to yesterday’s prize pu
Winners’ names will be printed

2 ( , $ $ 1 ( $
angry (3,5) ) , 5 6 7 & 2 5 . 6 & 5 ( :
JOTTER PAD 31 Obsessive drip separates doctor ) ) ( 7 3 /
and nurse (6) 3 $ 6 6 2 1 6 & 2 8 5 * (
0 & / 5 ( 5
DOWN 2 3 ( 1 $ , 5 2 1 7 $ 3 (
1 Country being covered by top- / 8 $ 3 5 +
class Irish broadcaster (8) $ 5 5 2 * $ 1 & ( / 2 2 6 (
2 Water source I fled in chaos (11) 6 2 + 7 5 ( ' $

3 Something precious from

6 & $ 1 7 < 3 $ 5 $ 4 8 $ 7
( 6 ( 7 9 & (
Republican buyout (4) 6 $ 7 , 5 ( 5 ( 9 ( 5 ( 1 '
Wednesday 16 December 2015 ★ 13

Tiger earns stripes Battle National

Australia Bank
Sanofi Vodafone Dollar index FTSE 100 US 10-year
Treasury
CBOE Vix Brent oil

for India’s internet economy 1% 5.34% 2.82% 0.6% 2.5% 5bp 7.7% 3%
INSIDE ASIA, PAGE 14
A$27.66 €78.72 209.5p 98.18 6,017.79 2.27% 20.98 $39.06

Sanofi and Boehringer in asset talks Short

View
3 Pharma groups eye €18bn exchange 3 Deal would bolster respective business areas
mark the second big asset swap after “grabbing the bull by the horns”. value of €11.4bn, while Boehringer
Elaine
The plan
ANDREW WARD AND ARASH MASSOUDI
LONDON GlaxoSmithKline agreed to trade vari- The proposed deal fits a pattern that
represents
Ingelheim’s consumer business was val- Moore
ous businesses with Novartis last year. has seen pharma groups disposing of ued at €6.7bn. The German company’s
Sanofi has entered exclusive talks with The plan represents the boldest step non-core assets while seeking greater the boldest Chinese consumer business would be
Boehringer Ingelheim over an €18bn so far by Olivier Brandicourt to reshape scale in areas of strength. step so far by excluded from the transaction. When markets are mercurial, it is easy to see why forecast-
asset exchange that would see the Sanofi in the face of declining sales from The addition of Boehringer Ingelheim A final agreement was expected in ers want to qualify every prediction about today’s US rate
French drugmaker swap its animal its diabetes drug franchise. He took over products such as its Dulcolax laxative Olivier “coming months” with the aim of decision.
health unit for the German company’s as chief executive in April. and Pharmaton multivitamin would Brandicourt closing the transaction in the fourth The Federal Reserve may be on the brink of raising rates
consumer health business. Mr Brandicourt has moved quickly make Sanofi a more powerful rival to to reshape quarter of next year. for the first time since the financial crisis, which might cre-
The proposed transaction would after announcing a review of the animal other large consumer health groups Luisa Hector, analyst at Exane BNP ate disorder in global markets; but it could also choose to be
involve a gross cash payment by pri- health business last month and stating such as Bayer, Johnson & Johnson and Sanofi Paribas, said that the proposed deal was cautious and introduce a gentle rate rise, which should
vately owned Boehringer Ingelheim to his desire to expand in consumer health. GSK. For Boehringer Ingelheim, the deal strategically sound and would enhance already be priced in and might not lead to meltdown.
Sanofi of €4.7bn and significantly Shares in Sanofi, France’s biggest group would strengthen its competitive posi- the credibility of Sanofi management. Life would be simpler if stresses were limited to US rate
strengthen each company’s position in by market capitalisation, rose more tion versus Eli Lilly, Bayer and Zoetis in However, she added that it would do rises, but with oil still below $40 a barrel and China’s weak-
the respective business areas. than 5 per cent yesterday to €78.72. the consolidating market for treatments nothing to ease pressure on the pharma ening renminbi darkening the general outlook, disruption
The deal, if consummated, would add Michael Leuchten, an analyst at for livestock and pets. business or relieve stagnation in earn- is already pooling in the riskiest corners of the market.
to the wave of dealmaking sweeping Barclays, said investors would be Sanofi said its animal health business, ings over the next two years. Developing countries, which offered generous coupons
through the pharmaceuticals sector and pleased that Mr Brandicourt was known as Merial, had an enterprise Lex page 12 to investors during years of low rates, have fallen firmly
out of favour. Overseas investment into emerging market
bonds and equities this year is less than a quarter of what it
was in 2014. Last week, the JPMorgan EM currencies
index, which measures the strength of developing country
currencies against the US dollar, hit a record low.
Sales chill But in a disappointing year there has been one bright
spot. List all the problems plaguing emerging markets and
Volkswagen loses you can dismiss almost every single one in eastern Europe.
Low oil prices? Eastern European countries are net
ground in Europe energy importers. China slowdown? The region’s main
trading partner is the eurozone, not China. Fed jitters?
Volkswagen lost 2 percentage points of Europe is still benefiting from the European Central Bank’s
European market share in November as largesse.
the wider market expanded by almost That is not to say Europe’s non-euro members are
14 per cent, underlining the toxic effects immune from a general sense of risk aversion and the
of the diesel emissions scandal on the strain of domestic problems.
German carmaker. Benchmark 10-year bond prices in Hungary, Poland and
According to figures released Romania have fallen sharply this month, widening the
yesterday by European manufacturers’ difference in yields between Germany and eastern Europe.
body Acea, VW’s EU market share Poland, the region’s biggest economy, is under particular
shrank from 26.6 per cent in November pressure over concerns about sweeping changes under a
2014 to 24.3 per cent last month. new populist government.
As of the end of November, global sales But with central banks still holding sway over markets
of VW cars including the Polo, Golf and and no one sure exactly what will happen when the Fed
Passat have fallen 4.5 per cent this year finally moves, eastern Europe’s proximity to a central
to 5.34m vehicles, meaning the brand is bank that has pledged to keep buying bonds until at least
unlikely to surpass last year’s 6.12m cars March 2017 could at least provide an effective cushion.
registered.
The industry-wide performance so far
this year means Europe’s car market is Polish-German
up 8.7 per cent, reaching 12.6m units and 10-year bond spread
surpassing the total for 2014. % points Benchmark
Erik Jonnaert, secretary-general of 2.6 10-year bond
Acea, said: “The trend is positive but the prices in Hungary,
2.4
market remains at a low ebb.” Poland and
Regarding the emissions scandal, last 2.2 Romania have
week Hans Dieter Pötsch, chairman of 2.0 fallen sharply this
VW’s supervisory board, said: “The 1.8 month, widening
growing industry-wide discrepancies the difference in
1.6
between official emissions data and real- yields between
life levels are no longer acceptable. We Jan 2015 Dec Germany and
need to break new ground here.” Source: Thomson Reuters Datastream eastern Europe
Report page 18
elaine.moore@ft.com
Akos Stiller/Bloomberg

Rolls-Royce chief to axe senior roles

in effort to shake-up UK engineer
PEGGY HOLLINGER — LONDON notorious for its unwieldy decision these changes through the business.”
making and hierarchical structure. As part of the changes Colin Smith, a
Warren East, the new chief executive of
In place of two broadly defined divi- 42-year veteran who is director of engi-
Rolls-Royce, is to axe a layer of senior
sions, the heads of five market-facing neering, will step up to group president,
managers as he seeks to revive the UK’s
businesses — civil aero-engines, remaining on the main board as well as
premier engineering group after five
defence, nuclear, marine, and power the executive team to advise the
profit warnings.
systems — will now report directly to younger cohort.
Hopes grow for Vodafone Tony Wood, the head of aerospace and a Mr East as part of the executive manage- Mr East is tightening his oversight of
connection with Liberty 15-year Rolls-Royce veteran, is leaving ment team. A new chief operating Rolls-Royce as he begins the long haul to
the group as part of an executive officer will be recruited from outside cut costs and accelerate decision mak-
Vodafone’s improved showing has led revamp which will see the company’s Rolls-Royce next year. ing at the world’s second biggest aero-
some investors to hope the new year divisional structure abolished. Lawrie “We are going to rewrite the operating engine company.
will bring a fresh attempt by the UK Haynes, head of the land and sea divi- system for the company,” Mr East told Pressure has intensified not only
telecoms group to strike a deal with sion since 2013, will also step down in the Financial Times, signalling that because of its serial profit warnings but
US-listed Liberty Global — whether a 2016. The moves are expected to be there was more streamlining to come. also with the arrival of activist ValueAct
full-blown merger or a combination of announced to staff today. “I am sure there will be some further as the group’s biggest investor with a
their European businesses. The stripping out of a layer of top structural changes but we need to start 10 per cent stake.
Analysis i PAGE 15; Lex i PAGE 12 management is the first phase of a pro- somewhere. The best place to start is the Editorial Comment page 8
gramme to simplify processes at a group executive team that will help me drive Analysis page 14

Companies / Sectors / People

Companies
3M....................................................................25
AS Watson...................................................16
Agco................................................................25
Alibaba...........................................................14
Amarin...........................................................18
Anglo American.................................14,25
Apple..............................................................25
Argyle Street Management..............26
Auto Trader...............................................25
Aveva........................................................12,16
BHF Kleinwort Benson........................16
BHP Billiton................................................14
BP.....................................................................24
BT ....................................................................15
BTG.................................................................25
Bacanora Minerals..................................18
Bank of America......................................25
BlackBuck.....................................................14
Boehringer Ingelheim......................12,13
CK Hutchison.............................................16
Caterpillar.......................................................2
Circassia........................................................25
Club Med......................................................16
Commonwealth Bnk of Australia...12
ConocoPhillips..........................................24
Cummins.........................................................2
Daiwa Securities......................................26
Deere & Co.............................................2,25
Dialog Semiconductor..........................25
EE......................................................................15
Emerson........................................................16
Facebook......................................................14
Fastenal...........................................................2
Fiat...................................................................18
Flipkart..........................................................14
Ford.................................................................18
Fosun International................................16
General Electric........................................16
GlaxoSmithKline.................................12,18
Glencore..................................................14,25
HSBC..............................................................24
J Sainsbury ...............................................25
JD.com...........................................................14
JPMorgan...............................................14,25
Jana Partners.............................................12
Jefferies .......................................................14
Johnson & Johnson...............................18
Liberty Global......................................12,15
LinkedIn........................................................14
Lucasfilm......................................................10
Lucidius........................................................26
Lyft...................................................................18
Metro Group...............................................16
Morgan Stanley........................................14
National Australia Bank......................12
Nomura Securities..................................26
Novartis...................................................12,18
Ola....................................................................14
Ophir Energy.............................................25
PNC Financial............................................25
Pacira..............................................................18
Panasonic.....................................................18
Petrobras........................................................2
Peugeot.........................................................18
Pfizer...............................................................18
Qualcomm..............................................12,14
Renault..........................................................18
Rightmove...................................................25
Rio Tinto.......................................................14
Rolls-Royce........................................8,13,14
Royal Dutch Shell...................................24
Samsung.......................................................14
Sanofi...................................................12,13,18
Schneider Electric..............................12,16
Snapdeal.......................................................14
SoftBank.......................................................14
SolarCity.........................................................6
Sound Point Capital Mangt..............18
Statoil.............................................................24
SuperGroup................................................25
TalkTalk .......................................................15
Telecom Italia............................................14
Tesla................................................................18
Third Avenue............................................26
Thomas Cook.............................................16
Three UK......................................................15
Tiger Global................................................14
Tullow Oil....................................................25
UBS..................................................................18
Uber...........................................................14,18
Valeant..........................................................25
ValueAct.........................................................8
Virgin Mobile..............................................15
Vivendi...........................................................14
Vodafone.................................................12,15
Volkswagen.................................................18
WW Grainger................................................2
Walt Disney................................................10
Westpac.........................................................12
Wm Morrison.............................................25
Sectors
Aerospace & Defence.......................8,14
Automobiles...............................................18
Banks.............................................12,14,18,25
Financials......................................................18
Industrials....................................................16
Media..............................................................10
Mining......................................................14,25
Oil & Gas..................................................2,24
Pharmaceuticals............................12,13,18
Retail...............................................................16
Support Services...............................14,18
Technology......................................14,16,18
Telecoms...........................................12,14,15
People
Bolloré, Vincent........................................14
Brandicourt, Olivier................................13
Colao, Vittorio............................................15
De Puyfontaine, Arnaud.....................14
East, Warren.........................................13,14
Fink, Larry...................................................24
Guo, Guangchang....................................16
Handler, Rich.............................................14
Hintze, Sir Michael ...............................26
Icahn, Carl...................................................24
Ketchum, Stephen..................................18
Koch, Olaf.....................................................16
Lai, Dominic................................................16
Li, Ka-shing.................................................16
Longdon, Richard....................................16
Malone, John..............................................15
Marks, Howard.........................................24
Mollenkopf, Steve...................................14
Philippe, Hervé.........................................14
Recchi, Giuseppe.....................................14
Roussel, Stéphane..................................14
Stackmann, Jürgen.................................18
Teach, Jeffrey............................................18
Wang, Qunbin............................................16

© The Financial Times Limited 2015 Week 51

14 ★ FINANCIAL TIMES Wednesday 16 December 2015

COMPANIES
INSIDE BUSINESS
Mining
ASIA

Miners under pressure over climate risks James

Rio, Anglo American and
Glencore face investor
calls after Paris agreement
JAMES WILSON
MINING CORRESPONDENT
Investors want a trio of the world’s larg-
est miners to make greater disclosure of
risks associated with climate change,
after this month’s Paris agreement to
listed miners of coal, comes after a coali-
tion of investors succeeded in winning
similar votes at BP and Shell at their
shareholder meetings this year.
Both boards at the groups supported
the shareholder resolutions, which were
approved with 98 per cent in favour and
became binding on the companies.
Glencore said yesterday that it would
support the resolution that investors in
the Aiming for A coalition intend to put
to its annual meeting in May.
have to adapt their businesses over the
longer term.
“Investors need to revisit their stew-
ardship of companies and companies
need to look hard at their business plans
for climate change,” said Edward
Mason, head of responsible investment
at the Church Commissioners, which
manages investments for the Church of
England. The church is one of the mem-
bers of the Aiming for A group.
The investor coalition includes other
Crabtree
tors so far backing the resolutions have a
combined $4tn under management.
Resolutions would demand that Glen-
core, Anglo and Rio show “strategic
resilience”. Each miner would have to
Man from Tiger earns
report what it was doing to manage car-
bon emissions and also how its assets
his Indian stripes for
would perform under various scenarios.
The resolutions would also require
companies to disclose whether climate
igniting internet sector
98% change considerations played any part
Level of support
for shareholder in incentives for executives.

limit global warming.
Rio Tinto, Anglo American and Glen-
core could face shareholder votes next
year on whether they should reveal
more about how their businesses might
perform in a low-carbon world.
The targeting of the mining compa-
nies, which are among the largest UK-
Telecoms
Anglo said it was also likely to support
a resolution, while Rio said it had had
“constructive” talks with the group.
The Paris deal on climate change
underlines the growing expectation that
companies depending substantially on
fossil fuels — including coal miners, oil
producers and power generators — will
private asset managers and the Local
Authority Pension Fund Forum. They
say they want to make sure their long-
term investments are protected against
the impact of climate change.
Helen Wildsmith, of CCLA, a special-
ist investment manager involved with
the Aiming for A group, said the inves-
Interview. Warren East
F
resolutions at BP Glencore said it would support such a ew readers could pick my nominee for Indian
and Shell boards resolution while Anglo said it expected business person of 2015 out of a line-up. He made
it would. Rio said disclosure on climate no public appearances, gave no interviews, and
change risk “is under constant review to was seldom mentioned in the press. Yet, almost
$4tn ensure we are in line with best practice single-handedly, he began — and now appears to
Amount of funds
under management
and are disclosing information that is have ended — a fierce battle for the future of India’s inter-
held by investors beneficial to our shareholders and other net economy. Step forward Lee Fixel of New York-based
backing resolutions stakeholders”. asset manager Tiger Global: the man most directly respon-
sible for pumping up and then deflating the country’s
start-up funding bubble.
Mr Fixel runs Tiger’s private equity arm, giving him con-
trol of more than half of the publicity-shy fund’s $20bn in
assets. Still only in his mid-30s, he built his reputation by

Vivendi steps aggressively backing tech start-ups, including Facebook

up battle to Rolls-Royce sets course for change and LinkedIn in the US. China’s internet boom proved
especially lucrative for Tiger, as the fund earned block-
buster returns from the likes of JD.com, an online retailer.
In a bid to repeat those successes in Asia’s other big

bolster role at
Telecom Italia
RACHEL SANDERSON — MILAN
A fight for influence at Telecom Italia
escalated after its largest investor,
French group Vivendi, won four board
seats and blocked the conversion of
savings shares into ordinary shares
which would have diluted its stake.
Vivendi is seeking greater sway over
strategy at Italy’s top phone company,
over the objection of some minority
investors.
Nearly 53 per cent of shares present at
a special meeting were voted in favour
of Vivendi’s proposals, while 42 per cent
were voted against. About 56 per cent of
the phone company’s shares were repre-
sented at the meeting.
ISS, the voting proxy advisory, had
encouraged minority investors to vote
against Vivendi’s request. The French
group controls a quarter of the board,
while it only holds a fifth of the shares.
Vivendi-proposed board members
include Vivendi chief executive Arnaud
de Puyfontaine, its chief operating
officer Stéphane Roussel and chief
financial officer Hervé Philippe.
In the share conversion vote, share-
holders with 62.25 per cent of the capital
voted in favour of the conversion but a
two-thirds majority was needed to win
the motion. Vivendi, which had 35.9 per
cent of the votes at the meeting,
abstained from the vote, effectively
blocking the move.
The conversion would have saved Tel-
ecom Italia money as ordinary shares do
not pay dividends. Telecom Italia chair-
man Giuseppe Recchi said: “We are
sorry. We have missed an opportunity
for the company”
Vincent Bolloré, billionaire chairman
of Vivendi, has ratcheted up his share-
holding in Telecom Italia to about 20.5
per cent. According to insiders he could
raise this to 25 per cent.
While Mr Bolloré has been guarded
about his intentions, people close to him
said he wants to gain influence at board
level to force divestments and steer Tel-
ecom Italia’s role in European telecoms
consolidation.
“We need to work together with
shared objectives” because Telecom Ita-
lia needs “a stable shareholder”, Mr De
Puyfontaine said at the shareholder
meeting.
Italian government officials have
watched Vivendi’s growing stake in Tel-
ecom Italia with alarm. They worry that
Mr Bolloré is seeking to control the Tele-
com Italia board without paying a pre-
mium for a full takeover.
They are also concerned about a
creeping French-led takeover at a time
when prime minister Matteo Renzi
wants to boost investment in Italy’s lag-
gard ultrafast broadband network.
Chief outlines plan to please
investors by ending divisional
structure and cutting red tape
PEGGY HOLLINGER — INDUSTRY EDITOR
Since Warren East became chief execu-
tive of Rolls-Royce in July, he says not a
day passes without someone in the UK
engineering group coming up to him
with an anecdote about waste.
“Nothing surprises me any more,” he
says when confronted with new stories
of Rolls-Royce’s slow and bureaucratic
decision-making.
His decision just before Christmas to
revamp his executive board — marking
the highest-profile departures since his
arrival — is the first, highly symbolic
attempt to make Britain’s 109-year-old
flagship engineering company a leaner,
fitter organisation.
Rolls-Royce is reeling after five profit
warnings in the past two years, and
Mr East has promised investors he will
restore confidence.
He says the new management struc-
ture being unveiled yesterday will “clar-
ify executive accountabilities and inten-
sify leadership focus on operational per-
formance”. It will also help towards his
promised gross cost savings of £150m to
£200m a year from 2017.
For Mr East, this is the beginning of a
much-needed cultural change at the jet
engine maker. “We are not in the busi-
ness of getting rid of vast numbers of
managers,” he says in an interview with
the Financial Times. “What we want to
do is change the processes.”
Mr East is seeking to strip out
bureaucracy that has bloated Rolls-
Royce’s costs, and people inside the
company expect the changes on the
executive board to be followed in 2016
with a shake-up lower down the com-
pany’s famously hierarchical structure.
The revamp should not only cut out
one layer of management at the top, but
also eliminate the company’s divisional
structure, which Mr East believes
merely duplicated much of what was
being done at the operating level.
The split of executive management
responsibilities into two broad areas —
aerospace, and land and sea — will dis-
appear, to be replaced by civil engines,
defence, marine, power systems and
nuclear. The heads of these operating
units will now report directly to the
chief executive.
“Typically you would have informa-
tion reviewed by the business, then by
the division and then the executive
team,” says Mr East. “We are taking a
week out of every month of decisions.”
Mr East is sympathetic but unrepent-
ant about the fact that his shake-up will
mean the departure of the 15-year vet-
eran Tony Wood, president of aero-
space. “It is disappointing to lose all that
experience when he walks out
the door,” he says. “But we were
unable to come up with a job
that satisfied his career aspira-
tions.”
Lawrie Haynes, the presi-
dent of land and sea since
Turbo-charged 2013, is also taking retirement earlier
scheme: Warren than planned. Both men will stay on for
East, below, part of next year to help with the transi-
plans a shake-up tion.
of engine maker Mr East is now gathering a team
Rolls-Royce’s around him to push through what he
culture in the calls a reworking of the “organisational
wake of five software” of Rolls-Royce. Eric Shulz,
profit warnings previously head of large civil engines,
becomes president of civil aerospace.
This will include smaller jet engines and
involve the group’s plans to one day
return to the narrow-body market.
Harry Holt, strategy director,
becomes head of nuclear, which is facing
its biggest challenge in the project to
renew Britain’s Trident submarines.
Chris Cholerton continues as presi-
dent of defence, Mikael Makinen as
head of the struggling marine business,
and Ulrich Dohle as chief executive of
the power systems unit. A new chief
operating officer, likely to be from out-
side Rolls-Royce, will be named as soon
as possible in 2016, says Mr East.
Chris Blakely, engineering director
for the large civil engines, will step up to
become group engineering and tech-
nology director. He replaces Colin
Smith, the bluff engineer who has been
at Rolls-Royce for 42 years.
Mr East says he does not want to lose
Mr Smith’s expertise, so he will remain
on the executive board, but as group
president.
The Rolls-Royce chief acknowl-
edges that even with this new struc-
ture and a new team, the task of
shifting the group’s systems and
culture will take four to five years.
emerging economy, Mr Fixel began to turn his full atten-
tion to India a few years back.
Tiger dabbled in Bangalore’s tech scene by picking up a
stake in Flipkart, the Indian online retailer, in 2009. From
there, the fund’s bets grew gradually larger, reaching a
peak earlier this year, as Mr Fixel poured in cash. There
was more for Flipkart, as well as Ola, the main local rival to
US ride-hailing service Uber.
Numerous smaller deals tar-
geted start-ups ranging from
Mr Fixel’s
online classifieds to grocer- aggression
ies and pushed Tiger’s total
investments to roughly
shocked
$2bn. established
India had never seen any-
thing quite like it. Mr Fixel’s
venture groups
aggression shocked estab-
lished venture groups, who began spraying money around
in response. Some tacitly clubbed together with other big
late-stage investors, including Japan’s SoftBank, to fund
rivals to companies backed by Tiger. Global internet com-
panies, including Alibaba of China, also got in on the act.
This funding splurge often led crowded sectors, like online
property or groceries, with three or four lavishly-funded
groups happily burning through cash.
Then, in the second half of the year, sense suddenly pre-
vailed. “The war is over; Lee called it off,” says Kashyap
Deorah, a veteran tech entrepreneur and author of The
Golden Tap, a book on India’s start-up boom.
Tiger declined to comment, but people familiar with its
strategy say the group has become choosier, leaving some
of its start-ups to find new financing elsewhere. “There is a
truce,” Mr Deorah says. “The big guys realised they weren’t
going to make returns by throwing money around.”
Investors began to reconsider their assumptions about
India, too — much as they had become more sceptical
about the lofty valuations of $1bn or more given to US
“unicorn” tech firms. More fundamentally, India’s truce
stemmed from a rethink about how big the country’s
ecommerce market could become, and how quickly its
start-ups would take to come good.
“I think it dawned on them that India isn’t going to
be another China, that the
scale of the thing was just
going to be different and take
Far better
longer,” says Praveen that India’s
Chakravarty, a Mumbai-
based angel investor.
bubble deflates
To take one example, gradually than
Tiger invested in Flipkart
and JD.com at roughly the
bursts in a mess
same time. JD went public on
Nasdaq last year, but most observers think that Flipkart
remains a few years away from listing. Smaller Indian
start-ups in areas such as hyper-local food delivery will
take even longer.
Mr Fixel has not stopped spending — one of his funds last
week took part in a $25m round for BlackBuck, a Banga-
lore-based online freight-booking group. Tiger has
invested in about 40 Indian companies, and will give many
of them fresh funds. But other investors have copied his
more cautious stance. Funding rounds have slowed. Valua-
tions have corrected. Some high-flying start-ups are strug-
gling to raise capital. Others are laying off staff.
All this is to be welcomed. Far better that India’s bubble
deflates gradually than bursts in a big mess. And its long-
term ecommerce potential, aided by its vast population
and growing smartphone use, remains undimmed.
Nevertheless, one of the big tech stories of 2016 will now
be how big funds such as Tiger and SoftBank unwind the
exuberance they showed in 2015, by brokering mergers of
weaker start-ups and folding others into larger players
such as Flipkart, or its rival Snapdeal. If the worst of India’s
funding war is over, Mr Fixel must now win the peace.
james.crabtree@ft.com

Technology Banks

Qualcomm sees off investor calls for break-up Jefferies raises Wall Street fears with sales fall
TIM BRADSHAW — SAN FRANCISCO
RICHARD BLACKDEN — NEW YORK
US chipmaker Qualcomm has resisted
pressure from an activist investor to
break up, arguing its structure is the
best way to grow.
The California-based company, which
has a market value of $70bn and
employs about 31,000 people, has been
examining options including a separa-
tion of its licensing and chip set busi-
nesses since July, as slowing chip
demand brought investor scrutiny.
It has suffered this year from a
broader pullback in the smartphone
market and Samsung’s decision to use
its own chips in its Galaxy devices.
Steve Mollenkopf, chief executive,
said: “The strategic benefits of the cur-
rent structure will best fuel Qualcomm’s
growth as we move through the upcom-
ing technology transitions and extend
our technologies into new user experi-
ences, services and industries.”
Mr Mollenkopf said keeping the two
units together fuelled R&D and returns
to shareholders, as well as being “mean-
ingfully more cost and tax efficient”.
Qualcomm shares, which have
slumped 37 per cent this year, rose 3 per
cent by midday in New York.
At the heart of the issue has been
whether Qualcomm would be better off
separating its chipmaking business,
which generates the bulk of its reve-
nues, from its patent licensing arm
which accounts for more overall profits.
Jana Partners, an activist investor,
took a $2bn stake in Qualcomm in April.
Two new directors appointed as part of
an agreement with Jana were part of the
committee that undertook the review.
Boston Consulting Group analysed
potential alternatives, while Goldman
Sachs, Evercore and Centerview Part-
ners also advised Qualcomm.
See Lex
LAURA NOONAN — NEW YORK
Jefferies cast a shadow over Wall Street
results yesterday as the boutique New
York investment bank reported an 83
per cent fall in revenues from fixed
income, currencies and commodities
trading in the three months to Novem-
ber 30, and a 36 per cent fall in overall
trading revenues.
It is the first company to report quar-
terly earnings, so its results are watched
for signs of how bigger rivals could have
fared. Jefferies blamed the performance
on external factors other banks are
grappling with too — chiefly the pro-
longed lead in to the Federal Reserve’s
anticipated interest rate rise and the
“collapse” in global energy markets.
Still, the comparison is not perfect;
Jefferies’ annual revenues of $2.5bn
make it less than a tenth of Wall Street
rivals such as JPMorgan.
“It’s tiny,” said one Wall Street banker
at a larger firm, adding that while all
banks were operating in the same mar-
ket conditions, Jefferies’ scale meant it
was more likely to be hit by one-off
events or single trades going bad.
Jefferies reported a 50 per cent fall in
FICC trading revenues in the second
quarter of 2015, while the big six US
banks followed with average falls of
about 25 per cent in a torrid quarter.
Rich Handler, chairman and chief
executive of Jefferies, said fixed income
had been a “solid to excellent” business
in previous years but “did not perform
well in 2015”.
“There were a number of periods of
extreme volatility, which were followed
by periods of low trading volume,” he
said. The bank expects fixed income to
return to “normal profitability” in 2016.
Jefferies overall revenues were down
just 2 per cent as a better performance
from investment banking cushioned the
trading losses.
Wednesday 16 December 2015
Vodafone calls the tune as deal talk intensifies
Telecoms company’s improved fortunes spark hopes that an agreement can be reached with cable-TV operator Liberty
DANIEL THOMAS — LONDON
When Vittorio Colao sold Vodafone’s
$130bn stake in a US mobile business
three years ago, the joke was that the
massive shareholder windfall would
provide a stimulus akin to quantitative
easing for the British economy.
But there was a serious point for
Vodafone’s investors, who were worried
about how the Italian chief executive
could revive the company’s moribund
performance.
Last month, Vodafone showed that
investment in its core European opera-
tions — part funded by its exit from Veri-
zon Wireless in the US — was starting to
pay off, with customers increasingly
buying 4G mobile services.
This improved performance has led
to hopes among some Vodafone share-
holders that the new year will bring
a fresh attempt by the UK telecoms
group to strike a deal with US-listed
Liberty Global after abortive attempts
to combine their European businesses
this year. Vodafone and Liberty execu-
tives have spent the past few weeks
meeting investors, and both companies
say the door remains open to deal talks.
“Neither side is pushing the other
away, which is interesting in itself, and
even their language seems similar,” says
one shareholder in both groups. Voda-
fone and Liberty declined to comment.
The fact Vodafone can trumpet a
turning point in its fortunes — after last
month, at its first-half results, when it
reported underlying growth in group
service revenue and core earnings for
the first time in four years — strengthens
Mr Colao’s ability to execute an ambi-
tious deal.
Vodafone has a history of value-
destructive deals — it has taken big
‘Neither side is pushing
the other away, which is
interesting, and their
language seems similar’
writedowns on assets bought in Ger-
many and India, for example — and
when Mr Colao became chief executive
in 2008, he played down the likelihood
of more ambitious acquisitions.
His focus on improving Vodafone’s
core operations was made harder by the
financial crisis, but the recent easing of
economic and regulatory pressures
has coincided with the company’s
£19bn “Project Spring” investment in
networks. Crucially, customers are
being persuaded to spend more on 4G
mobile services.
Vodafone executives are therefore
confident the company can beat ana-
lysts’ earnings forecasts.
“Management seems to think it can
do much better than consensus on
growth,” says one Vodafone share-
holder.
Maurice Patrick, analyst at Barclays,
Legal Notices
★ FINANCIAL TIMES
M&A chatter
Vodafone 4G fueling performance
Ebitda As a % Number of 4G customers (m)
(£bn) of sales
8 32
6 31
4 30
2 29
0 28
2012 13 14 15
Sources: Company; Bloomberg
2014 15
Complaints Vodafone has been named the most
Operator criticised mobile phone service in the UK
is most by Ofcom, the telecoms watchdog, after
attracting more than twice as many
criticised complaints as its nearest rival EE.
in UK Complaints about Vodafone, the only
mobile group listed in the UK, rose by a
quarter to 20 per 100,000 customers
from July to September, from 14 per
100,000 in the quarter before.
The scale of the complaints shows the
uphill task facing Vodafone as it invests in
improving its networks around the world.
Vodafone said a £1bn investment in its
UK network and services this year, as well
as “a significant management focus on
improving and simplifying customer
services”, would start to mean a change in
customer experience. “We apologise to
any customers who have had issues with
COMPANIES
Market cap
30
$33.0bn
20
Leverage
(Ratio of net debt
to ebitda) Enterprise value
10 5x
$78.4bn
0 4
our service,” said Vodafone. “Many of
the issues highlighted in this report
relate to the major programme we
have been undertaking over the last
18 months to streamline and improve
our billing platform.”
More than a third of complaints
about Vodafone involved problems
with billing, pricing and charges.
EE was the only other mobile
service to generate more complaints
than the industry average of eight per
100,000 customers. Virgin Mobile, O2
and Three UK all generated
complaints below the average.
Telecoms and pay-television
complaints made to Ofcom increased
in the third quarter compared to the
previous three months. Ofcom said the
rise was “disappointing”.
Valuation gap
Ratio of enterprise value
to ebitda (x)
$83.8bn
Leverage
(Ratio of net debt
to ebitda)
2.5x
$127.2bn
Vodafone
Liberty Global
2010 11 12 13 14 15
says there has been a sea change in
Vodafone’s performance.
“Revenues are now going up again fol-
lowing Project Spring and there is capac-
ity to cut costs, leading to the potential
for 5 per cent [core earnings] growth
with a fully covered dividend,” he adds.
One Vodafone executive describes a
“very different mood” at the group com-
pared with two years ago. “It’s much
more bullish,” he adds.
This helps explain why Vodafone and
Liberty, the cable-TV operator, could
yet strike a deal — whether a full-blown
merger or a less ambitious combination
of their core European businesses.
Vodafone announced on September
28 that talks with Liberty about a com-
plex asset swap involving their Euro-
pean businesses had ended. This was
primarily because of a valuation gap
between Vodafone and Liberty,
Contracts & Tenders
15
reflecting how telecoms groups generally
tradeatadiscounttotheircablepeers.
Now, however, some analysts and
investors hope Vodafone’s improving
performance can ensure a sustained rise
in its share price, and resolve the valua-
tion issue. Vodafone’s shares are down
about 4 per cent since the talks with Lib-
erty ended in September, while Lib-
erty’s stock is down about 16 per cent.
Gains in Vodafone’s shares could pave
the way for renewed deal talks, says a
person close to Vodafone, if John
Malone, Liberty chairman, wants to
return to the table. “The deal depends
on the [valuation] between Vodafone
and Liberty narrowing . . . more simply
the share price of Vodafone has to go up a
fair bit to make it work,” says one person
familiar with the situation.
Several investors see a resumption of
deal talks as plausible, particularly fol-
lowing Liberty’s agreement last month
to buy Cable & Wireless. In the short
term, this deal may distract Liberty
from resuming talks with Vodafone, but
thereafter it would give the group a new
‘The deal depends
on the valuation
between Vodafone
and Liberty narrowing’
front to attack if its European opera-
tions were sold. More importantly, there
is no disagreement between the man-
agement teams of Vodafone and Liberty
10
about the rationale for a deal given their
core European businesses are comple-
mentary.
8 Vodafone always saw itself in the driv-
ing seat in the recent round of talks,
adds the person. The telecoms group
has an enterprise value of £84.5bn, a
6
market capitalisation of £55.6bn and
net debt amounting to about 2.5 times
core earnings. Liberty Global has an
enterprise value of $78.4bn, a market
capitalisation of $33bn, and net debt
representing about five times earnings.
Vodafone might be in a stronger posi-
Vodafone tion in its next financial year to make a
needs to work deal work with Liberty, particularly if
hard to meet the UK group can hold out the prospect
performance of better earnings growth than the cable
targets but its company.
prospects are However, there are other barriers to a
back in its deal — for example, shareholders are
own hands keen that Vodafone has a relatively low
Krisztian Bocsi/Bloomberg
level of debt and retains a dividend cov-
ered by earnings. Liberty’s large bor-
rowings could threaten this position.
And there is no certainty that Voda-
fone can maintain its recovery given the
European Parliament’s proposed ban on
mobile roaming charges and potential
for further economic woes.
The group needs to work hard to hit
its performance targets. But Vodafone’s
prospects — and any future deals — are
back firmly in its own hands after years
of economic and regulatory headaches.
See Lex
16 ★ FINANCIAL TIMES Wednesday 16 December 2015

COMPANIES

Industrials Technology

Fosun’s European deals thrown into doubt Aveva and

Chairman’s temporary
absence creates uncertain
outlook for Chinese group
MARTIN ARNOLD — LONDON
JAMES SHOTTER — FRANKFURT
TOM MITCHELL — BEIJING
The chairman of China’s Fosun Group
returned to the office this week to find
his four-day disappearance has created
an uncertain outlook for his planned
European acquisitions.
Guo Guangchang, who went incom-
municado while assisting Shanghai
authorities in an unspecified investiga-
tion, is poised to complete a €210m
purchase of Frankfurt-based Hauck &
Aufhäuser. But the deal to buy the pri-
vate bank that was established in the
18th century is awaiting approval from
Germany’s financial regulator and the
European Central Bank.
In a separate bidding war for BHF
Kleinwort Benson, the London mer-
chant bank, Fosun is likely to lose out to
Oddo & Cie, the French private bank. Mr
Guo is China’s 17th-richest person with a
$7.8bn fortune, according to the Hurun
Report.
But along with Chinese tech billion-
aires such as Jack Ma, Alibaba’s founder,
he looms larger than most of his peers
on the international stage because of his
aggressive acquisition strategy.
Mr Guo, who is sometimes referred to
as China’s Warren Buffett, has spent
almost $4bn on insurance companies
in Bermuda, Portugal and the US to
generate investment capital for other
purchases. He has also snapped up Club
Med and taken stakes in entertainment
business Cirque du Soleil and Thomas
Cook, the UK holidays company.
In 2014, Fosun paid €1.7bn for 85 per
cent of Fidelidade, Portugal’s largest
insurance company, and then used it to
buy Espírito Santo Saúde, the hospital
business, for €460.5m. Fosun contrib-
uted most of the €500m injected into
Fidelidade last week as part of a planned
capital increase.
Retail & consumer. China growth
During Mr Guo’s mysterious absence,
Fosun executives argued that the under-
lying book value of the group’s rapidly
expanding portfolio would support the
share prices of its listed units. Shares in
Fosun International, the Hong Kong-
listed unit, were suspended on Friday
during Mr Guo’s absence but have now
resumed trading.
BaFin, Germany’s financial regulator,
is not expected to make a final recom-
mendation to the ECB on whether Fosun
should be deemed a “fit and proper”
owner of Hauck before Christmas, say
people close to the transaction. Fosun
International announced what would be
the first outright Chinese purchase of a
German bank in July. “The process with
BaFin is proceeding as normal,” Hauck
said. BaFin declined to comment.
In the battle for BHF, Oddo entered
the fray late last month with a bid of
€5.75 per share, trumping Fosun’s €5.10
July offer. Oddo says it has the support of
more than half of BHF’s shareholders.
One person involved in the deal said
Mr Guo was “furious” after the counter-
offer from Oddo and ordered his team to
prepare a knockout bid of its own.
If Fosun instead chooses to back
down, it could sell its 30 per cent stake
in BHF to Oddo for a 30 per cent profit
on its original investment.
The ECB had deemed Fosun a “fit and
proper” potential owner of BHF but
with conditions attached, say people
familiar with the transaction. These
include a requirement that BHF
remains a member of Germany’s
deposit guarantee scheme for private
sector banks, which is administered by
the country’s main banking association.
“As far as BHF is concerned, I don’t
‘As far as BHF is concerned,
I don’t think [Mr Guo] has
the credibility in Europe
to pursue this any more’
think he has the credibility in Europe to
pursue this any more,” said a person
involved in the bidding battle. “Would
you believe him [Mr Guo] now if he
came and said: ‘I have perfect access to
China and can open the market for you’?
That’s what he was saying to everyone.”
BHF and the ECB declined to com-
ment, as did the German banking asso-
ciation and Fosun.
Fosun International shares were
down more 3.6 per cent in trading yes-
terday. They fell 9.5 per cent on Monday
despite Mr Guo’s sudden reappearance.
In a conference call on Sunday, Wang
Qunbin, Fosun International’s presi-
dent, said any share price volatility in
the wake of the saga would offer inves-
tors a good buying opportunity.
“All’s well that ends well,” agreed one
Shanghai-based fund manager. “We
were buying Fosun Pharma into the
[Monday] close,” he added, referring to
the group’s listed pharmaceuticals unit.
Additional reporting by Peter Wise in Lis-
bon and Patti Waldmeir in Shanghai
Schneider
Electric call
halt to reverse
takeover talks
MURAD AHMED, NATHALIE THOMAS AND
ARASH MASSOUDI — LONDON
MICHAEL STOTHARD — PARIS
A £1.3bn reverse takeover of British
engineering software group Aveva by
France’s Schneider Electric has been
abandoned, with both companies cit-
ing unforeseen costs and risks associ-
ated with the proposed merger.
The complex deal would have involved
Aveva acquiring Schneider’s industrial
software unit, Schneider Software, but
the French company would in turn have
taken a majority stake in Aveva.
The two groups had said that there was a
“clear and compelling industrial logic
and strategic rationale” for the tie-up.
But following six months of extensive
due diligence, Aveva said yesterday the
companies had determined that “signif-
icant integration challenges were identi-
fied that could not be overcome without
considerable additional risk and cost”.

AS Watson sees the beauty in expansion plans Aveva shares dropped 35 per cent in
morning trading to £14.75. Schneider
shares were virtually unchanged.
Schneider said in a statement: “The
two parties have decided to stop their
discussions by mutual consent as no
Chain eyes new stores surge agreement could be reached on the
as it taps into spending power terms of transaction.”
Speaking to the Financial Times,
of lower and middle classes Aveva chief executive Richard Longdon
said: “The sad thing is the industrial
logic was always good, and still is. But
JENNIFER HUGHES — HONG KONG

China slowdown? What slowdown?

