THURSDAY 28 JANUARY 2016 WORLD BUSINESS NEWSPAPER EUROPE

A Chinese plot Apocalypse tax Beyond the iPhone

Mystery of Hong Kong’s missing Prepare for war between big tech and Apple shifts its focus to
booksellers — BIG READ, PAGE 9 Europe — JOHN GAPPER, PAGE 11 software — COMPANIES, PAGE 17

World Bank Teaming up Tencent joins African

media group to target Facebook app
Briefing
i ‘Lord Libor’ cleared over rates fixing

and IMF UK fraud investigators have suffered a big setback

as a broker nicknamed “Lord Libor” and four other
men were cleared by a London court of acting as
middlemen between a convicted ex-UBS trader and
others to help them manipulate bank rates.— PAGE 15

move to avert i Google defends £130m UK tax deal

The US technology group has broken its silence over
its tax arrangement with the British authorities as
premier David Cameron faced a parliamentary

oil-led defaults
grilling over the deal.— PAGE 6; JOHN GAPPER, PAGE 11

i Appeal over clearing of Malaysia premier

The anti-graft commission has said it
will appeal against the attorney-
general’s decision to exonerate
premier Najib Razak over his receipt
3 Talks over $4bn Azerbaijan package of $680m as the scandal takes yet
another turn.— PAGE 2
3 Potential for a series of fund bailouts i China double act fails to soothe investors
JACK FARCHY — MOSCOW the IMF said. It would discuss possible A good cop/bad cop team of officials who took to
SHAWN DONNAN — WASHINGTON
“technical assistance” and “assess the stage in Davos has failed to provide guidance
Officials from the International Mone- possible financing needs”. The financing over Beijing’s monetary and currency policies.
tary Fund and the World Bank will be in package under discussion was worth — PAGE 3; BIG READ, PAGE 9; JAMIL ANDERLINI, PAGE 11
Azerbaijan today to discuss a possible about $4bn, people familiar with the
$4bn emergency loan package in what discussions said. i Trump campaign brushes off Fox spat
risks becoming the first of a series of The World Bank said that the IMF and The spat between Donald Trump and Fox News, the
bailouts resulting from falling oil prices. it were discussing with the government network with a heavily conservative audience, does
The mission to Baku, which follows a immediate and longer-term measures not seem to be hurting the Republican poll leader’s
currency crisis triggered by the collapse “in response to the pressure on the local campaign, or the fortunes of the channel.— PAGE 4
in oil prices, comes amid concern at the currency and low oil prices”.
IMF and World Bank over emerging The World Bank predicted this week i Zimbabwe nears debt deal with west
market producers. that crude prices would average just $37 Talks have intensified between Harare and global
The fund and the bank have also been a barrel this year and warned of long- institutions that would see it clear billions in unpaid
monitoring developments in other oil- term consequences. It also cautioned debt, access new funds for its ravaged economy and
producing countries such as Brazil, that both producers and commodity end more than 15 years of isolation.— PAGE 2
which is now mired in its worst reces- markets faced the risk of a bigger than Most Africans’ first experience of the internet is through mobile devices — Mohamed Nureldin Abdallah/Reuters
sion in more than a century, and Ecua- expected slowdown in major oil-con- i Global groups slam EU derivatives rules
dor. The oil-driven crisis in Venezuela suming emerging economies like China. Ford, IBM, Airbus, BP and GE are among dozens of
has even raised the possibility of “These are bad times for oil producers continent. The service, which initial investment of $34m for companies that have attacked Europe’s derivatives
SMART
AFRICA
A
repaired relations between the fund and and their creditors,” Oxford Economics has more than 650m active the shareholding has paid off rules, claiming they unfairly boost costs for groups
Caracas, which IMF staff last visited warned clients yesterday. “History monthly users in China, has spectacularly, helping Naspers “that did not cause the financial crisis”.— PAGE 15
more than a decade ago. provides reason for extreme pessimism about 6m registered users in become South Africa’s biggest
Azerbaijan depends on oil and gas for on the likely fortunes of commodity South Africa, according to esti- company by value and its chair- Datawatch
95 per cent of its exports and the fallout producers; suggesting that [emerging mates, compared with about man Koos Bekker to become a
of its currency weakness has sparked a markets] are prone to default and that 14m active WhatsApp users. billionaire.
series of protests across the country, commodity slumps are possibly the The Chinese-South African Brett Loubser, head of Greenfield FDI into the UK More than
rattling the government of President biggest cause of defaults.” ANDREW ENGLAND joint venture is betting on the WeChat Africa, said the average Jan-Nov 2015 ($bn) two-thirds of the
CAPE TOWN capital invested
Ilham Aliyev. Last week the former Christine Lagarde, IMF managing rapid growth of smartphone African would have their first
Soviet republic resorted to capital con- director, began the year in Nigeria sales to young people, who are experience of the internet 50 by foreign groups
One of China’s biggest internet in greenfield
trols in response to the collapse in oil where she warned that Africa’s largest companies is intensifying its increasingly using their mobile through their mobile device. 40 projects in the UK
prices, imposing a 20 per cent tax on economy faced “tough choices”. phones to shop, bank, search “They’ve missed the entire Others
efforts to crack the African last year was in
exporting foreign currency. The manat Discussions with Baku are at an early market with a bid to disrupt for jobs, listen to radio and desktop, PC, laptop, whatever 30 real estate, oil and
has fallen 35 per cent since the stage and the government may yet opt Facebook’s WhatsApp with a order taxis and takeaways. thing, and because of that, I Renewable energy gas, and
20
central bank in December abandoned a to go without support from the IMF, rival messaging service. Naspers holds a 34 per cent think we’re seeing innovation renewable energy.
Real estate
dollar peg after spending more than half people familiar with the matter said. stake in Tencent, making it one come out of Africa from a 10 Property is the
its reserves in a year. While Azerbaijan’s central bank Tencent has teamed up with of the highest profile examples mobile perspective that is just Coal, oil & natural gas most targeted
The IMF team would be in Baku from reserves have fallen dramatically in the Naspers, Africa’s largest media of South African and Chinese leagues ahead of anywhere else 0 sector in the last
today until February 4 for “a fact-find- past year, the country has little debt. company, to introduce its social companies joining forces to on earth,” said Mr Loubser. Source: FDI Markets decade
ing staff visit at the authorities’ request”, Stock Markets page 32-34 media app WeChat across the expand across the continent. Its Smart Africa page 20

