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Monday, February 23, 2009


Asian markets advance, but investors want info on U.S. plans
Most Asian markets gained and the U.S. dollar slid Monday, following reports that the U.S. government is in talks with Citigroup to take a larger stake in the bank. While the news itself is not positive, it alleviates uncertainty about the banking sector's future. The MSCI index of Asia-Pacific stocks outside Japan gained 1.4%, Tokyo's Nikkei 225 slipped 0.9% and Hong Kong's Hang Seng rose 1.9%. International Herald Tribune/Reuters (23 Feb.)

Bankruptcy Funding Solicited for Car Makers
The Treasury's advisers have started lining up the largest bankruptcy loan ever, at least $40 billion in financing for GM and Chrysler.

European pension funds reduce equity allocations
Because stock values have declined, European pension funds are lowering their equity allocations and are not expected to restore them. Alan Brown, chairman of the CFA Institute Center Advisory Council, cautioned against reduced equity allocations. "Will plan sponsors give up on equity? I think the answer is 'No.' Beta returns should actually be pretty good going forward," said Brown, who is also group chief investment officer at Schroders. "Even if they do consider a wholesale retreat from equity, the question becomes 'To where?'" Pensions & Investments (23 Feb.)

Schwab files with SEC to create its first ETF
Charles Schwab filed with the Securities and Exchange Commission to create a an exchange-traded fund tracking the Dow Jones U.S. Total Stock Market Index, marking the investment manager's first move into ETF formation. James Pacetti, president of ETF International Associates, said the move will likely spur major mutual-fund firms to create ETFs as well. InvestmentNews (22 Feb.)

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