While upmarket consumer goods com-
panies endure falling sales and store clo-
sures in the once high-growth market,
one retail business still believes it can
quadruple its shop numbers.
AS Watson — the largest health
and beauty store operator in Asia and
Europe, controlled by Hong Kong bil-
lionaire Li Ka-shing — has already
grown its Chinese presence from 500
outlets in 2009 to about 2,500 today.
But now, despite strong competition
in a historically fragmented market,
managing director Dominic Lai says the
group plans to keep opening 500 new
stores in China per year.
In doing so, AS Watson is tapping into
an opportunity that is gaining wider
attention, namely the sales growth
to be generated not from luxury
customers, but from the gradually
‘It takes time to educate
the entire population to
consume. I’ve been taught
since I was young to save’
increasing spending power of the lower
and middle classes.
“This is the question my chairman
asks me,” says Mr Lai, referring to Mr Li.
“So 3,000 to 5,000 [stores] will be the
next target and then easily we can go up
to as many as 10,000.”
He bases his projection on the US
market. “Look at the US, with 300m
people,” he says. “You have Walgreens;
you’ve got CVS — they have almost
10,000 stores [each] in the domestic
market. There’s still a lot of room for us
to grow.”
AS Watson has already come a long
way from its origins in Hong Kong as a
pharmacy in 1841 — the year the terri-
tory was ceded to the British.
It was the 15th company registered
there and can claim Sun Yat-sen, the
Chinese revolutionary, as a beneficiary
of the early medical school scholarships
it offered.
It is now not only far larger but
broader in its activities, owning a Hong
AS Watson has Kong supermarket chain and an elec-
expanded its tronics retailer.
presence in Last year, Mr Li’s Hutchison business
China from sold a quarter-stake in AS Watson to
500 outlets in Temasek, the Singapore investment
2009 to about fund, for $5.7bn, rather than pursuing
2,500 today a stock market listing.
It still derives the majority of its prof-
its from its core health and beauty
stores, now in 24 countries.
In 2000, AS Watson began an interna-
tional acquisition drive, pushing beyond
its Asian roots with the takeover of Sav-
ers, a UK chain.
Since then, its expansion has taken in
Superdrug, Kruidvat, Rossmann and
The Perfume Shop, among others, to
make the group the largest health and
beauty retailer in Europe by outlets.
More recently, the group’s focus has
been on consolidating in Europe while
expanding rapidly in China.
By AS Watson’s own measure, which
includes supermarkets, it has between
8 per cent and 10 per cent of the
Chinese market. Analysts have previ-
ously estimated it could have as much
as 30 per cent of the specialist beauty
store segment.
“Right now we cover around 380 cit-
ies — some cities whose names I don’t
even know myself,” says Mr Lai.
The company says its 50m-strong
loyalty card scheme in China is adding
800,000 to 1m members a month,
bringing customer data that is essential
in a geographically diverse country.
“China is a big country with different
geographies and we try to differentiate
south and north,” he says.
“Even the formulation is different —
in the northern part, they have colder,
drier weather, so we design our own-
brand products accordingly.”
While China’s slowing growth rate has
worried many, Hong Kong-born Mr Lai
remains confident that the country can,
over time, engineer the shift to a con-
sumer-led economy laid out in Beijing’s
recent five-year plan.
“It takes a bit of time to educate the
entire population to consume — includ-
ing myself. I’ve been taught since I was
young to save. That’s the Chinese cul-
ture,” he says.
Mr Lai, a veteran Hutchison executive
of more than two decades, spends about
75 per cent of his time on AS Watson
business and the rest on parent group
CK Hutchison, of which he is a director.
Mr Li, who turned 87 earlier this year,
is still actively involved as chairman and
keeps in touch with his lieutenants
every day, expecting them to have mas-
24 tered a broad brief.
“When the chairman calls me it’s not
The number of
countries in to talk retail, it’s ‘how’s Three UK, how’s
which AS Watson David Dyson [its chief executive]
has stores doing?’ That’s how he calls his direc-
tors,” says Mr Lai. “When he cannot get
50m Frank [Sixt, finance director], he calls,
say, Susan [Chow, group deputy manag-
Membership of
the group’s ing director] or me and asks ‘how’s the
loyalty card financing, how is our debt ratio?’ — and
scheme in China we have to know.”
‘The sad thing is the
industrial logic was always
good, and still is. But they
say that time kills deals’
they say that time kills deals. Too much
time had gone on.”
Neither company will have to pay a
break fee because the terms of the trans-
action were non-binding.
Aveva, a member of the FTSE 250, is a
supplier of software to the mining, oil
and gas, and paper and pulp industries.
There had been growing frustration at
the company over the slow pace of talks
with Schneider, with some blaming the
French company’s larger size for a lack
of focus on completing the deal.
Mr Longdon said: “To do a deal this
complicated does need a huge amount
of attention from very senior staff.
We are talking about a very small part
of the overall Schneider — 2,000
employees [at the industrial software
unit] compared with 186,000 [at the
overall company].”
Other groups, including Emerson and
General Electric, were also reported to
be weighing offers for Aveva earlier this
year. People close to the situation say
that potential suitors were waiting for
the expected resolution of talks with
Schneider Electric in the new year
before making a decision on whether to
make a counter-offer.
“I wouldn’t be surprised if we get
interest today [from other buyers],
never mind January,” said Mr Longdon.
Aveva had previously been wary of a
full takeover by Schneider.
Under the proposed deal terms,
Aveva had inserted clauses such as an
insistence that its leadership — Mr
Longdon, chairman Philip Aiken, and
the company’s board of directors —
remained in place, as well as “standstill”
periods over which Schneider could not
increase its shareholding in the UK com-
pany.
George O’Connor, analyst at Panmure
Gordon, said that the market grew wary
of the deal as it would have required
“deep operational change” at Aveva
amid a “poor operational backdrop”.

Contracts & Tenders Retail

Metro defies challenging environment with buoyant forecast

JAMES SHOTTER — FRANKFURT
Metro Group has said it expects sales
and earnings to rise next year despite
the “continuously challenging eco-
nomic environment”, after posting
upbeat fourth-quarter results.
The German retail conglomerate said
that in the last three months of its finan-
cial year ending September 30, its oper-
ating profit had come in at €435m, up
8 per cent from a year earlier. Analysts
had forecast €379m.
Full-year profit before special items
was €1.51bn, or €1.91 per share, margin-
ally lower than the €1.53bn achieved in
the same period a year earlier. Sales
were down 1.2 per cent at €59.2bn. On a
like-for-like basis, however, they were
up 1.5 per cent.
Olaf Koch, chief executive, who has
been battling to turn round Metro’s
fortunes after years of falling sales and
high debt, said the results suggested
that the efforts were bearing fruit. “The
successes of our transformation have
become clearly evident in terms of oper-
ations,” he said.
Shares in the company, which have
halved in value since the start of 2011,
were up 1.3 per cent at €27.39 in midday
trading in Frankfurt.
The dominant cash-and-carry divi-
sion, which generates two-thirds of
operating profits, posted an 8 per cent
rise in earnings.
Media-Saturn, Metro’s electronics
arm, posted a 45 per cent rise, thanks to
one-off items and a surge in Russian
demand, as customers brought forward
purchases in anticipation of further able to invest more in its other busi-
declines in the value of the rouble. nesses as a result.
The Real hypermarket chain, which is Despite forecasting a “persistently
in the middle of a restructuring, fared complex geopolitical environment” for
less well, posting a €441m loss, mainly the next 12 months, Metro expects a
from a goodwill writedown. “slight” rise in its overall sales and earn-
David Payne, analyst at Nomura, said ings next year.
the mix of the results was better than
expected. “The margin expansion in the
cash-and-carry business, albeit from a
low base, was the standout feature,” he
said. “That will be a key theme for the
stock over the next two years.”
Metro sold Galeria Kaufhof in Sep-
tember as part of a series of asset dispos-
als. The German department store
chain had previously made up its fourth
division. Proceeds of the sale had
allowed net debt to be cut by €2.2bn to
€2.5bn, the group said. and it would be
Wednesday 16 December 2015 ★ FINANCIAL TIMES 17
18 ★ FINANCIAL TIMES Wednesday 16 December 2015

COMPANIES

Automobiles

VW loses traction in Europe as rivals pick up pace

German group’s market
share shrinks further in
wake of emissions scandal
ANDY SHARMAN
MOTOR INDUSTRY CORRESPONDENT
Volkswagen lost ground to rivals last
month as the European car market grew
strongly, underlining the toxic effects of
the diesel emissions scandal engulfing
the continent’s biggest carmaker.
The German multi-brand car group,
which includes marques from Bentley
to Skoda, lost 2 percentage points of
market share in November as the wider
market expanded by almost 14 per cent.
VW is reeling from revelations of
cheating in tests for emissions of nitro-
gen oxides and carbon dioxide, with up
to 12m vehicles affected in regions
across the world.
In the US — where it was found to have
engines fitted with software capable of
masking pollutants — sales of VW-
brand cars fell 25 per cent last month,
although that was partly because the
carmaker had stopped selling certain
vehicles affected by illegal software.
According to figures released yester-
day by European manufacturers’ body
Acea, VW’s EU market share shrank
from 26.6 per cent in November 2014 to
24.3 per cent last month.
While mass-market brands Seat and
Skoda are noticeably underperforming
in the German company’s portfolio,
VW’s core brand is expected to bear the
brunt of any consumer backlash against
the company. Sales of VW-brand cars
fell by one-fifth in the UK in November,
even as Europe’s second-largest market
returned to growth.
However, VW still managed to main-
tain growth in Europe-wide registra-
tions, with group sales up 4.1 per cent in
November.
The VW brand was up 2.8 per cent but
this compared poorly with year-on-year
growth at rival brands in November:
17 per cent for Peugeot, 18 per cent at
Opel, 19 per cent for Renault and about
20 per cent for Ford and Fiat.
VW admitted on Friday that deliver-
ies of its namesake brand would proba-
bly decline this year for the first time in
11 years.
As of the end of November, global
sales of VW cars including the Polo, Golf
and Passat have fallen 4.5 per cent this
year to 5.34m vehicles, meaning the
brand is unlikely to surpass last year’s
6.12m cars registered.
“In view of the situation of the brand,
which is currently challenging, I do not
expect that we will be able to compen-
sate for this fall in the remaining days of
the year,” said Jürgen Stackmann, the
VW brand’s sales chief.
However, he added that continued
growth in European sales was a sign that
customers in its home territory were
“remaining loyal”.
The industry-wide performance so far
this year means Europe’s car market is
up 8.7 per cent, reaching 12.6m units
and surpassing the total for 2014.

Technology. Green power Technology

Uber drivers
Tesla in stand-off over lithium supply for factory on road to
Electric carmaker needs to
unionising
secure raw material for the with Seattle
world’s biggest battery plant
law approval
HENRY SANDERSON

On the edge of the Nevada desert, Tesla,
the electric carmaker, is building the
world’s largest battery plant.
The mile-long, so-called Gigafactory
is expected to boost demand for lith-
ium, the raw material used in the batter-
ies that power most electric cars.
But the company has yet to announce
any lithium supply deals with big pro-
ducers, leaving it unclear where it will
source the lightweight material that it
and its partner Panasonic will need to
start producing batteries by 2017.
The Gigafactory is set to supply bat-
teries for the 500,000 cars ayear Tesla
hopes to make by the end of the decade,
as well as to power homes. It hopes that
by supplying its own batteries the costs
per kilowatt hour can be cut by more
than 30 per cent, crucial for the mass-
market uptake of electric vehicles.
But that will require secure, long-
term supplies of lithium, more than
70 per cent of which is found in Chile,
Argentina and Bolivia. Due to growth in
demand for batteries, the global lithium
market is approaching a shortage, with
no new supply coming on stream next
year, say analysts. At the same time, bat-
tery factories being built in China are set
to increase demand for lithium.
“Raw material availability is probably
the biggest challenge facing the Gigafac-
tory outside of the need for basic
demand,” says Benchmark Mineral
Intelligence, a consultancy in London.
“It is also the only area of the electric
vehicle supply chain where Tesla does
not have ownership and control.”
The company tried to buy Simbol
Materials, a California-based lithium
start-up, in June 2014 but the company
has since gone into receivership, said a
person familiar with the matter.
Joe Lowry, founder of Global Lithium,
a consultancy, says: “The current strat-
egy seems to be no direct investment
but leveraging the Tesla name by sign-
ing ‘contingent’ contracts at unachieva-
bly low prices with junior mining com-
panies who have never produced lith-
ium chemicals.
“The most likely outcome is Tesla will
pay high market prices for lithium
through at least the end of the decade,”
adds Mr Lowry, who used to work for
FMC Lithium, one of the big producers.
So far two companies have
announced supply deals with Tesla, and
neither is expected to produce substan-
tial amounts of lithium until after 2020.
That could leave the company short of
Pharmaceuticals
Tesla hopes to cut the cost of
producing electric vehicles by Hard cell
making its own batteries — Emile Clean energy set to drive
Wamsteker/Bloomberg
need for reactive metal
Lithium is mostly used in glass,
ceramics and lubricants — about
30 per cent of lithium supplies are
currently used in batteries. Lithium
salts are also used to treat
depression and mood disorders.
Lithium is a highly reactive metal
that rarely occurs in its natural
state; it needs to be chemically
Lithium carbonate prices extracted from compounds in hard
Annual average battery-grade price rock, or from ionic solutions such as
($ ’000 per tonne) brine. About 70 per cent of the
world’s supply lies in the salt flats
8 of Chile, Bolivia, and Argentina.
Analysts say lithium demand is
6 set to increase over the next five to
10 years as battery costs come
4 down and electric vehicles and
storage for grid power become
more widespread.
2 Prices for lithium in China have
risen 60 per cent over the past two
0 months on increased demand in
2010 11 12 13 14 consumer goods and electric
vehicles.
Source: USGS
the material it needs when its factory
starts operating — or trying to sign sup-
ply agreements when the price of lith-
ium hydroxide is higher.
Tesla will need about 24,000 tonnes
annually of the material, according to
Benchmark Mineral Intelligence, out of
a market last year of 50,000 tonnes.
Elon Musk, Tesla’s founder, has said
the company will seek to use lithium
from Nevada. The US’s only operation
producing the metal — Albemarle’s Sil-
ver Peak mine — is based there.
Analysts say Albemarle of Baton
Rouge, FMC Lithium of Philadelphia
and SQM of Chile, the big producers of
lithium, have not been willing to supply
at the prices Tesla has demanded.
“Tesla is not the biggest piece of the
pie,” one smaller producer says. “It’s the
dog that barks that doesn’t bite.”
Tesla says none of the announced sup-
ply agreements is exclusive and not all its
lithiumwillcomefromthesesuppliers.
FMC Lithium says it is in continuous
sourcing discussions with many of the
leading electric vehicle manufacturers,
including Tesla. Albemarle says it can-
not discuss any information related to
its supply agreements. SQM did not
respond to a request for comment.
In August, Bacanora Minerals, which
Financials
is developing the Sonora project, a lith-
ium plant in Mexico, said it had a condi-
tional agreement with Tesla to supply
lithium hydroxide. That sent Bacanora’s
shares up by about a quarter on the day.
Last month the Toronto-listed com-
pany raised £8.8m through issuing new
shares for the project, which is not
expected to start its first phase of pro-
duction until the first half of 2018.
In September Mr Musk said on Twit-
ter that the Bacanora deal “is not exclu-
sive and has many contingencies”.
The same month, Pure Energy Miner-
als said it had entered into an agreement
with Tesla for the “potential” supply of
lithium hydroxide. It plans to produce
this from Nevada, in the same basin as
Albemarle, about three and a half hours’
drive from the Gigafactory.
The company said the agreement sets
a “predetermined price that is below
current market rates and is aligned with
Tesla’s goal to continuously reduce the
cost of its lithium ion batteries”.
As the Gigafactory comes into produc-
tionthatis likely to spur other small pro-
ducersintheUS,accordingtoanalysts.
“You’re going to see a lot more people
digging for lithium brine in Nevada,”
one producer adds. “For just its close-
ness to the factory.”
TIM BRADSHAW AND LESLIE HOOK
SAN FRANCISCO
Drivers for ride-hailing apps such
as Uber and Lyft may soon be able to
unionise in Seattle, a first in the US that
will fuel a growing debate about work-
ers’ rights in the on-demand economy.
Seattle City Council has unanimously
approved a law, titled “Giving Drivers a
Voice”, aimed at “levelling the bargain-
ing power” between drivers and the
operators of app-enabled transport
services, as well as traditional taxis
and limos.
Seattle council member Mike O’Brien
hailed the city’s legislation as “ground-
breaking”.
“We’ve heard from Seattle drivers
making [a] sub-minimum wage, and
companies like Uber have turned a deaf
ear to their concerns,” he said. “This bill
was only introduced out of necessity
after witnessing how little power drivers
themselves had in working for a living
wage.”
However, Seattle Mayor Ed Murray
said that even though he supported
workers’ rights to organise, he had con-
cerns about the costs and administra-
tive burden of implementing the bill
and would not sign it. While the ordi-
nance will become law without the
mayor’s signature, implementation
may require “additional clarifying legis-
lation” next year.
Services such as Uber had seen “tre-
The vote will bolster
nascent efforts by Uber
drivers to organise in
other US cities
mendous growth” in Seattle, Mr Murray
noted, adding that “these companies are
providing valuable new tools for city
residents and innovating at a tremen-
dous pace”.
Nonetheless, the vote will bolster nas-
cent efforts by Uber drivers to organise
in other US cities. In October, several
hundred drivers in Los Angeles, Chicago
and Houston pledged to strike over fare
pricing and tips. However, such move-
ments represent a small minority of the
hundreds of thousands of independent
contractors involved with Uber.
The issue of how independent con-
tractors are treated by operators of on-
demand apps has emerged as a regula-
tory challenge for tech start-ups in
recent months.
Last week a judge in California
expanded the number of Uber drivers

FDA in U-turn over Pacira pain drug
DAVID CROW — NEW YORK
US regulators have taken the rare step
of reversing a decision aimed at curb-
ing the use of a pain medicine after the
company that makes the drug sued the
government for violating its right to
free speech.
The Food and Drug Administration’s
U-turn sent shares in drugmaker Pacira
up 16 per cent, as lawyers said the move
represented a victory for drugmakers
that engage in “off-label” promotion —
the marketing of medicines to treat ill-
nesses for which they are not approved.
In September last year, the FDA
issued a warning letter that effectively
banned Pacira, a New Jersey drug-
maker, from marketing Exparel as a
pain reliever suitable for a broad swath
of patients recovering from surgery.
The agency said the drug should only
be used after surgery to remove haem-
orrhoids or bunions — two operations
where the drug was proved to be effec-
tive during large clinical trials.
Yesterday the FDA overturned its
decision and agreed the drug’s label
could be revised to make clear that it
could be used by patients recovering
from a wider range of procedures.
The about-turn comes just three
months after Pacira sued the US govern-
ment, alleging the FDA had infringed on
its right under the First Amendment to
“speak in a truthful and non-misleading
fashion” about its product. After the
Exparel can now be marketed to
more people than previously
decision yesterday Pacira agreed to
drop all litigation against the agency
without seeking a court ruling on the
free speech issue.
James Beck, an attorney at Reed
Smith, called the FDA’s U-turn “remark-
able” and said he could not recall a pre-
vious rescinding of a warning letter.
A spokesperson for the FDA said it
had done so in the past but that “such
action is rare”.
Pacira’s fight against the FDA was
backed by 11 of the biggest names in the
pharmaceuticals industry — such as
Pfizer, Johnson & Johnson, GlaxoSmith-
Kline, Novartis and Sanofi — which filed
a so-called amicus brief in support.
The decision could open the door for
drug companies to promote their medi-
cines as treatments for a variety of ill-
nesses without having to do as many
costly clinical trials to prove they work.
Instead, companies could seek to
market their drugs for a wide range of
illnesses, pointing to evidence with a
much lower bar, such as the anecdotal
experiences of patients and doctors.
Distressed-debt manager exits
MARY CHILDS — NEW YORK
Credit trader Jeffrey Teach, who moved
from UBS to Sound Point Capital Man-
agement two years ago, has stepped
down from running a distressed-debt
portfolio.
Mr Teach departed in the past month,
about two years after joining the credit-
focused alternative asset manager. In
2013, Sound Point bought a portion of
UBS’s distressed credit and loan asset
and brought Mr Teach and five others
on board.
The firm said in an internal note last
week that after 20 years, Mr Teach
wanted to “step away from his day-to-
day portfolio management,” and will
continue to be involved with the fund.
He remains the largest individual inves-
tor in The Sound Point Beacon Offshore
Fund, the firm said.
Stephen Ketchum, who founded
Sound Point in 2008, continues to man-
age the fund. Last month, he hired Marc
Sole, formerly of Hudson Bay Credit, as
head of hedge fund research, according
to a person familiar with the matter. The
firm has expanded assets under man-
agement this year by a third to $7.6bn.
The Beacon fund has gained 2.6 per
cent this year to the end of October. An
HFRI index of hedge funds focused on
distressed situations and restructuring
has returned a loss of 6.4 per cent this
year to the end of November. Since 2013,
the Beacon fund has returned more
than 29 per cent.
Mr Teach started at UBS in 2001, and
before that traded loans and bonds at
JPMorgan, according to Sound Point’s
website. His departure comes amid tur-
moil in the bond market, including ris-
ing indebtedness, depressed commod-
ity prices and falling revenues.
Hedge fund Lucidus Capital Partners
was the latest specialist credit fund to
liquidate its assets in the wake of inves-
tor withdrawals, following US asset
manager Third Avenue, which said last
week it would shut its $788m “Focused
Credit Fund” after a wave of losses and
investor redemptions. Stone Lion Capi-
tal Partners, a hedge fund, said on Fri-
day that it was barring redemptions
from a $400m credit fund.
who can participate in a class-action
lawsuit over whether they are entitled
to benefits and expenses.
“This law is the first in what is likely to
be a rising wave of innovative
approaches to updating a legal frame-
work that ensures all workers in the on-
demand and subcontracted economies
have access to the basic rights they
deserve,” said Nikki Fortunato Bas,
director of advocacy group Partnership
for Working Families.
Uber and Lyft criticised the legisla-
tion, saying it threatened the flexibility
their drivers currently enjoy. Oppo-
nents have questioned to what extent
city authorities can overrule federal
laws on collective bargaining, as con-
tractors are excluded from the National
Labor Relations Act.
Uber said it created “new opportuni-
ties for many people to earn a better liv-
ing on their own time and their own
terms”, with half driving fewer than 10
hours a week and a majority using the
service to supplement income from
other jobs.
“Unfortunately, the ordinance passed
today threatens the privacy of drivers,
imposes substantial costs on passengers
and the city, and conflicts with long-
standing federal law,” Lyft said.
Wednesday 16 December 2015 ★ FINANCIAL TIMES
20 ★ FINANCIAL TIMES Wednesday 16 December 2015

MARKET DATA

WORLD MARKETS AT A GLANCE FT.COM/MARKETSDATA

Change during previous day’s 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 $

-1.68% -0.17% -0.997% -0.463% -0.412% -0.63%

1.04% 0.87% 1.00% 2.45% 2.91% 0.99% 0.833% 0.06%
Stock Market movements over last 30 days, with the FTSE All-World in the same currency as a comparison
AMERICAS EUROPE ASIA
Nov 16 - Dec 15 Index All World Nov 16 - Dec 15 Index All World Nov 16 - Dec 15 Index All World Nov 16 - Dec 15 Index All World Nov 16 - Dec 15 Index All World Nov 16 - Dec 15 Index All World

S&P 500 New York S&P/TSX COMP Toronto FTSE 100 London Xetra Dax Frankfurt Nikkei 225 Tokyo Kospi Seoul

2,042.96 13,317.52 19,596.91

2,023.04 12,911.96 6,118.28 10,713.23 10,450.38 1,943.02 1,932.97
5,874.06
18,565.90
Day 1.04% Month 0.93% Year 1.98% Day 1.71% Month -1.36% Year -5.89% Day 2.45% Month -1.59% Year -2.62% Day 3.07% Month -2.09% Year NaN% Day -1.68% Month -5.26% Year 6.88% Day 0.27% Month -2.04% Year 0.59%

Nasdaq Composite New York IPC Mexico City FTSE Eurofirst 300 Europe Ibex 35 Madrid Hang Seng Hong Kong FTSE Straits Times Singapore

1,460.76 10,124.50 2,915.73

4,995.42 43,617.73 22,010.82
4,927.88 42,526.07 1,411.68 9,711.60
21,274.37 2,815.52
Day 0.87% Month 1.35% Year 7.32% Day 1.49% Month -2.50% Year 1.94% Day 2.91% Month -3.15% Year 9.40% Day 3.00% Month -3.95% Year -4.27% Day -0.17% Month -5.01% Year -8.49% Day 0.02% Month -3.77% Year 11.76%

Dow Jones Industrial New York Bovespa São Paulo CAC 40 Paris FTSE MIB Milan Shanghai Composite Shanghai BSE Sensex Mumbai
17,542.04 47,435.58 4,804.31
4,614.40 21,811.36 3,606.96
17,245.24 21,272.68 3,510.35 25,610.53
45,086.43 25,320.44
Day 1.00% Month 1.67% Year 1.47% Day 0.76% Month -3.16% Year -4.20% Day 3.16% Month -4.03% Year 12.30% Day 3.74% Month -2.61% Year 17.67% Day -0.29% Month -1.97% Year 19.47% Day 0.68% Month -1.13% Year -7.42%

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 12360.20 12337.32 Cyprus CSE M&P Gen 67.04 67.78 Italy FTSE Italia All-Share 23009.62 22228.85 Philippines Manila Comp 6701.35 6745.99 Taiwan Weighted Pr 8073.35 8040.16 Cross-Border DJ Global Titans ($) 234.05 231.31
Australia All Ordinaries 4963.90 4981.90 Czech Republic
PX 928.99 919.73 FTSE Italia Mid Cap 33955.11 33274.76 Poland Wig 44275.41 43887.16 Thailand Bangkok SET 1300.51 1267.61 Euro Stoxx 50 (Eur) 3241.59 3139.24
S&P/ASX 200 4909.60 4928.60 Denmark OMXC Copenahgen 20 981.57 962.79 FTSE MIB 21272.68 20506.56 Portugal PSI 20 5150.10 5022.98 Turkey BIST 100 69308.74 70280.34 Euronext 100 ID 895.06 869.24
S&P/ASX 200 Res 2211.60 2238.60 Egypt EGX 30 6408.12 6395.20 Japan 2nd Section 4643.29 4709.52 PSI General 2397.26 2342.99 UAE Abu Dhabi General Index 4014.92 4026.23 FTSE 4Good Global ($) 5380.86 5313.30
Austria ATX 2352.43 2292.32 Estonia OMX Tallinn 887.50 890.25 Nikkei 225 18565.90 18883.42 Romania BET Index 6873.40 6881.48 UK FT 30 2777.80 2716.60 FTSE All World 261.13 258.56
Belgium BEL 20 3582.18 3492.90 Finland OMX Helsinki General 8404.16 8200.25 S&P Topix 150 1241.64 1264.09 Russia Micex Index 1742.46 1708.70 FTSE 100 6017.79 5874.06 FTSE E300 1411.68 1371.76
BEL Mid 5787.32 5730.99 France CAC 40 4614.40 4473.07 Topix 1502.55 1527.88 RTX 783.65 761.08 FTSE 4Good UK 5502.17 5376.82 FTSE Eurotop 100 2797.60 2716.43
Brazil Bovespa 45086.43 44747.31 SBF 120 3637.25 3531.97 Jordan Amman SE 2087.06 2080.13 Saudi-Arabia TADAWUL All Share Index 6771.53 6686.27 FTSE All Share 3327.71 3256.53 FTSE Global 100 ($) 1308.63 1291.83
Canada S&P/TSX 60 763.38 749.53Germany M-DAX 20484.65 19962.31 Kenya NSE 20 3987.57 3968.20 Singapore FTSE Straits Times 2815.52 2815.04 FTSE techMARK 100 3877.71 3851.47 FTSE Gold Min ($) 869.50 908.79
S&P/TSX Comp 12911.96 12695.49 TecDAX 1789.16 1741.56 Kuwait KSX Market Index 5616.18 5602.38 Slovakia SAX 295.10 295.10 USA DJ Composite 5976.64 5923.63 FTSE Latibex Top (Eur) 2339.80 2290.40
S&P/TSX Met & Min 305.98 303.25 XETRA Dax 10450.38 10139.34 Latvia OMX Riga 592.35 591.88 Slovenia SBI TOP 676.70 682.93 DJ Industrial 17542.04 17368.50 FTSE Multinationals ($) 1464.34 1468.92
Chile IGPA Gen 17629.39 17492.93Greece Athens Gen 583.18 590.26 Lithuania OMX Vilnius 483.82 484.51 South Africa FTSE/JSE All Share 48428.77 48081.71 DJ Transport 7526.92 7489.64 FTSE World ($) 463.53 458.92
China FTSE A200 9397.79 9451.24 FTSE/ASE 20 170.82 172.11 Luxembourg LuxX 1343.13 1324.18 FTSE/JSE Res 20 23275.90 23599.54 DJ Utilities 560.56 553.88 FTSEurofirst 100 (Eur) 3964.11 3845.32
FTSE B35 11292.52 11237.48Hong Kong Hang Seng 21274.37 21309.85 Malaysia FTSE Bursa KLCI 1622.84 1629.96 FTSE/JSE Top 40 43701.61 43415.47 Nasdaq 100 4607.48 4570.16 FTSEurofirst 80 (Eur) 4356.53 4222.87
Shanghai A 3674.97 3685.93 HS China Enterprise 9344.07 9315.91 Mexico IPC 42526.07 41901.96 South Korea Kospi 1932.97 1927.82 Nasdaq Cmp 4995.42 4952.23 MSCI ACWI Fr ($) 391.63 392.95
Shanghai B 400.11 396.70 HSCC Red Chip 3967.60 3944.77 Morocco MASI 8865.63 9108.93 Kospi 200 238.80 238.17 NYSE Comp 10098.81 9986.76 MSCI All World ($) 1632.28 1637.83
Shanghai Comp 3510.35 3520.67Hungary Bux 23073.63 23005.73 Netherlands AEX 433.63 420.66 Spain IBEX 35 9711.60 9428.50 S&P 500 2042.96 2021.94 MSCI Europe (Eur) 1344.96 1365.81
Shenzhen A 2369.22 2342.93India BSE Sensex 25320.44 25150.35 AEX All Share 665.38 646.97 Sri Lanka CSE All Share 6820.77 6803.08 Wilshire 5000 21082.31 20871.03 MSCI Pacific ($) 2250.18 2279.10
Shenzhen B 1292.12 1289.52 S&P CNX 500 6501.75 6457.60 New Zealand NZX 50 6040.55 6035.25 Sweden OMX Stockholm 30 1425.25 1389.26 Venezuela IBC 14478.96 15005.31 S&P Euro (Eur) 1448.18 1405.10
Colombia COLCAP 1074.26 1074.88Indonesia Jakarta Comp 4409.17 4374.19 Nigeria SE All Share 27179.28 27269.71 OMX Stockholm AS 494.58 483.56 Vietnam VNI 568.00 562.22 S&P Europe 350 (Eur) 1449.03 1407.79
Croatia CROBEX 1653.09 1659.99Ireland ISEQ Overall 6656.32 6589.96 Norway Oslo All Share 640.81 622.72 Switzerland SMI Index 8581.56 8375.31 S&P Global 1200 ($) 1817.46 1800.53
Israel Tel Aviv 100 12.83 12.90 Pakistan KSE 100 32467.04 32467.04 Stoxx 50 (Eur) 3052.05 2960.70
(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 Dec 15 %Chg %Chg Dec 15 %Chg %Chg Dec 15 %Chg %Chg Dec 15 %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
Apple 27.3 111.49 -0.99 Royal Dutch Shell 150.5 1473.50 45.50 Santander 739.8 4.63 0.19 Toyota Motor 769.2 7324.00 -139.00 Ashtead 1100.00 6.7 -4.5 Entertainment One 165.20 17.2 -48.8 Stock Spirits 129.50 23.3 -41.1 Oil Equipment & Services 12481.74 4.0 -23.9
Amazon.com 15.1 664.86 6.95 Hsbc Holdings 146.0 511.60 17.45 Novartis N 568.5 75.99 0.00 Mitsubishi Ufj Fin,. 480.9 743.00 -19.20 Centrica 209.30 4.5 -24.4 Micro Focus Int 1536.00 15.7 41.3 Johnston Press 45.38 19.2 -72.9 Electricity 8311.64 1.5 -15.2
Hospira 11.8 89.95 -0.01 Vodafone 138.9 209.50 5.75 Telefonica 496.8 10.70 0.46 Mizuho Fin,. 341.5 235.50 -6.10 Tui Ag 1189.00 4.4 10.1 Petra Diamonds 68.00 11.3 -64.9 Nanoco 47.00 14.6 -67.8 Electronic & Electrical Equip. 4179.21 0.7 3.7
Microsoft 10.1 55.25 0.11 Bp 138.0 337.70 7.40 Sanofi 461.3 78.72 3.99 Sumitomo Mitsui Fin,. 326.8 4492.00 -94.00 Glencore 82.37 3.7 -72.4 Polymetal Int 545.50 8.6 -5.3 Kcom 110.25 11.2 22.0 Nonlife Insurance 2447.66 0.6 26.5
Facebook Class A 9.9 104.84 0.18 Bg 125.3 956.00 30.26 Total 422.3 42.28 1.70 Softbank . 302.1 6007.00 -93.00 Carnival 3544.00 2.4 20.7 Wood (john) 583.50 8.5 -2.2 Hss Hire 63.00 9.6 - General Industrials 4310.22 0.4 10.6
The Walt Disney 7.9 112.59 3.24 Royal Dutch Shell 121.2 1463.50 43.04 Nestle N 384.2 66.15 0.00 Sony 289.3 2950.50 -65.50 Sainsbury (j) 249.30 1.9 1.1 Moneysupermarket.com 344.80 7.8 47.4 Xchanging 191.50 9.0 23.2 Gas Water & Multiutilities 5774.01 0.4 -5.9
Exxon Mobil 7.8 79.09 3.06 Glaxosmithkline 115.6 1308.50 19.04 Roche Gs 360.6 242.77 0.00 Fanuc 220.5 20455.00 -420.00 Merlin Entertainments 437.00 1.7 10.1 Btg 667.00 7.8 -16.1 Kainos 259.00 8.8 - Automobiles & Parts 6850.53 0.2 -14.9
General Electric 7.4 30.35 0.09 British American Tobacco 114.6 3686.00 78.25 Bbva 325.7 6.93 0.13 Fast Retailing Co., 219.9 43980.00 -540.00 Intercontinental Hotels 2566.00 1.6 -1.1 Sig 140.10 6.9 -20.0 Petropavlovsk 6.59 6.3 -55.3 Travel & Leisure 8748.03 -0.1 8.5
Bank Of America 7.3 17.27 0.47 Sabmiller 111.1 4030.00 25.00 Allianz Se Vna O.n. 307.1 155.70 0.00 Nippon Telegraph And Telephone 210.8 4597.00 11.00 Admiral 1653.00 1.4 24.5 Circassia Pharmaceuticals 300.00 5.6 7.6 Anglo-eastern Plantations 535.25 5.7 -2.7 Household Goods 16144.19 -0.1 26.2
Netflix 6.9 120.45 -0.22 Lloyds Banking 104.8 70.34 1.54 Unicredit 306.8 4.91 0.00 Alps Electric Co., 209.4 3365.00 -90.00 Morrison (wm) Supermarkets 147.10 1.2 -20.7 Auto Trader 447.00 5.4 - Tyman 269.75 5.6 -14.4 Equity Investment Instruments 7304.17 -0.5 0.9
Sse 1450.00 1.1 -11.2 Bellway 2772.00 5.2 41.4 S&U 2476.50 5.1 25.2 Media 7189.55 -0.6 10.0
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
Direct Line Insurance 410.00 1.0 29.0 Bwin.party Digital Entertainment 116.70 5.1 -0.9 Uk Mail 291.88 4.8 -37.5 Health Care Equip.& Services 6675.16 -1.1 -0.9
price change chng% price change chng% price change chng% price change chng%
Ups Ups Ups Ups Losers Losers Losers Losers
Ensco 16.42 1.23 8.10 Circassia Pharmaceuticals 300.00 24.50 8.89 Altice 10.82 0.82 8.25 Konami 2940.00 23.00 0.79 Anglo American 271.10 -16.2 -77.4 Aveva 1550.00 -30.4 18.0 Tribal 24.75 -54.1 -84.4 Industrial Metals 613.08 -19.3 -59.9
Vimpelcom 3.28 0.24 7.73 Btg 667.00 43.50 6.98 Altice B 10.92 0.73 7.16 Chubu Electric Power ,orporated 1656.50 7.50 0.45 Old Mutual 166.20 -15.6 -99.1 Evraz 62.25 -19.0 -59.7 Kenmare Resources 0.37 -32.5 -88.5 Aerospace & Defense 4026.24 -4.0 -15.3
Leucadia National 17.00 0.92 5.72 Tullow Oil 159.90 9.11 5.99 Arcelormittal 3.56 0.19 5.55 Thb Kansai Electric Power ,orporated 1374.00 4.50 0.33 Sports Direct Int 579.50 -14.3 -18.6 Stagecoach 297.60 -17.1 -20.3 Lonmin 0.76 -26.9 -99.6 Technology Hardware & Equip. 1289.39 -4.0 8.3
Wynn Resorts Ltd 66.31 3.54 5.64 Evraz 62.25 3.50 5.96 Sanofi 78.72 3.99 5.34 Credit Saison Co., 2424.00 6.00 0.25 Rolls-royce Holdings 540.00 -9.2 -38.4 Int Personal Finance 290.50 -16.1 -35.4 Ferrexpo 17.25 -19.4 -65.4 Forestry & Paper 14282.82 -3.7 26.2
Columbia Pipeline Common Stock 19.59 0.98 5.24 Aa 285.60 16.00 5.93 Asml Holding 81.69 3.98 5.12 Nippon Telegraph And Telephone 4597.00 11.00 0.24 Pearson 707.00 -7.8 -40.8 Premier Oil 48.69 -16.0 -70.9 Imagination 146.00 -16.2 -34.2 Life Insurance 7536.98 -3.4 -0.1
Standard Chartered 482.00 -7.3 -50.0 Acacia Mining 157.90 -14.2 -38.2 Communisis 37.50 -13.8 -24.8 Mobile Telecommunications 4847.39 -3.2 -3.4
Downs Downs Downs Downs
Antofagasta 412.90 -6.5 -45.1 Investec 452.10 -14.0 -16.5 Hochschild Mining 45.25 -10.8 -48.6 Oil & Gas Producers 5423.92 -2.7 -23.9
3m 150.01 -7.62 -4.83 Aveva 1550.00 -616.00 -28.44 Bouygues 34.78 -0.39 -1.11 Asahi Kasei 761.10 -39.80 -4.97
Mondi 1326.00 -6.3 22.9 Pz Cussons 271.00 -14.0 -11.8 Dialight 440.00 -10.2 -45.7 General Retailers 2992.94 -2.7 0.6
Comcast 58.00 -1.69 -2.83 Supergroup 1516.00 -103.00 -6.36 Assa Abloy Ab Ser. B 18.79 0.00 0.00 Nisshin Steel Holdings Co., 1264.00 -52.00 -3.95
Standard Life 371.10 -6.1 -7.3 Allied Minds 414.40 -11.5 13.1 Lamprell 91.50 -7.6 -24.4 Food & Drug Retailers 2482.93 -2.7 -12.4
Cabot Oil & Gas 15.23 -0.42 -2.68 Paragon Of Companies 344.40 -13.70 -3.83 Atlas Copco Ab Ser. A 22.46 0.00 0.00 Tdk 8290.00 -340.00 -3.94
Shire 4182.00 -6.1 -7.7 Vedanta Resources 288.50 -10.7 -49.8 Carclo 131.00 -7.3 46.4 General Financial 9133.67 -2.6 7.1
Deere & 77.02 -1.92 -2.43 Anglo American 271.10 -9.70 -3.45 Atlas Copco Ab Ser. B 20.64 0.00 0.00 Fukuoka Fin,. 545.00 -21.00 -3.71
Capita 1146.00 -5.6 6.0 Aldermore 205.50 -10.6 - Chemring 169.75 -6.7 -29.0 Food Producers 8851.23 -2.5 8.6
Skyworks Solutions 76.85 -1.66 -2.11 Paypoint 921.50 -27.00 -2.85 Ericsson , Telefonab. L M Ser. B 8.24 0.00 0.00 Pioneer 340.00 -13.00 -3.68
Next 7505.00 -5.6 7.7 Paragon Of Companies 344.40 -8.5 -17.3 Porvair 283.00 -6.1 2.2 Construction & Materials 4965.55 -2.5 20.3
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
Dec 15 Currency Mid Change Mid Change Mid Change Dec 15 Currency Mid Change Mid Change Mid Change Dec 15 Currency Mid Change Mid Change Mid Change Dec 15 Currency Mid Change Mid Change Mid Change
Argentina Argentine Peso 9.7716 -0.0132 10.6715 -0.1186 14.7034 -0.0910 Indonesia Indonesian Rupiah 14056.5000 -21.0000 15351.0556 -172.9896 21150.9948 -134.0696 Poland Polish Zloty 3.9681 0.0115 4.3335 -0.0296 5.9708 -0.0115 ..Three Month 0.6646 0.0032 0.7256 -0.0036 - -
Australia Australian Dollar 1.3948 0.0135 1.5233 0.0000 2.0988 0.0102 Israel Israeli Shekel 3.8692 0.0117 4.2255 -0.0283 5.8219 -0.0105 Romania Romanian Leu 4.1180 0.0296 4.4973 -0.0113 6.1964 0.0147 ..One Year 0.6648 0.0032 0.7250 -0.0036 - -
Bahrain Bahrainin Dinar 0.3773 -0.0001 0.4120 -0.0041 0.5677 -0.0029 Japan Japanese Yen 121.7250 1.0050 132.9354 -0.1891 183.1608 0.6334 Russia Russian Ruble 70.0469 -0.6481 76.4980 -1.4613 105.4003 -1.4899 United States United States Dollar - - 1.0921 -0.0107 1.5047 -0.0073
Bolivia Bolivian Boliviano 6.9100 0.0100 7.5464 -0.0626 10.3975 -0.0352 ..One Month 121.7248 1.0047 132.9354 -0.1892 183.1606 0.6329 Saudi Arabia Saudi Riyal 3.7520 0.0000 4.0975 -0.0399 5.6457 -0.0272 ..One Month - - 1.0920 -0.4199 1.5047 -0.0073
Brazil Brazilian Real 3.8909 0.0033 4.2492 -0.0379 5.8546 -0.0234 ..Three Month 121.7247 1.0044 132.9355 -0.1891 183.1604 0.6325 Singapore Singapore Dollar 1.4086 -0.0004 1.5383 -0.0155 2.1195 -0.0109 ..Three Month - - 1.0918 -0.4199 1.5047 -0.0073
Canada Canadian Dollar 1.3756 0.0007 1.5023 -0.0139 2.0699 -0.0090 ..One Year 121.7235 1.0019 132.9354 -0.1892 183.1606 0.6310 South Africa South African Rand 14.9859 -0.2898 16.3660 -0.4794 22.5494 -0.5474 ..One Year - - 1.0907 -0.4199 1.5049 -0.0073
Chile Chilean Peso 710.1900 -2.1350 775.5960 -9.9237 1068.6299 -8.3986 Kenya Kenyan Shilling 102.2500 - 111.6669 -1.0898 153.8566 -0.7444 South Korea South Korean Won 1183.5000 -1.2000 1292.4963 -13.9372 1780.8240 -10.4307 Venezuela Venezuelan Bolivar Fuerte 6.3053 0.0203 6.8859 -0.0449 9.4876 -0.0153
China Chinese Yuan 6.4610 0.0019 7.0560 -0.0668 9.7219 -0.0442 Kuwait Kuwaiti Dinar 0.3033 0.0002 0.3312 -0.0030 0.4564 -0.0019 Sweden Swedish Krona 8.4990 0.0206 9.2817 -0.0679 12.7885 -0.0308 Vietnam Vietnamese Dong 22538.5000 -7.5000 24614.2334 -248.5242 33913.9400 -175.4971
Colombia Colombian Peso 3323.2500 -30.6000 3629.3109 -69.1629 5000.5276 -70.4612 Malaysia Malaysian Ringgit 4.3050 -0.0205 4.7015 -0.0685 6.4778 -0.0623 Switzerland Swiss Franc 0.9905 0.0092 1.0817 -0.0004 1.4903 0.0067 European Union Euro 0.9157 0.0089 - - 1.3778 0.0067
Costa Rica Costa Rican Colon 531.2500 - 580.1763 -5.6622 799.3771 -3.8677 Mexico Mexican Peson 17.1683 -0.2217 18.7494 -0.4274 25.8332 -0.4601 Taiwan New Taiwan Dollar 32.8025 -0.0760 35.8235 -0.4334 49.3582 -0.3537 ..One Month 0.9155 0.0088 - - 1.3777 0.0067
Czech Republic Czech Koruna 24.7455 0.2417 27.0244 0.0028 37.2347 0.1853 New Zealand New Zealand Dollar 1.4823 0.0049 1.6188 -0.0104 2.2304 -0.0033 Thailand Thai Baht 35.9700 -0.1700 39.2827 -0.5708 54.1244 -0.5189 ..Three Month 0.9154 0.0088 - - 1.3776 0.0067
Denmark Danish Krone 6.8321 0.0658 7.4614 -0.0002 10.2804 0.0498 Nigeria Nigerian Naira 199.2200 -0.0300 217.5675 -2.1564 299.7683 -1.4957 Tunisia Tunisian Dinar 2.0253 0.0149 2.2118 -0.0052 3.0475 0.0078 ..One Year 0.9143 0.0088 - - 1.3770 0.0067
Egypt Egyptian Pound 7.8351 0.0263 8.5566 -0.0546 11.7895 -0.0174 Norway Norwegian Krone 8.6962 0.0194 9.4970 -0.0712 13.0852 -0.0339 Turkey Turkish Lira 2.9648 -0.0293 3.2378 -0.0639 4.4611 -0.0658
Hong Kong Hong Kong Dollar 7.7504 -0.0003 8.4642 -0.0829 11.6621 -0.0568 Pakistan Pakistani Rupee 104.7500 0.0500 114.3971 -1.0613 157.6183 -0.6870 United Arab Emirates UAE Dirham 3.6729 0.0000 4.0112 -0.0392 5.5266 -0.0268
Hungary Hungarian Forint 289.5523 2.1344 316.2190 -0.7324 435.6921 1.1192 Peru Peruvian Nuevo Sol 3.3740 -0.0032 3.6847 -0.0394 5.0769 -0.0293 United Kingdom Pound Sterling 0.6646 0.0032 0.7258 -0.0036 - -
India Indian Rupee 66.9550 -0.1525 73.1213 -0.8818 100.7478 -0.7180 Philippines Philippine Peso 47.3525 0.0150 51.7135 -0.4882 71.2518 -0.3221 ..One Month 0.6646 0.0032 0.7257 -0.0036 - -
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 Dec 15 Dec 14 Dec 11 Dec 10 Dec 09 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 2777.80 2716.60 2750.70 2806.70 2828.50 0.00 3110.40 2575.90 Software & Comp Serv 34.38 FTSE 250 Index 4.92 FTSE All{HY-}Share Index -6.73 FTSE 100 Price Change FTSE 100 Price Change
Dec 15 chge% Index Dec 14 Dec 11 ago yield% Cover ratio adj Return FT 30 Div Yield 1.78 1.81 1.79 1.76 1.75 0.00 3.93 2.74 Nonlife Insurance 25.20 Financial Services 4.83 NON FINANCIALS Index -6.92 3I Group PLC 463.90 12.50 Kingfisher PLC 325.50 5.70
FTSE 100 (100) 6017.79 2.45 6460.71 5874.06 5952.78 6331.83 4.15 1.44 16.68 246.09 4712.86 P/E Ratio net 25.11 24.64 24.92 25.38 25.55 0.00 19.44 14.26 Household Goods & Ho 24.29 Consumer Services 2.94 Chemicals -7.02 Aberdeen Asset Management PLC 291.10 10.70 Land Securities Group PLC 1160 20.00
FTSE 250 (250) 16999.56 1.35 18250.77 16772.57 16877.29 15426.80 2.54 2.10 18.70 436.62 11825.46 FT 30 since compilation: 4198.4 high: 19/07/1999; low49.4 26/06/1940Base Date: 1/7/35 Forestry & Paper 21.43 Support Services 2.87 Industrial Transport -7.73 Admiral Group PLC 1653 42.00 Legal & General Group PLC 260.20 7.00
FTSE 250 ex Inv Co (211) 18477.45 1.32 19837.43 18237.36 18353.16 16624.90 2.57 2.22 17.56 478.25 13106.32 FT 30 hourly changes Construct & Material 19.91 FTSE SmallCap Index 2.81 Utilities -8.47 Anglo American PLC 271.10 -9.70 Lloyds Banking Group PLC 70.34 1.66
FTSE 350 (350) 3375.84 2.25 3624.31 3301.62 3341.57 3464.01 3.86 1.52 17.01 128.82 5328.74 8 9 10 11 12 13 14 15 16 High Low Technology 18.34 Telecommunications 2.63 FTSE 100 Index -9.34 Antofagasta PLC 412.90 0.60 London Stock Exchange Group PLC 2603 117.00
FTSE 350 ex Investment Trusts (311) 3351.24 2.26 3597.90 3277.06 3317.23 3443.85 3.89 1.53 16.82 128.96 2723.74 2716.6 2744.3 2751 2751.3 2756.5 2756.1 2761.4 2775.7 2783.6 2786.1 2716.6 Fixed Line Telecomms 13.83 Electronic & Elec Eq 2.53 Aerospace & Defense -14.40 Arm Holdings PLC 1052 11.00 Marks And Spencer Group PLC 462.60 6.90
FTSE 350 Higher Yield (107) 3030.40 2.50 3253.44 2956.38 2998.10 3375.53 5.74 1.28 13.60 171.99 4906.86 FT30 constituents and recent additions/deletions can be found at www.ft.com/ft30 Real Est Invest & Se 13.69 General Retailers 0.55 Food & Drug Retailer -15.60 Ashtead Group PLC 1100 23.00 Meggitt PLC 362.00 8.70
FTSE 350 Lower Yield (243) 3407.14 2.00 3657.92 3340.46 3374.26 3214.18 2.00 2.21 22.66 70.78 3603.96 Leisure Goods 11.00 Equity Invest Instr -0.66 Electricity -15.94 Associated British Foods PLC 3398 50.00 Merlin Entertainments PLC 437.00 1.70
FTSE SmallCap (288) 4491.58 0.55 4822.17 4467.10 4488.48 4223.97 2.98 1.31 25.63 123.82 6150.72 Consumer Goods 8.91 Personal Goods -0.99 Automobiles & Parts -17.35
FTSE SmallCap ex Inv Co (152) 4060.39 0.28 4359.25 4048.97 4065.02 3683.08 2.90 1.75 19.72 110.11 5839.99 FX: EFFECTIVE INDICES Food Producers 8.13 Industrials -1.11 Banks -18.09
Astrazeneca PLC 4391 105.50 Mondi PLC 1326 51.00
Aviva PLC 496.40 14.40 Morrison (Wm) Supermarkets PLC 147.10 6.90
FTSE All-Share (638) 3327.71 2.19 3572.64 3256.53 3295.07 3404.22 3.83 1.52 17.22 125.70 5313.57 Tobacco 7.90 Life Insurance -1.36 Industrial Eng -19.04
Dec 14 Dec 11 Mnth Ago Dec 15 Dec 14 Mnth Ago Babcock International Group PLC 987.00 11.50 National Grid PLC 909.20 15.00
FTSE All-Share ex Inv Co (463) 3288.65 2.22 3530.71 3217.13 3256.02 3371.42 3.87 1.53 16.87 125.79 2717.10 Tech Hardware & Eq 7.81 Health Care Eq & Srv -1.36 Oil Equipment & Serv -24.22 Bae Systems PLC 490.00 6.60 Next PLC 7505 180.00
FTSE All-Share ex Multinationals (573) 1163.02 2.01 1034.88 1140.10 1149.90 1095.24 2.88 1.57 22.06 32.77 1980.56 Australia 91.37 91.09 91.02 Sweden 78.87 78.97 78.18 Media 7.59 Mobile Telecomms -4.03 Oil & Gas -24.66 Barclays PLC 214.80 5.70 Old Mutual PLC 166.20 8.40
FTSE Fledgling (100) 7647.12 0.02 8209.96 7645.55 7680.33 6678.41 2.58 1.16 33.53 174.55 13774.93 Canada 85.47 85.75 88.34 Switzerland 159.75 159.69 158.80 Travel & Leisure 6.40 Health Care -4.61 Oil & Gas Producers -24.67 Barratt Developments PLC 614.00 19.00 Pearson PLC 707.00 12.00
FTSE Fledgling ex Inv Co (50) 10492.81 -0.01 11265.10 10494.13 10552.34 8291.50 2.82 1.37 25.83 237.62 18394.26 Denmark 106.11 105.95 105.34 UK 91.87 92.60 93.48 Beverages 6.31 Pharmace & Biotech -4.96 Basic Materials -45.10 Berkeley Group Holdings (The) PLC 3725 204.00 Persimmon PLC 1970 67.00
FTSE All-Small (388) 3117.16 0.52 3346.59 3100.99 3115.80 2921.25 2.96 1.30 25.93 85.21 5481.05 Japan 127.02 126.80 125.94 USA 105.29 105.31 106.00 Real Est Invest & Tr 5.14 Financials -6.14 Mining -51.41 Bg Group PLC 956.00 36.50 Prudential PLC 1482 42.50
FTSE All-Small ex Inv Co Index (202) 3032.56 0.27 3255.76 3024.38 3036.55 2733.74 2.90 1.73 19.90 81.56 5526.56 New Zealand 114.71 113.91 111.90 Euro 86.57 86.23 84.82 Gas Water & Multi -6.34 Industrial Metals & -55.51 Bhp Billiton PLC 686.90 17.60 Randgold Resources LD 4024 -18.00
FTSE AIM All-Share Index (819) 719.52 0.31 772.48 717.31 725.40 679.83 1.47 0.79 85.73 9.14 773.87 Norway 83.72 83.65 85.14
BP PLC 337.70 8.40 Reckitt Benckiser Group PLC 6166 78.00
FTSE Sector Indices Source: Bank of England. New Sterling ERI base Jan 2005 = 100. Other indices base average 1990 = 100. British American Tobacco PLC 3686 96.00 RELX PLC 1164 27.00
Oil & Gas (18) 5737.10 3.09 6159.36 5564.98 5685.50 7103.05 6.56 0.20 76.03 371.71 4805.19 Index rebased 1/2/95. for further information about ERIs see www.bankofengland.co.uk British Land Company PLC 778.00 16.00 Rio Tinto PLC 1879.5 31.50
Oil & Gas Producers (11) 5454.71 3.11 5856.19 5290.36 5407.07 6749.45 6.59 0.16 93.42 354.65 4724.08 Bt Group PLC 469.50 12.65 Rolls-Royce Holdings PLC 540.00 2.50
Oil Equipment Services & Distribution (7)13084.94 2.71 14048.02 12740.20 12871.09 16446.97 5.82 1.41 12.18 761.22 9623.43 FTSE GLOBAL EQUITY INDEX SERIES Bunzl PLC 1845 40.00 Royal Bank Of Scotland Group PLC 288.80 6.20
Basic Materials (29) 2574.12 1.72 2763.59 2530.52 2600.15 4458.15 7.93 1.88 6.71 198.46 2524.01 Burberry Group PLC 1157 38.00 Royal Dutch Shell PLC 1473.5 45.50
Chemicals (7) 11299.89 1.80 12131.59 11100.33 11218.18 11699.70 2.46 2.28 17.81 237.16 9714.81 Dec 15 No of US $ Day Mth YTD
YTD Gr Div Dec 15Total No of US $ Day Mth YTD Total YTD Gr Div Capita PLC 1146 1.00 Royal Dutch Shell PLC 1463.5 45.00
Forestry & Paper (1) 15585.18 4.00 16732.28 14985.75 14985.75 12188.41 2.31 3.37 12.81 360.52 16189.46 Regions & countries stocks indices % % %
% Yield Sectorsretn stocks indices % % % retn % Yield Carnival PLC 3544 109.00 Royal Mail PLC 444.00 6.30
Industrial Metals & Mining (2) 618.89 3.80 664.44 596.21 692.86 1211.94 1.86 -18.64 -2.88 11.18 540.10 FTSE Global All Cap 7743 441.88 -0.4 -1.8-3.8 -6.0 603.96
2.6 Oil & Gas 165 300.26 -0.4 -0.4 -24.6 458.28 -21.9 4.4 Centrica PLC 209.30 1.20 Rsa Insurance Group PLC 421.00 8.50
Mining (19) 6531.37 1.52 7012.09 6433.62 6642.85 12819.64 9.56 1.85 5.65 616.70 3353.31 FTSE Global All Cap 7113 454.92 -0.3 -1.7-3.9 -6.0 610.87
2.5 Oil & Gas Producers 117 280.26 -0.5 -0.5 -22.7 435.28 -19.9 4.4 Coca-Cola Hbc AG 1490 76.00 Sabmiller PLC 4030 25.00
FTSE Global Large Cap 1420 391.04 -0.3 -1.8-3.9 -6.2 546.72
2.7 Oil Equipment & Services 39 277.48 -0.6 -0.6 -33.1 386.56 -30.9 4.7 Compass Group PLC 1137 28.00 Sage Group PLC 589.50 10.00
Industrials (117) 4245.67 1.05 4558.16 4201.62 4255.47 4149.55 2.64 1.21 31.38 111.53 4216.06
Construction & Materials (13) 5161.70 0.55 5541.61 5133.58 5149.66 4087.40 2.32 -0.83 -52.25 121.45 5274.47 FTSE Global Mid Cap 1646 588.84 -0.6 -1.7-2.8 -4.6 768.39
2.1 Basic Materials 262 341.35 -1.7 -1.7 -21.6 499.61 -19.4 3.5 Crh PLC 1885 10.00 Sainsbury (J) PLC 249.30 12.40
Aerospace & Defense (9) 4185.16 1.00 4493.20 4143.71 4227.01 4723.81 2.73 0.96 38.19 113.27 4326.60 FTSE Global Small Cap 4677 611.69 -0.8 -2.2-4.6 -6.2 774.96
2.1 Chemicals 123 579.73 -1.3 -1.3 -7.0 851.04 -4.9 2.6 Diageo PLC 1820.5 24.50 Schroders PLC 2832 154.00
General Industrials (6) 3500.81 1.90 3758.48 3435.38 3456.57 3088.91 3.29 1.68 18.12 112.80 3807.90 FTSE All-World 3066 258.56 -0.3 -1.8-3.7 -5.9 372.84
2.6 Forestry & Paper 16 192.20 -0.8 -0.8 -7.7 308.64 -4.9 3.6 Direct Line Insurance Group PLC 410.00 9.60 Severn Trent PLC 2143 34.00
Electronic & Electrical Equipment (11) 5282.37 1.82 5671.17 5188.00 5243.75 4889.66 2.22 2.04 22.13 110.13 4666.99 FTSE World 2551 458.92 -0.3 -1.6-3.3 -5.6 888.54
2.6 Industrial Metals & Mining 67 245.28 -2.2 -2.2 -40.5 359.58 -39.0 3.6 Dixons Carphone PLC 476.70 12.20 Shire PLC 4182 93.00
Industrial Engineering (14) 7411.38 0.42 7956.87 7380.12 7472.23 8777.94 3.30 1.58 19.19 243.31 8677.13 FTSE Global All Cap ex UNITED KINGDOM In 7418 454.56 -0.3 -1.7-3.4 -5.6 612.65
2.5 Mining 56 307.27 -3.0 -3.0 -46.1 450.21 -43.7 7.1 Easyjet PLC 1696 47.00 Sky PLC 1088 19.00
Industrial Transportation (8) 3829.80 1.40 4111.69 3777.04 3830.25 3931.84 3.96 0.94 26.90 168.06 3221.90 FTSE Global All Cap ex USA 5737 405.13 -1.2 -3.3-6.9 -9.4 587.27
3.1 Industrials 537 295.39 -0.5 -0.5 -6.1 410.05 -4.2 2.3 Experian PLC 1154 33.00 Smith & Nephew PLC 1086 26.00
Support Services (56) 6498.18 1.04 6976.46 6431.27 6517.61 6162.30 2.43 1.54 26.78 156.78 6514.50 FTSE Global All Cap ex JAPAN 6482 449.52 -0.3 -1.8-4.9 -7.1 619.82
2.6 Construction & Materials 109 409.59 -0.5 -0.5 -5.0 595.39 -3.1 2.2 Fresnillo PLC 659.50 -5.50 Smiths Group PLC 927.00 7.50
FTSE Developed 2116 418.86 -0.4 -1.4-2.2 -4.4 576.78
2.6 Aerospace & Defense 28 501.32 -0.6 -0.6 0.9 690.23 2.9 2.1 G4S PLC 213.90 2.50 Sports Direct International PLC 579.50 5.50
Consumer Goods (40) 17899.37 2.09 19216.81 17533.70 17617.12 15692.08 3.07 1.72 18.94 539.35 12620.33
FTSE Developed All Cap 5734 438.89 -0.4 -1.4-2.4 -4.5 597.83
2.5 General Industrials 56 213.03 0.0 0.0 -2.1 317.18 0.3 2.7 Gkn PLC 293.00 12.60 Sse PLC 1450 43.00
Automobiles & Parts (1) 6885.64 4.49 7392.43 6589.53 6681.18 7802.15 2.90 1.53 22.52 199.75 6332.31
FTSE Developed Large Cap 923 387.72 -0.3 -1.4-2.4 -4.7 541.13
2.7 Electronic & Electrical Equipment 69 316.01 -1.3 -1.3 -2.9 404.87 -1.1 1.9 Glaxosmithkline PLC 1308.5 28.50 St. James's Place PLC 970.00 43.00
Beverages (6) 15209.05 1.19 16328.47 15030.06 15087.18 13892.32 2.51 1.65 24.16 382.69 10359.25
FTSE Developed Europe Large Cap 218 319.61 -1.6 -3.6-6.6 -9.6 503.36
3.7 Industrial Engineering 105 532.14 -0.9 -0.9 -13.9 726.44 -12.1 2.7 Glencore PLC 82.37 2.37 Standard Chartered PLC 482.00 5.80
Food Producers (10) 8896.81 1.14 9551.63 8796.45 8876.72 7952.52 1.84 1.40 38.91 163.26 7444.75
FTSE Developed Europe Mid Cap 302 499.50 -1.0 -0.5 2.2 -0.1 714.99
2.7 Industrial Transportation 97 487.80 -0.4 -0.4 -18.3 675.73 -16.7 2.5 Hammerson PLC 598.50 16.00 Standard Life PLC 371.10 5.20
Household Goods & Home Construction (13)13499.23 2.16 14492.80 13213.22 13274.72 10121.99 2.14 2.56 18.27 265.76 9166.98
FTSE Dev Europe Small Cap 713 711.96 -1.1 0.2 5.7 3.4 992.73
2.4 Support Services 73 272.41 -0.2 -0.2 0.0 363.82 1.9 1.9 Hargreaves Lansdown PLC 1455 34.00 Taylor Wimpey PLC 198.70 5.30
Leisure Goods (2) 5568.16 -1.42 5977.99 5648.45 5568.07 4979.97 4.30 1.32 17.61 238.83 4715.89
FTSE North America Large Cap 323 431.99 0.5 -0.2-0.8 -2.9 568.19
2.3 Consumer Goods 424 408.82 -0.4 -0.4 1.0 580.32 3.3 2.5 Hikma Pharmaceuticals PLC 2112 64.00 Tesco PLC 149.30 6.25
Personal Goods (6) 21575.29 2.72 23163.28 21004.24 21236.42 20951.20 3.02 3.02 10.98 629.27 13904.84
FTSE North America Mid Cap 399 629.39 -0.4 -1.7-5.8 -7.2 776.39
1.8 Automobiles & Parts 101 373.06 -1.3 -1.3 -4.3 508.57 -2.1 2.6 HSBC Holdings PLC 511.60 17.45 Travis Perkins PLC 1940 14.00
Tobacco (2) 44927.83 2.65 48234.62 43769.74 43856.10 39565.54 4.44 1.16 19.43 1994.40 27380.04
FTSE North America Small Cap 1513 628.91 -0.8 -2.8-7.3 -8.7 754.52
1.8 Beverages 48 565.19 -0.3 -0.3 5.1 814.94 7.8 2.5 Imperial Tobacco Group PLC 3488 88.00 Tui AG 1189 24.00
Health Care (19) 8913.69 2.34 9569.76 8710.00 8860.51 9077.77 3.92 3.53 7.22 348.00 6499.34
FTSE North America 722 288.09 0.4 -0.5-1.6 -3.6 388.33
2.2 Food Producers 107 545.48 -0.2 -0.2 -1.2 797.47 0.9 2.3 Inmarsat PLC 1093 8.00 Unilever PLC 2799 79.00
Health Care Equipment & Services (7) 6778.44 2.01 7277.35 6645.03 6720.25 6167.03 1.67 2.15 27.83 104.41 5747.20
FTSE Developed ex North America 1394 220.20 -1.4 -2.7-3.0 -5.6 342.42
3.1 Household Goods & Home Construction 48 393.79 -0.2 -0.2 -0.6 556.51 1.7 2.4 Intercontinental Hotels Group PLC 2566 55.00 United Utilities Group PLC 938.00 14.50
Pharmaceuticals & Biotechnology (12)12051.10 2.37 12938.09 11772.22 11982.07 12406.49 4.13 3.58 6.77 498.46 7805.17
FTSE Japan Large Cap 177 322.62 -1.4 -2.6 7.7 5.8 403.06
2.0 Leisure Goods 28 131.01 -0.9 -0.9 4.0 167.51 5.0 1.4 International Consolidated Airlines Group S.A. 583.50 18.00 Vodafone Group PLC 209.50 5.75
Consumer Services (97) 4797.30 2.28 5150.39 4690.15 4705.53 4353.26 2.35 1.58 27.03 113.20 4328.15 FTSE Japan Mid Cap 303 485.23 -0.8 -0.6
15.9 14.1 585.61
1.5 Personal Goods 80 585.82 -0.3 -0.3 0.5 793.55 2.4 2.0
Food & Drug Retailers (7) 2589.47 4.09 2780.06 2487.76 2495.81 2667.18 2.06 -1.50 -32.21 53.33 2961.07 Intertek Group PLC 2684 23.00 Whitbread PLC 4469 107.00
FTSE Global wi JAPAN Small Cap 781 515.72 -0.7 0.1
11.8 10.0 642.32
1.7 Tobacco 12 1196.12 0.6 0.6 11.4 2320.99 15.5 4.1 Intu Properties PLC 309.80 8.30 Wolseley PLC 3679 26.00
General Retailers (33) 2932.40 1.80 3148.23 2880.58 2902.28 2748.64 2.39 2.24 18.67 71.50 3211.39
FTSE Japan 480 134.29 -1.3 -2.2 9.3 1.9 Health Care
7.4 188.53 172 444.80 0.0 0.0 2.4 619.38 4.3 1.9 Itv PLC 266.00 4.60 Wpp PLC 1513 46.00
Media (22) 7282.19 2.30 7818.18 7118.48 7137.14 6411.66 2.81 1.62 21.94 208.30 4299.00
FTSE Asia Pacific Large Cap ex Japan 531 519.20 -0.9 -3.6
-13.2 -15.7 774.80
3.4 Health Care Equipment & Services 61 633.02 0.0 0.0 7.2 725.36 8.2 1.0 Johnson Matthey PLC 2595 74.00
Travel & Leisure (35) 8546.89 2.10 9175.96 8370.90 8381.59 7541.90 2.01 1.88 26.51 168.22 7783.91
FTSE Asia Pacific Mid Cap ex Japan 434 707.93 -1.0 -4.0
-10.0 -12.2 1019.04
3.0 Pharmaceuticals & Biotechnology 111 337.21 0.0 0.0 1.0 487.94 3.1 2.2
Telecommunications (7) 3870.06 2.68 4154.90 3769.06 3827.89 3704.18 4.18 0.19 129.15 148.84 4040.82 FTSE Asia Pacific Small Cap ex Japan 1430 474.95 -0.9 -3.1-8.9 -11.1 674.58
2.9 Consumer Services 390 384.40 0.2 0.2 2.7 499.19 4.4 1.7
Fixed Line Telecommunications (5) 5380.69 2.72 5776.72 5238.20 5281.13 4675.29 2.78 1.80 19.96 106.86 4626.31
Mobile Telecommunications (2) 4840.06 2.65 5196.29 4715.09 4813.89 4937.92 5.20 -0.44 -43.80 251.48 4526.76
FTSE Asia Pacific Ex Japan
FTSE Emerging All Cap
965
2009
411.44
551.54
-0.9
-0.2
-3.7
-12.8
-6.1
-17.7
-15.2 652.61
3.4 Food & Drug Retailers
-20.0 786.02
3.3 General Retailers
54 292.80
121 529.54
0.4
0.8
0.4
0.8
-2.6 395.53
10.7 671.15
-1.0
12.4
1.8
1.5
UK STOCK MARKET TRADING DATA
Utilities (8) 8117.55 1.70 8715.02 7982.19 8068.52 8581.21 5.00 1.36 14.70 396.42 8634.96 FTSE Emerging Large Cap 497 521.38 -0.1 -6.3
-18.0 -20.3 747.55
3.4 Media 91 286.84 -0.5 -0.5 -4.6 373.33 -3.0 1.9 Dec 15 Dec 14 Dec 11 Dec 10 Dec 09 Yr Ago
Electricity (3) 8294.05 2.87 8904.51 8062.71 8217.10 9788.20 6.12 1.33 12.29 504.89 11033.46 FTSE Emerging Mid Cap 453 680.12 0.0 -6.8
-18.9 -21.0 964.54
3.1 Travel & Leisure 124 371.45 -0.2 -0.2 3.1 486.96 4.9 1.8 SEAQ Bargains 5277.00 4796.00 4796.00 4796.00 4971.00 4820.00
Gas Water & Multiutilities (5) 7630.94 1.40 8192.60 7525.67 7591.19 7825.92 4.71 1.37 15.48 348.95 8147.04 FTSE Emerging Small Cap 1059 589.17 -0.4 -3.8
-14.4 -16.7 809.76
3.1 Telecommunication 91 153.15 -0.5 -0.5 -8.3 269.19 -4.6 4.3 Order Book Turnover (m) 32.10 34.11 34.11 34.11 28.13 39.16
Financials (283) 4416.08 2.46 4741.11 4310.06 4357.18 4509.03 3.72 1.87 14.36 163.46 3856.45 FTSE Emerging Europe 99 260.94 -1.6 -10.0
-13.0 -16.3 381.89
4.6 Fixed Line Telecommuniations 44 129.22 0.1 0.1 -5.7 248.38 -1.4 4.8 Order Book Bargains 870654.00 928786.00 928786.00 928786.00 800728.00 882812.00
Banks (9) 3594.75 2.90 3859.33 3493.60 3538.30 4233.96 4.60 1.37 15.93 170.78 2477.97 FTSE Latin America All Cap 240 600.62 -1.0 -7.2
-31.6 -33.4 884.95
3.8 Mobile Telecommunications 47 159.70 -1.2 -1.2 -11.7 254.55 -8.8 3.7 Order Book Shares Traded (m) 1463.00 1454.00 1454.00 1454.00 1435.00 1465.00
Nonlife Insurance (10) 2818.99 1.72 3026.47 2771.36 2782.99 2114.70 2.69 2.06 18.01 75.75 4737.62 FTSE Middle East and Africa All Cap 220 592.19 4.0 -8.8
-20.9 3.1 Utilities
-23.1 882.45 163 228.76 -0.5 -0.5 -14.4 418.45 -11.3 4.2 Total Equity Turnover (£m) 3511.99 2507.88 2507.88 2507.88 0.01 2541.60
Life Insurance/Assurance (11) 7647.05 3.02 8209.89 7422.98 7552.69 7420.32 3.96 1.59 15.88 293.04 7020.08 FTSE Global wi UNITED KINGDOM All Cap In 325 318.60 -1.8 -3.8-8.1 4.0 Electricity
-11.3 503.26 112 249.25 -0.3 -0.3 -12.1 451.09 -9.1 4.0 Total Mkt Bargains 999618.00 1039586.00 1039586.00 1039586.00 8.00 992827.00
Index- Real Estate Investment & Services (21) 3029.81 0.96 3252.81 3001.02 3034.52 2580.80 2.09 5.70 8.41 59.82 7784.35 FTSE Global wi USA All Cap 2006 495.09 0.3 -0.5-0.9 2.1 Gas Water & Multiutilities
-2.7 633.96 51 243.50 -0.7 -0.7 -18.2 456.77 -14.9 4.6 Total Shares Traded (m) 4549.00 4027.00 4027.00 4027.00 0.00 4702.00
Real Estate Investment Trusts (25) 2920.19 1.92 3135.13 2865.18 2892.86 2671.63 3.01 6.00 5.54 87.57 3450.32 FTSE Europe All Cap 1392 369.91 -1.5 -2.9-4.3 3.4 Financials
-7.1 564.88 676 195.41 -0.5 -0.5 -9.4 303.24 -6.9 3.1 † Excluding intra-market and overseas turnover. *UK only total at 6pm. ‡ UK plus intra-market turnover. (u) Unavaliable.
General Financial (32) 7816.06 2.73 8391.34 7608.10 7640.48 6907.09 2.96 2.22 15.22 217.93 8483.23 FTSE Eurobloc All Cap 630 349.09 -1.5 -2.7-2.6 3.1 Banks
-5.3 539.10 243 173.15 -0.8 -0.8 -13.9 286.32 -11.2 3.6 (c) Market closed.
Equity Investment Instruments (175) 7520.63 1.28 8074.16 7425.82 7467.49 7291.90 2.68 1.05 35.62 195.18 3951.83 FTSE RAFI All World 3000 3010 5307.71 -0.7 -2.8-7.3 3.2 Nonlife Insurance
-9.9 6677.66 71 210.39 -0.3 -0.3 -1.8 292.69 0.5 2.4
Non Financials (355) 3848.87 2.09 4132.15 3770.17 3815.99 3939.75 3.87 1.39 18.56 146.45 5386.62 FTSE RAFI US 1000 1003 8715.54 0.2 -1.1-4.0 2.6 Life Insurance
-6.2 11006.31 51 193.06 -1.0 -1.0 -8.6 292.81 -6.1 3.0
Technology (20) 1426.99 -0.17 1532.02 1429.38 1460.36 1173.38 1.35 2.13 34.77 18.79 1783.26 FTSE EDHEC-Risk Efficient All-World 3066 308.68 -0.4 -1.2-1.4 2.3 Financial Services
-3.4 414.44 140 217.53 -0.2 -0.2 -6.1 289.44 -4.3 2.0 All data provided by Morningstar unless otherwise noted. All elements listed are indicative and believed
Software & Computer Services (13) 1789.58 -1.29 1921.30 1813.01 1835.69 1312.38 1.83 1.74 31.34 32.44 2342.82 FTSE EDHEC-Risk Efficient Developed Europe 520 271.63 -1.2 -1.5 0.0 2.8 Technology
-2.5 396.34 186 173.90 0.2 0.2 1.0 207.35 2.7 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 (7) 1605.19 0.84 1723.33 1591.85 1639.38 1435.37 0.93 2.79 38.44 14.34 1842.60 Software & Computer Services 85 306.54 1.0 1.0 12.9 351.74 14.2 1.1 guarantee that the information is reliable or complete. The FT does not accept responsibility and will not be
Technology Hardware & Equipment 101 127.44 -0.7 -0.7 -9.0 156.24 -7.0 2.4 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 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/ For all queries e-mail ft.reader.enquiries@morningstar.com
FTSE 100 5922.08 5954.89 5971.33 5969.04 5980.13 5972.83 5982.21 6013.22 6028.58 6036.19 5922.08 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
FTSE 250 16848.87 16837.72 16863.31 16875.40 16942.59 16962.85 16948.73 17002.46 17028.30 17028.30 16820.33 (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,
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
Data provided by Morningstar | www.morningstar.co.uk
FTSE SmallCap 4475.86 4477.29 4482.51 4483.88 4487.93 4489.72 4489.69 4492.31 4494.08 4495.65 4470.57
FTSE All-Share 3280.35 3294.35 3302.53 3301.98 3309.42 3306.76 3310.39 3325.83 3333.47 3336.70 3280.35 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
Time of FTSE 100 Day's high:15:55:15 Day's Low08:03:00 FTSE 100 2010/11 High: 7103.98(27/04/2015) Low: 5874.06(14/12/2015) Group companies and is used by FTSE International Limited under licence.
Time of FTSE All-Share Day's high:15:55:00 Day's Low08:03:00 FTSE 100 2010/11 High: 3834.45(27/04/2015) Low: 3245.99(24/08/2015)
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 AEW UK REIT Int - 0.991L - 1.22L - 2.25 - Dec 31 2.25 - date price(p) Sector code Stock price(p) +/- High Low Cap (£m)
price up date High Low Stock Price p +or- Aurasian Minerals Int - - 0.281L 0.208L 0.08L 0.06L - - - - - 12/11 3.50 AIM WEY Wey Education PLC 4.13 -0.13 3.88 3.88 387.6
460p nil 19-01-16 823.00 783.50 RPC Group PLC 816.50 34.00 Carpetright Int 231.2 227.9 7.1 6.7 7.3 7.6 - - - - - 11/17 260.00 AIM FARN Faron Pharmaceuticals Oy 260.00 3.00 295.00 263.00 6009.0
Castleton Technology Int 8.476 1.866 1.403L 0.322L 32.2L 1.8 - - - - - 11/17 10.00 SCGL Sealand Capital Galaxy Ltd 12.50 - 13.90 13.90 0.0
Galileo Resources Int - 0.008 0.171L 0.277L 0.1L 0.3L - - - - - 11/13 240.00 SCT Softcat PLC 300.00 0.25 307.00 240.00 59221.8
Gateley (Holdings) Int 29.636 - 2.93 - 2 - 1.895 - Jan 22 1.895 - 11/10 5.00 SEN Senterra Energy PLC 4.38 -0.13 5.59 4.06 118.1
Imagination Technologies Group Int 71.148 82.24 22.664L 10.72L 7.7L 3.9L - - - - - 11/09 195.00 GYM Gym Group (The) PLC 201.00 1.94 216.75 195.00 25749.2
JPMorgan Indian Investment Trust Pre 74.211 147.361 2.21L 0.53 - - - - - 11/06 180.00 MCS McCarthy & Stone PLC 238.75 0.00 243.00 180.00 128283.7
Kodal Minerals Int - - 0.275L 0.262L 0.028L 0.034L - - - - - 11/06 100.00 RGL Regional REIT Ltd 100.00 0.00 104.00 98.25 27421.7
Pressure Technologies Pre 55.57 54.015 0.578 5.349 4.9 28.5 5.6 5.6 Mar 18 8.4 8.4
Trafalgar New Homes Int 0.531 2.233 0.168L 0.035 0.07L 0.02 - - - - -

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.
Wednesday 16 December 2015 ★ FINANCIAL TIMES 21

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) ArcherDan 34.65 0.47 53.69 33.84 3.10 12.05 20677.04 Lockheed♦ 216.51 -0.07 227.91 181.91 2.75 19.34 66532.55
ANZ♦ 25.33 -0.35 37.25 25.01 9.93 10.12 52796.68 Nokia 6.37 0.13 7.87 4.91 2.23 -43.12 25570.94 AstellasPh 1646 -9.50 2047 1514.5 1.96 21.15 30044.12 AtlasCpcoB 194.00 2.40 270.00 173.70 1.56 16.76 8907.22 AT&T 33.87 0.27 36.45 30.97 5.51 35.95 208368.24 Lowes 75.41 -0.24 78.13 64.07 1.32 24.44 69008.04
BHPBilltn 16.27 -0.33 34.29 16.25 14.50 18.67 37463.57 SampoA 46.24 1.52 49.40 37.01 4.28 15.13 28218.58 Bridgestne 4158 -71.00 5182 3753.5 2.91 11.94 27774.73 Ericsson 76.50 - 120.00 75.30 4.36 24.87 29748.5 AutomData♦ 85.42 0.82 90.67 64.29 2.28 28.62 39742.49 Lyondell 88.08 2.36 107.32 70.37 3.34 9.52 39587.01
CmwBkAu 76.87 -0.57 96.69 70.15 7.89 14.17 94105.93 France (€) Canon 3628 -38.00 4539 3402 4.45 17.91 39752.67 H&M 304.90 9.40 368.50 292.20 3.13 23.85 59375.39 Avago Tech 142.67 0.16 150.50 95.18 0.98 39.23 39376.75 Marathon Ptl 48.77 0.78 60.38 37.62 2.18 7.77 25993.15
CSL 100.35 0.49 102.43 81.48 1.42 25.71 33448.66 Airbus Grpe 63.14 1.84 68.50 39.64 1.93 17.18 54343.09 CntJpRwy 20460 -400.00 24800 16720 0.59 13.62 34625.26 Investor 305.00 3.00 363.40 265.10 2.97 14.72 27339.82 BakerHu♦ 49.15 2.37 70.45 43.00 1.37 -79.34 21433.66 Marsh&M 56.30 1.33 59.99 50.90 2.58 20.65 29368.79
NatAusBk 27.66 -0.28 39.71 27.51 9.88 11.64 52077.61 AirLiquide 104.70 2.65 123.95 93.01 2.38 21.01 39342.76 Denso 5586 -82.00 6548 4945 2.22 17.01 40570.2 Nordea Bk 92.20 2.90 115.50 85.15 6.34 10.66 43935.26 BankAm♦ 17.27 0.47 18.48 14.60 1.15 13.03 179823.52 MasterCard 98.36 2.06 101.76 74.61 0.65 30.47 108218.97
Telstra 5.23 0.06 6.74 5.06 8.41 14.87 45841.81 AXA 24.69 0.56 26.02 17.56 3.76 12.12 66448.95 EastJpRwy 11050 -200.00 12815 8570 1.14 20.29 35630.52 SEB 86.85 3.05 111.50 83.45 5.51 10.76 22175.1 Baxter♦ 37.09 0.56 43.44 32.18 4.49 11.18 20288.89 McDonald's 117.48 1.22 118.24 87.50 2.87 25.62 107873.64
Wesfarmers 37.30 0.07 46.95 36.65 9.08 16.86 30115.21 BNP Parib 52.45 2.17 61.00 43.14 2.90 8.96 71382.12 Fanuc 20455 -420.00 28575 17930 3.82 19.32 34607.09 SvnskaHn 112.90 4.50 426.00 108.40 3.72 14.63 24864.72 BB & T 37.72 0.81 41.90 34.24 2.69 14.07 29427.27 McGraw Hill 94.89 0.48 109.13 84.64 1.35-260.21 25648.77
Westpc♦ 30.60 -0.06 40.07 29.10 8.35 13.00 72900.01 ChristianDior 160.20 4.60 195.35 127.90 2.07 11.52 31793.85 FastRetail 43980 -540.00 61970 40610 0.78 41.46 38325.07 Swedbank 185.80 8.20 223.90 177.20 6.15 13.09 24747.23 BectonDick♦ 153.19 - 155.53 128.87 1.56 46.03 32075.78 McKesson♦ 188.04 -2.54 243.61 160.10 0.53 21.28 43268.79
Woolworths 22.49 -0.10 34.71 22.42 7.75 12.88 20492.82 Cred Agr 10.44 0.32 14.49 9.82 3.41 21.96 30077.85 Fuji Hvy Ind 4861 -49.00 5223 3669 2.26 10.98 31263.18 TeliaSonera 41.36 1.31 55.85 39.89 7.30 12.27 21072.14 BerkshHat 201793.13 3753.13 229300 190007 - 14.66 163680.26 Medtronic 77.01 0.36 79.50 55.54 1.73 45.24 108288.05
Belgium (€) Danone 62.12 1.17 67.74 51.50 2.36 42.01 44432.56 Hitachi 678.60 -15.40 929.10 585.70 1.79 13.17 26945.88 Volvo 77.15 1.05 120.50 75.90 3.91 16.37 14732.28 Biogen 288.67 6.28 480.18 254.00 - 18.98 64345.44 Merck♦ 52.60 0.40 63.62 45.69 3.40 14.04 146940.37
AnBshInBv 112.40 2.00 124.20 85.63 2.70 22.22 197414.38 EDF♦ 12.85 0.25 24.89 12.40 9.50 6.92 26102.32 HondaMtr 3776 -72.00 4499 3382.5 2.35 12.30 56191.85 Switzerland (SFr) BkNYMeln 41.64 1.25 45.45 35.63 1.62 18.14 45510.55 Metlife 47.32 0.90 58.23 44.49 3.04 9.23 52602.17
KBC Grp 55.70 2.01 66.00 42.77 3.65 9.05 25413.5 Engie SA 15.89 0.38 20.08 13.80 6.14 43.70 42260.5 JapanTob 4319 -72.00 4848 3101 2.38 18.59 70963.24 ABB 17.84 0.33 22.16 16.49 - 16.80 41693.18 BlackRock♦ 325.19 5.59 382.84 275.00 2.59 16.83 53328.73 Microsoft 55.25 0.11 56.23 39.72 2.23 37.08 441332.2
Esslr Intl 114.90 3.10 125.15 82.75 0.87 41.10 27124.28 KDDI 2887.5 -20.00 8550 2519 2.10 14.97 63831.97 CredSuisse 20.68 0.66 28.94 18.57 3.35 9.64 40868.9 Boeing 145.78 2.78 158.83 115.14 2.36 18.44 97670.21 Mnstr Bvrg 151.27 -0.64 160.50 105.35 - 52.79 30665.83
Brazil (R$)
Hermes Intl 317.70 7.20 365.55 267.40 0.91 36.80 36628.26 Keyence 62920-1500.00 70100 50700 0.33 30.63 31428.69 Nestle 73.10 1.55 77.00 64.55 3.05 15.98 235319.35 BrisMySq 69.78 1.14 70.54 51.82 2.11 66.36 116413.02 MondelezInt 43.90 0.58 48.58 33.97 1.40 8.63 69756.51
Ambev 18.04 -0.01 20.46 15.00 8.88 23.00 72875.04
LOreal 158.40 6.40 181.30 127.70 1.66 30.93 96824 MitsbCp 1972 -14.50 2837 1887.5 2.82 10.51 25759.96 Novartis 84.40 2.20 103.20 82.20 3.18 24.55 228116.72 Broadcom 56.83 -0.22 58.48 40.21 0.94 24.86 31881.07 Monsanto 94.69 0.94 126.00 81.22 2.03 20.38 41688.88
Bradesco 23.11 0.31 32.40 22.72 4.12 8.28 14993.67
LVMH 147.95 5.75 176.60 123.50 2.11 13.37 82108.82 MitsubEst 2440.5 -50.50 2975 2321 0.62 44.03 27876.47 Richemont 70.95 1.45 91.75 66.40 2.27 22.74 37393.01 CapOne 74.80 1.49 92.10 67.73 1.86 10.59 39796.98 MorganStly 32.82 0.94 41.04 30.15 1.51 20.32 63546.87
Cielo 35.48 -0.42 46.27 30.48 1.88 17.41 17204.29
Nmrcble-SFR 35.43 2.28 60.01 33.15 - -42.91 16957.02 MitsubishiEle 1252.5 -29.50 1718 1063 2.18 11.59 22093.82 Roche 268.30 5.70 289.40 238.80 3.02 25.49 190315.08 CardinalHlth 86.65 0.13 91.91 74.76 1.67 21.84 28506.21 MylanNV 54.29 0.92 76.69 37.59 - 30.50 26696.95
ItauHldFin 25.65 0.32 32.66 23.81 1.94 5.89 20087.28
Orange 15.30 0.56 16.98 12.21 3.83 41.25 44260.44 MitsuiFud 2996 -67.00 3879 2951 0.94 24.38 24401.8 Swiss Re 97.30 2.75 99.75 74.95 4.57 38.54 36417.57 Carnival 51.56 0.77 54.59 42.51 1.99 29.28 30423.15 Netflix 120.45 -0.22 133.27 45.08 - 323.94 51478.92
Petrobras 9.05 0.28 16.26 7.66 - -3.49 17310.93
PernodRic 102.45 2.00 117.75 87.90 1.56 32.39 29696.77 MitUFJFin 743.00 -19.20 936.80 604.00 2.45 6.69 86485.55 Swisscom 487.50 16.30 580.50 471.10 4.54 17.75 25496.94 Caterpillar 66.30 0.18 94.66 62.99 4.30 13.78 38602.1 NextEraE 98.82 0.84 112.64 93.74 3.05 14.27 45510.16
Vale 13.00 0.54 27.89 11.25 18.26 -5.60 10749.17
Renault 87.98 2.48 100.25 55.68 2.11 9.74 28413.78 Mizuho Fin 235.50 -6.10 280.40 191.00 3.32 7.23 48119.25 Syngent 373.40 7.90 435.20 280.00 2.97 25.04 35040.54 CBS♦ 46.68 0.34 63.95 38.51 1.28 15.17 20245.25 Nike♦ 129.09 1.23 135.30 90.69 0.85 33.35 87101.66
Canada (C$) Murata Mfg 18510 -465.00 22220 12430 1.09 18.09 34254.5 Celgene 112.71 2.45 140.72 92.98 - 56.87 89101.78 NorfolkS 90.51 1.16 112.22 72.10 2.57 16.47 27023.55
Safran 63.32 2.43 72.45 47.75 1.85 -19.69 28838.24 UBS 18.55 0.66 22.57 13.58 4.07 11.39 72096.5
BCE♦ 54.67 0.09 60.20 51.22 4.79 17.61 33775.59 NipponTT 4597 11.00 5066 3011 2.09 16.07 79171.28 CharlesSch 33.00 0.75 35.72 25.43 0.72 33.46 43438.69 Northrop♦ 188.00 0.93 193.99 141.21 1.59 18.26 34288.01
Sanofi 78.72 3.99 101.10 69.77 3.53 22.02 112244.79 Zurich Fin 250.30 4.40 334.60 232.60 - 12.42 38008.93
BkMontrl 78.40 1.38 82.91 64.01 4.23 11.65 36622.95 Nissan Mt 1218 -46.00 1350 963.10 3.11 9.26 45235 ChevrnTx 92.31 2.98 114.45 69.58 4.61 20.18 173730.81 NXP 83.40 -0.04 114.00 70.35 - 29.00 20996.08
Sant Gbn 39.29 1.21 44.84 31.83 1.54 27.00 24064.97 Taiwan (NT$)
BkNvaS 56.56 0.90 67.72 52.60 4.89 9.86 49469.25 Nomura 681.50 -10.30 909.20 609.30 3.41 9.49 21401.34 Cigna 139.66 -1.03 170.68 99.88 0.03 17.22 35980.31 Occid Pet♦ 68.41 1.76 83.74 63.60 4.27 -8.71 52247.17
Schneider 53.00 0.58 75.29 48.57 3.54 18.78 34010.94 Chunghwa Telecom 98.00 0.20 101.00 91.50 4.90 19.36 23175.99
Brookfield♦ 43.18 0.14 48.64 36.35 1.46 11.29 30795.24 Nppn Stl 2299 -45.00 3505 2122.5 2.85 9.35 17948.57 Cisco 26.88 0.39 30.31 23.03 2.97 14.78 136717.24 Oracle 38.23 0.58 46.71 35.14 1.38 18.38 163036.74
SocGen 41.56 1.41 48.77 31.85 2.93 11.26 36587.43 HonHaiPrc 80.00 -0.80 99.70 77.90 4.70 8.43 38139.28
CanadPcR 171.05 1.97 245.05 168.12 0.83 18.69 19006.14 NTTDCMo 2323 -41.00 2873.5 1731 3.04 19.22 77972.87 Citigroup 52.23 1.13 60.95 46.60 0.23 11.85 155592.67 Pepsico♦ 98.49 0.54 103.44 76.48 2.74 29.41 143485.23
Total 42.29 1.71 50.30 36.92 5.96 114.15 112612.3 MediaTek 259.00 4.00 505.00 227.00 8.41 12.82 12408.82
CanImp 93.19 1.03 102.90 83.10 4.73 10.25 26914.04 Panasonic 1236.5 -25.00 1853.5 1177.5 1.33 86.62 24918.46 CME Grp♦ 95.39 0.70 100.87 83.43 2.05 25.69 32264.07 Perrigo 149.44 0.45 215.73 140.40 0.32 149.00 21877.59
UnibailR 230.35 6.15 262.00 193.05 4.13 13.40 24814.72 TaiwanSem 138.00 -1.00 155.00 112.50 3.23 11.89 109089.11
CanNatRs♦ 29.57 0.75 42.46 25.01 3.15 73.75 23526.23 Seven & I 5296 -165.00 5998 4117.5 1.39 27.45 38567.24 Coca-Cola 42.83 0.38 43.85 36.56 3.00 27.66 186267.03 Pfizer 32.40 0.22 36.46 28.47 3.37 24.51 199508.51
Vinci 57.68 0.52 62.60 39.65 3.00 16.86 37816.66
CanNatRy♦ 75.25 1.17 88.89 69.90 1.61 17.38 43361.96 ShnEtsuCh 6557 -137.00 8310 5801 1.62 20.09 23276.43 Thailand (THB) Cognizant 60.48 0.72 69.80 50.19 - 23.89 36864.33 Phillips66 81.77 0.37 94.12 57.33 2.58 9.61 43619.41
Vivendi 19.16 0.35 24.83 18.81 10.60-219.04 28611.37
Enbridge 42.56 1.47 66.14 40.17 4.18-107.68 26720.83 Softbank 6007 -93.00 7827 5370 0.67 12.67 59251.32 PTT Explor 234.00 10.00 382.00 206.00 4.63 -71.37 18581.43 ColgtPlm 66.64 0.79 71.56 50.84 2.21 24.82 59770.89 PhilMorris 87.29 0.13 90.08 75.27 4.57 18.89 135238.02
GtWesLif♦ 34.51 0.55 37.70 30.42 3.80 12.36 24914.39 Germany (€)
Sony 2950.5 -65.50 3970 2315 0.77 35.20 30595.06 United Arab Emirates (Dhs) Comcast 58.20 0.83 64.99 50.01 1.66 18.35 121889.97 PNCFin 94.83 2.06 100.52 81.84 2.07 12.85 49114.39
ImpOil 41.72 0.82 55.37 39.30 1.16 20.59 25706.47 Allianz 159.20 3.50 170.15 129.35 4.37 11.10 79454.82
SumitomoF 4492 -94.00 5770 3902 3.48 11.65 52182.68 Emirtestele 15.70 - 16.50 9.41 4.07 17.11 33795.19 ConocPhil 50.80 1.27 71.37 41.10 5.73 -62.41 62724.01 PPG Inds 98.81 1.08 118.95 82.93 1.40 23.26 26606.49
Manulife 20.70 0.34 24.20 18.91 3.20 16.07 29664.13 BASF 70.05 2.04 97.22 63.00 3.90 13.53 70264.87
Takeda Ph 5646 -86.00 6657 4821 3.22 -28.73 36651.66 United Kingdom (p) Corning 17.88 -0.19 25.16 15.42 2.56 11.77 21155.43 Praxair 105.71 0.99 132.95 98.55 2.63 21.69 30111.02
Potash 23.38 0.36 47.10 22.89 8.53 9.70 14192.68 Bayer 113.40 3.55 146.45 106.80 2.01 24.80 102412.31
TokioMarine 4377 -90.00 5504 3703 2.48 17.27 27239.14 AscBrFd♦ 3398 50.00 3606 2705.75 1.00 47.62 40478.33 Costco 160.92 -0.92 169.73 117.03 0.92 30.63 70722.35 Prec Cast♦ 231.83 0.05 242.96 186.17 0.05 24.52 31895.44
RylBkC 73.48 1.03 81.53 68.05 4.29 10.68 79326.03 BMW 94.69 2.79 123.75 72.05 3.11 10.88 62252.7
Toyota 7324 -139.00 8783 6650 3.10 9.94 200842 AstraZen 4391 105.50 4931.68 3746 4.23 49.60 83507.08 CrownCstl 85.86 0.66 89.44 74.45 3.79 56.37 28657.6 Priceline 1314.99 17.11 1476.52 990.69 - 27.65 65465.31
Suncor En♦ 35.16 0.61 40.93 30.89 2.43 520.26 36947.66 Continental 218.00 6.65 234.25 161.20 1.51 16.14 47616.83
Mexico (Mex$) Aviva 496.40 14.40 578.68 428.40 3.65 12.99 30220.59 CSX 25.88 0.59 37.67 24.47 2.61 12.95 25231.57 ProctGmbl 79.25 0.96 93.89 65.02 3.28 26.66 215605.39
ThmReut 53.07 0.25 55.92 44.69 3.44 15.43 29626.99 Daimler 75.50 2.55 96.07 62.06 3.29 10.30 88211.62
AmerMvl 12.70 0.08 17.37 12.40 1.98 23.05 31082.81 Barclays 214.80 5.70 289.90 209.05 3.03 0.72 54302.4 CVS 93.00 -1.11 113.65 81.37 1.42 21.04 102980.49 Prudntl♦ 83.06 2.37 92.60 73.19 2.77 10.91 37293.49
TntoDom 54.02 0.77 56.48 47.75 3.79 12.51 72892.9 Deut Bank 21.40 0.63 33.42 20.69 3.56 -6.91 32234.81
FEMSA UBD 160.90 2.15 169.74 119.19 0.69 31.17 33534.96 BG 956.00 36.50 1301.62 780.55 2.00 -18.46 49166.27 Danaher 92.52 -0.85 97.62 81.25 0.54 25.88 63402.6 PublStor♦ 247.30 -1.79 251.74 178.42 2.49 41.75 42757.15
TrnCan 46.73 0.36 59.50 40.58 4.45 19.44 24085.3 Deut Tlkm 16.25 0.77 17.63 12.40 3.12 33.02 81752.27
WalMrtMex 43.65 0.70 47.00 28.26 1.25 33.21 44396.97 BP♦ 337.70 8.40 499.25 252.55 7.97 -12.34 93073.88 Deere 77.02 -1.92 98.23 71.85 3.00 12.26 25275.37 Qualcomm♦ 48.39 1.56 75.72 45.93 3.70 15.13 72734.72
ValeantPh 150.65 21.41 347.84 92.65 - 63.01 37365.82 DeutsPost 25.31 1.13 31.19 22.93 - 20.85 33478.19
BrAmTob 3686 96.00 3931.5 3231.5 4.02 17.11 103396.28 Delphi 83.37 1.22 90.57 66.10 1.19 17.68 23349.55 Raytheon 127.07 0.75 128.94 95.32 2.04 18.89 38260.52
E.ON 8.20 0.36 14.85 7.08 1.73 -1.74 17917.15 Netherlands (€)
China (HK$) BSkyB 1088 19.00 1180 857.50 2.97 13.91 28142.44 Delta 50.92 0.74 52.00 34.61 0.79 14.77 40047.24 Regen Pharm 547.27 7.33 605.93 383.87 - 108.90 55677.35
Fresenius Med 76.18 2.32 83.17 57.70 1.02 24.34 25882.6 Altice 10.83 0.83 47.73 9.98 - 190.83 9708.3
AgricBkCh 2.87 - 4.55 2.84 7.80 4.31 11382.59 BT 469.50 12.65 502.60 385.60 2.43 17.69 59101.21 DiscFinServ 53.60 1.05 66.73 50.20 1.93 11.13 22913.13 ReynoldsAm♦ 45.25 0.21 49.56 31.35 3.00 17.16 64666.84
Fresenius SE 63.17 1.22 70.00 40.85 0.71 27.11 37594.25 ASML Hld 81.69 3.98 104.85 70.25 0.87 24.96 38659.04
Bk China 3.33 - 5.68 3.25 7.02 4.91 35929.15 Compass 1137 28.00 1223.36 963.00 2.38 22.07 28142.79 Disney♦ 112.59 3.24 122.08 90.00 1.60 23.11 186131.3 Salesforce 77.37 0.38 82.90 53.75 - -592.04 51373.68
HenkelKgaA 84.96 2.27 99.44 75.76 1.54 20.50 24105.04 Heineken 78.97 1.50 85.90 56.14 1.36 22.96 49676.11
BkofComm 5.25 -0.05 8.61 5.17 6.32 4.82 23716.34 Diageo 1820.5 24.50 2055 1592.5 2.94 19.24 68904.49 DominRes♦ 66.25 0.85 80.89 64.54 3.81 22.09 39440.85 Schlmbrg♦ 71.68 1.66 95.13 66.57 2.63 27.27 90397.93
Linde 131.20 3.15 195.55 127.85 2.44 21.05 26612.42 ING 12.36 0.44 16.00 9.68 - 26.88 52235.05
BOE Tech 2.24 -0.02 4.78 1.17 1.71 31.70 57.50 GlaxoSmh♦ 1308.5 28.50 1645 1227.5 6.11 6.48 95826.84 DowChem 50.79 -0.50 57.10 35.11 3.29 13.78 58820.11 Shrwin-Will 263.37 0.03 294.35 218.27 0.97 25.40 24519.88
MuenchRkv 181.80 2.15 206.50 154.20 4.33 9.65 33125.72 Unilever 39.46 1.27 42.84 30.28 2.86 23.87 73894.7
Ch Coms Cons 8.11 0.07 17.00 7.70 2.93 7.32 4632.94 Glencore 82.37 2.37 318.46 66.67 13.89-191.56 17841.27 DukeEner♦ 69.25 0.80 89.97 65.50 4.60 20.25 47667.16 SimonProp 190.22 4.25 208.14 170.99 3.00 35.81 58857.51
SAP 71.63 2.23 75.75 53.01 1.56 27.33 96102.04 Norway (Kr)
Ch Evrbrght 3.42 -0.01 5.65 3.22 6.69 4.48 3030.97 HSBC 511.60 17.45 674.57 478.35 6.55 10.09 151514.24 DuPont 67.41 -0.52 76.61 47.11 2.67 19.49 59074.21 SouthCpr 25.32 0.29 33.31 23.41 1.65 20.00 19885.72
Siemens 88.20 1.95 106.35 77.91 3.65 13.06 84860.48 DNB 107.20 3.60 143.00 100.90 3.75 7.46 20078.68
Ch Rail Cons 9.57 -0.25 17.70 8.10 1.93 8.32 2563.75 ImpTob 3488 88.00 3665 2680 3.67 17.46 50317.25 Eaton 50.28 -0.10 73.82 49.21 4.23 11.72 23269.58 Starbucks 60.18 0.26 64.00 39.22 1.06 33.25 89355.26
Volkswgn 134.30 2.60 254.50 95.00 3.63 10.51 43280.4 Statoil 124.70 4.60 161.70 113.90 5.85 -10.52 45724.18
Ch Rail Gp 5.73 -0.09 12.30 5.47 1.68 9.58 3110.61 LlydsBkg 70.34 1.66 89.35 68.57 2.13 41.94 75628.32 eBay 28.48 0.45 29.83 22.11 - 11.58 34194.62 StateSt 67.04 1.31 81.26 63.97 1.90 15.79 27049.71
ChConstBk 5.16 0.03 7.98 5.02 7.17 4.63 160062.64 Hong Kong (HK$) Telenor 152.10 5.30 186.10 143.70 2.53 36.72 26261.25 Ecolab♦ 114.29 0.65 122.48 97.78 1.15 30.84 33750.24 Stryker 92.05 0.64 105.34 89.81 1.49 30.08 34566.82
Natl Grid♦ 909.20 15.00 954.00 806.40 4.72 15.85 51217.64
China Vanke RMB 21.08 1.00 21.46 10.93 2.39 14.35 31710.57 AIA 45.40 -0.45 58.20 38.85 0.94 21.22 70576.34 Qatar (QR) EMC 26.00 0.25 30.92 22.66 1.76 21.94 50409.77 Sychrony Fin 29.88 0.20 36.40 27.92 - 11.44 24914.72
Prudential 1482 42.50 1761.5 1045.99 2.49 15.09 57346.86
ChinaCitic 4.76 -0.01 7.40 4.36 - 4.47 9140.03 BOC Hold 22.90 -0.05 33.70 22.30 4.68 9.78 31239.29 QatarNtBk 160.50 0.80 216.00 158.20 4.64 10.12 30842.02 Emerson 45.04 0.05 63.41 42.21 4.15 11.32 29481.25 Target 73.35 0.63 85.81 68.15 2.82 16.85 45187.39
RBS 288.80 6.20 414.00 281.40 - -12.95 50307.9
ChinaLife 25.00 0.15 41.00 23.40 1.94 15.07 24002.55 Ch OSLnd&Inv 25.50 0.30 34.05 20.70 2.06 7.34 32442.79 EOG Res 77.63 0.77 101.36 68.15 0.86 -11.23 42673.77 TE Connect 63.34 0.67 73.73 54.32 1.94 21.18 24468.62
Russia (RUB) ReckittB 6166 78.00 6450 4895 2.25 26.20 65687.01
ChinaMBank 17.52 0.16 26.85 16.40 4.70 6.23 10377.87 ChngKng 50.40 -0.60 77.55 50.10 - 11.10 25099.07 EquityResTP 79.17 0.98 82.53 61.90 2.71 34.56 28838.61 Telsa Mtrs 219.55 0.97 286.65 181.40 - -41.46 28750.69
Gzprm neft 134.40 2.81 166.94 113.73 6.44 6.69 45422.61 RELX 1164 27.00 1232 988.50 2.23 26.73 35990.39
ChinaMob 87.80 -0.05 118.00 85.00 3.17 13.81 231955.49 Citic Ltd 13.64 -0.02 16.40 11.64 1.51 6.73 51196.24 Exelon 25.68 0.22 38.93 25.09 4.80 11.49 23609.82 TexasInstr 57.51 1.29 59.99 43.49 2.35 20.49 58338.84
Lukoil 2446.8 14.00 3297.7 2053.6 7.54 20.42 29710.92 RioTinto 1879.5 31.50 3280 1843 7.26 18.70 38911.27
ChinaPcIns 30.35 0.45 47.10 24.80 1.97 14.84 10867.88 Citic Secs 17.62 -0.04 40.50 12.82 1.97 7.87 5179.62 ExpScripts 86.89 1.07 94.61 68.06 - 27.15 58761.62 TheTrvelers♦ 113.03 2.00 116.48 95.21 2.04 10.11 34385.85
MmcNrlskNckl 8965 185.00 12247 7962 15.89 10.48 20253.15 RollsRoyce 540.00 2.50 1061 504.50 4.28 -39.71 14940
ChMinsheng 7.17 -0.03 11.88 6.70 3.17 4.62 6414.32 CK Hutchison 100.10 -1.40 174.90 97.50 3.49 4.13 49849.53 ExxonMb 79.09 3.06 95.18 66.55 3.57 16.81 329225.99 ThrmoFshr♦ 137.04 1.63 141.25 117.10 0.43 28.06 54692.35
Novatek 585.00 15.00 646.30 398.50 10.62 50.27 25357.86 RylDShlA♦ 1463.5 45.00 2239.5 1415.5 8.58 88.46 86805.86
ChMrchSecs RMB 22.84 -0.66 40.00 13.85 1.85 12.98 16979.25 CNOOC 7.90 0.08 13.78 7.41 6.87 7.15 45509.15 Facebook 104.84 0.18 110.65 72.00 - 106.55 236910.78 TimeWrnr 64.99 0.73 91.34 63.54 2.09 15.03 53004.64
Rosneft 249.70 4.80 294.20 183.95 3.49 6.35 37779.85 SABMill 4030 25.00 4090 2773 1.84 33.38 98233.42
Chna Utd Coms RMB 6.15 -0.07 10.74 4.27 1.10 41.40 20176.4 HangSeng 143.70 -0.70 162.10 125.00 3.73 10.75 35447.44 Fedex♦ 144.66 0.97 185.19 130.01 0.57 38.90 40849.01 TimeWrnrC 181.61 2.80 194.22 134.21 2.05 27.29 51431.51
Sberbank 100.00 2.30 110.70 47.21 - 6.60 30817.74 Shire 4182 93.00 5870 4082 0.36 12.34 37278.03
ChShenEgy 11.50 -0.12 24.40 11.28 7.79 7.96 5042.78 HK Exc&Clr 195.30 -0.30 311.40 168.10 1.95 34.97 30453.54 FordMtr 13.89 0.27 16.74 10.44 4.11 11.73 54140.14 TJX Cos 70.72 -0.21 76.93 63.53 1.06 22.12 47349.1
Surgutneftegas 34.27 0.48 39.80 21.82 - 1.22 17478.59 StandCh 482.00 5.80 1166 475.55 10.64 11.27 23604.33
ChShpbldng RMB 9.88 -0.02 20.19 8.05 0.39-597.80 27460.79 MTR 36.35 0.15 40.00 30.75 2.76 13.96 27470.32 Franklin 35.70 0.58 57.64 34.62 1.67 10.92 21473.17 T-MobileUS 37.95 1.43 43.43 24.26 - 63.25 30968.62
Saudi Arabia (SR) Tesco 149.30 6.25 252.52 142.95 0.78 -2.15 18289.11
ChStConEng RMB 6.36 -0.10 12.52 4.88 2.73 8.07 29432.39 SandsCh 24.90 -0.50 40.80 22.85 7.64 14.18 25924.24 GenDyn 138.36 -0.83 153.76 130.91 2.38 15.69 43739.49 UnionPac♦ 76.31 -0.57 124.52 74.78 2.80 13.27 65177.95
AlRajhiBnk 48.21 0.85 69.00 46.60 3.85 12.30 20879.87 Vodafone♦ 209.50 5.75 258.00 201.25 5.36 -39.23 83709.26
ChUncHK 9.36 0.20 16.00 8.90 2.63 19.88 28920.41 SHK Props 93.50 -0.35 137.60 92.00 2.46 8.90 34905.33 GenElectric 30.35 0.09 30.99 19.37 3.01 59.23 306815.4 UPS B 98.15 0.28 114.40 93.64 2.89 22.68 68326.4
Natnlcombnk 50.07 0.08 72.75 48.80 - 11.43 26618.15 WPP 1513 46.00 1616 1271 2.52 15.64 29475.6
CNNC Intl RMB 9.74 -0.01 14.38 4.07 - 27.14 5865.72 Tencent 147.50 1.00 171.00 104.50 0.24 41.14 178952.12 GenMills 58.25 -0.18 59.87 47.43 2.86 28.13 34815.3 USBancorp 43.53 1.10 46.26 38.81 2.28 13.89 76141.68
SaudiBasic 84.05 0.34 110.50 70.25 6.07 10.75 67204.17 United States of America ($)
CSR♦ 9.42 -0.01 20.70 7.80 - 20.94 5312.68 India (Rs) GenMotors 34.45 0.06 39.00 24.62 3.81 12.73 53614.34 UtdHlthcre 116.96 1.11 126.21 95.00 1.49 18.68 111475.56
SaudiTelec 65.95 - 73.25 52.75 6.03 13.57 35154.58 21stC Fox A 27.54 0.29 39.27 22.81 1.08 7.22 32236.65
Daqin RMB 8.68 -0.09 15.15 7.88 5.58 9.05 19972.79 Bhartiartl 309.20 - 452.45 304.15 0.73 21.15 18460.11 GileadSci♦ 102.25 1.76 123.37 85.95 0.84 9.46 147360.67 UtdTech 93.81 0.78 124.45 85.50 2.66 14.83 83211.43
Singapore (S$) 3M 150.01 -7.62 170.50 134.00 2.60 19.54 92363.1
Gree Elec Apl 0.24 0.00 0.45 0.13 - -2.67 373.33 HDFC Bk 1059.45 - 1128 916.00 0.77 24.06 39922.1 GoldmSchs♦ 181.45 5.05 218.77 167.49 1.37 12.00 77394.99 ValeroEngy♦ 68.05 0.50 73.88 43.45 2.15 7.61 32766.31
DBS 16.32 - 21.50 16.00 3.62 12.56 28988.9 AbbottLb 45.48 0.67 51.74 39.00 2.05 27.21 67843.42
GuosenSec RMB 19.74 -0.56 34.94 7.00 1.02 11.85 25053.05 Hind Unilevr 858.60 - 981.00 744.50 1.71 39.27 27748.48 Halliburton♦ 38.02 1.47 50.20 30.93 1.88 124.35 32538.02 Verizon 45.74 0.29 50.86 38.06 4.81 18.46 186110.26
JardnMt US$ 46.02 -0.38 67.88 45.00 3.01 11.19 32322.36 Abbvie 56.05 0.61 71.60 45.45 3.42 32.64 91627.56
HaitongSecs 13.24 0.06 27.90 10.00 2.32 8.17 5824.57 HsngDevFin 1206.55 - 1402.3 1060.1 1.26 20.76 28444.53 HCA Hold 65.52 0.06 95.49 43.91 - 13.79 26710.39 VertexPharm 116.27 0.57 143.45 97.45 - -42.66 28569.55
JardnStr US$ 26.27 0.10 36.93 25.75 0.98 9.73 29266.05 Accenture 106.66 0.30 109.86 81.66 1.87 24.23 85991.78
Hngzh HikVDT RMB 34.07 0.12 56.48 21.53 1.19 24.01 16640.62 ICICI Bk 246.40 - 393.40 243.05 2.04 11.33 21388.37 Hew-Pack♦ 12.39 0.23 18.66 11.03 5.11 5.24 22280.01 VF Cp♦ 62.76 0.33 77.83 61.17 2.03 26.33 26755.16
OCBC 8.56 0.02 10.92 8.50 4.14 9.66 25009.11 Ace 115.32 1.22 117.98 96.00 2.27 14.18 37384.61
Hunng Pwr 6.61 0.21 11.90 6.24 7.03 6.25 4008.77 Infosys 1077.55 - 2336 932.65 3.48 19.24 36783.94 HiltonWwde♦ 21.60 0.32 31.60 20.91 0.32 28.73 21328.96 Viacom♦ 41.06 0.32 77.89 36.32 3.53 8.74 14254.66
SingTel 3.76 -0.03 4.57 3.43 4.58 15.72 42559.94 Adobe 94.88 1.62 95.79 68.98 - 99.41 47326.08
IM Baotou Stl RMB 3.66 -0.08 7.50 3.16 - -46.36 8917.54 ITC 322.95 - 409.95 294.00 2.01 24.81 38743.64 HomeDep♦ 131.55 -0.46 135.47 92.17 1.66 25.31 166789.78 Visa Inc 78.64 1.77 81.01 60.00 0.61 30.74 153068.23
UOB■ 19.09 -0.07 25.05 18.20 4.38 9.82 21707.43 AEP 56.03 1.49 65.38 52.29 3.76 15.65 27500.5
In&CmBkCh 4.47 -0.01 7.10 4.30 7.03 4.79 50057.6 L&T 1283.2 - 1893.8 1264.5 1.20 23.06 17846.83 Honywell 98.66 -0.33 107.41 87.00 2.08 17.40 76032.56 Walgreen 82.66 0.10 97.30 71.46 1.62 21.10 89740.33
Aetna 106.94 1.14 134.40 85.62 0.91 16.51 37289.98
IndstrlBk RMB 16.08 -0.16 21.42 11.90 3.58 6.08 40267.51 OilNatGas 217.80 - 373.80 211.25 4.61 9.37 27830.41 South Africa (R) HumanaInc 176.07 1.18 219.79 137.45 0.64 20.39 26097.79 WalMartSto♦ 60.03 -0.36 90.97 56.30 3.16 13.21 192209.65
Aflac 60.75 1.21 66.53 51.41 2.55 10.70 25924.37
Kweichow RMB 214.51 0.41 290.00 166.20 2.06 16.60 41706.7 RelianceIn 975.90 - 1067.85 796.45 1.04 11.55 47212.99 Firstrand 42.00 1.80 58.47 34.08 5.34 8.99 15721.32 IBM 138.24 2.31 176.30 131.65 3.45 9.54 134108.02 WellsFargo 54.51 1.31 58.77 47.75 2.64 13.27 279819.41
AirProd 130.09 1.13 158.20 123.66 2.44 22.27 28024.84
Midea 1.99 0.01 2.68 1.65 4.81 13.09 55.21 SBI NewA 226.40 - 336.00 220.15 1.57 9.23 26248.9 MTN Grp 130.00 3.59 250.00 123.04 11.31 6.60 16009.32 IllinoisTool 92.52 -0.37 100.14 78.79 2.15 18.34 33630.26 Williams Cos♦ 26.25 0.68 61.38 25.08 9.01 59.01 19681.32
Alexion 187.10 -0.69 208.88 142.02 - 170.60 42158.18
New Ch Life Ins 32.00 -0.40 56.55 27.05 0.80 8.89 4269.64 SunPhrmInds 773.75 - 1200.8 704.00 - 64.35 27811.39 Naspers N 2020 53.53 2270 1283 0.25 58.96 56566.85 Illumina 181.66 7.00 242.37 130.00 - 53.39 26595.02 Yahoo 33.19 0.60 51.68 27.20 - 130.82 31343.15
Allegran 306.25 3.23 340.34 237.50 - -41.84 120700.64
PetroChina 5.05 0.03 11.04 4.93 3.83 17.70 13747.62 Tata Cons 2375.85 - 2812.1 2315.25 1.68 22.12 69919.22 South Korea (KRW) Intcntl Exch♦ 248.50 2.92 266.74 202.24 0.86 23.66 27271.19 Yum!Brnds 72.46 0.81 95.90 66.35 2.25 34.87 31247.77
Allstate♦ 62.18 0.79 72.87 54.12 1.89 10.90 24082.7
PingAnIns 41.55 0.30 62.90 35.00 2.00 11.01 39926.53 Indonesia (Rp) HyundMobis 246500 3500 271500 185500 1.21 12.54 20274.83 Intel 34.90 0.43 37.74 24.87 2.69 15.04 164693.1 Venezuela ()
Alphabet 761.44 -1.10 793.05 490.91 - 35.37 221828.63
PngAnBnk RMB 11.92 -0.15 17.50 9.30 1.47 7.50 21777.54 Bk Cent Asia 13100 -100.00 15600 11000 1.08 19.19 22977.24 KoreaElePwr 48700 -750.00 54000 38750 1.04 6.77 26416.26 Intuit 98.18 1.88 109.21 79.63 1.04 61.48 25919.95 Bco de Vnzla 100.00 -6.99 143.95 27.00 - - 27015.81
Altria 57.27 -0.25 61.74 47.31 3.69 21.69 112288.11
Pwr Cons Corp RMB 8.09 -0.10 20.00 6.02 1.25 15.76 4132.03 SK Hynix 29400 400.00 51700 28550 1.01 4.68 17551.63 John&John 104.02 1.87 107.39 81.79 2.77 20.09 287817.48 Bco Provncl 4000 -350.00 4400 850.00 0.86 54.29 31948.88
Israel (ILS) Amazon 664.86 6.95 684.82 285.25 - 965.69 311661.11
SaicMtr RMB 20.56 -0.19 29.18 14.00 6.38 7.79 35085.23 SmsungEl 1277000 16000 1510000 1033000 1.59 9.44 139528.73 JohnsonCn♦ 39.37 -0.30 54.52 38.48 2.62 18.18 25499.03 Mrcntl Srvcs 5100 -100.00 5900 1310 0.16 37.79 22440.51
TevaPha 250.20 0.30 275.90 213.20 2.02 31.49 65848.72 AmerAir 42.28 0.51 56.20 34.10 0.94 6.11 26650.16
ShenwanHong 0.17 0.01 0.41 0.15 - -2.52 53.16 Spain (€) JPMrgnCh 66.02 1.75 70.61 50.07 2.53 11.32 243028.19
Italy (€) AmerExpr 70.18 1.35 94.89 67.80 1.56 12.57 69074.38
ShgPdgBk RMB 18.31 -0.14 20.12 11.91 4.17 6.85 52862.63 Kimb-Clark♦ 123.73 1.08 124.83 103.04 2.79 74.99 44911.48 Closing prices and highs & lows are in traded currency (with variations for that
Enel 3.90 0.15 4.50 3.36 3.64 64.06 40071.09 BBVA 6.93 0.13 9.77 6.80 2.34 17.35 48177.56 AmerIntGrp♦ 59.49 1.07 64.93 48.68 1.09 17.37 73589.87
Sinopec Corp 4.37 0.02 7.79 4.29 5.59 20.47 14385.5 KinderM 16.00 0.00 44.71 15.06 11.55 30.02 35704.46 country indicated by stock), market capitalisation is in USD. Highs & lows are
ENI 13.77 0.53 17.66 12.98 7.08 -17.79 54651.5 BcoSantdr 4.63 0.19 7.19 4.45 10.87 8.78 73033.91 AmerTower♦ 95.72 1.68 104.12 86.83 1.76 71.94 40544.14
Sinopec Oil RMB 8.35 -0.07 14.23 4.47 - -238.58 581.57 Kraft Heinz 72.26 1.29 81.20 61.42 0.76 -47.70 87687.34 based on intraday trading over a rolling 52 week period.
Generali 16.85 0.41 19.21 15.16 3.62 13.42 28649.32 CaixaBnk 3.55 0.14 4.57 3.32 2.29 29.50 22579.26 Amgen 162.99 4.88 181.81 130.09 1.82 19.60 122947.9
Denmark (kr) Iberdrola 6.52 0.10 6.71 5.31 2.41 16.47 45135.31 Kroger 42.33 0.47 42.40 27.32 0.82 22.39 41200.61 ♦ ex-dividend
IntSPaolo 3.10 0.13 3.65 2.22 2.30 17.55 53623.29 Anadarko♦ 48.17 0.58 95.94 47.35 2.23 -4.22 24477.29
DanskeBk 180.40 3.30 218.00 155.50 3.10 26.26 26632.18 Inditex 32.40 0.98 35.38 21.56 1.22 36.12 110279.4 L Brands 97.37 0.16 101.11 75.11 1.84 25.13 28182.23 ■ ex-capital redistribution
Luxottica 60.40 2.25 67.80 42.22 1.21 36.13 31899.12 Anthem♦ 134.43 -1.10 173.59 121.22 1.71 12.95 35084.02
MollerMrsk 9250 100.00 16450 9045 3.19 8.35 14409.32 Repsol 10.61 0.36 18.75 9.90 9.15 30.60 16218.53 LasVegasSd 41.64 1.22 61.59 36.53 5.84 15.07 33205.87 # price at time of suspension
Unicred 5.16 0.24 6.61 4.82 2.36 15.89 33593.78 Aon Cp 96.00 1.92 107.08 86.38 1.14 22.08 26296.02
NovoB 384.20 7.70 415.00 256.00 1.32 29.60 115986.49 Telefonica 10.70 0.46 14.31 10.23 3.80 17.73 56815.36 LibertyGbl 40.11 0.34 58.66 39.45 - -26.05 10138.05
Apple 111.49 -0.99 134.54 92.00 1.76 12.18 621593.65
Lilly (E) 85.19 0.51 92.85 68.31 2.32 38.80 94397.04

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
China Vanke 21.08 20.08 1.00 4.98 3.06 17.0 51.65 Firstrand 42.00 40.20 1.80 4.48 -4512.00 -99.1 -11.62 Dec 15 date Coupon S* M* F* price yield yield yield US Dec 15 date Coupon S* M* F* price yield yield yield US
TrnCan 46.37 46.37 0.00 0.00 5.35 13.0 13.06 MTN Grp 130.00 126.41 3.59 2.84 -13447.00 -99.0 -10.34 High Yield US$ US$
ChMrchSecs 22.84 23.50 -0.66 -2.81 1.54 7.2 -1.51 Naspers N 2020.00 1966.47 53.53 2.72 -194980.00 -99.0 -1.56 Windstream Services, LLC 11/17 7.88 B+ B2 BB 103.24 6.11 0.00 0.89 5.15 Burlington Resources, Inc. 02/26 6.88 A A2 A 117.73 4.72 0.00 0.07 2.48
Vale 12.46 12.46 0.00 0.00 0.81 7.0 -15.42 Altice 10.83 10.00 0.83 8.25 -1.55 -12.5 -29.13 High Yield Euro Merrill Lynch & Co., Inc. 09/26 6.22 BBB+ Baa3 A- 114.41 4.56 0.00 0.04 2.33
ChevrnTx 92.31 89.33 2.98 3.34 5.87 6.8 4.04 Ch Rail Gp 5.73 5.82 -0.09 -1.55 -0.70 -10.9 -14.48 Kazkommerts Intl BV 02/17 6.88 B Caa1 B 97.50 - 0.00 0.00 - Cummins Inc. 02/27 6.75 A+ A2 A 119.37 4.57 0.00 -0.11 -
ExxonMb 79.09 76.03 3.06 4.02 4.46 6.0 1.17 Panasonic 1236.50 1261.50 -25.00 -1.98 -140.50 -10.2 -12.28 Korea Electric Power Corporation 08/27 6.75 AA- Aa3 AA- 99.14 6.97 0.00 -0.08 -
MylanNV 54.29 53.37 0.92 1.72 3.03 5.9 11.13 AtlasCpcoB 191.60 191.60 0.00 0.00 -21.70 -10.2 -5.28 Emerging US$ FleetBoston Financial Corp. 01/28 6.88 BBB+ Baa3 A- 119.22 4.82 0.00 -0.06 -
ConocPhil 50.80 49.53 1.27 2.57 2.50 5.2 -2.08 BHPBilltn 16.27 16.60 -0.33 -1.99 -1.72 -9.6 -19.57 Peru 05/16 8.38 BBB+ A3 BBB+ 121.00 1.23 0.00 0.00 0.27 SunTrust Banks, Inc. 01/28 6.00 BBB+ Baa1 A- 109.43 5.01 0.00 -0.07 -
NorfolkS 90.51 89.35 1.16 1.30 4.19 4.9 1.72 Volvo 76.10 76.10 0.00 0.00 -8.00 -9.5 -14.08 Mexico 09/16 11.40 BBB+ A3 BBB+ 107.21 1.59 0.00 0.57 0.64
Brazil 01/18 8.00 BB+ Baa3 BBB- 104.32 5.75 0.00 0.00 4.79 Euro
Halliburton 38.02 36.55 1.47 4.02 1.75 4.8 1.60 Franklin 35.70 35.12 0.58 1.65 -3.62 -9.2 -10.02 Danske Bank AS 05/26 2.75 BBB NR A- 102.73 2.21 0.07 0.12 -0.03
GuosenSec 19.74 20.30 -0.56 -2.76 0.80 4.2 -9.95 Ch Rail Cons 9.57 9.82 -0.25 -2.55 -0.95 -9.0 -12.36 Russia 07/18 11.00 BB+ Ba1 BBB- 118.89 3.38 0.00 0.07 2.42
Peru 03/19 7.13 BBB+ A3 BBB+ 114.28 2.59 0.00 0.18 0.92 Credit Agricole S.A. 03/27 2.63 BBB Baa3 A- 95.37 3.12 0.00 0.03 -
Glencore 82.37 80.00 2.37 2.96 2.92 3.7 -11.53 MitsubishiEle 1252.50 1282.00 -29.50 -2.30 -123.50 -9.0 -3.10 BHP Billiton Fin Ltd 09/27 3.25 A+ A1 A+ 108.18 2.44 0.00 0.36 -
CSX 25.88 25.29 0.59 2.33 0.89 3.6 -4.05 DNB 103.60 103.60 0.00 0.00 -9.90 -8.7 -0.92 Brazil 01/21 7.88 BB+ Baa3 BBB- 94.23 6.31 0.00 0.92 4.65
Turkey 03/21 5.63 - Baa3 BBB- 105.23 4.55 0.00 0.29 2.89 B.A.T. Netherlands Fin B.V. (Re - British American Tobacco) 03/29 3.13 A- A3 A- 108.98 2.33 0.00 0.22 -
HumanaInc 176.07 174.89 1.18 0.67 6.03 3.5 5.07 JardnMt US$ 46.02 46.40 -0.38 -0.82 -4.38 -8.7 -8.24
Poland 04/21 5.13 A- A2 A- 111.58 2.80 0.00 0.00 1.14 Yen
Adobe 94.88 93.26 1.62 1.74 3.16 3.4 6.54 Nokia 6.24 6.24 0.00 0.00 -0.59 -8.6 -4.57
Colombia 07/21 4.38 BBB Baa2 BBB 99.78 4.47 0.00 0.47 2.81 Wal-Mart Stores, Inc. 07/15 0.94 NR WR NR 100.00 0.31 0.00 0.00 -
HyundMobis 246500.00 243000.00 3500.00 1.44 8000.00 3.4 -0.40 RollsRoyce 540.00 537.50 2.50 0.47 -50.00 -8.5 4.28
Hind Unilevr 858.60 858.60 0.00 0.00 25.10 3.0 7.77 Fanuc 20455.00 20875.00 -420.00 -2.01 -1820.00 -8.2 -5.53 Turkey 04/26 4.25 - Baa3 BBB- 92.51 5.26 0.00 0.40 3.03 £ Sterling
ITC 322.95 322.95 0.00 0.00 9.40 3.0 -2.08 Viacom 41.06 40.74 0.32 0.79 -3.65 -8.2 -17.96 Emerging Euro IPIC GMTN Limited 03/26 6.88 AA Aa2 AA 123.53 4.02 0.01 -0.04 1.79
Infosys 1077.55 1077.55 0.00 0.00 31.30 3.0 -2.11 CNOOC 7.90 7.82 0.08 1.02 -0.70 -8.1 -5.05 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- 106.07 3.32 0.03 0.01 1.08
Aetna 106.94 105.80 1.14 1.08 3.01 2.9 4.63 MollerMrsk 9150.00 9150.00 0.00 0.00 -790.00 -7.9 -6.23 Mexico 07/17 4.25 BBB+ A3 BBB+ 111.13 1.50 0.00 0.00 0.54 Data provided by SIX Financial Information. US $ denominated bonds NY close; all other London close. *S - Standard & Poor’s, M -
Mexico 02/20 5.50 BBB+ - BBB+ 109.77 2.97 0.00 -0.03 1.31 Moody’s, 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- 114.25 4.02 0.00 0.07 1.78
Data provided by SIX Financial Information & Tullett Prebon Information. US $ denominated bonds NY close; all other
London close. *S - Standard & Poor’s, M - Moody’s, F - Fitch.

INTEREST RATES: OFFICIAL BOND INDICES VOLATILITY INDICES GILTS: UK CASH MARKET
Dec 15 Rate Current Since Last Mnth Ago Year Ago Day's Month's Year Return Return Dec 15 Day Chng Prev 52 wk high 52 wk low Red Change in Yield 52 Week Amnt
US Fed Funds 0.00-0.25 16-12-2008 1.00 0.00-0.25 0.00-0.25 Index change change change 1 month 1 year VIX 21.46 -1.27 22.73 53.29 10.88 Dec 15 Price £ Yield Day Week Month Year High Low £m
US Prime 3.25 16-12-2008 3.25 3.25 3.25 Markit IBoxx VXD 19.73 -1.16 20.89 56.32 7.04 Tr 2pc '16 100.16 0.40 14.29 -2.44 -13.04 -4.76 101.73 100.16 0.32
US Discount 0.75 18-02-2010 0.75 0.75 0.75 ABF Pan-Asia unhedged 171.89 -0.33 -0.83 -3.58 0.03 -3.44 VXN 21.99 -1.12 23.11 46.72 11.15 Tr 1.75pc '17 101.40 0.47 9.30 9.30 -11.32 -16.07 102.68 101.38 0.29
Euro Repo 0.05 10-09-2014 0.05 0.05 0.25 Corporates( £) 297.90 -0.23 -0.09 1.49 1.53 2.04 VDAX 24.40 -2.09 26.49 29.94 - Tr 5pc '18 109.62 0.64 12.28 12.28 -4.48 -23.81 113.54 109.62 0.35
UK Repo 0.50 05-03-2009 0.50 0.50 0.50 Corporates($) 251.57 0.35 0.08 0.44 0.08 0.44 † CBOE. VIX: S&P 500 index Options Volatility, VXD: DJIA Index Options Volatility, VXN: NASDAQ Index Options Volatility. Tr 4.5pc '19 111.40 0.91 10.98 10.98 -1.09 -15.74 115.07 111.40 0.36
Japan O'night Call 0.00-0.03 05-10-2010 0.03 0.00-0.10 0.00-0.10 Corporates(€) 211.48 -0.22 -0.76 -0.57 -0.19 -0.19 ‡ Deutsche Borse. VDAX: DAX Index Options Volatility. Tr 4.75pc '20 114.91 1.13 9.71 9.71 -4.24 -11.72 119.04 114.67 0.33
Switzerland Libor Target 0.00-0.25 15-01-2015 0.00-0.75 -1.25--0.25 0-0.25 Eurozone Sov(€) 226.04 -0.31 -0.70 1.97 0.10 2.73 Tr 1.5pc '21 100.40 1.42 8.40 8.40 -1.39 0.71 142.92 99.91 0.12
Gilts( £) 291.21 -0.14 0.35 1.95 1.86 2.50 BONDS: BENCHMARK GOVERNMENT Tr 4pc '22 115.11 1.45 8.21 8.21 -3.33 -4.61 119.85 113.65 0.38
INTEREST RATES: MARKET Global Inflation-Lkd 243.75 0.45 0.43 -2.83 1.28 -3.90 Red Bid Bid Day chg Wk chg Month Year Tr 5pc '25 126.84 1.83 7.65 7.65 -1.61 1.67 134.70 124.47 0.35
Over Change One Three Six One Markit iBoxx £ Non-Gilts 297.73 -0.18 0.03 1.45 1.47 1.98 Date Coupon Price Yield yield yield chg yld chg yld Tr 4.25pc '27 122.96 2.07 6.15 6.15 -1.43 2.48 131.90 119.79 0.31
Dec 15 (Libor: Dec 14) night Day Week Month month month month year Overall ($) 226.75 0.48 0.39 1.15 0.39 1.15 Australia 10/18 3.25 103.11 2.12 -0.03 -0.02 -0.03 -0.21 Tr 4.25pc '32 125.42 2.38 5.78 6.73 -1.24 4.39 136.85 121.93 0.35
US$ Libor 0.13500 0.002 0.005 0.014 0.34450 0.51775 0.74850 1.06425 Overall( £) 290.45 -0.15 0.26 1.80 1.74 2.35 04/26 4.25 112.09 2.89 -0.02 -0.03 -0.09 -0.12 Tr 4.25pc '36 126.95 2.54 5.39 5.83 -1.55 4.96 140.37 123.52 0.28
Euro Libor -0.27643 -0.001 -0.086 -0.001 -0.19571 -0.12357 -0.02929 0.06000 Overall(€) 221.34 -0.25 -0.64 1.30 0.04 1.89 Austria 10/18 1.15 103.64 0.05 0.00 0.00 0.00 0.00 Tr 4.5pc '42 136.62 2.60 4.84 5.69 -1.52 4.00 153.16 132.20 0.26
£ Libor 0.48063 0.000 0.000 -0.004 0.50288 0.58463 0.74438 1.05513 Treasuries ($) 218.56 0.60 0.65 1.63 0.65 1.63 10/25 1.20 102.80 0.90 0.04 0.08 0.11 0.00 Tr 3.75pc '52 129.33 2.52 5.00 5.88 -2.33 -0.40 145.21 121.95 0.22
Swiss Fr Libor 0.000 -0.80400 -0.77100 -0.71660 -0.62560 FTSE Belgium 06/18 0.75 101.82 0.01 0.00 0.00 0.00 -0.32 Tr 4pc '60 140.98 2.47 5.11 6.01 -2.76 -1.20 159.23 131.72 0.21
Yen Libor -0.002 0.03357 0.07500 0.11714 0.22214 Sterling Corporate (£) 110.07 -0.88 - - 0.24 -3.46 06/25 0.80 98.61 0.95 0.07 0.10 0.12 0.00 xd Ex dividend. Closing mid-prices are shown in pounds per £ 100 nominal of stock. Red yield: Gross redemption yield.
Euro Euribor -0.002 -0.19100 -0.12900 -0.03900 0.06000 Euro Corporate (€) 105.44 -0.36 - - -0.78 -3.81 Canada 11/17 0.25 99.50 0.52 0.00 0.00 0.00 0.00 This table shows the gilts benchmarks & the non-rump undated stocks.
Sterling CDs 0.000 0.51000 0.60000 0.79500 Euro Emerging Mkts (€) 847.98 28.74 - - -10.98 -6.99 06/26 1.50 99.04 1.60 0.00 0.00 0.00 0.00
US$ CDs
Euro CDs
0.000
0.000
0.26000
-0.22500
0.48000
-0.16500
0.69000
-0.05500
Eurozone Govt Bond 113.25 -0.56 - - -0.64 -0.65 Denmark 11/18 0.25 101.48 -0.25 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 1.75 108.31 0.87 0.06 0.06 0.07 -0.05
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 99.41 1.25 0.00 -0.02 0.04 0.00
Fixed Coupon Dec 15 chg % Return 1 month 1 year Yield
Dec 15 term notice month month month year Markit iTraxx 09/25 0.88 99.62 0.92 0.06 0.09 0.15 0.00
1 Up to 5 Years 98.40 -0.21 2365.65 0.05 1.17 0.99
Euro -0.35 -0.25 -0.35 -0.25 -0.30 -0.15 -0.24 -0.09 -0.15 0.00 -0.04 0.11 Crossover 5Y 332.81 -26.45 30.92 20.21 389.82 280.05 France 05/18 1.00 102.97 -0.21 0.00 0.00 0.00 0.00
2 5 - 10 Years 178.54 -0.75 3230.97 0.13 1.74 1.67
Sterling 0.40 0.55 0.40 0.55 0.46 0.56 0.55 0.65 0.72 0.87 1.02 1.17 Europe 5Y 80.14 -5.57 6.85 6.01 95.40 68.39 11/20 0.25 100.71 0.11 0.05 0.04 0.08 0.00
3 10 - 15 Years 202.71 -1.30 3775.62 -0.04 1.44 2.17
Swiss Franc - - - - - - - - - - - - Japan 5Y 76.55 -1.47 2.41 3.78 83.13 65.01 11/25 1.00 100.13 0.99 0.08 0.11 0.13 0.00
4 5 - 15 Years 184.20 -0.91 3362.05 0.04 1.63 1.87
Canadian Dollar - - - - - - - - - - - - Senior Financials 5Y 77.26 -4.85 6.31 1.80 99.56 65.28 05/45 3.25 128.71 1.96 0.07 0.10 0.08 0.04
5 Over 15 Years 293.81 -2.14 4265.61 0.52 1.46 2.53
US Dollar 0.13 0.23 0.30 0.40 0.35 0.45 0.55 0.65 0.75 0.85 1.05 1.15 Germany 04/18 0.25 101.30 -0.31 0.00 0.00 0.00 0.00
Markit CDX 7 All stocks 171.10 -1.16 3207.95 0.28 1.32 2.27
Japanese Yen -0.03 0.07 -0.30 0.00 -0.40 -0.10 -0.15 0.15 -0.15 0.15 -0.10 0.20 10/20 0.25 101.45 -0.05 0.00 0.00 0.00 0.00
Emerging Markets 5Y 365.13 -10.94 20.42 39.75 376.07 299.17 08/25 1.00 103.41 0.63 0.06 0.06 0.11 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 514.35 -8.18 65.84 55.69 522.53 416.39 08/46 2.50 126.77 1.42 0.05 0.05 0.03 -0.03
Tullett Prebon; SDR, US Discount: IMF; EONIA: ECB; Swiss Libor: SNB; EURONIA, RONIA & SONIA: WMBA. Index Linked Dec 15 chg % chg % chg % Return 1 month 1 year
Nth Amer Inv Grade 5Y 92.79 -3.53 9.52 9.73 96.32 75.52 Greece 07/17 3.38 92.10 8.92 0.02 0.52 3.12 -1.18
Nth AmerHiVol 5Y 283.44 55.44 55.44 55.44 283.44 100.00 1 Up to 5 Years 308.53 0.03 -0.18 -2.42 2357.18 -0.18 -0.83
02/26 3.00 66.80 8.58 0.04 0.38 1.64 -0.57 2 Over 5 years 562.94 -1.29 -0.47 -1.60 4154.99 -0.47 -0.86
Websites: markit.com, ftse.com. All indices shown are unhedged. Currencies are shown in brackets after the index names. Ireland 10/17 5.50 110.40 -0.15 0.00 0.00 0.00 0.00 3 5-15 years 425.42 -0.56 -0.56 -3.11 3232.84 -0.56 -2.00
03/25 5.40 137.22 1.13 0.07 0.04 0.05 -0.29 4 Over 15 years 692.75 -1.58 -0.43 -0.80 5018.76 -0.43 -0.21
COMMODITIES www.ft.com/commodities BONDS: INDEX-LINKED Italy 10/18 0.30 100.26 0.21 0.02 0.06 0.05 0.00 5 All stocks 522.18 -1.09 -0.43 -1.53 3903.70 -0.43 -0.68
11/20 0.65 99.79 0.69 0.03 0.11 0.15 0.00
Energy Price* Change Agricultural & Cattle Futures Price* Change Price Yield Month Value No of
12/25 2.00 103.09 1.67 0.05 0.12 0.10 0.00 Yield Indices Dec 15 Dec 14 Yr ago Dec 15 Dec 14 Yr ago
Crude Oil† Dec 36.25 0.02 Corn♦ Mar 377.75 -1.50 Dec 14 Dec 14 Prev return stock Market stocks
09/46 3.25 111.61 2.71 0.03 0.12 0.01 0.00 5 Yrs 1.26 1.15 1.22 20 Yrs 2.57 2.45 2.42
Brent Crude Oil‡ 39.25 1.49 Wheat♦ Mar 489.00 -3.00 Can 4.25%' 21 127.25 -0.279 -0.321 0.20 5.18 69096.05 7
Japan 11/17 0.10 100.25 -0.03 0.00 0.00 0.00 0.00 10 Yrs 1.98 1.86 1.86 45 Yrs 2.49 2.37 2.53
RBOB Gasoline† Dec 1.23 -0.01 Soybeans♦ Jan 871.75 -3.25 Fr 2.25%' 20 114.71 -0.864 -0.917 -1.03 20.31 214785.50 14
12/20 0.05 99.91 0.07 0.00 -0.01 0.00 0.00 15 Yrs 2.39 2.27 2.23
Heating Oil† Dec 1.28 -0.07 Soybeans Meal♦ Jan 275.40 -0.60 Swe 0.25%' 22 107.98 -0.800 -0.830 -1.36 32.00 224263.61 7
09/25 0.40 101.19 0.28 -0.01 -0.02 -0.02 0.00
Natural Gas† Dec 1.85 -0.05 Cocoa (ICE Liffe)X Mar 2286.00 -14.00 UK 2.5%' 16 - - - - - - -
09/45 1.40 100.94 1.36 -0.01 -0.03 -0.04 0.00 inflation 0% inflation 5%
Ethanol♦ - - Cocoa (ICE US)♥ Mar 3367.00 -15.00 UK 2.5%' 24 336.19 -0.706 -0.730 -1.08 6.82 482133.28 25
Netherlands 04/17 0.50 101.07 -0.30 0.00 0.00 0.00 0.00 Real yield Dec 15 Dur yrs Previous Yr ago Dec 15 Dur yrs Previous Yr ago
Uranium Dec 36.75 0.00 Coffee(Robusta)X Jan 1480.00 5.00 UK 2%' 35 230.02 -0.738 -0.746 -0.82 9.08 482133.28 25
07/25 0.25 95.00 0.79 0.07 0.07 0.09 0.00 Up to 5 yrs -0.74 2.40 -0.77 -1.05 -1.61 2.42 -1.48 -1.58
Carbon Emissions - - Coffee (Arabica)♥ Mar 120.85 0.25 US 0.625%' 21 100.64 0.508 0.406 -0.88 35.84 1098113.19 36
Diesel Dec - - White SugarX 402.10 0.70 New Zealand - - - - - - - Over 5 yrs -0.74 23.41 -0.79 -0.76 -0.77 23.52 -0.82 -0.79
US 3.625%' 28 130.95 0.958 0.406 -1.32 16.78 1098113.19 36
Unleaded (95R) - - Sugar 11♥ 14.78 0.18 12/17 6.00 106.49 2.64 0.02 0.08 0.05 -0.91 5-15 yrs -0.61 9.62 -0.68 -0.84 -0.75 9.64 -0.78 -0.95
Representative stocks from each major market Source: Merill Lynch Global Bond Indices † Local currencies. ‡ Total market
Norway 05/17 4.25 105.16 0.59 0.01 -0.01 -0.05 -0.37 Over 15 yrs -0.75 29.09 -0.81 -0.75 -0.78 29.14 -0.82 -0.77
Base Metals (♠ LME 3 Months) Cotton♥ Mar 63.54 0.19 value. In line with market convention, for UK Gilts inflation factor is applied to price, for other markets it is applied to par
03/25 1.75 102.22 1.49 0.03 -0.02 -0.09 0.00 All stocks -0.74 20.31 -0.79 -0.77 -0.79 20.48 -0.83 -0.80
Aluminium 1481.50 -3.00 Orange Juice♥ Jan 149.15 -0.20 amount.
Aluminium Alloy 1600.00 -10.00 Palm Oil♣ Jan 562.00 5.75 Portugal 06/18 4.45 110.24 0.32 0.02 0.02 -0.08 -1.05 See the FTSE website for more details: http://www.ftse.com/products/indices/gilts
Copper 4586.00 -94.50 Live Cattle♣ Dec 118.55 -0.38 BONDS: TEN YEAR GOVT SPREADS 10/25 2.88 102.84 2.54 0.02 0.11 -0.01 0.00
Lead 1716.50 -13.50 Spain 04/18 0.25 100.07 0.22 0.01 0.07 0.03 0.00 All data provided by Morningstar unless otherwise noted. All elements listed are indicative and believed accurate
Feeder Cattle♣ Jan 147.63 -3.88
Nickel 8680.00 -95.00 Lean Hogs♣ Feb 59.65 0.30 Spread Spread Spread Spread 10/25 2.15 103.63 1.75 0.03 0.14 -0.03 0.00 at the time of publication. No offer is made by Morningstar or the FT. The FT does not warrant nor guarantee
Tin 14680.00 70.00 Bid vs vs Bid vs vs Sweden 01/18 0.88 99.41 1.16 0.00 -0.04 0.01 0.00 that the information is reliable or complete. The FT does not accept responsibility and will not be liable for any
Zinc 1515.50 -31.50 % Chg % Chg Yield Bund T-Bonds Yield Bund T-Bonds 05/25 2.50 114.15 0.92 0.06 0.02 0.07 -0.04 loss arising from the reliance on or use of the listed information. For all queries e-mail
Precious Metals (PM London Fix) Dec 14 Month Year Australia 2.89 2.25 0.65 Italy 1.67 1.03 -0.57 Switzerland 01/18 3.00 108.25 -0.95 0.00 0.00 0.00 0.00 ft.reader.enquiries@morningstar.com
Gold 1061.50 -6.75 S&P GSCI Spt 314.46 -7.28 -29.69 Austria 0.90 0.27 -1.33 Japan 0.28 -0.36 -1.96 05/26 1.25 114.43 -0.12 0.00 0.00 0.00 0.00
Silver (US cents) 1374.00 3.00 DJ UBS Spot 77.60 -5.79 -29.89 Belgium 0.95 0.32 -1.28 Netherlands 0.79 0.16 -1.44 United Kingdom 07/18 1.25 101.07 0.84 0.04 0.05 -0.03 -0.16 Data provided by Morningstar | www.morningstar.co.uk
Platinum 852.00 -2.00 R/J CRB TR 174.91 -5.53 -28.37 Canada 1.60 0.97 -0.63 Norway 1.49 0.86 -0.74 01/21 1.50 100.60 1.38 0.04 0.06 -0.06 0.00
Palladium 558.00 11.00 Rogers RICIX TR 2029.05 - - Denmark 0.87 0.24 -1.36 Portugal 2.54 1.91 0.31 09/25 2.00 100.92 1.90 0.05 0.07 -0.08 0.00
Bulk Commodities M Lynch MLCX Ex. Rtn 231.14 -9.84 -33.05 Finland 0.92 0.29 -1.31 Spain 1.75 1.11 -0.49 01/45 3.50 119.02 2.57 0.04 0.08 -0.11 0.03
Iron Ore (Platts) 38.50 -0.55 UBS Bberg CMCI TR 12.04 -5.25 -29.53 France 0.99 0.35 -1.25 Switzerland -0.12 -0.76 -2.36 United States 11/17 0.88 99.84 0.96 0.01 0.02 0.00 0.00
Iron Ore (The Steel Index) 37.50 0.00 LEBA EUA Carbon 8.02 -5.87 18.64 Germany 0.63 0.00 -1.60 United Kingdom 1.90 1.26 -0.34 11/20 1.63 99.83 1.66 0.01 -0.01 0.00 0.00
GlobalCOAL RB Index 48.25 0.25 LEBA CER Carbon 0.51 -21.54 1600.00 Greece 8.58 7.95 6.35 United States 2.23 1.60 0.00 11/25 2.25 100.13 2.23 0.02 0.01 -0.04 0.00
Baltic Dry Index 484.00 -24.00 LEBA UK Power 2150.00 58.09 57.74 Ireland 1.13 0.50 -1.10 11/45 3.00 100.59 2.97 0.03 0.01 -0.09 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.
22 ★ FINANCIAL TIMES Wednesday 16 December 2015

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

Invesco Latin American Equity A $ 5.53 - -0.03 0.00 Monthly Share £ 1.2190xd - -0.0070 1.89 Global Basics 2181.06 2248.52 -0.97 0.31

ACPI Global UCITS Funds Plc (IRL) Cohen & Steers SICAV (LUX) Euronova Asset Management UK LLP (CYM) Genesis Asset Managers LLP Lloyds Money Fund Limited

AXIOM
Invesco Nippon Small/Mid Cap Equity A ¥ 998.00 - -18.00 0.00 Global Leaders 3233.37 3368.09 -1.93 1.10
www.acpishard.com Regulated Regulated Other International Funds
Regulated Sterling Class £ 52.6150 - 0.0000 0.11
European Real Estate Securities € 22.9529 - -0.3146 1.54 Smaller Cos Cls One Shares (Est) € 36.08 - -0.02 0.00 Emerging Mkts NAV £ 4.87 - 0.00 0.00 Invesco Pan European Equity A EUR Cap NAV € 18.73 - 0.21 0.00 Global High Yield Bond 925.66 954.29 -6.28 4.64
ALTERNATIVE INVESTMENTS
ACPI Emerging Mkts FI UCITS Fund USD A $ 105.94 - -0.62 0.00 Lloyds Multi Strategy Fund Limited
Europ.RealEstate Sec. IX € 30.7283 - -0.4212 0.00 Smaller Cos Cls Two Shares (Est) € 25.15 - -0.02 0.00 Invesco Pan European High Income Fd A € 13.63 - -0.04 2.38 Global Macro Bond Fund 10841.87 11177.19 -37.44 1.31
Conservative Strategy £ 1.0890 - -0.0040 1.97
ACPI Global Credit UCITS Funds USD A $ 13.91 - -0.05 0.00
Axiom Alternative Investments (FRA) Gbl Listed Infrastructure I $ 9.5582 - -0.0201 - Smaller Cos Cls Three Shares (Est) € 12.67 - -0.01 0.00 HPB Assurance Ltd Invesco Pan European Small Cap Equity A € 22.57 - 0.00 0.00 North American Dividend Fund 150.59 156.86 -0.77 2.19
Anglo Intl House, Bank Hill, Douglas, Isle of Man, IM1 4LN 01638 563490 Growth Strategy £ 1.4430 - -0.0060 1.32
ACPI Global Fixed Income UCITS Fund USD A $ 151.79 - -0.58 0.00 1 Conduit Street - 4th floor - London W1S 2XA
www.axiom-ai.com Tel: +44 330 822 0374 Gbl Listed Infrastructure IX $ 9.5582 - -0.0201 - Smaller Cos Cls Four Shares (Est) € 16.28 - -0.01 0.00 International Insurances Invesco Pan European Structured Equity A € 17.04 - 0.10 0.00 Optimal Income Fund 139.37 143.69 -0.31 2.64
Aggressive Strategy £ 1.7460 - -0.0060 0.00
Q ACPI India Fixed Income UCITS Fund USD A $ 9.83 - -0.05 - Regulated
Holiday Property Bond Ser 1 £ 0.50 - 0.01 0.00
Gbl RealEstate Sec. I $ 10.6270 - 0.0059 1.42 Invesco UK Eqty Income A £ 30.99 - 0.15 0.00 Recovery Fund Limited 'A' Participating Shares 9539.71 9937.19 -7.78 0.48
Axiom Contingent Capital € 1016.19 - -8.54 - Global USD Growth Strategy $ 1.3560 - -0.0070 0.00
ACPI India Fixed Income UCITS Fund USD A3 $ 84.00 - -0.46 0.00
Holiday Property Bond Ser 2 £ 0.60 - 0.01 0.00
Gbl RealEstate Sec. IX $ 12.5683 - 0.0069 0.00 Invesco UK Investment Grade Bond A £ 0.98 - 0.00 2.90 Dealing Daily Recovery Fund Limited 'I' Participating Shares 9561.14 9657.71 -6.98 1.33
Axiom Contingent Capital £ 1020.32 - -8.64 -
ACPI International Bond UCITS Fund USD A $ 17.78 - -0.11 0.00
Invesco US Structured Equity A $ 20.59 - 0.04 0.00 Strategic Corporate Bond Fund 131.49 136.97 -0.71 3.01
Axiom Equity $ 834.57 - -15.85 -
Hamon Investment Group
Other International Funds Invesco US Value Eq Fd A $ 30.15 - -0.05 0.00 UK Select 1437.79 1497.70 7.49 1.02
ACPI Select UCITS Funds PLC (IRL) Axiom Equity € 875.96 - -16.50 0.00
Regulated Asian Market Leaders - USD $ 23.76 - 0.08 0.00
Axiom Obligataire $ 1775.69 - -7.83 0.00
Eurobank Fund Management Company (Luxembourg) S.A. Invesco USD Reserve A $ 87.02 - 0.00 0.00
ACPI Balanced UCITS Fund USD Retail $ 13.72 - -0.08 0.00 Regulated
Asian Market Leaders - GBP £ 12.25 - 0.05 0.00
Axiom Obligataire € 1773.07 - -7.70 0.00 (LF) Absolute Return € 1.32 - 0.00 0.00
ACPI Balanced UCITS Fund EUR Retail € 10.35 - -0.06 0.00
Greater China - USD $ 10.24 - 0.03 0.00 Invesco Global Asset Management Ltd (IRL) Lombard Odier Funds (Europe) S.A (LUX)
Axiom Obligataire £ 1784.74 - -7.82 0.00
Crèdit Andorrà Asset Management (LUX)
(LF) Eq Emerging Europe € 0.66 - -0.01 0.00 www.loim.com
Dublin 00 353 1 439 8100 Hong Kong 00 852 2842 7200
ACPI Balanced UCITS Fund GBP Retail £ 10.47 - -0.07 0.00 www.creditandorra.com
Greater China - GBP £ 4.27 - 0.02 0.00 FCA Recognised Regulated
FCA Recognised
(LF) Eq Flexi Style Greece € 0.94 - -0.05 0.00 Lombard Odier Funds
ACPI Balanced UCITS Fund USD Institutional $ 10.00 - - - Invesco Stlg Bd A QD F £ 2.59 - 0.00 3.30
Crediinvest SICAV Money Market Eur I € 11.20 - 0.00 0.00 Selected Asian P'folio $ 44.01 44.02 -0.17 0.00
BLME Asset Management (LUX) Absolute Ret Bond (EUR) PA € 11.99 - 0.00 0.00 MFS Investment Funds (LUX)
(LF) Eq Mena Fund € 12.31 - -0.05 0.00
ACPI Balanced UCITS Fund EUR Institutional € 10.00 - - - BLME Sharia'a Umbrella Fund SICAV SIF Invesco Asian Equity A $ 6.03 - 0.02 0.53 FCA Recognised
Crediinvest SICAV Money Market Usd A $ 10.02 - 0.00 0.00
Regulated Absolute Ret Bond (USD) PA $ 17.63 - 0.00 0.00
(LF) Greek Government Bond € 17.72 - 0.03 - Blend.Research Gb.Eq.Fd. € 100.21 - -0.14 -
ACPI Balanced UCITS Fund GBP Institutional £ 10.00 - - -
Income Fund - Share Class A Acc $ 1135.26 - -0.51 0.00 Crediinvest SICAV Fixed Income Eur € 10.53 - -0.04 0.00
Haussmann Invesco ASEAN Equity A $ 86.01 - 0.70 0.45
Other International Funds All Roads (CHF) PA SFr 17.16 - -0.10 0.00
(LF) Greek Corporate Bond € 11.92 - -0.08 - Blend.Research Gb.Eq.Fd. £ 98.19 - 0.74 -
ACPI Horizon UCITS Fund $ 12.75 - -0.06 0.00 Invesco Bond A $ 26.72 - -0.08 2.22
Income Fund - Share Class G Acc £ 1076.07 - -0.49 0.00 Crediinvest SICAV Fixed Income Usd $ 10.35 - -0.03 0.00 Haussmann Cls A $ 2707.71 - 23.04 0.00
All Roads (USD) PA $ 10.95 - -0.06 0.00
(LF) FOF Dynamic Fixed Inc € 11.64 - -0.05 0.00 Blend.Research U.S.Core Eq.Fd. ¥ 10116.00 - 22.00 -
Invesco Continental Eurp Small Cap Eqty A $ 195.94 - 1.69 0.00
Gl Sukuk Fund - Share Class A Acc $ 1222.66 - -3.16 0.00 Crediinvest SICAV Spanish Value € 238.40 - -3.16 0.00 Haussmann Cls C € 2370.05 - 20.06 0.00
All Roads (GBP) PA £ 11.18 - -0.07 0.00
(LF) FOF Real Estate € 16.20 - -0.06 0.00 Blend.Research Gb.Eq.Fd. $ 97.55 - 0.13 -
Invesco Emerging Markets Equity A $ 33.99 - 0.22 0.00
Gl Sukuk Fund - Share class B Acc £ 1091.38 1091.38 -2.80 0.00 Crediinvest SICAV International Value € 203.64 - -3.91 0.00 Haussmann Cls D SFr 1254.52 - 10.27 0.00
All Roads (EUR) PA € 11.09 - -0.06 0.00
Em.Mk.Eq.Fund Euro € 105.63 - 0.35 0.00
Invesco Emerging Markets Bond A $ 20.34 - -0.12 4.73
Crediinvest SICAV Big Cap Value € 15.02 - -0.27 0.00
FIL Fund Management (LUX) Alpha Japan (EUR) PA F € 11.57 - -0.15 0.00
Em.Mk.Eq.Fund Sterling £ 90.59 - 1.11 0.00
Bank of America Cap Mgmt (Ireland) Ltd (IRL) 2a, rur Albert Borschette, BP 2175, L-1021, Luxembourg Heartwood Wealth Management Limited (IRL) Invesco Continental European Equity A € 8.59 - 0.09 0.19
Crediinvest SICAV US American Value $ 17.70 - 0.02 0.00
Regulated Phone: 800 22 089, 800 22 088 Regulated Alpha Japan (CHF) PA F SFr 14.43 - -0.18 0.00
Em.Mk.Eq.Fd.US Dollar $ 88.97 - 0.55 0.00
Algebris Investments (IRL)
Global Liquidity USD $ 1.00 - 0.00 0.29
Regulated Invesco Gilt A £ 14.91 - -0.16 1.40
Crediinvest SICAV Sustainability € 15.09 - -0.21 0.00 Heartwood Caut Multi Asset B Acc 136.85 - -0.42 0.00
Regulated Alpha Japan (JPY) PA F ¥ 1376.00 - -17.00 0.00
China Consumer A-GBP £ 13.97 - 0.02 0.00 Gb.Conc.Eq.Fd.Euro € 273.19 - -0.01 0.00
Invesco Global Small Cap Equity A NAV $ 116.34 - -0.18 0.00
Algebris Financial Credit Fund - Class I EUR € 131.85 - -0.83 0.00
China Focus A-GBP £ 4.06 - 0.01 0.71 Alpha Japan (USD) PA F $ 16.58 - -0.21 0.00
Barclays Investment Funds (CI) Ltd (JER) Gb.Conc.Eq.Fd.Sterl.UK T £ 166.69 - 1.49 0.00
Algebris Financial Income Fund - Class I EUR € 115.98 - -1.40 0.00
Daiwa SB Investments (UK) Ltd (LUX) Invesco Global High Income A NAV $ 11.74 - -0.12 5.46
39/41 Broad Street, St Helier, Jersey, JE2 3RR Channel Islands 01534 812800 5 King William Street, London EC4N 7DA Alternative Beta PA F SFr 113.13 - -0.59 0.00
Global Financial Services A-GBP £ 0.43 - 0.00 0.11 Gb.Conc.Eq.Fd.Sterling £ 252.28 - 2.24 0.00
FCA Recognised www.daiwasbi.co.uk 0207 597 7000 Invesco Gbl R/Est Secs A GBP F F £ 7.60 - -0.01 0.89
Algebris Financial Equity Fund - Class B EUR € 95.09 - -2.00 -
Bond Funds Regulated Alternative Beta PA F € 76.48 - -0.40 0.00
Global Health Care A-GBP £ 0.54 - -0.01 0.00 Gb.Conc.Eq.Fd.US $ 190.74 - 0.51 0.00
Invesco Global Health Care A $ 124.61 - -0.04 0.00
Algebris Asset Allocation Fund - Class B EUR € 98.67 - -0.91 - Sterling Bond F £ 0.45 - -0.01 3.30 DSBI Japan Equity Fundamental Active I JPY ¥ 12114.44 12114.44 -189.94 0.00
Global Industrials A-GBP £ 0.61 - 0.00 0.00 Alternative Beta PA F $ 114.45 - -0.61 0.00
Gb.Eq.Hdg Fd.Euro IRE T € 177.89 - -0.15 0.00
Invesco Global Select Equity A $ 12.72 - 0.08 0.00
DSBI Japan Equity Fundamental Active I GBP £ 120.24 120.24 -1.94 0.00 Hermes Investment Funds Plc (IRL)
Commodities (CHF) PA SFr 4.88 - -0.03 0.00
Global Inflation-Linked Bd A-GBP-Hdg £ 1.15 - 0.00 0.56 Hermes Investment Management Limited, 1 Portsoken Street, London E1 8HZ +44 (0) 207 680 2121 Gb.Eq.Euro Hdg Fd. € 252.09 - -0.20 0.00
Alken Asset Management (LUX) Baring International Fd Mgrs (Ireland) (IRL) Invesco Jap Eqty Core A $ 1.76 - -0.03 0.00
61 Conduit Street, London, W1S 2GB Northern Trust, George Court 54-62 Townsend Street, Dublin 2 Rep of Ireland 020 7214 1004 DSBI Japan Equity Fundamental Active A EUR € 115.53 121.31 -1.78 0.00 FCA Recognised
Global Real Asset Securities £ 1.31 - -0.01 0.00 Commodities (EUR) PA € 4.95 - -0.03 0.00
www.alken-am.com FCA Recognised Gb.Eq.Fund Euro € 275.08 - -0.77 0.00
Hermes Abs Return Credit Fund Class F Acc £ £ 1.00 1.00 0.00 - Invesco Japanese Equity A $ 18.47 - -0.34 0.00
Regulated Commodities (USD) PA $ 5.13 - -0.03 0.00
ASEAN Frontiers A GBP Inc £ 103.86 - 0.68 0.59 Global Technology A-GBP £ 0.26 - 0.00 0.00 Gb.Eq. Fd Euro IRE T € 174.05 - -0.49 0.00
Alken European Opportunities € 202.93 - -3.94 0.00
DAVIS Funds SICAV (LUX) Hermes Abs Return Credit Fund Class R Acc € € 1.97 1.97 -0.01 - Invesco Korean Equity A $ 30.00 - 0.40 0.00
Asia Growth A GBP Inc H £ 43.09 - -0.04 0.00 Regulated Convertible Bd P A € 17.28 - -0.07 0.00
Global Telecomms A-GBP £ 0.27 - 0.00 1.17 Gb.Eq.Fd.Sterling UK T £ 202.95 - 1.26 0.00
Hermes Active UK Inflation Fund Class F Acc £ 1.28 1.28 -0.01 0.00 Invesco PRC Equity A $ 50.66 - 0.38 0.00
Alken European Opportunities £ 118.37 - -1.21 0.00 Davis Value A $ 39.45 - 0.05 0.00
Australia A GBP Inc £ 65.36 - -0.11 1.95 India Focus A-GBP £ 4.11 - 0.04 0.00 Convertible Bd Asia PA F SFr 13.52 - -0.03 0.00
Gb.Eq.Fd.US Dollar $ 303.22 - 0.00 0.00
Hermes Asia Ex-Japan Equity Fund Class F Acc £ 1.48 1.48 -0.01 0.00 Invesco Pacific Equity A $ 45.61 - -0.27 0.19
Alken Absolute Return € 141.88 - -1.00 0.00 Davis Global A $ 27.88 - -0.08 0.00
Baring China Bond Fund $ 9.82 - 0.02 0.00 Latin America A-GBP £ 1.27 - -0.01 0.65 Convertible Bd Asia PA F € 14.43 - -0.04 0.00
Gb.Eq.Fund Sterling £ 200.60 - 1.24 0.00
Hermes Asia Ex-Japan Equity Fund Class R Acc € 3.24 3.24 -0.01 0.00 Invesco Global Technology A $ 15.98 - 0.09 0.00
Alken Absolute Return £ 115.20 - -0.80 0.00
Baring Emerging Markets Corporate Debt Fund $ 9.12 - -0.04 0.00 Convertible Bd Asia PA F $ 14.55 - -0.04 0.00
Gb.Val.Ex-Jap.Fd.USD $ 115.06 - 0.08 0.00
Hermes Global Emerging Markets Fund Class F Acc £ 1.11 1.11 0.00 0.00 Invesco UK Eqty A £ 7.68 - 0.07 1.37
Alken Small Cap € 182.88 - -2.43 0.00
Findlay Park Funds Plc (IRL) Emerg. Consumer (CHF) PA SFr 11.08 - -0.04 0.00
Baring European Opportunities Fund Class A EUR Acc € 13.61 - 0.10 0.00 Gb.Val.Ex-Japan Fd.Yen ¥ 13659.00 - -20.00 0.00
30 Herbert Street, Dublin 2, Ireland Tel: 020 7968 4900 Hermes Global Emerging Markets Fund Class R Acc € 2.83 2.83 0.01 0.00
FCA Recognised Emerg. Consumer (EUR) PA € 11.23 - -0.04 0.00
Baring Global Mining Fund - Class A GBP Inc £ 3.23 - -0.02 0.65 Gb.Val.Fd. Euro € 128.99 - 0.02 0.00
Amundi Funds (LUX) Hermes Global Equity Fund Class F Acc £ 1.47 1.47 0.00 0.00
Asset Management
American Fund USD Class $ 79.47 - 0.12 0.00
5 Allee Scheffer L-2520 Luxembourg + 44 (0)20 7074 9332 Emerg. Consumer (USD) PA $ 11.21 - -0.05 0.00
www.amundi-funds.com
FCA Recognised
Dynamic Emerging Markets A GBP Acc F £ 8.34 - -0.02 0.00
Dodge & Cox Worldwide Funds (IRL) American Fund GBP Hedged £ 43.33 - 0.07 0.00 Hermes Global Equity Fund Class R Acc € 3.90 3.90 0.00 0.00 Asset Management Emerg.Eq. Risk Par.(EUR) PA € 7.13 - -0.05 0.00
Gb.Val.Fd.Sterling
Asset Management £ 114.58 - 1.05 0.00

Eastern Europe A GBP Inc £ 38.63 - 0.50 1.72 6 Duke Street,St.James,London SW1Y 6BN Gb.Val.Fd.USD $ 102.53 - 0.30 0.00
Bd. Euro Corporate AE Class - R - EUR € 18.46 - -0.07 0.00 American Fund GBP Unhedged £ 52.48 - 0.11 - Hermes Global ESG Equity Fund Class F Acc £ 1.14 1.14 0.00 0.00
www.dodgeandcox.worldwide.com 020 3713 7664
Emerging Mkt Debt LC A GBP Hedged Inc £ 6.90 - -0.01 6.56 Emerg. Eq. Risk Par.(USD) PA $ 5.49 - -0.03 0.00
FCA Recognised Low Volatility Gb.Eq.Fd.Euro € 102.10 - 0.30 -
Bd. Global AU Class - R - USD $ 25.47 - -0.08 0.00 Latin American Fund USD Class $ 10.98 - -0.07 0.00 Hermes Global High Yield Bond Fund Class F Acc £ 1.03 1.03 0.00 0.00 Invest AD
Dodge & Cox Worldwide Funds plc - Global Bond Fund
Client services: +971 2 692 6101 clientservices@InvestAD.com Emerg. Loc.Cur.&Bds DH (CHF) PASFr 7.77 - -0.02 0.00
Emerging Opportunities A GBP Inc H £ 17.83 - -0.15 0.00 Low Volatility Gb.Eq.Fd.Sterl £ 100.04 - 1.18 -
Eq. Emerging Europe AE Class - R - EUR € 26.83 - -0.24 0.00 EUR Accumulating Class € 11.54 - -0.04 0.00 Latin American Fund GBP Unhedged £ 7.25 - -0.05 - Hermes Global High Yield Bond Fund Class R Acc € 2.72 2.72 -0.02 0.00 Other International Funds
Glb Emerging Markets A GBP Inc H £ 18.13 - 0.15 0.00 Emerg.Loc.Cur.Bd.Fdt PA SFr 8.02 - -0.04 0.00
Invest AD - Iraq Opportunity Fund $ 61.02 - 0.43 0.00 Low Volatility Gb.Eq.Fd.USD $ 99.39 - 0.57 -
Eq. Emerging World AU Class - R - USD $ 77.66 - -0.27 0.00 EUR Accumulating Class (H) € 9.08 - -0.03 0.00 Hermes Global Small Cap Fund Class F Acc £ £ 0.96 0.96 -0.01 -
Glb Resources A GBP Inc H £ 10.21 - 0.03 0.37 Emerg.Loc.Cur.Bd.Fdt PA € 10.67 - -0.06 0.00
Invest AD - Emerging Africa Fund $ 897.24 - -9.32 0.00 Low Volatility Gb.Eq.Fd.Yen ¥ 9358.00 - 33.00 -
Eq. Greater China AU Class - R - USD $ 537.91 - -4.82 0.00 EUR Distributing Class € 11.07 - -0.03 3.09 Hermes Global Small Cap Fund Class R Acc € € 1.91 1.91 -0.01 -
High Yield Bond A GBP Hedged Inc H £ 6.09 - -0.05 7.10 Emerg.Loc.Cur.Bd.Fdt PA $ 8.17 - -0.03 0.00
Invest AD - GCC Focus Fund $ 1355.51 - -29.46 0.00
Eq. Latin America AU Class - R - USD $ 306.49 - -3.26 0.00 EUR Distributing Class (H) € 8.70 - -0.03 3.37 Hermes Multi Asset Inflation Fund Class F GBP Acc £ 0.97 0.97 -0.01 0.00
Hong Kong China A GBP Inc £ 565.34 - 0.28 0.59 Euro BBB-BB Fdt PA SFr 15.34 - -0.06 0.00 MFS Meridian Funds SICAV (LUX)
GBP Distributing Class £ 9.78 - 0.03 3.26 Hermes Multi Strategy Credit Fund Class F Acc Hed £ 1.01 1.01 0.00 0.00 Regulated
Gl. Macro Bds & Curr Low Vol AHG - GBP £ 98.65 - -0.03 0.00
India Fund - Class A GBP Inc £ 13.64 - 0.11 0.00 Euro BBB-BB Fdt PA € 12.20 - -0.05 0.00
Absolute Return A1 € 19.63 - -0.14 0.00
GBP Distributing Class (H) £ 8.78 - -0.03 3.34 Fleming Financial Trust Investment Fund Limited (NZ) Hermes Sourcecap EU Alpha Fund Class F Acc £ 1.26 1.26 0.00 0.00
Latin America A USD Inc H $ 25.34 - 0.55 0.23 Incorporated in New Zealand, Reg No 5141841 Euro BBB-BB Fdt PA £ 10.78 - -0.05 0.00
Asia ex-Japan A1 $ 21.80 - 0.09 0.00
The Antares European Fund Limited USD Accumulating Class $ 9.14 - -0.04 0.00 Registered address: Level 5, 3 City Road, Graftn, Auckland, 1010, New Zealand Hermes Sourcecap EU Alpha Fund Class F Dis £ 1.23 1.23 0.01 1.29
Other International www.fftinvestmentfund.com Euro BBB-BB Fdt PA $ 17.33 - -0.07 0.00
MENA A GBP Inc F * £ 11.39 - 0.04 0.66 Dodge & Cox Worldwide Funds plc-Global Stock Fund Bond A1 $ 10.27 - -0.09 0.00
info@fftinvestmentfund.com Hermes Sourcecap EU Alpha Fund Class R Acc € 3.08 3.08 0.01 0.00
AEF Ltd Usd $ 673.40 - 3.50 -
USD Accumulating Share Class $ 15.27 - -0.03 0.00 Other International Funds Euro Credit Bd PA F € 12.87 - -0.02 0.00
China Equity Fd A1 $ 9.28 - -0.01 0.00
Asset Management
Hermes Sourcecap EX UK Fund Class F Acc £ 1.34 1.34 0.01 0.00
GAM
Fleming FT Investment Fund

Asset Management
AEF Ltd Eur € 676.17 - 3.34 0.00 Baring International Fd Mgrs (Ireland) (IRL) funds@gam.com, www.jbfundnet.com
GBP Accumulating Share Class £ 16.59 - 0.06 0.00 Euro Government Fdt PA € 12.56 - -0.04 0.00
Regulated Fleming Fund £ 4.68 4.68 -0.01 - Regulated Continental European Eqty A1 € 16.81 - -0.11 0.00
Hermes Sourcecap EX UK Fund Class R Acc € 3.17 3.17 0.02 0.00
China A-Share A GBP Inc £ 5.70 - 0.14 0.00 GBP Distributing Share class £ 12.10 - 0.04 0.83 JB BF ABS-EUR B € 104.85 - -0.01 0.00 Euro Inflation-Lk Fdt PA € 11.97 - -0.03 0.00
Emer Mkts Debt Lo Curr Fd A1 $ 10.54 - 0.01 0.00
Arisaig Partners Hermes UK Small & Mid Cap Fund Class F Acc £ 1.66 1.66 0.01 0.00
Other International Funds EUR Accumulating Share Class € 20.87 - -0.04 0.00 Foord Asset Management JB BF Abs Ret Def-EUR B € 108.92 - -0.12 0.00 Euro Resp.Corp. Fdt PA € 18.09 - -0.05 0.00
Emerging Markets Debt A1 $ 32.42 - -0.20 0.00
Other International Funds Hermes UK Small & Mid Cap Fund Class R Acc € 5.02 5.02 0.03 0.00
Arisaig Africa Consumer Fund Limited $ 13.31 - 0.06 0.00 Barings (Luxembourg) (LUX) Dodge & Cox Worldwide Funds plc-International Stock Fund JB BF Abs Ret EM-USD B $ 112.93 - -0.04 0.00 Europe High Conviction PA € 11.47 - -0.14 0.00
FCA Recognised Emerging Markets Eq.A1 $ 9.85 - 0.06 0.00
Foord International Trust $ 34.31 - -0.32 0.00 Hermes US All Cap Equity Class F Stg £ Acc £ 0.98 0.98 0.00 -
Arisaig Asia Consumer Fund Limited $ 61.90 - -0.42 0.00 USD Accumulating Share Class $ 12.99 - -0.05 0.00
Russia A GBP Inc F £ 24.19 - -0.09 0.00 JB BF Abs Ret-EUR B € 127.42 - -0.11 0.00 Eurozone Small&Mid Caps PA € 53.07 - -0.39 0.00
European Concentrated A1 € 16.76 - -0.10 0.00
Foord Global Equity Fund_Class B $ 12.11 - -0.11 0.00 Hermes US All Cap Equity Class R € Acc € 1.93 1.93 0.00 -
Arisaig Global Emerging Markets Consumer UCITS € 11.56 - -0.08 0.00 EUR Accumulating Share Class € 13.92 - -0.05 0.00
JB BF Abs Ret Pl-EUR B € 126.00 - -0.08 0.00 Fdmt.Eq.L/S SH Sd EUR PA € 10.65 - 0.00 0.00
European Core Eq A1 € 30.55 - -0.17 0.00
Dodge & Cox Worldwide Funds plc-U.S. Stock Fund Hermes US SMID Equity Fund Class F Acc £ 1.57 1.57 -0.01 0.00
Arisaig Global Emerging Markets Consumer UCITS STG £ 10.77 - 0.03 0.00 BlackRock (JER)
JB BF EM Corporate-USD B $ 105.99 - -0.41 0.00 Fdmt.Eq.L/S SH Sd USD PA $ 10.69 - 0.00 0.00
Regulated USD Accumulating Share Class $ 17.58 - 0.00 0.00 Franklin Templeton International Services Sarl (IRL) European Res.A1 € 31.38 - -0.19 0.00
Hermes US SMID Equity Fund Class R Acc € 3.37 3.37 -0.02 0.00
Arisaig Latin America Consumer Fund $ 20.18 - -0.09 0.00 JPMorgan House - International Financial Services Centre,Dublin 1, Ireland
BlackRock UK Property £ 41.21 - 0.17 3.37 Other International Funds JB BF EM Infl Link-USD B $ 78.00 - 0.35 0.00 Gbl.Gvt.Fdmt PA € 10.41 - -0.04 0.00
GBP Accumulating Share Class £ 18.07 - 0.11 0.00 European Smaller Companies A1 € 50.82 - -0.26 0.00
Franklin Emerging Market Debt Opportunities Fund Plc
Blackrock UK Long Lease £ 1071.52 - 0.97 0.00 JB BF EM Inv Grade-USD B $ 96.55 - -0.23 0.00 Gbl.Gvt.Fdmt.(CHF) PA SFr 22.57 - -0.09 0.00
GBP Distributing Share Class £ 11.50 - 0.06 0.57 Impax Asset Management (IRL) European Value A1 € 35.40 - -0.23 0.00
Artisan Partners Global Funds PLC (IRL) Franklin Emg Mkts Debt Opp CHFSFr 17.44 - 0.51 8.01
Norfolk House, 31 St James's Square, London, SW1Y 4JR
Beaux Lane House, Mercer Street Lower, Dublin 2, Ireland BLK Intl Gold & General $ 3.78 3.99 -0.13 0.00 JB Emerging (EUR)-EUR B € 328.03 - -2.65 0.00 Gbl.Gvt.Fdt.SH (CHF) PA SFr 26.44 - -0.06 0.00
EUR Accumulating Share Class € 20.75 - 0.00 0.00 FCA Recognised Global Conc.A1 $ 35.52 - 0.06 0.00
Tel: 44 (0) 207 766 7130 Franklin Emg Mkts Debt Opp EUR € 12.27 - 0.36 7.13
FCA Recognised Env Mkts (Ire) Stl A £ 2.16 - 0.01 0.00 JB Emerging (USD)-USD B $ 399.04 - -1.63 0.00 Gbl.5B Fdmt (EUR) PA € 11.65 - -0.09 0.00
Global Credit Fund $ 10.24 - -0.08 0.00
Artisan Partners Global Funds plc Franklin Emg Mkts Debt Opp GBP £ 10.18 - 0.25 6.96
BONHOTE Env Mkts (Ire) Euro A € 2.03 - -0.01 0.00 JB BF Local EM-USD B $ 239.70 - -0.85 0.00 Gbl.5B Fdmt (CHF) PA SFr 10.31 - -0.08 0.00
Artisan Emerging Markets I USD Acc $ 6.53 - -0.02 0.00 Other International Funds Global Energy Fund A1 $ 11.64 - -0.02 0.00
Franklin Emg Mkts Debt Opp SGD S$ 22.43 - 0.51 6.17
Env Mkts (Ire) USD A $ 1.71 - -0.01 0.00 JB BF Total Ret-EUR B € 96.79 - -0.03 0.00 Gbl.5B Fdmt SH (USD) PA $ 10.81 - -0.06 0.00
Bonhôte Alternative - Multi-Arbitrage (USD) Classe (EUR) € 6695.00 - -30.00 2.26 Global Equity A1 $ 43.84 - -0.05 0.00
Artisan Global Equity Fund Class I USD Acc $ 14.12 - -0.06 0.00 Franklin Emg Mkts Debt Opp USD $ 17.18 - 0.35 6.99
Bonhôte Alternative - Multi-Performance (USD) Classe (EUR) € 9791.00 - 139.00 0.93 JB EF Abs Ret Eur-EUR B € 120.58 - -0.05 0.00 Generation Global (CHF) PA F SFr 13.43 - -0.03 0.00
Artisan Global Opportunities I USD Acc $ 12.15 - 0.02 0.00 Global Equity A1 € 25.26 - -0.20 0.00
INDIA VALUE INVESTMENTS LIMITED (INVIL)
JB EF Euro Value-EUR B € 164.78 - -4.19 0.00 Generation Global (EUR) PA F € 20.45 - -0.04 0.00
Artisan Global Value Fund Class I USD Acc $ 15.47 - -0.03 0.00 Dragon Capital Group Frontier Capital (Bermuda) Limited www.invil.mu Global High Yield Fund $ 23.52 - -0.27 0.00
c/o 1901 Me Linh Point, 2 Ngo Duc Ke, District 1, Ho Chi Minh City, Vietnam Other International Other International Funds
Braemar Group PCC Limited (GSY) JB EF Japan-JPY B ¥ 16983.00 - -284.00 0.00 Generation Global (USD) PA F $ 15.37 - 0.01 0.00
Artisan US Value Equity Fund Class I USD Acc $ 10.26 - -0.12 0.00 Regulated Fund information, dealing and administration: funds@dragoncapital.com Global High Yield Fund € 15.57 - -0.28 0.00
Commercial Property-GBP Class £ 71.42 - -0.53 - NAV £ 7.59 - -0.06 0.00
Other International Funds Global Energy (USD) PA F $ 5.82 - -0.09 0.00
UK Agricultural Class A £ 1.27 - 0.01 0.00 JB EF Luxury B-EUR B € 209.81 - -2.25 0.00
Global Multi-Asset A1 $ 14.70 - -0.04 0.00
Vietnam Enterprise Inv. (VEIL) NAV $ 3.56 - 0.01 0.00 Global Real Estate-GBP C Class £ 45.26 - -0.50 -
Ashmore Sicav (LUX) UK Agricultural Class B £ 1.39 - -0.02 0.00 JB Ms EF Special Val. EUR/A € 131.64 - -1.30 1.10 Golden Age (CHF) PA F SFr 20.95 - -0.10 0.00
Intrinsic Value Investors (IVI) LLP (IRL) Global Res.A1 $ 24.94 - 0.04 0.00
2 rue Albert Borschette L-1246 Luxembourg Vietnam Growth Fund (VGF) NAV $ 23.09 - 0.08 0.00 1 Hat & Mitre Court, 88 St John Street, London EC1M 4EL +44 (0)20 7566 1210
FCA Recognised Student Accom Class B £ 0.55 - -0.17 0.00 JB Strategy Balanced-CHF/B SFr 146.22 - -0.67 0.00 Golden Age (EUR) PA € 14.26 - -0.07 0.00
GAM Limited (IRL) FCA Recognised Global Total Return A1 € 17.37 - -0.14 0.00
Vietnam Property Fund (VPF) NAV $ 0.81 - 0.00 0.00
Ashmore SICAV Emerging Market Debt Fund $ 90.19 - -0.68 8.42 FCA Recognised IVI European Fund EUR € 17.26 - -0.26 0.00 JB Strategy Balanced-EUR € 151.35 - -0.74 0.00 Golden Age (USD) PA F $ 19.78 - -0.10 0.00
GAM Fund Management Ltd Inflation-Adjusted Bond A1 $ 13.72 - -0.11 0.00
Ashmore SICAV Emerging Market Frontier Equity Fund $ 138.42 - -1.33 0.97 CG Asset Management Limited (IRL) Georges Court, 54-62 Townsend Street, Dublin 2 + 353 1 6093927 IVI European Fund GBP £ 17.07 - -0.11 1.02 JB Strategy Balanced-USD/B $ 126.73 - -0.42 0.00 Sh.T- Money Mkt EUR PA € 112.28 - 0.00 0.00
Japan Equity A1 $ 10.21 - 0.12 0.00
Northern Trust, George's Court, 54-62 Townsend Street, Dublin 2, Rep of Ireland DSM Capital Partners Funds (LUX) GAM Star Fund Plc
Ashmore SICAV Emerging Market Total Return Fund $ 76.76 - -0.37 6.05 00 353 1 434 5098 www.dsmsicav.com JB Strategy Growth-CHF/B SFr 89.30 - -0.38 0.00 Sh.T- Money Mkt CHF PA SFr 128.53 - -0.01 0.00
FCA Recognised Regulated GAM Star Asia-Pacific Eqty USD Acc F $ 11.50 - -0.12 0.00 Latin American Equity Fd A1 $ 10.96 - -0.07 0.00
Ashmore SICAV Global Small Cap Equity Fund $ 119.87 - -0.08 0.00
Capital Gearing Portfolio Fund Plc £ 26782.12 26782.12 -148.02 0.62 Global Growth I2 Acc € 134.17 - -0.08 0.00 JB Strategy Growth-EUR € 112.36 - -0.55 0.00 Sh.T- Money Mkt GBP PA £ 10.28 - 0.00 0.00
GAM Star Asian Eqty USD Ord Acc F $ 12.89 - 0.06 0.00 Limited Maturity A1 $ 13.99 - -0.01 0.00
Ashmore SICAV Local Currency Fund $ 79.99 - -0.04 0.32 CG Portfolio Fund Plc
Global Growth I1 Eur € 100.34 - -0.06 - JB Strategy Inc-CHF/B SFr 117.46 - -0.49 0.00 Sh.T- Money Mkt USD PA $ 10.31 - 0.00 0.00
GAM Star Balanced GBP Acc £ 10.18 - -0.09 0.00 Prudent Wealth Fd A1 $ 14.75 - 0.02 0.00
EM Mkts Corp.Debt USD F $ 85.80 - -0.57 8.49 Real Return Cls A £ 165.05 165.05 -1.11 1.76
JB Strategy Inc-EUR/B € 157.38 - -0.69 0.00 Sw.Fr.Bd(For) PA SFr 23.62 - -0.05 0.00
GAM Star Cap.Appr.US Eqty USD Inc F $ 16.62 - 0.01 0.00 Research Bond A1 $ 16.45 - -0.09 0.00
Dollar Fund Cls D £ 128.13 128.13 -0.96 1.65
EM Mkts Loc.Ccy Bd USD F $ 72.71 - -0.02 4.38 Edinburgh Partners Limited (IRL)
Invesco (LUX) JB Strategy Inc-USD/B $ 144.37 - -0.49 0.00 Sw.Fr.Credit Bd(For) PA SFr 13.55 - -0.03 0.00
27-31 Melville Street, Edinburgh, Edinburgh, EH2 4DJ +353 1 434 5143 GAM Star Cat Bond USD Acc $ 12.70 - 0.00 0.00 UK Equity A1 £ 7.69 - 0.00 0.00
Dublin 00 353 1 439 8100 Hong Kong 00852 3191 8282
Capital Value Fund Cls V £ 129.77 129.77 -0.82 0.27 Dealing - Fax only - +353 1 434 5230 FCA Recognised Tactical Alpha (CHF) PA SFr 10.11 - -0.03 0.00
FCA Recognised GAM Star Cautious GBP Acc £ 10.26 - -0.07 0.00 US Conc.Growth A1 $ 15.17 - 0.07 0.00
Invesco Management SA
Edinburgh Partners Opportunities Fund PLC
Tactical Alpha (EUR) PA € 10.41 - -0.03 0.00
GAM Star China Equity USD Acc F $ 22.34 - -0.01 0.00 Invesco Active Multi-Sector Credit Fund A € 2.87 - -0.01 0.00 US Government Bond A1 $ 17.03 - -0.06 0.00
Cedar Rock Capital Limited (IRL)
European Opportunities I EUR € 2.37 - -0.05 2.20
Regulated Tactical Alpha (USD) PA $ 14.98 - -0.05 0.00
GAM Star Cont European Eqty GBP Acc F £ 3.53 - -0.01 0.00 Invesco Asia Balanced A dist $ 13.70 - 0.11 3.72 Value A1 $ 21.40 - 0.06 0.00
Cedar Rock Capital Fd Plc $ 368.06 - 9.24 0.00 European Opportunities I GBP £ 1.72 - -0.02 2.47
Technology PA € 13.11 - -0.06 0.00
GAM Star Cred Opportunities GBP Acc £ 12.35 - -0.02 4.57 Invesco Asia Consumer Demand Fund A income $ 12.11 - 0.10 0.24
Cedar Rock Capital Fd Plc £ 383.87 - 13.04 0.00 European Opportunities I USD $ 2.62 - -0.05 2.05
Aspect Capital Ltd (UK) Kames Capital VCIC (IRL) Technology PA $ 19.86 - -0.09 0.00 MMIP Investment Management Limited (GSY)
Other International Funds GAM Star Discretionary FX USD Acc F $ 12.70 - -0.04 0.00 Invesco Asia Infrastructure (A) $ 11.94 - 0.09 0.78 Regulated
Cedar Rock Capital Fd Plc € 362.78 - 14.70 0.00 European Opportunities A EUR € 2.31 - -0.05 1.53 1 North Wall Quay, Dublin 1, Ireland +35 3162 24493
FCA Recognised Wld Gold Expertise PAF SFr 8.52 - -0.36 0.00 Multi-Manager Investment Programmes PCC Limited
Aspect Diversified USD $ 439.48 - 5.55 0.00 Invesco Asia Opportunities Equity A $ 98.27 - 0.55 0.00
GAM Star Dynamic Gbl Bd USD Acc H $ 9.66 - 0.00 0.00
Global Opportunities I USD $ 1.57 - -0.02 2.09 Absolute Return Bond B GBP Acc 1081.50 - 0.52 - European Equity Fd Cl A Initial Ser € 2579.25 2589.39 212.70 0.00
Aspect Diversified EUR € 264.16 - 3.33 - Wld Gold Expertise PA € 6.79 - -0.29 0.00
Charles Schwab Worldwide Funds Plc (IRL) GAM Star Emerg. Market Rates USD Acc F $ 11.32 - 0.02 0.00 Invesco Balanced Risk Allocation Fund A € 14.35 - -0.08 0.00
Global Opportunities I GBP £ 1.04 - 0.00 1.94 Eq Market Neutral B Acc 1021.73 - 1.76 - Japanese Equity Fd Cl A Initial Ser ¥ 361904.00 363123.00 28252.00 0.00
Regulated Wld Gold Expertise PA $ 9.07 - -0.39 0.00
Aspect Diversified GBP £ 135.11 - 1.71 0.00 Invesco Emerging Europe Equity Fund A $ 7.44 - 0.13 0.00
GAM Star European Eqty USD Acc F $ 23.02 - -0.20 0.00
Schwab USD Liquid Assets Fd $ 1.00 - 0.00 0.01 Global Opportunities I EUR € 1.52 - -0.01 1.98 Eq Market Neutral Plus B Acc 1034.39 - 4.32 - LO Selection MMIP - US EQUITY CLASS A 01 June 07 Series $ 1135.99 1139.27 -48.31 0.00
Aspect Diversified CHF SFr 126.44 - 1.59 0.00 Invesco Emerging Local Currencies Debt A Inc $ 6.56 - 0.01 6.93
GAM Star Flexible Gbl Port GBP Ac £ 12.37 - -0.06 0.00
Global Opportunities A GBP £ 0.97 - -0.01 1.47 High Yield Global Bond A GBP Inc 507.50 - -4.70 5.26 Balanced (CHF) PA F SFr 105.18 - -0.69 0.00
Pacific Basin Fd Cl A Initial Ser $ 2142.33 2154.57 139.28 0.00
Aspect Diversified Trends USD $ 129.92 - 1.39 0.00
Chartered Asset Management Pte Ltd GAM Star GAMCO US Equity Acc F $ 12.60 - -0.28 0.00 Invesco Emerging Mkt Quant.Eq. A $ 8.61 - 0.05 0.00
Pan European Opportunities I EUR € 1.43 - -0.03 - High Yield Global Bond B GBP Inc 1054.42 - -9.76 5.26 Balanced (EUR) PA F € 122.88 - -0.90 0.00
Other International Funds UK Equity Fd Cl A Series 01 £ 2356.72 2380.35 78.79 0.00
Aspect Diversified Trends EUR € 130.19 - 1.37 0.00 Invesco Energy A $ 16.24 - -0.11 0.00
GAM Star Global Rates USD Acc F $ 12.26 - -0.08 0.00
CAM-GTF Limited $ 272314.26 272314.26 -8841.06 0.00 Investment Grade Global Bd A GBP Inc 552.05 - -3.59 2.34 Conservative (CHF) PA F SFr 102.51 - -0.42 0.00
Diversified Absolute Rtn Fd USD Cl AF2 $ 1591.09 - 14.69 0.00
Aspect Diversified Trends GBP £ 134.90 - 1.43 0.00 Invesco Euro Corporate Bond Fund (A) € 16.99 - -0.03 0.00
GAM Star Global Selector USD Acc F $ 12.62 - -0.13 0.00
CAM GTi Limited $ 612.98 - -36.72 0.00 Kames Global Equity Income B GBP Acc 1155.24 - 2.14 - Conservative (EUR) PA F € 113.00 - -0.54 0.00
Diversified Absolute Return Stlg Cell AF2 £ 1611.67 - 15.03 0.00
GAM Star Japan Eqty USD Acc F $ 13.13 - -0.18 0.00 Invesco Euro Inflation Linked Bond A € 15.52 - -0.07 0.00
Raffles-Asia Investment Company $ 1.55 1.55 -0.11 5.55 Kames Global Equity Income B GBP Inc 1101.21 - 2.04 - Global Allocation (GBP) PA F £ 9.93 - -0.04 0.00
Atlantas Sicav (LUX)
Regulated GAM Star Keynes Quant Strat USD Acc F $ 11.73 - -0.04 0.00 Invesco Euro Reserve A € 322.70 - -0.01 0.00
Strategic Global Bond A GBP Inc 1090.59 - -0.74 0.71 Growth (CHF) PA F SFr 109.05 - -0.94 0.00 LNG Capital (CYM)
American Dynamic $ 3387.75 - -124.20 0.00 Kingsbury House, 15-17 King St, London SW1Y 6QU
GAM Star Local EM Rates and FX USD Acc $ 10.63 - 0.00 0.00 Invesco Euro Bond A € 7.09 - -0.03 0.00
EFG Hermes Growth (EUR) PA F € 132.01 - -1.23 0.00 www.lngcapital.com, Tel: 0207 839 3456
Strategic Global Bond B GBP Inc 615.53 - -3.22 1.21
American One $ 3166.90 - -79.95 0.00 DIFC, The Gate Building, West Wing Level 6, PO BOX 30727, Dubai UAE Regulated
GAM Star North of South EM Equity Acc F $ 9.44 - -0.13 0.00 Invesco European Growth Equity A € 24.19 - 0.11 0.00
Contact: Telephone + 971 4 363 4029 Email AMsales@EFG-HERMES.com Vantage 1500 (EUR) MA € 10.16 - -0.01 0.00
LNG Europa Credit Fund EUR (Est) € 1196.70 - 65.31 -
Bond Global € 1382.32 - -24.18 0.00 Other International Funds Invesco Global Absolute Return Fund A Class € 11.65 - 0.02 0.00
GAM Star Technology USD Acc F $ 15.26 - 0.03 0.00 Lloyds Investment Fund Managers Limited (1000)F (JER) Vantage 3000 (EUR) MA € 10.25 - -0.02 0.00
The EFG-Hermes Egypt Fund $ 29.93 - - 0.00 PO Box 311, 11-12 Esplanade, St Helier, Jersey, JE4 8ZU 01534 845555 LNG Europa Credit Fund GBP (Est) £ 1196.70 - 56.94 -
Eurocroissance € 866.91 - -49.28 0.00 Invesco Global Bond A Inc $ 5.51 - 0.00 0.75
GAM Star US All Cap Eqty USD Acc F $ 13.10 - 0.00 0.00 Other International Funds PrivilEdge
Cheyne Capital Management (UK) LLP (IRL) LNG Europa Credit Fund USD $ 1183.45 - -15.60 -
Middle East & Developing Africa Fund (Final) $ 19.81 - - 0.00
Far East $ 685.08 - -10.35 0.00 Regulated Invesco Global Conservative Fund 90 (EUR) A € 11.84 - -0.03 0.00 Lloydstrust Gilt £ 12.1900 - -0.0700 2.41 Inc.Pt.RMB Dt.CNH PA CNH 102.67 - -0.07 0.00
GAM Star Worldwide Eqty USD Acc F $ 2987.16 - -35.91 0.00
Cheyne Convertibles Absolute Return Fund € 1346.36 - -6.90 0.00 Saudi Arabia Equity Fund SR 12.64 - -0.54 0.00 Lloyds Investment Funds Limited
Invesco Global Equity Income Fund A $ 57.69 - 0.46 0.00 Inc.Pt.RMB Dt.SH CHF PA SFr 9.61 - -0.03 0.00
Euro High Income € 1.6090 - -0.0060 2.92
Marlborough International Management Limited (GSY)
Atlantis Investment Management Ltd (IRL) Cheyne Global Credit Fund € 117.05 - -0.51 0.00
GYS Investment Management Ltd (GSY) Tudor House, Le Bordage, St Peter Port, Guernsey, CI, GY1 1DB +44 1481 71520
2nd Floor, 13 St Swithin's Lane, London EC4N 8AL Invesco Global Inc Real Estate Sec A dist $ 8.95 - -0.01 2.23 Inc.Pt.RMB Dt.SH EUR PA € 9.70 - -0.03 0.00
Ennismore Smaller Cos Plc (IRL) Regulated FCA Recognised
www.atlantis-investmenet.com, Tel: 0207 877 3377 Cheyne European Mid Cap Fund € 1129.42 - -17.77 0.00 European £ 7.2770 - 0.0140 1.32
5 Kensington Church St, London W8 4LD 020 7368 4220 Taurus Emerging Fund Ltd $ 178.98 182.64 4.40 0.00 Invesco Global Inv Grd Corp Bond A Dist $ 11.74 - -0.07 3.03 Inc.Pt.RMB Dt.USD PA $ 9.77 - -0.03 0.00 Marlborough North American Fund Ltd £ 30.92 32.95 -0.92 0.00
Regulated
FCA Recognised High Income £ 0.8580xd - -0.0038 5.02
Atlantis China Fund $ 6.44 - 0.00 0.00 Invesco Global Leisure A $ 36.12 - 0.09 0.00 Jenn. US Eq.Opp. USD PA $ 9.19 - -0.03 0.00 Marlborough Tiger Fund Ltd F £ 25.14 26.79 -0.95 0.00
Ennismore European Smlr Cos NAV £ 100.97 - 0.29 0.00
Cheyne Capital Management (UK) LLP International £ 3.8100 - 0.0040 1.21
Atlantis China Healthcare Fund $ 2.02 - 0.01 0.00 Other International Funds Generali International Limited Neubrg.Berman US Core PA $ 13.59 - 0.00 0.00
Ennismore European Smlr Cos NAV € 138.45 - -0.84 0.00 Invesco Global Smaller Comp Eq Fd A $ 55.94 - -0.05 0.00
PO Box 613, Generali House, Hirzel Street, St Peter Port, Guernesy, GY1 4PA 01481 714108
North American £ 15.1300 - 0.1000 0.15
Atlantis Japan Opportunities Fund $ 2.48 - -0.03 0.00
Cheyne European Event Driven Fund € 137.91 - 0.00 0.00 International Insurances Sands US Growth PA € 14.25 - 0.09 0.00 Marwyn Asset Management Limited (CYM)
Invesco Global Structured Equity A $ 45.79 - 0.05 0.73
Regulated
Global Multi-Strategy Managed $ 4.74 5.10 -0.08 0.00 Sterling Bond £ 1.4600 - -0.0080 3.62
Cheyne Real Estate Credit Holdings Fund £ 160.92 - 7.23 0.00 Ennismore European Smlr Cos Hedge Fd
Atlantis Asian Fund $ 6.18 - 0.02 0.00 Invesco Global Total Ret.(EUR) Bond Fund A € 13.11 - -0.03 0.00 Sands US Growth PA $ 17.22 - 0.12 0.00 Marwyn Value Investors £ 458.79 - -5.08 0.00
Other International Funds UK £ 6.1300 - -0.0860 1.81
Cheyne Real Estate Credit Holdings Fund III £ 111.98 - 0.56 0.00 UK Multi-Strategy Managed £ 4.81 5.18 -0.11 0.00
Invesco Gold & Precious Metals A $ 3.43 - -0.16 0.00 Will.Blair Gbl. Ldrs PA € 15.57 - -0.11 0.00
NAV € 496.00 - 10.70 0.00 Lloyds Gilt Fund Limited
Cheyne Real Estate Debt Fund Class A1 £ 131.65 - 0.83 0.00 EU Multi-Strategy Managed € 3.03 3.27 -0.07 0.00 Meridian Fund Managers Ltd
Invesco Greater China Equity A $ 42.94 - 0.12 0.00 Will.Blair Gbl. Ldrs PA $ 12.80 - -0.06 0.00
Lloyds Gilt Fund Quarterly Share £ 1.2690 - -0.0070 1.89 Other International Funds
Cheyne Total Return Credit Fund - December 2017 Class $ 182.18 - 10.16 0.00 Global Bond USD $ 3.46 3.73 0.01 0.00
Equinox Fund Mgmt (Guernsey) Limited (GSY) Invesco India Equity A $ 49.87 - 0.59 0.00 Global Gold & Resources Fund $ 179.68 - 10.63 -
Regulated
Cheyne Total Return Credit Fund 2020 $ 103.39 - 0.01 - M & G (Guernsey) Ltd (GSY)
Equinox Russian Opportunities Fund Limited $ 118.76 - -1.14 0.00 Invesco Japanese Equity Adv Fd A ¥ 3734.00 - -55.00 0.00 Regulated Global Energy & Resources Fund $ 33.88 - 1.76 -
The M&G Offshore Fund Range
Invesco Japanese Value Eq Fd A ¥ 1247.00 - -20.00 0.00
Corporate Bond 1303.72 1344.04 -8.99 3.16
Wednesday 16 December 2015 ★ FINANCIAL TIMES 23

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

China Equity USD Ord Acc $ 131.28 - 0.45 0.00 Emerging Asia Bond Fund Inst Acc $ 9.43 - -0.01 0.00 Chinese Equities (EUR) € 72.59 - 0.93 0.00 Renminbi Bond Fund USD Cls A $ 164.81 - -0.45 3.43

Mirabaud Asset Management (LUX) OTP Asset Management Romania SAI SA ((ROM)) Veritas Asset Management LLP (IRL)
China Equity USD Inst Acc $ 134.99 - 0.48 0.00 Emerging Local Bond - Inst Acc $ 10.38 - 0.01 0.00 Em Stars Equities (EUR) € 161.97 - 0.04 0.00 Renminbi Bond Fund GBP Cls A £ 160.22 - -0.44 3.66
www.mirabaud.com, marketing@mirabaud.com www.otpfonduri.ro HSSI Ltd, 1 Grand Canal Sq, Grand Canal Harbour, Dublin 2, Ireland
Regulated Other International Funds Veritas Funds Plc
Global Val.Cr.Fd GBP Ord Inc £ 110.39 - -0.39 3.61 Emerging Markets Bond - Inst Acc $ 37.01 - -0.25 0.00 Emerging Markets Equities (EUR) € 136.67 - 1.10 0.00 Renminbi Bond Fund SGD Cls A S$ 158.20 - -0.43 3.62
www.veritas-asset.com
Mir. Conv. Bds Eur A EUR € 135.67 - -0.75 0.00 OTP Comodisro RON 16.86 - 0.00 -
+353 1 635 6799
Global Val.Cr.Fd USD Inst Acc $ 121.94 - -0.42 0.00 Emerging Markets Corp.Bd Fund Inst Acc F $ 12.45 - -0.09 0.00 Flex-o-Rente (EUR) € 109.53 - -0.19 0.00 Renminbi Bond Fund YEN Cls A ¥ 19478.62 - -53.04 0.00 FCA Recognised
Mir. Conv. Bds Glb A USD $ 113.78 - -0.76 0.00 OTP Obligatiuni RON 14.25 - 0.00 -
Global Val.Cr.Fd GBP Ord Acc £ 175.79 - -0.62 0.00 Emerging Markets Short-Term Local Currency Fund $ 11.54 - 0.01 0.00 Glob.Consumer Trends Equities (EUR) € 153.11 - 0.05 0.00 Renminbi Bond Fund EUR Cls A € 108.64 - -0.29 3.88
Institutional Guide to Data
Mir. - Eq Asia ex Jap A $ 168.20 - 0.39 0.00 OTP Avantisro RON 8.33 - -0.05 - Veritas Asian Fund A USD H $ 306.01 - 1.48 0.43
Global Val.Cr.Fd USD Ord Acc $ 164.98 - -0.58 0.00 Euro Bond - Inst Acc € 22.70 - -0.11 0.00 High Yield Bonds (EUR) € 120.39 - -1.27 0.00
Mir. - Eq Glb Emrg Mkt A USD $ 84.96 - 0.61 0.00 OTP Euro Bond € 12.40 - 0.00 - Veritas Asian Fund A GBP H £ 373.34 - 1.66 0.24 The fund prices quoted on these pages are supplied by
Global Val.Cr.Fd EUR Ord Acc € 153.66 - -0.51 0.00 Euro Credit - Inst Acc € 14.70 - -0.06 0.00 Lux -O- Rente (EUR) € 140.67 - -0.75 0.00 the operator of the relevant fund. Details of funds
Mir. - Eq Global Focus A USD $ 100.72 - 0.05 0.00 OTP Dollar Bond $ 10.57 - -0.01 - Veritas Asian Fund A EUR H € 315.04 - 0.85 0.21 published on these pages, including prices, are for the
purpose of information only and should only be used as
Swiss Select Equity Inst Acc SFr 111.59 - -0.10 0.00 Euro Income Bond - Inst Acc F € 12.85 - -0.08 0.00 New World Financials (EUR) € 50.24 - -0.48 0.00 a guide. The Financial Times Limited makes no
Mir. -Eq Spain A € 24.89 - -0.40 0.00 OTP Premium Return RON 1065.18 - -2.68 - Veritas China Fund A USD $ 142.16 - 2.01 0.36 representation as to their accuracy or completeness and
Swiss Select Equity Ord Acc SFr 110.32 - -0.11 0.00 Euro Long Average Duration - Inst Acc € 21.66 - -0.14 0.00 US Premium Equities (EUR) € 178.14 - 0.13 0.00 they should not be relied upon when making an
investment decision.
Mir. - Eq Swiss Sm/Mid A SFr 321.52 - -1.78 0.00 Veritas China Fund A GBP £ 147.23 - 2.05 0.37
US Growth USD Ord Acc $ 207.02 - 0.13 0.00 Euro Low Duration Fund Inst Acc € 11.27 - -0.01 0.00 US Premium Equities (USD) $ 199.17 - 0.22 0.00 E.I. Sturdza Strategic Management Limited (GSY) The sale of interests in the funds listed on these pages
Mir. - Glb High Yield Bds A $ 106.08 - -1.05 - Regulated Veritas China Fund A EUR € 140.76 - 1.98 0.37 may, in certain jurisdictions, be restricted by law and
US Growth EUR Ord Acc € 198.10 - 0.12 0.00 Euro Real Return - Inst Acc € 13.44 - -0.08 0.00 the funds will not necessarily be available to persons in
Nippon Growth Fund Limited ¥ 101857.00 - -4296.00 0.00 all jurisdictions in which the publication circulates.
Mir. - Glb Eq High Income A USD $ 97.08 - -0.35 0.00 Veritas Global Equity Income Fund D USD $ 110.63 - 0.00 4.11
Persons in any doubt should take appropriate
US Growth GBP Ord Acc £ 208.28 - 0.13 0.00 Euro Short-Term Inst Acc € 12.26 - -0.01 0.00 professional advice. Data collated by Morningstar. For
Strat Evarich Japan Fd Ltd JPY ¥ 93700.00 - -1641.00 0.00
Mir. - Glb Inv Grade Bds A € 100.41 - -0.23 - Veritas Global Equity Income Fund D EUR € 194.69 - -0.60 3.91 other queries contact reader.enquiries@ft.com +44
US Growth USD Inst Acc $ 191.22 - 0.14 0.00 Euro Ultra Long Duration - Inst Acc € 28.52 - -0.21 0.00 (0)207 873 4211.
Strat Evarich Japan Fd Ltd USD $ 927.88 - -15.71 0.00
Mir. - Glb Strat. Bd A USD $ 103.45 - -0.58 0.00 Permal Investment Mgmt Svcs Ltd Veritas Global Equity Income Fund D GBP £ 141.78 - -0.35 4.08
Wealthy Nat Bd EUR Inst Inc € 108.00 - -0.53 3.77 www.permal.com Global Advantage - Inst Acc $ 11.94 - -0.03 0.00
The fund prices published in this edition along with
additional information are also available on the
Other International Funds Veritas Global Focus Fund D USD $ 25.22 - -0.02 0.64 Financial Times website, www.ft.com/funds. The
Wealthy Nat Bd GBP Inst Inc £ 112.19 - -0.57 3.61 Offshore Fund Class A US $ Shares Global Advantage Real Return Fund Inst Acc $ 8.32 - -0.03 0.00 S W Mitchell Capital LLP (CYM) E.I. Sturdza Funds PLC (IRL) funds published on these pages are grouped together by
MW Japan Fund Plc (IRL) fund management company.
Regulated Regulated Veritas Global Focus Fund D EUR € 23.06 - -0.09 0.61
FCA Recognised Investment Holdings N.V. $ 5487.68 - 49.80 0.00
Wealthy Nat Bd EUR Ord Inc € 107.23 - -0.53 3.53 Global Bond - Inst Acc $ 27.76 - -0.11 0.00
S W Mitchell European Fund Class A EUR € 334.37 - 23.63 - Nippon Growth (UCITS Fund Euro Hedged Class EUR) € 1085.49 - -17.12 0.00 Prices are in pence unless otherwise indicated. The
MW Japan Fund PLC A $ 24.79 - -0.47 - Veritas Global Focus Fund D GBP £ 28.23 - -0.10 0.63
Macro Holdings Ltd $ 4192.02 - 66.31 0.00 change, if shown, is the change on the previously
Wealthy Nat Bd GBP Ord Inc £ 112.74 - -0.57 3.34 Global Bond Ex-US - Inst Acc $ 19.48 - -0.08 0.00 quoted figure (not all funds update prices daily). Those
S W Mitchell Small Cap European Fund Class A EUR € 233.97 - 4.05 - Nippon Growth (UCITS Fund Euro Hedged Institutional Class EUR) € 1278.57 - -20.11 0.00
MW Japan Fund PLC B $ 24.99 - -0.48 - Veritas Global Focus Fund A GBP £ 27.27 - -0.09 0.36 designated $ with no prefix refer to US dollars. Yield
Fixed Income Holdings N.V. $ 364.13 - -1.93 - percentage figures (in Tuesday to Saturday papers)
Wealthy Nat Bd USD Ord Inc $ 109.73 - -0.56 3.32 Global High Yield Bond - Inst Acc $ 19.29 - -0.23 0.00
The Charlemagne Fund EUR € 323.41 - -9.82 - Nippon Growth (UCITS) Fund JPY Class A shares ¥ 100403.00 - -1581.00 0.00 allow for buying expenses. Prices of certain older
MW Japan Fund PLC C $ 96.06 - -1.65 - Veritas Global Focus Fund A EUR € 13.44 - -0.06 0.35 insurance linked plans might be subject to capital gains
Asset Management
New Capital Alternative Strategies Permal Absolute Return Fund $ 163.59 - 0.48 0.00
Global Investment Grade Credit - Inst Income $ 12.05 - -0.08 3.65 tax on sales.
Nippon Growth (UCITS) Fund JPY Class B Acc shares ¥ 84191.00 - -1326.00 0.00

Morant Wright Funds (Ireland) PLC (IRL)

All Weather Fd USD Cls $ 117.78 - 0.27 0.00
Global Investment Grade Credit Fund Inst Acc € € 11.57 - -0.10 0.00 S W Mitchell Capital LLP (IRL)
Nippon Growth (UCITS) Fund JPY Class C Dis shares ¥ 82212.00 - 968.00 0.00
Asset Management
Veritas Global Focus Fund A USD $ 24.34 - -0.02 0.37
Guide to pricing of Authorised Investment Funds
(compiled with the assistance of the IMA. The
All Weather Fd EUR Cls € 105.81 - 0.21 0.00 Regulated Veritas Global Focus Fund C GBP £ 29.60 - -0.10 0.00
FCA Recognised Investment Management Association, 65 Kingsway,
Global Investment Grade Credit Fund Inst Acc $ $ 16.49 - -0.10 0.00 London WC2B 6TD. Tel: +44 (0)20 7831 0898.)
SWMC European Fund B EUR € 14733.38 - -199.96 0.00 Nippon Growth (UCITS Fund Class D Institutional JPY) ¥ 54510.00 - -855.00 0.00
Morant Wright Fuji Yield EUR Acc Hedged € 11.68 - 0.07 - Veritas Global Focus Fund C EUR € 24.29 - -0.10 0.00
All Weather Fd GBP Cls £ 114.00 - 0.29 0.00
Global Multi-Asset - Inst Acc $ 14.15 - -0.08 0.00 OEIC: Open-Ended Investment Company. Similar to a
SWMC UK Fund B £ 11726.47 - -69.20 0.00 Strategic China Panda Fund USD $ 2200.02 - 3.09 0.00
Morant Wright Fuji Yield EUR Dist Hedged € 10.96 - -0.14 - Veritas Global Focus Fund C USD $ 26.49 - -0.03 0.00 unit trust but using a company rather than a trust
Tactical Opps USD Cls $ 136.11 - -9.95 0.00
structure.
Global Real Return - Inst Acc $ 17.82 - -0.12 0.00
SWMC Small Cap European Fund B EUR € 13324.40 - -109.13 0.00 Strategic China Panda Fund Hedged EURO € 2149.02 - 3.76 0.00
Morant Wright Fuji Yield GBP Acc Hedged £ 11.38 - -0.13 0.00 Veritas Global Equity Income Fund A GBP £ 135.87 - -0.35 4.09
Tactical Opps EUR Cls € 113.98 - -8.28 0.00
Pictet Asset Management (Europe) SA (LUX)
Income Fund Inst Acc $ 12.25 - -0.03 0.00
Different share classes are issued to reflect a different
15, Avenue J.F. Kennedy L-1855 Luxembourg SWMC Emerging European Fund B EUR € 8731.62 - -86.89 0.00 Strategic China Panda Fund Hedged Sterling £ 2176.32 - 3.26 0.00 currency, charging structure or type of holder.
Morant Wright Fuji Yield GBP Dist Hedged £ 11.06 - -0.13 - Veritas Global Equity Income Fund A EUR € 189.73 - -2.03 3.91
Tactical Opps GBP Cls £ 128.17 - -9.33 0.00 Tel: 0041 58 323 3000
Inflation Strategy Fund Inst Acc $ 8.54 - -0.05 0.00 Selling price:Also called bid price. The price at which
FCA Recognised Strategic Euro Bond Accumulating Class CHFSFr 983.95 - -0.95 0.00
Morant Wright Fuji Yield USD Acc Hedged $ 11.05 - -0.14 0.00 Veritas Global Equity Income Fund A USD $ 106.46 - 0.00 4.11 units in a unit trust are sold by investors.
Pictet-Absl Rtn Fix Inc-HI EUR € 106.84 - -0.27 0.00 Low Average Duration - Inst Acc $ 14.76 - -0.03 0.00
Strategic Euro Bond Institutional Class EUR € 1010.75 - -0.93 0.00
Morant Wright Fuji Yield USD Dist Hedged $ 11.08 - -0.14 2.09 Veritas Global Equity Income Fund C GBP £ 163.30 - -0.41 - Buying price: Also called offer price. The price at
which units in a unit trust are bought by investors.
Pictet-Absl Rtn Glo Div-I EUR F € 123.48 - -0.20 0.00 PIMCO RAE Fundam.PLUS Em.Mkts Inst Acc $ 7.73 - -0.05 0.00
Strategic Euro Bond Fund Accumulating Class Shares € 1133.24 - -1.08 0.00 Includes manager’s initial charge.
Morant Wright Fuji Yield YEN Acc ¥ 1140.20 - -14.16 0.00 Veritas Global Equity Income Fund C EUR € 227.21 - -0.70 -
Pictet-Agriculture-I EUR F € 179.25 - -1.58 0.00 PIMCO RAE Fundam.PLUS Gl.Dev.Inst Acc $ 10.44 - -0.08 0.00 Single price: Based on a mid-market valuation of the
Strategic Euro Bond Fund Distributing Class Shares € 1022.72 - -0.97 1.33
Morant Wright Fuji Yield B YEN Acc ¥ 1004.55 - -13.12 - Veritas Global Equity Income Fund C USD $ 127.13 - -0.01 - underlying investments. The buying and selling price
Pictet-Asian Equities Ex Japan-I USD F $ 197.62 - 0.47 0.00 PIMCO RAE Fundam.PLUS US Inst Acc $ 11.90 - 0.02 0.00 for shares of an OEIC and units of a single priced unit
Morant Wright Fuji Yield YEN Dist ¥ 1116.55 - -13.86 2.08 RobecoSAM (LUX) Strategic European Smaller Companies Fund EUR Class € 961.64 - -30.56 - trust are the same.
Northwest Investment Management (HK) Ltd Veritas Global Real Return Fund A USD $ 19.96 - -0.11 0.30
Tel. +41 44 653 10 10 http://www.robecosam.com/
11th Floor, Kinwick Centre, 32, Hollywood Road, Central Hong Kong +852 9084 4373 Pictet-Asian Local Currency Debt-I USD F $ 149.49 - -0.80 0.00 Socially Resp.Emerg.Mkts Bd Fd Inst Acc F $ 12.33 - -0.07 0.00
Regulated Strategic Global Bond RMB Acc $ 1046.16 - -5.33 0.00 Treatment of manager’s periodic capital charge:
Morant Wright Sakura Fund Sterling Acc Hedged £ 13.82 - -0.24 0.00 Other International Funds Veritas Global Real Return Fund A GBP £ 11.18 - -0.06 0.32 The letter C denotes that the trust deducts all or part of
Pictet-Biotech-I USD F $ 804.25 - -2.69 0.00 StocksPLUS{TM} - Inst Acc $ 22.71 - 0.03 0.00 RobecoSAM Sm.Energy/A £ 10.91 - 0.09 1.69 the manager’s/operator’s periodic charge from capital,
Northwest $ class $ 2357.94 - -24.48 0.00 Strategic Global Bond USD Acc $ 1043.01 - -2.46 0.00
Morant Wright Sakura Fund Euro Acc Hedged € 13.78 - -0.24 0.00 Veritas Global Real Return Fund A EUR € 11.78 - -0.07 0.12
contact the manager/operator for full details of the
effect of this course of action.
Pictet-Brazil Index I USD $ 35.95 - -0.53 0.00 Total Return Bond - Inst Acc $ 27.06 - -0.13 0.00 RobecoSAM Sm.Energy/N € 11.33 - -0.01 0.00
Northwest Warrant $ class $ 1969.35 - -444.40 0.00 Strategic US Momentum and Value Fund $ 763.46 - 0.68 0.00 Retail
Morant Wright Sakura Fund Yen Acc Unhedged ¥ 1407.42 - -24.93 0.00
Exit Charges: The letter E denotes that an exit charge
Pictet-CHF Bonds I CHF SFr 506.10 - -0.38 0.00 UK Corporate Bond - Inst Acc £ 17.26 - -0.05 0.00 RobecoSAM Sm.Materials/A £ 117.19 - -0.62 1.42
Strategic US Momentum & Value Fund USD I Class $ 507.04 - 0.48 0.00 Veritas Asian Fund B USD $ 213.71 - 1.05 0.00 may be made when you sell units, contact the
Morant Wright Sakura Fund Dollar Acc Hedged $ 13.73 - -0.24 0.00 manager/operator for full details.
Pictet-China Index I USD $ 102.00 - -0.34 0.00 UK Long Term Corp. Bnd Inst-Inst Acc £ 19.21 - -0.07 0.00 RobecoSAM Sm.Materials/N € 138.40 - -1.99 0.00
Strategic US Momentum and Value EUR Hedged Class EUR € 532.94 - 0.48 0.00 Veritas Asian Fund B GBP £ 275.23 - 1.24 0.00
Morant Wright Sakura Fund Swiss Franc Acc HedgedSFr 13.65 - -0.24 0.00 Time: Some funds give information about the timing of
price quotes. The time shown alongside the fund
Pictet-Clean Energy-I USD F $ 76.08 - 0.11 0.00 UK Low Duration - Inst Acc £ 14.04 - -0.01 0.00 RobecoSAM Sm.Materials/Na € 95.51 - -1.36 -
Strategic US Momentum and Value CHF Hedged Class CHFSFr 530.07 - 0.50 0.00 Veritas Asian Fund B EUR € 232.26 - 0.62 0.00 manager’s/operator’s name is the valuation point for
their unit trusts/OEICs, unless another time is indicated
Pictet-Digital Communication-I USD F $ 256.99 - 1.23 0.00 UK Real Return - Inst Acc £ 22.73 - -0.03 0.00 RobecoSAM Gl.Small Cap Eq/A £ 75.10 - 0.09 1.30 by the symbol alongside the individual unit trust/OEIC
Veritas China Fund B GBP £ 142.71 - 2.00 0.00 name.
Pictet-Eastern Europe-I EUR F € 249.47 - -2.08 0.00 UK Sterling Long Average Duration - Inst Acc £ 21.81 - -0.08 0.00 RobecoSAM Gl.Small Cap Eq/N € 153.61 - -1.20 0.00 The Hartford International Funds (IRL) Veritas China Fund B EUR € 163.91 - 1.09 0.00
Oasis Crescent Management Company Ltd Regulated
The symbols are as follows: ✠ 0001 to 1100 hours; ♦
1101 to 1400 hours; ▲1401 to 1700 hours; # 1701 to
Other International Funds Pictet-Em Lcl Ccy Dbt-I USD F $ 149.83 - 1.32 0.00 Unconstrained Bond - Inst Acc $ 11.83 - -0.02 0.00 RobecoSAM Sustainable Gl.Eq/B € 176.08 - -0.76 0.00 midnight. Daily dealing prices are set on the basis of
Gbl Govt Bond (Ex Japan) Index (GBP) £ 1596.47 - 5.88 0.00 Veritas Global Focus Fund B USD $ 17.58 - -0.02 0.00
the valuation point, a short period of time may elapse
Oasis Crescent Equity Fund R 8.94 - -0.06 0.00 before prices become available.Historic pricing: The
Pictet-Emerging Markets-I USD F $ 444.70 - 1.09 0.00 US High Yield Bond Fund Inst Acc $ 26.35 - -0.38 0.00 RobecoSAM Sustainable Gl.Eq/N € 151.95 - -0.66 0.00
UK Corporate Bond £ 1567.96 - -11.37 0.00 Veritas Global Focus Fund B GBP £ 20.84 - -0.07 0.00 letter H denotes that the managers/operators will
Morgan Stanley Investment Funds (LUX) normally deal on the price set at the most recent
6b Route de Trèves L-2633 Senningerberg Luxembourg (352) 34 64 61 Pictet-Emerging Markets Index-I USD F $ 200.32 - -0.60 0.00 RobecoSAM S.HealthyLiv/B € 173.30 - -0.89 0.00 valuation. The prices shown are the latest available
Gilt £ 1576.74 - -18.14 0.00 Veritas Global Focus Fund B EUR € 16.02 - -0.06 0.00
www.morganstanleyinvestmentfunds.com Oasis Global Mgmt Co (Ireland) Ltd (IRL) before publication and may not be the current dealing
levels because of an intervening portfolio revaluation or
FCA Recognised Regulated Pictet-Emerging Corporate Bonds I USD $ 104.92 - -0.48 0.00 RobecoSAM S.HealthyLiv/N € 161.49 - -0.81 0.00
Global Eq (Ex Japan) Index Fund ¥ 1.34 - 0.00 0.00 Veritas Global Equity Income Fund B GBP £ 124.97 - -0.32 4.11 a switch to a forward pricing basis. The
Oasis Global Investment (Ireland) Plc managers/operators must deal at a forward price on
US Advantage A F $ 57.81 - -0.30 0.00
Pictet-Emerging Markets High Dividend I USD $ 87.61 - 0.50 0.00 RobecoSAM S.HealthyLiv/Na £ 102.74 - 0.40 - request, and may move to forward pricing at any time.
Oasis Crescent Global Short Term Income Fund $ 0.99 - 0.00 0.79 Global Eq (ex Japan) Class HJ4 ¥ 1.39 - -0.01 0.00 Veritas Global Equity Income Fund B EUR € 174.07 - -1.87 3.93 Forward pricing: The letter F denotes that that
Asian Equity A F $ 39.29 - -0.14 0.00 managers/operators deal at the price to be set at the
Pictet-Emerging Markets Sust Eq I USD $ 78.02 - 0.09 0.00 RobecoSAM S.Water/A £ 162.57 - 0.73 1.21 next valuation.
Oasis Global Equity $ 26.60 - 0.04 0.23 Global Eq (ex Japan) Class JP5 ¥ 1.51 - 0.00 0.00 Veritas Global Equity Income Fund B USD $ 105.52 - -0.01 4.13
Asian Property A F $ 17.14 - 0.05 0.00
Oasis Crescent Global Investment Fund (Ireland) plc Pictet-Environmental Megatrend Sel I EUR € 156.73 - -0.46 0.00 Platinum Capital Management Ltd RobecoSAM S.Water/N € 160.43 - -0.71 0.00 Investors can be given no definite price in advance of
Global Eq Ex Japan Index Fund (Hedge) ¥ 1.38 - -0.01 0.00 Veritas Global Real Return Fund B USD $ 19.36 - -0.11 0.00
the purchase or sale being carried out. The prices
Asian Property AX F £ 10.45 - 0.09 0.54 Other International Funds appearing in the newspaper are the most recent
Oasis Crescent Global Equity Fund $ 27.10 - 0.08 0.00 Pictet-EUR Bonds-I F € 555.25 - -2.36 0.00
Gbl Govt Bond (Ex Japan) Index ¥ 1.34 - 0.00 0.00 Veritas Global Real Return Fund B GBP £ 10.97 - -0.06 0.00 provided by the managers/operators. Scheme
Platinum All Star Fund - A (Est) $ 117.46 - - - particulars, prospectus, key features and reports: The
Diversified Alpha Plus A F € 29.36 - 0.01 0.00
Oasis Crescent Variable Balanced Fund £ 10.03 - -0.05 0.59 Pictet-EUR Corporate Bonds Ex Fin i EUR € 142.83 - -0.32 0.00 most recent particulars and documents may be obtained
Gbl Govt Bond (ex Japan) Class JP4 ¥ 1.31 - 0.00 0.00 Veritas Global Real Return Fund B EUR € 12.60 - -0.06 0.00 free of charge from fund managers/operators. *
Platinum Global Dividend Fund - A (Est) $ 57.25 - - -
Emerg Europ, Mid-East & Africa Eq A F € 61.79 - 0.41 0.00 Indicates funds which do not price on Fridays.
OasisCresGl Income Class A $ 10.78 - -0.02 2.40 Pictet-EUR Corporate Bonds-I F € 199.24 - 0.08 0.00
Platinum Maverick Enhanced Fund Limited (Est) $ 96.39 - - 0.00 Japan Equity Index Fund ¥ 1.04 - -0.01 0.00
Emerging Markets Debt A F $ 74.43 - -0.62 0.00 Charges for this advertising service are based on the
OasisCresGl LowBal D ($) Dist $ 11.45 - 0.03 0.00 Pictet-EUR Government Bonds I EUR € 158.35 - -0.45 0.00 Veritas Asset Management LLP number of lines published and the classification of the
Japan Equity Class JP3 ¥ 1.26 - -0.02 0.00 www.veritas-asset.com fund. Please contact data@ft.com or call
Emerging Markets Domestic Debt AX F £ 9.88 - -0.01 5.50 +44 (0)20 7873 3132 for further information.
OasisCresGl Med Eq Bal A ($) Dist $ 11.64 - 0.02 0.32 Pictet-EUR High Yield-I F € 238.98 - -1.86 0.00 Schroder Property Managers (Jersey) Ltd Other International Funds

Emerging Markets Equity A F $ 31.51 - -0.07 0.00 Other International Funds

Oasis Crescent Gbl Property Eqty $ 9.19 - -0.05 2.07 Real Return Asian Fund USD (Est) € 303.80 - 20.85 0.00
Pictet-EUR Short Mid-Term Bonds-I F € 136.83 - -0.02 0.00 The National Investor (TNI)
Indirect Real Estate SIRE £ 133.37 139.46 0.14 2.24 www.tni.ae
Euro Bond A F € 15.72 - -0.06 0.00 Real Return Asian Fund GBP (Est) £ 303.80 - 1.50 0.00
Pictet-EUR Short Term HY I EUR € 118.91 - -0.43 0.00 Other International Funds
Euro Corporate Bond AX F £ 21.55 - 0.01 1.52 TNI Blue Chip UAE Fund * AED 9.09 - 0.05 0.00 Real Return Asian Fund EUR (Est) $ 303.80 - 5.31 0.00
Pictet-EUR Sov.Sht.Mon.Mkt EUR I € 102.96 - -0.01 0.00 SIA (SIA Funds AG) (LUX)
Polar Capital Funds Plc (IRL) Regulated TNI Funds Ltd (BMU)
Euro Strategic Bond A F € 43.15 - -0.28 0.00
Pictet-Euroland Index IS EUR € 126.54 - -2.37 0.00 Regulated
LTIF Classic € 314.78 - -5.14 0.00 MENA Hedge Fund $ 905.00 - -40.66 0.00
European Currencies High Yield Bd A F € 21.23 - -0.26 0.00 Asian Financials I USD $ 270.44 270.44 1.06 0.00 Waverton Investment Funds Plc (1600)F (IRL)
Pictet-Europe Index-I EUR F € 162.11 - -2.98 0.00 waverton.investments@citi.com
LTIF Natural Resources € 65.05 - -1.39 0.00 TNI Funds Plc (Ireland)
FCA Recognised
European Equity Alpha A F € 41.46 - -0.12 0.00 Biotechnology I USD $ 17.40 17.40 0.05 0.00
Odey Asset Management LLP (CYM) Pictet-European Equity Selection-I EUR F € 602.18 - -8.35 0.00 MENA UCITS Fund * $ 1053.27 - -9.38 0.00
LTIF Stability A ACCU € 157.40 - -2.27 0.00 Waverton Asia Pacific A USD $ 16.96 - 0.13 5.27
Regulated
European Property A F € 34.77 - -0.09 0.00 European Income Acc EUR € 11.07 11.07 -0.16 0.00
OEI Mac Inc GBP A £ 344.31 - -17.86 0.00 Pictet-European Sust Eq-I EUR F € 235.19 - -3.28 0.00 Waverton Global Bond Fund Cls A $ 8.73 - 0.01 5.41
Eurozone Equity Alpha A F € 11.18 - -0.02 0.00 European Ex UK Inc EUR Acc € 9.49 9.49 -0.12 -
OEI Mac Inc GBP B £ 189.70 - -8.02 0.00 Pictet-Global Bds Fundamental I USD $ 116.64 - -0.20 0.00 SIA (SIA Funds AG) (CH) Waverton Global Equity Fund A GBP £ 13.22 - 0.01 0.58
Global Bond A F $ 38.26 - -0.13 0.00 Financial Opps I USD $ 11.89 - -0.11 2.13 Other International Fds
OEI MAC Inc USD $ 1838.08 - -95.34 0.00 Pictet-Global Bonds-I EUR € 163.73 - -0.92 0.00 Waverton UK Fund A GBP £ 12.95 - 0.05 1.83
LTIF Stability Growth SFr 190.40 - -8.70 -
Global Brands A F $ 96.88 - -0.35 0.00 GEM Growth I USD $ 7.96 - -0.02 0.00
Odey European Inc EUR € 807.22 - -35.55 0.00 Pictet-Global Emerging Currencies-I USD F $ 95.20 - -0.02 0.00 Waverton Equity Fund A GBP £ 14.20 - -0.12 0.19
LTIF Stability Inc Plus SFr 163.50 - -13.40 5.80
Global Convertible Bond A F $ 41.77 - -0.26 0.00 GEM Income I USD $ 8.86 - -0.03 0.00
Odey European Inc GBP A £ 310.09 - -13.62 0.00 Pictet-Global Emerging Debt-I USD F $ 353.40 - 1.99 0.00 Toscafund Asset Management LLP (UK)
Waverton Sterling Bond Fund A GBP £ 9.43 - -0.01 5.31
Global Alpha I USD $ 12.45 12.45 -0.08 0.00 www.toscafund.com
Global Property A F $ 27.02 - 0.01 0.00
Odey European Inc GBP B £ 175.96 - -7.73 0.00 Pictet-Global Megatrend Selection-I USD F $ 217.17 - -0.59 0.00 Standard Life Wealth (JER) Authorised Funds
Indian Equity A F $ 32.83 - -0.03 0.00 Global Convertible I USD $ 11.26 11.26 -0.03 0.00 PO Box 189, St Helier, Jersey, JE4 9RU 01534 709130 Aptus Global Financials B Acc £ 3.01 - -0.03 4.53
Odey European Inc USD $ 371.78 - -16.41 0.00 Pictet-Greater China-I USD F $ 436.95 - 2.25 0.00 FCA Recognised WA Fixed Income Fund Plc (IRL)
Regulated
Latin American Equity A F $ 35.66 - -0.28 0.00 Global Insurance I GBP £ 4.04 - -0.05 0.00 Standard Life Offshore Strategy Fund Limited Aptus Global Financials B Inc £ 2.66 - -0.03 4.53
Giano Capital EUR Inc € 4456.59 - 3.33 0.00 Pictet-Health-I USD $ 264.63 - 0.67 0.00 European Multi-Sector € 115.89 - -0.77 0.00
Bridge Fund £ 1.5952 - 0.0001 2.01
Short Maturity Euro Bond A F € 20.38 - 0.00 0.00 Global Technology I USD $ 23.33 - 0.02 0.00
Pictet-High Dividend Sel I EUR F € 149.59 - -0.80 0.00
US Dollar Liquidity A F $ 13.03 - 0.00 0.00 Healthcare Blue Chip Fund I USD Acc $ 10.42 10.42 0.02 0.00
Diversified Assets Fund £ 1.1673 - -0.0021 2.87 Toscafund Asset Management LLP (CYM)
Odey Asset Management LLP (IRL)
Pictet-India Index I USD $ 91.28 - 0.36 0.00 www.toscafund.com
FCA Recognised Global Equity Fund £ 1.8604 - 0.0009 1.05 Regulated
US Growth A F $ 67.68 - -0.68 0.00 Healthcare Opps I USD $ 37.74 - -0.02 0.00
Odey Pan European EUR R € 331.59 - -2.56 0.00 Pictet-Indian Equities-I USD F $ 422.84 - 3.79 0.00 Tosca A USD $ 306.65 - 4.15 0.00
Global Balanced Fund - Income Units £ 1.3259 - -0.0006 1.90
US Growth AH F € 46.92 - -0.47 0.00 Income Opportunities B2 I GBP Acc £ 1.68 1.68 0.00 0.00
Odey Absolute Return Focus Fund $ 100.00 - - - Pictet-Japan Index-I JPY F ¥ 15840.55 - -280.55 0.00 Tosca Mid Cap GBP £ 253.12 - -6.14 0.00
Global Balanced Fund - Accumulations Units £ 1.5390 - -0.0007 1.87
US Growth AX F £ 44.71 - -0.21 0.00 Japan Alpha I JPY ¥ 207.67 207.67 -3.29 0.00
Odey Allegra European EUR O € 254.28 - -2.19 0.00 Pictet-Japanese Equities Opp-I JPY F ¥ 9562.97 - -184.38 0.00 Tosca Opportunity B USD $ 346.98 - -10.49 0.00 Yuki International Limited (IRL)
Global Fixed Interest Fund £ 0.9755 - -0.0063 5.16
US Property A F $ 66.45 - 0.09 0.00 Japan I JPY ¥ 2065.05 - -36.36 0.00 Tel +44-20-7269-0207 www.yukifunds.com
Odey Allegra International EUR O € 171.01 - -1.26 0.00 Pictet-Japanese Equity Selection-I JPY F ¥ 14204.01 - -254.90 0.00 Regulated
Sterling Fixed Interest Fund £ 0.8411 - -0.0065 4.21
North American I USD $ 17.45 17.45 0.02 0.00 Yuki Mizuho Umbrella Fund
Odey Allegra Developed Markets USD I $ 128.43 - -1.35 0.00 Pictet-LATAM Index I USD $ 47.27 - -0.44 0.00
Morgens Waterfall Vintiadis.co Inc UK Absolute Equity I GBP £ 12.84 12.84 -0.08 0.00
UK Equity Fund £ 1.8779 - 0.0013 2.76 Yuki Mizuho Japan Dynamic Growth ¥ 6709.00 - -111.00 0.00
Other International Funds Odey European Focus Fund € 17.02 - -0.15 0.49 Pictet-LATAM Lc Ccy Dbt-I USD F $ 104.54 - -0.48 0.00
Yuki Mizuho Japan Large Cap ¥ 777.62 - -0.38 0.00
Phaeton Intl (BVI) Ltd (Est) $ 397.28 - -13.63 0.00
Odey Atlas Fund GBP I S £ 1.13 - -0.01 0.00 Pictet-Pacific Ex Japan Index-I USD F $ 312.10 - -3.92 0.00
Polar Capital LLP (CYM) Yuki Japan Low Price ¥ 26140.00 - -486.00 0.00
Pictet-Premium Brands-I EUR F € 148.66 - -1.52 0.00 Regulated
Odey Giano European Fund EUR R € 121.52 - -0.13 0.00
ALVA Convertible A USD $ 128.85 - 0.86 0.00 Yuki Japan Value Select ¥ 12275.00 - -156.00 0.00
Odey Naver Fund EUR I € 126.86 - 0.61 0.00 Pictet-Quality Global Equities I USD $ 130.95 - -0.48 0.00
YMR Umbrella Fund
European Conviction A EUR € 140.86 - 1.11 0.00
Odey Odyssey USD I $ 140.90 - 0.25 0.00 Pictet-Russia Index I USD $ 45.21 - -0.89 0.00 TreeTop Asset Management S.A. (LUX) YMR N Growth ¥ 16787.00 - -219.00 0.00
European Forager A EUR € 174.98 - 0.29 0.00 Stenham Asset Management Inc Regulated
Pictet-Russian Equities-I USD F $ 40.08 - -0.63 0.00 www.stenhamassetmanagement.com TreeTop Convertible Sicav Yuki Asia Umbrella Fund
Odey Orion Fund EUR I € 118.73 - -0.07 0.00
Other International Funds
Natixis International Funds (Lux) I SICAV (LUX) International A € 296.29 - -0.31 0.00 Yuki Japan Rebounding Growth Fund JPY Class ¥ 22962.00 - -320.00 0.00
Odey Swan Fund EUR I € 98.59 - 1.26 0.00 Pictet-Security-I USD F $ 197.13 - -0.09 0.00
Cannon Bridge House, 25 Dowgate Hill, London, EC4R 2YA 0044 20 3216 9000 Polunin Capital Partners Ltd Stenham Asia USD (Est) $ 129.79 - -0.25 -
FCA Recognised International B $ 379.57 - -0.34 0.00 Yuki Japan Rebounding Growth Fund USD Hedged Class $ 911.93 - -12.73 -
Pictet-Select-Callisto I EUR € 105.17 - -1.26 0.00 Other International Funds
Odey European Absolute Return GBP S £ 100.17 - 0.81 0.00 Stenham Credit Opportunities A Class USD (Est) $ 100.94 - -1.12 0.00
Harris Global Equity R/A (USD) $ 252.09 252.09 -2.77 0.00
Emerging Markets Active $ 40.08 - -0.85 - International C £ 128.16 - 0.04 0.00
Pictet-Small Cap Europe-I EUR F € 1108.77 - -9.72 0.00
Stenham Equity UCITS USD $ 139.94 - -2.96 0.00
Harris US Equity Fund R/A (USD) $ 202.74 202.74 -0.54 0.00 Zadig Gestion (Memnon Fund) (LUX)
Odey Wealth Management (CI) Ltd (IRL) Luxcellence Em Mkts Tech $ 942.92 - 18.53 0.00 International D € 275.03 - -0.27 2.94
Pictet-ST.MoneyMkt-I € 140.46 - -0.01 0.00 FCA Recognised
www.odey.com/prices Stenham Growth USD (Est) $ 215.41 - 0.52 -
Harris Concentrated US Equity R/A (USD) $ 154.47 154.47 -0.67 0.00 TreeTop Global Sicav
FCA Recognised Polunin Developing Countries $ 685.60 691.43 -12.62 0.00 Memnon European Fund I GBP £ 109.87 - -0.57 0.00
Pictet-ST.MoneyMkt JPY I USD ¥ 101529.39 - 2.68 0.00
Stenham Healthcare USD (Est) $ 183.28 - 2.64 0.00 Global Opp.A € 137.14 - -0.80 0.00
Loomis Sayles Strategic Alpha R/A (USD) $ 109.00 109.00 -0.59 - Odey Opportunity EUR I € 218.50 - -0.52 0.00 Polunin Discovery - Frontier Markets $ 1348.14 - -3.47 0.00
Pictet-ST.MoneyMkt-ICHF SFr 124.24 - 0.01 0.00
Stenham Managed Fund USD (Est) $ 114.17 - 0.51 - Global Opp.B $ 135.40 - -0.75 0.00 Zebedee Capital Partners LLP (CYM)
Polunin Small Cap $ 1376.37 1393.57 12.39 0.00
Pictet-ST.MoneyMkt-IUSD $ 135.21 - -0.01 0.00 Regulated
Natixis International Funds (Dublin) I plc (IRL) Omnia Fund Ltd Stenham Macro UCITS USD $ 102.39 - -0.35 - Global Opp.C £ 171.58 - 0.07 0.00
Cannon Bridge House, 25 Dowgate Hill, London, EC4R 2YA +44 (0)20 3216 9000 Zebedee Focus Fund Limited Class A EURO Shares € 169.78 - -0.96 0.00
Other International Funds
Regulated Pictet-Timber-I USD F $ 144.03 - -1.95 0.00
Stenham Multi Strategy USD (Est) $ 116.04 - -0.19 - Sequoia Equity A € 140.53 - -0.35 0.00
Estimated NAV $ 855.62 - 16.81 0.00 Private Fund Mgrs (Guernsey) Ltd (GSY)
Zebedee Focus Fund Limited Class B USD Shares $ 197.30 - -1.19 0.00
Loomis Sayles Global Opportunistic Bond R/D (USD) $ 12.31 12.31 -0.04 1.21 Pictet Total Ret-Agora I EUR € 115.76 - 0.13 0.00 Regulated
Stenham Quadrant USD A (Est) $ 401.44 - 7.18 - Sequoia Equity B $ 143.70 - -0.41 0.00
Monument Growth 08/12/2015 £ 494.04 499.59 -1.81 1.01 Zebedee Focus Fund Limited Class A USD $ 170.38 - -0.82 0.00
Loomis Sayles High Income R/D (USD) $ 8.10 8.10 -0.06 14.98 Pictet Total Ret-Corto Europe I EUR € 136.14 - -0.25 0.00
Stenham Trading Inc USD (Est) $ 116.37 - 2.08 - Sequoia Equity C £ 162.91 - 0.54 0.00
Loomis Sayles Multisector Income R/D (GBP) $ 11.92 11.92 -0.06 5.77 Pictet Total Ret-Divers Alpha I EUR € 104.99 - -0.09 0.00
Prusik Investment Management LLP (IRL) Stenham Universal USD (Est) $ 431.31 - -0.52 -

Pictet Total Ret-Kosmos I EUR € 109.18 - -0.02 0.00 Enquiries - 0207 493 1331
Stenham Universal II USD (Est) $ 159.79 - -0.26 0.00 Unicapital Investments (LUX) Data Provided by
Regulated
Regulated
Pictet Total Ret-Mandarin I USD $ 114.12 - 0.25 0.00 Prusik Asian Equity Income B Dist $ 153.57 - 0.45 3.83
Investments III € 5.03 - -22.38 -
Optima Fund Management
Other International Funds Pictet-US Equity Selection-I USD $ 186.71 - 0.58 0.00 Prusik Asia A $ 189.42 - 0.94 0.00 Stratton Street Capital (CI) Limited (GSY)
Regulated Investments IV - European Private Eq. € 247.75 260.13 -44.58 -
Cuttyhunk Fund II Limited $ 1489.07 - -4.76 0.00 Pictet-US High Yield-I USD F $ 140.93 - -1.41 0.00 Prusik Asian Smaller Cos A $ 136.35 - 1.57 0.00 Japan Synthetic Warrant Yen Class ¥ 1772.84 - -37.12 0.00 Investments IV - Global Private Eq. € 366.42 384.74 -49.81 -
New Capital Fund Management Ltd (IRL) JENOP Global Healthcare Fund Ltd $ 14.98 - 0.33 0.00 Pictet-USA Index-I USD F $ 178.64 - 0.85 0.00
Japan Synthetic Warrant GBP Hedged Class £ 199.88 - 1.10 0.00
Leconfield House, Curzon Street, London, W1J 5JB
FCA Recognised OPTIKA Fund Limited - Cl A $ 101.47 - -0.10 - Purisima Investment Fds (CI) Ltd (JER)
www.morningstar.co.uk
Pictet-USD Government Bonds-I F $ 635.06 - -3.21 0.00 Value Partners Hong Kong Limited (IRL)
Regulated Japan Synthetic Warrant USD Class $ 18.75 - -0.43 0.00
New Capital UCITS Funds www.valuepartners.net, fis@vp.com.hk Data as shown is for information purposes only. No
Optima Fd NAV $ 90.17 - 0.01 0.00 Pictet-USD Short Mid-Term Bonds-I F $ 129.49 - -0.17 0.00 PCG B 163.87 - -3.16 0.00 Regulated offer is made by Morningstar or this publication.
Asia Pac Bd USD Inst Inc $ 92.18 - -0.20 3.25 Japan Synthetic Warrant USD Hedged Class $ 198.97 - 1.03 0.00

Optima Discretionary Macro Fund Limited $ 87.21 - -1.06 0.00 Value Partners Asia ex-Japan Equity Fund $ 8.44 - -0.08 -
Pictet-USD Sov.ST.Mon.Mkt-I $ 102.62 - 0.00 0.00 PCG C 161.59 - -3.12 0.00
Asia Pac Bd USD Ord Inc $ 93.92 - -0.21 2.52 Renminbi Bond Fund AUD Cls A A$ 119.84 - -0.34 3.82

The Dorset Energy Fd Ltd NAV $ 27.90 - 0.17 0.00 Value Partners Classic Equity Fund USD Z Unhedged $ 11.03 - -0.02 0.00
Pictet-Water-I EUR F € 274.79 - -1.33 0.00
Asia Pac Eq EUR Ord Inc € 82.42 - -0.86 3.37 Renminbi Bond Fund AUD Cls B A$ 121.58 - -0.35 3.57

Platinum Fd Ltd $ 86.27 - 0.07 0.00 Putnam Investments (Ireland) Ltd (IRL) Value Partners Classic Equity Fund CHF HedgedSFr 11.55 - -0.02 0.00
Asia Pac Eq GBP Ord Inc £ 85.42 - -0.93 3.81 Regulated Renminbi Bond Fund CHF Cls A SFr 116.58 - -0.32 3.88

Platinum Fd Ltd EUR € 16.75 - 0.01 0.00 Pimco Fds: Global Investors Series Plc (IRL) Value Partners Classic Equity Fund EUR Hedged € 11.68 - -0.02 0.00
Asia Pac Eq USD Ord Inc $ 85.88 - -0.94 3.19 Putnam New Flag Euro High Yield Plc - E € 1007.62 - -6.48 4.27 Renminbi Bond Fund CHF Cls B SFr 116.29 - -0.32 3.64
PIMCO Europe Ltd,11 Baker Street,London W1U 3AH
http://gisnav.pimco-funds.com/ Value Partners Classic Equity Fund GBP Hedged £ 11.95 - -0.02 0.00
Platinum Japan Fd Ltd $ 53.74 - -0.25 0.00
Asia Pac Eq USD Inst Acc $ 91.18 - -0.99 0.00 Dealing: +44 20 3640 1000 Renminbi Bond Fund CNH Cls A CNH 127.25 - -0.15 3.33
PIMCO Funds: +44 (0)20 3640 1407 Value Partners Classic Equity Fund GBP Unhedged £ 12.40 - 0.04 0.00
Optima Partners Global Fd $ 14.25 - 0.01 0.00
Asia Pac Eq USD Inst Inc $ 96.01 - -1.04 3.91 FCA Recognised Renminbi Bond Fund CNH Cls B CNH 126.91 - -0.14 3.10

Optima Partners Focus Fund A $ 15.88 - 0.03 0.00 Capital Securities Inst Acc $ 14.88 - -0.09 0.00 Value Partners Classic Equity USD Hedged $ 13.57 - -0.03 0.00
Dyn Europ Eq EUR Ord Inc € 171.22 - -2.47 1.29 Renminbi Bond Fund Euro Cls B € 118.06 - -0.32 3.64

Commodity Real Return Fund Inst Acc $ 5.65 - -0.05 0.00 Value Partners Greater China Equity Fund $ 8.30 - -0.05 -
Dyn Europ Eq GBP Ord Inc £ 181.70 - -2.74 1.64 Renminbi Bond Fund GBP Cls B £ 120.14 - -0.33 3.42
Oryx International Growth Fund Ltd Value Partners Health Care Fund RMB Class Z UnhedgedCNH 9.78 - -0.04 -
Credit Absolute Return Fund Inst Acc $ 10.91 - -0.06 0.00 Robeco Asset Management (LUX)
Dyn Europ Eq USD Ord Inc $ 170.56 - -2.58 1.21 Other International Funds Renminbi Bond Fund SGD Cls B S$ 119.36 - -0.33 3.38
Coolsingel 120, 3011 AG Rotterdam, The Netherlands.
Diversified Income - Inst Acc $ 18.92 - -0.18 0.00 Value Partners Health Care Fund HKD Class A UnhedgedHK$ 9.16 - -0.07 -
NAV (Fully Diluted) £ 6.57 - -0.06 0.00 www.robeco.com/contact
China Equity EUR Ord Acc € 129.13 - 0.44 0.00 Renminbi Bond Fund USD Cls B $ 119.47 - -0.32 3.19
FCA Recognised
Diversified Income Durat Hdg Fund Inst Acc $ 11.05 - -0.08 0.00 Value Partners Health Care Fund USD Class A Unhedged $ 9.20 - -0.07 -
China Equity GBP Ord Acc £ 134.97 - 0.46 0.00 Asia-Pacific Equities (EUR) € 127.57 - -0.46 0.00 Renminbi Bond Fund YEN Cls B ¥ 13154.48 - -35.77 0.00
24 ★ FINANCIAL TIMES Wednesday 16 December 2015

MARKETS & INVESTING

Capital markets
Capital markets

How the US Federal Reserve

intends to raise interest rates
Buckle up. The Federal
Reserve is expected to
raise interest rates today
for the first time since
2006, and reversing seven
years of extraordinary
monetary policy could
make for a bumpy
lift-off, writes Robin
Wigglesworth.
When economists talk
about the Fed’s official
borrowing rate, they are
referring to the federal
funds rate, which since late
2008 has been confined to
a corridor between zero
and 0.25 per cent.
Every US bank has to
keep a certain amount of
money deposited at the
central bank every day as
reserves, but some will be
flush while others have too
little, so they lend to each
other all the time, using the
fed funds rate.
For a smooth lift-off,
overnight RRP will have
to be enlarged from its
current $300bn cap
to $750bn or $1tn,
according to analysts
The fed funds rate sets a
benchmark for the cost of
credit that guides
borrowing costs for
everyone in the US (and
much further afield). But
the Fed’s crisis-fighting has
stymied the old-fashioned
way of lifting interest rates.
Quantitative easing
entailed buying vast
amounts of bonds from
banks and crediting their
accounts at the Fed with
new money. As a result the
financial system is awash
with surplus funds.
The US central bank has
maintained the effective
fed funds rate as its
primary interest rate target
at the upper end of a zero
to 0.25 per cent corridor.
Interest on excess
reserves, or IOER, is paid
by the Fed on money with
it. When policymakers vote
to lift interest rates, the
IOER rate will presumably
be lifted to 0.5 per cent.
In theory, this should
drag the effective fed
funds rate up to this level,
because banks should not
be willing to lend to other
financial institutions at a
rate lower than what the
central bank pays.
But only banks have
access to the IOER. There
are many other lenders
that have in practice
Excess reserves held at Federal Reserve
$tn
2000 02 04 06
Source: Bloomberg
dragged the effective rate
well below the IOER.
The Fed has other new
tools with which to manage
lift-off. The overnight
reverse repo programme,
or overnight RRP, is
primarily aimed at money
market funds, and is
expected to do much of
the heavy lifting. Overnight
RRP is acting as a floor, for
now, at 0.05 per cent.
In a typical RRP the Fed
sells a Treasury bond from
its portfolio to a money-
market fund and agrees to
buy it back the next day at
a certain price, a process
known as “repo”, short for
repurchase.
In practice, the central
bank’s balance sheet does
not shrink.
RRP operations — which
take place every business
day between 12.45pm
and 1.15pm in New York —
set a benchmark for cash
interest rates paid by
the Fed.
Currently the
programme is capped at
$300bn so that the Fed’s
operations will not distort
money markets. But
economists expect RRP to
be expanded — possibly
dramatically — to ensure
that the central bank gets
enough torque underneath
its interest rate increase, at
least in the short term.
Most analysts say RRP
will have to be enlarged to
$750bn or $1tn, or perhaps
be unlimited in size to
ensure a smooth lift-off.
But even if the Fed
manages to get the
effective fed funds rate up
to the midpoint in its new
corridor, the question
remains whether the rest
of the fixed income market
will respond.
Typically, other
important market rates
would be expected to rise
alongside the fed funds, as
banks and fund managers
took advantage of any
opportunities to
“arbitrage” away price
discrepancies.
But regulations have
severely curtailed the
ability of banks to lubricate
arb trades, leading to a
series of anomalies in
money markets.
Fed officials are
confident they have the
tools to raise the fed funds
rate to roughly where they
want it, and while the
recent rash of market
abnormalities has raised
eyebrows, most expect
other important interest
rates to rise in conjunction.
But it could still be a
bumpy take-off.
3 national Energy Agency.
2 production and investment, next year
1 decline as oil from US shale fields, the
0 put is not hedged beyond the end of
08 10 12 14 15
Junk bond ETF trade soars to record
Providers argue products
provide liquidity as critics
highlight risks to stability
JOE RENNISON AND STEPHEN FOLEY
NEW YORK
Trading in the biggest junk bond
exchange traded funds soared to record
levels during the recent market sell-off,
intensifying a debate about whether
high-yield ETFs contribute to financial
stability or put it at risk.
The three highest volume days in the
history of BlackRock iShares HYG and
State Street JNK, the two largest high-
yield bond ETFs, came in the past week,
as the market reeled from declining oil
prices, which could lead to a wave of
defaults by energy companies.
BlackRock, the world’s largest ETF
Oil’s big slide shows few signs of slowing
With Opec not cutting and
inventories at record levels,
the outlook is for lower prices
ANJLI RAVAL, DAVID SHEPPARD
AND NEIL HUME
Oil traders have found few reasons for
optimism as 2015 ends, as supplies swell
and Opec sticks with its policy of not
cutting production.
Prices almost breached financial
crisis-era lows this week and both lead-
ing benchmarks — Brent and West
Texas Intermediate — are firmly below
$40 a barrel. Many are asking how low
prices can go or if the market is ready
to rebound.
Here is what to look out for next year:
Opec primes the pump
The producers’ cartel took no action to
cut output and support prices at the last
meeting of ministers and removed its
official ceiling of 30m barrels a day. This
took away any pretence of restraint.
How Iraq and Saudi Arabia — which
reached record production levels 2015
— perform next year will be watched
closely, particularly as additional Ira-
nian barrels make their way to market
after the expected lifting of interna-
tional sanctions.
With Riyadh not willing to capitulate
to calls for unilateral cuts and Tehran
refusing to limit its production, the
scene has been set for an intensifying
rivalry in Opec that could put more
pressure on prices in the coming year.
“It remains unlikely that key Opec
producers are about to blink,” says
Edward Morse, global head of commod-
ities research at Citigroup.
US shale boom in retreat
Production growth outside Opec has
slowed dramatically on lower oil prices.
From a year-on-year figure of 2.2m b/d
at the start of 2015, it slowed to 300,000
b/d in November, according to the Inter-
With cash-strapped companies in the
US and elsewhere having pulled back on
will be the first annual decline in non-
Opec production since 2008.
The IEA expects a 600,000 b/d
driver of non-Opec growth, retrenches.
“A significant amount of US shale out-
2015,” say analysts from JBC Energy.
“This has the potential to become signif-
icant sooner rather than later.”
provider, said the trading vindicated the sell shares in an ETF similar to trading
$4.3bn bated by ETFs, and at an investment
role of the products in the market as a stocks but when there is a large amount conference appearance with Larry Fink,
source of liquidity. HYG trades on aver- of buying or selling, investors can Value of trading in BlackRock’s chief executive, in July, he
HYG on Friday,
age $800m shares a day, but volumes hit choose to create or redeem shares. according to called BlackRock “a very dangerous
a record $2.1bn last Tuesday, according Depending on the structure, either BlackRock company” for selling junk bond funds.
to BlackRock. That was broken again on the ETF provider or market makers in AllianceBernstein, another fund
Friday when volumes rose to $4.3bn the product are forced to sell the under- management group, has been a propo-
and on Monday they reached $3bn. lying bonds into an illiquid market to $800 m
nent of active management over ETFs
The ETFs track junk bond indices and raise investors’ cash. Average day’s for long-term investors. “There is an
trading volume
claim to provide greater access to the HYG saw redemptions of $560m last in the same illusion of liquidity. It is not nearly as
market because many of the underlying week. BlackRock said that while this high-yield fund good as people think,” said Gershon Dis-
bonds trade infrequently. was high it was not unprecedented, with tenfeld, director of high yield at AB.
“Stress events help investors under- similar sized withdrawals seen on three Others are more positive. Peter Tchir,
stand that fixed income ETFs are very other trading days this year. head of macro strategies at asset man-
well structured and well performing Among critics of junk bond ETFs have ager Brean Capital, said liquid ETFs
even in volatile markets,” said Matt been veteran investors Howard Marks encouraged buyers to step in when they
Tucker, head of Americas iShares fixed and Carl Icahn. Mr Marks likened them might have been too fearful, preventing
income strategy at BlackRock. to auction-rate securities, a kind of markets from tumbling too far. “Bond
But critics fear that as soon as ETFs municipal bond that proved impossible buyers and sellers are indirectly finding
are faced with heavy redemptions, the for retail investors to sell in the credit each other through ETF activity, and
liquidity of the underlying asset crisis. Mr Icahn is predicting a melt- ETFs are attracting investors who are
becomes paramount. Investors buy and down in high yield that will be exacer- afraid of individual bond risk,” he said.
Analysis. Commodities
Crude reality
Opec and non-Opec oil supply Global supply and demand
Year-on-year change Opec crude Non-Opec balances
Opec natural Total supply Until Q4 2016
gas liquids Demand Implied stock
Supply* change
mb/d mb/d
98 3.5
96 2.5
94 1.5
92 0.5
90 0
US shale supply Demand fails Opec decides Saudi Arabia US production 88 -0.5
86 -1.5
begins to to offset supply not to cut and Iraq ramp growth slows 84 -2.5
accelerate growth production up output mb/d
Q1 Q3 Q1 Q3 Q1 Q3
4.0 2009 2010 2012 2013 2015 2016
3.5 Opec growth year on year
Saudi Arabia
3.0 mb/d
Iraq Other Opec
2.5 1.5
1.0
2.0 0.5
0
1.5 -0.5
-1.0
1.0 -1.5
0.5 Jan 14 Jul 14 Jan 15 Jul 15
0 OECD total oil stocks
2009 2010 20122011
-0.5 2013 2014 2015
Barrels (bn)
-1.0 3.0
2.9
-1.5 2.8
2.7
2.6
Jan 13 Jul 13 Jan 14 Jul 14 Jan 15 Jul 15 2.5
Jan Mar May Jul Sep Nov Jan
FT graphic Source: IEA * Opec output assumed steady at 31.7mb/d through Mar 2016. A gradual ramp-up of iranian production is expected during 2016 to 600/kb/d in June
Hedge funds Hedge fund positioning lower than last year. But funds do not will not be felt until 2017 and beyond —
appear willing to back off from pushing when the impact could be pronounced.
have amassed Record positions in the benchmark oil crude lower.
record contracts have been amassed by hedge Swelling stockpiles
funds betting on further price falls. Bolstering balance sheets Crude inventories in developed coun-
positions in Money managers have sold the equiv- The impact of the Saudi-led Opec strat- tries are at a record level close to 3bn
the two main alent of more than three days of global egy of keeping the taps open has been barrels — or a month’s global demand —
benchmark oil demand through futures and options felt most acutely among the biggest oil and outside the US storage space is
oil contracts, contracts. But this may turn out to be a companies. Royal Dutch Shell, BP, becoming tighter.
bullish factor for oil in 2016, as funds ConocoPhillips, Statoil and Total, Supplies are expected to outstrip
betting on look to take profits on their positions by among others, have cut spending on demand for at least the first six months
a further buying the contracts back. new and existing projects to stem losses of the year. So where do you store the
price fall It could even exacerbate any initial and conserve cash. excess?
move higher, especially if a surprise Paul Horsnell, analyst at Standard About 230m barrels of new onshore
bullish factor — such as a big supply dis- Chartered, estimates that low oil prices storage capacity is expected to come
ruption in an Opec country — sparks a have forced $300bn of cuts this year. He online next year, the IEA says, including
scramble for the exit. expects these to deepen in 2016, taking large-scale strategic tanks in China
Funds may return to the buyside if the cumulative capital expenditure and India.
they judge prices below $40 a barrel reduction beyond $500bn. Traders can profit by storing crude
unsustainable in the long run. The question is when this era of aus- when it is cheap, locking in higher prices
After the last big oil crash during the terity starts to affect non-Opec produc- for delivery months later in the futures
financial crisis, funds emerged as big tion and contribute to a rebalancing of market. But oil is likely to move out to
buyers of oil contracts once the worst the market. sea to be stored on ships only if prices
appeared to be over. The average Brent Analysts say the full effect of the drop further, which is expected in the
price in 2015 looks set to be 44 per cent delays and cancellations by oil majors coming months.

Commodities Capital markets

Sugar jumps ahead of forecast supply shortfall Sovereign ‘panda’ bond five times subscribed
EMIKO TERAZONO
Sugar rose more than 3 per cent yester-
day as bulls were encouraged by supply
and demand estimates for the next
two years.
ICE March sugar rallied to 14.95 cents a
pound as fresh forecasts from Platts
Kingsman, a sugar consultancy, spurred
buying for the commodity.
The price has struggled to remain
above 15 cents after jumping at the end
of September on expectations of a pro-
duction decline in Brazil, the world’s
largest producer.
Kingsman increased its global supply
shortfall estimate for 2015-16 to 5.26m
tonnes, up from 3.31m tonnes, while the
2016-17 estimates were raised from
6.44m tonnes to 7.81m.
The changes for the current year
reflect higher consumption estimates
for India and Thailand, and lower pro-
duction than forecast for Brazil.
For 2016-17 the consultancy said its
previous demand forecasts in south-
east Africa had been “too low”.
Despite years of low prices, the mar-
ket has been in oversupply. A supply
shortfall is expected for the 2015-16
crop year for the first time in six years.
The last time sugar was in “deficit”,
where demand outstrips production,
was in 2009-10. “After so many years of
surpluses, we are finally getting into def-
icit,” said Claudiu Covrig, senior analyst
at Kingsman.
Although a price fall — and hence
lower profits for producers — normally
leads to a decline in output, government
subsidies in some Asian countries and
the need to repay debt among many
Brazilian mills have kept global produc-
tion growing.
The sharp fall in the real has also
boosted returns on sugar, sold in US dol-
lars, for Brazilian producers, encourag-
ing active selling.
Rabobank says sugar’s fundamentals
are “more bullish” than most other agri-
cultural commodities going into 2016.
Heightened weather risks — mainly
dry conditions in producing countries —
are expected to support prices, but for-
eign-exchange swings and government
support are likely to lead to volatility,
say analysts.
Rabobank forecasts an average sugar
price of 14.5 cents a pound in the final
three months of the year, rising to 15.5
cents in the fourth quarter of next year.
But its analysts warned that “height-
ened price volatility can be expected, as
the world supply-demand balance tran-
sitions into the first production deficit in
six seasons”.
JENNIFER HUGHES — HONG KONG
The first sovereign “panda” bond
attracted bids for five times the paper
on offer in a deal that marked another
step in Beijing’s efforts to internation-
alise the renminbi and broaden the
pool of investment products.
South Korea sold Rmb3bn ($464m) in
three-year notes at 3 per cent, the tight
end of its estimated 3-3.5 per cent range.
Panda bonds are renminbi-denomi-
nated debt sold by foreigners into
China’s onshore bond markets, the third
largest, after the US and Japan, with
more than $6tn of debt outstanding.
International borrowers have largely
been limited to selling renminbi-
denominated bonds in the far smaller
offshore “dim sum” market.
But the panda market is increasingly
seen as an alternative. Companies this
year have sold a total of Rmb7bn in pan-
das — more than the Rmb6bn sold dur-
ing the previous decade.
Duncan Phillips, head of Asia debt
syndicate for Citigroup, a bookrunner
on the deal, said the demand showed
Chinese investors’ growing interest in
foreign borrowers.
“We expect to see further issuance
across several sectors, including sover-
eign, bank and corporate issuers, as the
market develops further,” he added.
Korea’s test of sovereign demand is a
milestone for the market. This year
HSBC became the first foreign bank to
sell pandas and Daimler, the German
carmaker, was the first non-financial
company to do so, in 2014.
South Korea was “honoured” to have
been the first sovereign to sell panda
debt, said Choi Hee-nam, finance vice-
minister. “This new issue sets an impor-
tant benchmark for Korea and for fur-
ther issuance.”
The deal was in large part designed to
pave the way for Korean companies to
tap the panda market by setting a
benchmark. Some people involved in
the deal said investors had appeared
interested in the prospect for further
panda issuance from South Korea, and
this balanced any concerns about the
country’s risk profile.
Won-denominated three-year South
Korean debt yields 1.73 per cent. China’s
sovereign paper, having fallen sharply in
recent months, offers 2.74 per cent.
Both countries are rated double A
minus by Standard & Poor’s.
The move to increase panda bond
activity is another sign of China’s will-
ingness to gradually open its capital
markets to more international partici-
pation.
Wednesday 16 December 2015 ★ FINANCIAL TIMES 25

MARKETS & INVESTING

Global overview
TRADING POST Markets update
Jamie
Chisholm
US and European stocks rebound S&P 500 index
Change on day 1.23%

during countdown to Fed lift-off

2100

Traders of the euro/dollar pair know
what it is like to be caught out by
confounded expectations. This
month’s lurch higher for the common
currency came after the European
Central Bank eased policy less than
the market and his dog had predicted.
Heavy euro-bearish positioning
exacerbated the snapback as shorts
were squeezed.
Are investors in danger of repeating
the mistake for the Federal Reserve’s
decision today?
Pretty much all participants think
the Fed will raise interest rates by 25
basis points — but that Janet Yellen,
its chair, will stress the tightening
trajectory will be unusually shallow. A
dovish rise, as the saying goes.
But RBC Capital Markets reckons Ms
Yellen will oversee “a somewhat less
dovish statement” than many forecast
— a potential boost for the dollar
versus the Japanese yen.
“Friday’s sell-off in risky assets drove
our risk-aversion thermometer into
outright risk-averse territory for the
first time since October, which we see
as the sole cause of dollar/yen slipping
below 121,” says the bank.
Indeed the rate hit a six-week trough
of Y120.32 at the start of this week.
“We think buying the dollar/yen dip
is the right strategy into the Federal
Open Market Committee meeting,”
RBC continues.
“To the extent that higher US rates
reflect the Fed’s confidence in US and
global growth, risk appetite should
recover (the mirror image of the sell-
off in risk after the [Fed’s] unchanged
decision in September).”
jamie.chisholm@ft.com
Yen
Against the dollar (¥ per $)
118
120
122
124
126
Jun 2015 Dec
Source: Thomson Reuters Datastream
Brent bounces 1.7% and
junk bond sell-off halts
with further rise in
Treasury yields and data
supporting dollar
DAVE SHELLOCK
Rallying oil prices and easing concerns
about the high-yield credit market
helped European and US stocks push
higher as participants awaited today’s
interest rate decision from the Federal
Reserve.
The dollar and US Treasury yields
rose as the futures market moved to
price in a 79 per cent probability of the
US central bank increasing official bor-
rowing costs for the first time in nearly
a decade.
US inflation data appeared to increase
the likelihood of such of a scenario, ana-
lysts said.
But the main focus remained on oil as
Brent, the international crude bench-
mark, bounced 1.7 per cent to $38.58 a
barrel — a day after persistent worries
about a supply glut drove it to a fresh
seven-year low of $36.33. US West Texas
Intermediate rose 2.2 per cent to $37.12.
Michael Stanes, investment director
at Heartwood Investment Manage-
ment, said there should be an improve-
ment in the oil supply/demand balance
through 2016, although oversupply
would persist in the short term.
“Market forecasts predict that oil will
actually be in deficit by early to mid-
2017,” said Mr Stanes. “Demand, mean-
while, should gradually improve, partic-
ularly as we see signs of stabilisation in
China’s industrial sector.
“We would expect the oil price to
trade around current levels with volatil-
ity in the near term, before moving
modestly higher as next year
progresses.”
But analysts at Deutsche Bank high-
Markets uncertain before Fed decision: FT.com/video
The FT’s Dan McCrum discusses market uncertainty with
currencies reporter Roger Blitz after a poor trading year
lighted that oil prices were trading 8 per
cent below fair value, while gross short
positions were near a record high.
“A short squeeze from similar levels in
March saw oil prices rally over 30 per
cent,” they noted.
“Oil shorts are also in disconnect from
falling dollar longs, likely driven by
forecasts of warmer weather and
disappointment over Opec inaction on
supply.”
Broad sentiment improved as a sharp
sell-off in the energy-dominated US
high-yield corporate bond market came
to a halt.
The two biggest high-yield exchange
traded funds — known by the tickers
HYG and JNK — were up 1.5 per cent and
Andrew Gombert/EPA
1 per cent on the day respectively,
although both were still down more
than 10 per cent this year.
“While outflows may continue in
the short term, longer term the world is
still faced with a tremendous income
shortage, which will eventually push
investors back into higher-yielding
parts of the market,” said Bill Eigen,
fund manager of JPMorgan Income
Opportunities.
“This is not 2008 and the global finan-
cial system is not on the verge of col-
lapse. The froth that existed in the sys-
tem back then is simply not here to con-
tinue fuelling selling pressure.”
An apparent improvement in risk
appetite yesterday gave a strong boost
2050
2000
Nov 2015 Dec
to European equities. The pan- US equities Gains for the financial and
European Euro Stoxx 600 rallied 2.9 per energy sectors lifted the S&P 500 for a
cent after falling more than 6 per cent second day as Wall Street braced itself
over the previous five sessions to its low- for an expected interest rate rise from
est since early October. the Federal Reserve today
US stocks built on Monday’s late rally,
with the S&P 500 rising 1.2 per cent to FTSE 100 index
2,047 by midday in New York — Change on day 2.45%
although that still left the index about 6400
0.5 per cent down from where it started
the year. 6200
In Tokyo, however, the Nikkei 225 6000
Average fell 1.7 per cent to its lowest for
5800
more than seven weeks. Nov 2015 Dec
In currencies the dollar recovered
from an early bout of weakness after US UK equities The FTSE 100 had its best
inflation data helped reinforce expecta- day in more than two months as an
tions for a Fed rate rise today. eight-day run of declines — during
The euro was down 0.7 per cent at which the index slid 8.5 per cent —
$1.0915, having hit $1.1059, while the US finally came to a halt
currency was 0.5 per cent higher versus
the yen at Y121.61. The dollar index, Eurofirst 300 index
which measures the unit against a
Change on day 2.91%
weighted basket of its peers, was up 0.6 1550
per cent at 98.19, well within sight of a 1500
recent 12-year of 100.51. 1450
Meanwhile the year-on-year pace of
1400
core consumer price inflation, which
1350
excludes food and energy, edged up
Nov 2015 Dec
from 1.9 per cent to 2 per cent in Novem-
ber. “The timing is simply impeccable,” European equities The region’s stock
said Harm Bandholz, chief US econo- markets rallied sharply after several
mist at UniCredit. days of hefty losses as a rebound for
“To be sure, this is ‘only’ the CPI ex- oil prices lifted energy stocks and
food & energy, and not the PCE deflator helped boost broader sentiment
ex-food & energy, which is the Fed’s pre-
ferred inflation gauge,” he said. “Never-
theless, the message from the CPI must Nikkei 225 index
not and cannot simply be dismissed out (’000) Change on day 1.68%
20.0
of hand.”
A further rise in Treasury yields sup- 19.5
ported the dollar. The 10-year yield was 19.0
up 4 basis points at 2.27 per cent while
that on the two-year was 1bp higher at 18.5
0.96 per cent. Nov 2015 Dec
The 10-year German Bund yield Japanese equities Risk aversion ahead
jumped 7bp to 0.63 per cent. of an expected rise in US interest rates
Gold paid little heed to the rally in the today helped drive the Nikkei to its
dollar and rose $3 to $1,065 an ounce lowest close since October 22
ahead of the Fed’s decision.

3M Federal Reserve would announce the

Wall Street
3M slides after blaming
‘slow-growth’ reality
for reduction in outlook
Adam Samson
Shares in 3M dropped yesterday after it
cut its full-year profit outlook. The
maker of Post-it notes said that it had
reduced its full-year 2015 earnings view
from $7.60-$7.65 to $7.55 a share. Wall
Street analysts had expected $7.62.
The new expectations took into
account “the realities of a continued
slow-growth global economy”, said 3M.
Earnings growth slowed to 3.5 per
cent in the third quarter, from 11.2 per
cent in the three-month period a year
earlier, according to Bloomberg data.
Shares in 3M, a Dow component,
skidded 4.3 per cent to $150.89. They
have fallen 8.2 per cent for 2015.
In pharmaceuticals Valeant rallied
after it said that it would reduce the
price of certain drugs distributed to
more than 8,000 Walgreens retail
pharmacies. It would cut the prices by
Share price ($)
Jan 2015
Source: Thomson Reuters Datastream
Dec
Indices
S & P 500
Close
2042.96
change
DJ Industrials
Nasdaq Comp
17542.04
4995.42
173.54
Russell 2000 1204.70
VIX 21.46
US 10 yr Treas Bd 2.23
US 2 yr Treas Bd 0.96
10 per cent for all branded dermatology
and ophthalmology drugs distributed
through the chain’s retail network and
for some independent pharmacies.
Some branded products for which
generics were available would be
distributed through Walgreens at
generic prices, it said.
Valeant faces a Senate investigation
into its decisions to increase the prices
of three of its drugs. It has faced scrutiny
for its relationship with specialty
pharmacies such as Philidor Rx, with
which it cut ties in late October.
The shares rallied 11.9 per cent in New
York trading to $105.54, cutting their
loss this year to 26.1 per cent.
Financial companies were among the
top performers of the main S&P 500
groups after a tick-up in US consumer
prices bolstered expectations that the
first rate rise in almost a decade today. Trading Directory
170 Higher interest rates are forecast to
lift banks’ net interest margins, or the
160
difference between what they charge for
150 a loan and what they pay on deposits.
140 JPMorgan Chase, the biggest US
lender by assets, climbed 2.6 per cent to
$65.94, while Bank of America rallied
Day's 2.7 per cent to $17.26. Regional
21.02
heavyweight PNC Financial climbed
2.2 per cent to $94.83.
43.19
Agco, a maker of agriculture
equipment, revealed 2016 sales and
-8.35 earnings forecasts that missed analysts’
-1.27
expectations. It said that it expected a
0.02
third year of “weaker demand” in the
0.01
North American market. The shares
slid 5.7 per cent to $46.55.
Deere, the world’s biggest maker of
agriculture machinery, dipped 2.3 per
cent to $77.16 on the news.
Apple shares slumped after Dialog
Semiconductor, one of its suppliers, cut
its current-quarter sales outlook on
“weaker than anticipated demand” in
its mobile unit. The iPhone maker
accounts for 90 per cent of Dialog’s
mobile business, according to Stifel
Financial analysts, who warned that the
outlook cut could be a bad omen for
sales of the smartphone range.
Shares of Apple, the world’s biggest
technology company, dipped 0.3 per
cent to $112.11.
In midday trading the S&P 500 was
1.1 per cent higher at 2,044.7, the Dow
Jones Industrial Average had climbed
1.1 per cent to 17,559.5 and the tech-
heavy Nasdaq Composite was up 1.1 per
cent at 5,005.4.

“underperform” in its 2016 mining sector data hinted at a slight slowdown

London
Anglo hits record low
as FTSE 100 rebounds
Bryce Elder
Even during the FTSE 100’s biggest
rebound for more than two months,
Anglo American remained unloved.
Anglo hit another record low, down
3.5 per cent to 271.1p. The miner’s 78 per
cent slump this year means Anglo is
now smaller by market capitalisation
than Rightmove and Auto Trader, the
online marketplaces.
Macquarie downgraded Anglo to
sector preview. A turnround plan set out
last week “was long on promises but
short on action”, it said.
At spot prices, Anglo needs to find
$4bn of extra capital or lose its
investment-grade credit rating,
JPMorgan Cazenove forecast.
Management’s preferred solution — to
cut two-thirds of its employees and
assets while retaining two-thirds of the
operating profit — requires “delicate
negotiations” with stakeholders
including the South African
government, it said.
JPMorgan advised a switch from
Anglo to Glencore, which rose 3 per cent
to 82.4p. Deep cost-cutting might cause
long-term damage to Glencore’s
business but, for now, the decisive
action has mitigated the risk to
shareholders of being diluted, it said.
The wider market broke an eight-day
losing streak, with the FTSE 100 rising
2.5 per cent or 143.73 points to 5,017.79
on a broad-based rebound.
Wm Morrison was up 4.9 per cent to
147.1p and J Sainsbury climbed 5.2 per
cent to 249.3p after Kantar grocery
for the discounters. Sainsbury
improved its market share for a second
straight month while Morrisons showed
only a narrow decline in sales.
SuperGroup fell 6.4 per cent to £15.16
after Liberum Capital raised concerns
about recent promotions by the fashion
retailer. Amid fierce competition,
SuperGroup’s discounting seems at
similar levels to last year, when a poor
autumn left the group with a large stock
overhang to clear, Liberum said.
Allergy drugmaker Circassia rose 8.9
per cent to 300p on a push from RBC,
which started coverage with a 430p
target. Investors should buy ahead of
final-stage trial results due in mid-2016
for Circassia’s lead immunotherapy
medicine, a cat allergy treatment, which
looks superior to peers, it said.
RBC’s team was also positive on BTG,
which rose 7 per cent to 667p.
Tullow Oil gained 5.1 per cent to
159.9p on news of an oil discovery in
Kenya. Separately, Tullow and Ophir
Energy, up 1.9 per cent to 82.3p, were
being mooted as potential merger
partners for France’s Maurel & Prom.
26 ★ † FINANCIAL TIMES Wednesday 16 December 2015

INSIGHT

Henny Analysis. Capital markets

Sender
High-yield fears grow as default wave spreads
Junk sector is heading for first Yields on the lowest rated
negative year since 2008 amid US junk bonds surge
Investment life in new fund outflows and illiquidity
Bank of America Merrill Lynch
high yield CCC and lower rated index,
yield to worst (%)
improved Japan Inc ERIC PLATT
20

is still cosier for some Investors are discovering why high-

yield bonds are also called “junk”.
15

After years of ignoring the low credit 10

ratings and indebted balance sheets of

T
he Japanese stock market is virtually the companies in the junk bond sector, a
5
only market in the developed world that wave of redemptions for three funds —
2010 11 12 13 14 15
has performed solidly this year, up about forcing two to close in the past week —
7 per cent in dollar terms. The performance has triggered an unpleasant frisson Credit metrics weaken as
partly reflects improved corporate earnings; across the US fixed income market. energy takes its toll
never mind that translation gains from a weak yen With the US Federal Reserve Debt burden to trailing
support the result. expected to nudge overnight borrowing 12-month earnings
A large part of the rise in share prices stems from inves- costs up from near zero today, the $1.3tn US high 7
tors’ belief that Japan Inc is moving to a new template junk bond market is counting the cost of US high yield
involving more loving treatment of shareholders. the easy money era. yield index, index 6
excluding
Companies have been buying back stock, raising divi- Much of the pain reflects heavily energy 5
dends, emphasising profitability over market share, con- indebted gas drillers and miners, hit
solidating to improve efficiency and generally paying hard by a collapse in commodity-based 4
more attention to western-style corporate governance. revenues. But the suffering has spread
Progress is not always clear, and such improvements to other sectors, suggesting that years of 3
may not be enough to keep the stock market rolling higher booming debt sales are catching up with 1998 05 10 14
into next year. When Nippon Life — one of the two largest companies and investors. Sources: Bloomberg; Bank of America
life assurers — said this year it would buy the far smaller Bonnie Baha, head of global devel- Merrill Lynch
Mitsui Life, the language used was oblique. Mergers oped credit at DoubleLine Capital, says
remain a sensitive topic in Japan. the closure of funds managed by Third Prices of bonds course for its first negative year of per- likely to be manageable, we expect com- mately ends,” says Matthew Mish, a
The proposed merger is a vast improvement on past Avenue and Lucidius, and the decision issued by groups formance since 2008, while bonds rated panies’ credit quality to take more hits strategist with UBS.
practice. All too often combinations have involved a to bar redemptions from a Stone Lion in the telecoms, triple C, the most speculative area of in the year ahead,” he says. Some strategists and investors have
strong company buying a weaker one, often at the behest credit fund have sparked a reassess- media, junk, are yielding above 17 per cent. Investment managers worry they will begun to question how much further
of regulators, and weakening itself in the process. By con- ment of risk. semiconductor Years of low interest rates spurred be unable to sell lower-rated and less bond prices could fall before finding a
trast, this is a case of consolidation in an industry that des- “It brings back bad memories of 2008 and retail investors to seek returns beyond invest- liquid bonds if there is a rise in mutual bottom.
perately needs it. all over again and that’s what really has industries have ment-grade corporate debt, with triple fund outflows. Last week high-yield Indeed, some see value in the market.
In early November Nippon Life launched a tender offer been fuelling this [sell-off],” she says. slid in the final C yields falling below 8 per cent at the bond funds were hit with $3.5bn of with- Sir Michael Hintze, founder of CQS, a
for Mitsui shares. Both companies are private. But the ten- “Defaults are ticking up. Energy is lead- months of the height of the credit boom. drawals, the most for 70 weeks, accord- London-based credit-focused asset
der offer valued the potential ing the way but it’s starting to spread to year That spurred a rise in leverage as US ing to Lipper. manager with about $12.5bn of assets
target at far less than standard other sectors. It’s not just an energy or Stefan Wermuth/Reuters
companies locked in low borrowing The fear thus remains of a widespread under management, says “recent
practice outside Japan.
Advisers on metals and mining issue.” costs — a metric that has attracted the withdrawal from credit markets by liquidity-related credit market disloca-
Nippon Life is offering to an insurance Indeed prices of bonds, which move attention of investors. Excluding the retail investors who have piled into tions create opportunity for long-term
buy Mitsui Life shares at inversely to their yields, issued by com- energy sector, leverage has reached lev- mutual funds offering attractive investors”, provided they can weather
0.4 times embedded value,
merger may gain panies in the pharmaceuticals, media, els last touched in 2001. income, either in response to losses or as volatility in prices day to day.
which is well below the 1.1 to in the long term telecoms, semiconductor and retail David Tesher, analyst at Standard & a reaction to restrictions on withdrawals But not everyone is ready to step in. “I
1.4 times that is the norm else- industries have slid in the final months Poor’s, says the lowest-rated groups may by other funds. would want this to settle down,” Ms
where.
if they ‘go along‘ of the year. That has intensified the be finding it increasingly “challenging” “Recent weakness in higher-quality Baha says. “Buying on the dips has
Foreign insurers that pressure on bond portfolios and to tap new buyers for their debt, which junk names in parallel with mutual fund rewarded investors in the cycle this far,
expressed an interest were quietly rebuffed, according exchange traded funds that track the can be problematic as maturities outflows and illiquidity is also discon- but things are different now.”
to people familiar with the transaction. To some sector, such as HYG and JNK. mount. “Credit risk is rising, in our view, certing, because this may be a preview Additional reporting by Miles Johnson and
extent this reflects the fact that corporate practice in The broad high-yield market is on and although any deterioration is still to investors of how the credit cycle ulti- Dan McCrum
Japan still values longstanding relationships more highly
than shareholder value.
An arm of Argyle Street Management, a Hong Kong
hedge fund that has a 3.56 per cent stake in Mitsui Life, is Capital markets
fighting the offer price as inadequate.
Nomura Securities and Daiwa Securities were brought in
as independent advisers on the transaction. Both said the
tender offer price fell “within their valuation ranges”,
Money funds applaud
according to materials sent to investors.
This may not be a totally objective assessment. Both
end of near-zero rates
Nomura and Daiwa have units that are shareholders of
Mitsui Life, with the former holding almost 10 per cent of
the stock and the latter almost 13 per cent. JOE RENNISON — NEW YORK Times this week expect the
Those opposed to the terms of the proposed deal say that Fed will undertake two to
rather than press for a better price, the two securities com- Rising yields on Treasury four rate increases next year.
panies are thinking of longer-term benefits of supporting bills and other short-term “Money market funds are
the offer. “If they go along, they will have the option to get debt securities mean good absolutely ecstatic. For the
the mandate for corporate finance business and fees from news for savers and money first time in a decade they are
a possible IPO one day,” says one person involved. “If they market funds as the era of going to be in a rate-rising
reject the terms of the deal, they will lose that option.” near-zero returns draws to a environment,” said Joseph
It could also be that the price is fair and actually reflects close. Abate, a rates strategist at
future prospects that are not particularly bright and bal- A widely expected shift in Barclays.
ance sheets that may be more troubled than they look policy by the US Federal To cope with years of low
(though Argyle does not believe this to be the case). Reserve on Wednesday will returns, a number of money
Policy origination and the asset management side are formally end seven years of market funds have waived
both grim, though not always visibly so. For example ultra-low returns for inves- fees for investors. And an
insurers have sold investment products to clients with tors who maintain holdings increase in interest rates is
embedded guarantees on returns that are impossible to of cash or own money mar- likely to be accompanied by a
achieve in a zero-interest world. ket funds. rise in fees.
Given Japan’s ageing population, fewer younger people Prolonged low interest Money market funds have
are looking to buy life assurance. That is putting pressure rates have stunted returns also been reducing the matu-
on the industry’s future cash flows and returns to share- for money market mutual rity of their portfolios to take
holders, as illustrated by a demographic chart released by funds that invest in assets full advantage of higher rates
the groups promoting their deal. with a maturity of 12 months as soon as the Federal Open
Japan has made many improvements in the way its com- or less. The yield on Van- Market Committee meeting
panies are run. But the fundamentals facing many indus- guard’s prime money market concludes today. The
tries are as challenging as those facing insurers. Moreover, fund, one of the largest avail- weighted average maturity
without further yen devaluation, profits generally will able, doubled from 8 basis of prime institutional money
probably slide back, as Diana Choyleva, chief economist at points in October to 16bp on market funds stood at 28
Lombard Street Research, notes. Monday. days last week from 32 days
Against that backdrop, investors eyeing Japanese equi- “It will be great news for at the beginning of October,
ties should be careful lest they be left in the dust. money market funds,” said accoroding to Crane data.
Debbie Cunningham, chief “We have shortened our
henny.sender@ft.com investment officer at Feder- weighted average maturity
ated Investors. “It means the over the last three to six
return from our portfolio months and more than likely
composition back to the end we will lengthen it after the
shareholders is improving meeting depending on what
and that hasn’t happened the outcome is,” added Ms
More comment and data on ft.com since 2008.” Cunningham.
The yield on three-month That has spurred a flow of
Treasury bills has doubled to cash into even shorter-dated,
Y Fast FT Our global economies, headed 24bp over the past month, sometimes overnight invest-
team gives you market- by Brazil, Russia, India and other short-term inter- ments, such as repurchase,
moving news and views, and China. est rates are trading higher. or repo, agreements in which
24 hours a day, five days ft.com/beyondbrics The three-month London cash is exchanged for securi-
a week. ft.com/fastft Interbank Offered Rate has ties at a predetermined rate
Y Podcast The Hard
Y Alphaville Our Currency podcast takes a risen to above 0.5 per cent, its of interest, to be returned at
irreverent financial blog. look at what is driving highest level this year. a predetermined time.
Join Paul Murphy and the global currency Short-term market rates Usually a flood of cash
Bryce Elder for the daily market. ft.com/podcasts are expected to continue ris- would push down the inter-
Markets Live session at ing once the central bank est rate paid to investors in
Y Lex Video Analysis shifts its overnight Fed funds repo markets but it has actu-
11am. ft.com/alphaville
and opinion from the rate higher, with the market ally been climbing.
Y beyondbrics News and team on the hot issues anticipating a new corridor BNY Mellon’s tri-party
comment from more affecting companies and set between 0.25 per cent and repo rate rose to a high of
than 40 emerging markets. ft.com/lexvideo 0.5 per cent. Economists 10bp points last week, from
polled by the Financial 5bp in November.