Athens faces ejection from borderless

EU zone over migrant processing errors
JIM BRUNSDEN — BRUSSELS the report notably finds that there is no achievement of the integration project.
KERIN HOPE — ATHENS
PETER SPIEGEL — LONDON
effective identification and registration The commission insists by exploring
of irregular migrants, and that finger- temporary controls it is trying to salvage
Brussels yesterday warned Greece that prints are not being entered systemati- the passport-free zone rather than dis-
it would be suspended from the EU’s cally into the system, and that travel mantle it. It is impossible under existing
AI milestone as computer passport-free travel zone unless it documents are not being systemically rules to exclude Greece from Schengen
beats human playing Go addressed serious deficiencies in its checked for their authenticity or against altogether and Greece shares no land
handling of the massive influx of crucial security databases.” borders with other Schengen members.
Report i PAGE 6 migrants from the Middle East within The commission inspection and Threats to ringfence Greece from the
three months. warning to Athens are the first steps in a rest of Schengen have prompted howls
process that could give Schengen gov- of protest from Greek ministers who
Austria €3.60 Macedonia Den220 Valdis Dombrovskis, the European ernments the power to reimpose pass- argue such a step would be akin to turn-
Bahrain Din1.7 Malta €3.50
Belgium €3.60 Morocco Dh43 Commission’s vice-president, issued the port controls for up to two years on ing the country into a “black box” for
Bulgaria Lev7.50 Netherlands €3.60
Croatia Kn27.50 Nigeria Naira715 ultimatum to Athens after an unan- Greece — or other member countries. refugees. Ioannis Mouzalas, deputy
Cyprus €3.50 Norway NKr34
Czech Rep Kc100 Oman OR1.50 nounced inspection of Greece’s han- Sweden, Denmark, Germany, Austria minister for migration, said it would
Denmark
Egypt
DKr32
E£20
Pakistan
Poland
Rupee 280
Zl 18 dling of migrants on two islands near the and Slovenia have already set up short- turn his country into a “cemetery of
Finland
France
€4.10
€3.60
Portugal
Qatar
€3.50
QR15 Turkish coast and at the land border term border controls. souls”.
Germany
Gibraltar
€3.60
£2.70
Romania
Russia
Ron17
€5.00
with Turkey, where inspectors found The commission’s move is the latest He said the “report is bad”, admitting
Greece
Hungary
€3.50
Ft990
Saudi Arabia
Serbia
Rls15
NewD420
repeated failures to abide by EU migra- sign of how the refugee crisis has placed that calls from Greece’s European part-
India
Italy
Rup195
€3.50
Slovak Rep
Slovenia
€3.60
€3.50
tion policies. enormous strain on Schengen, which ners to set up and operate “hotspots” to
Kazakhstan
Kenya
US$5.50
Kshs300
Spain
Sweden
€3.50
SKr37
“The Greek authorities are under along with the euro is viewed by most register migrants “hasn’t progressed as
Kuwait KWD1.50 Switzerland SFr5.90 pressure,” Mr Dombrovskis said. “[But] European leaders as the signature it should have done”.
Latvia €6.99 Tunisia Din7.50
Lebanon LBP7500 Turkey TL10
Lithuania €4.30 UAE Dh15.00
Luxembourg €3.60

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2 ★
Financial scandal
Malaysia move to clear premier challenged
Anti-corruption agency
seeks review of decision by
attorney-general on Najib
MICHAEL PEEL
Malaysia’s anti-corruption body will
appeal against Tuesday’s decision to
clear the prime minister of wrongdoing
in a financial scandal that has rocked
the Southeast Asian nation.
Just 24 hours after the attorney-gen-
eral said Najib Razak had no case to
answer over $680m paid into his per-
sonal bank account, transfers it said had
been made by Saudi royals, the Malay-
sian Anti-Corruption Commission said
it would seek a review of the conclusion.
The move highlights rising tensions in
Malaysia’s political system over probes
into corruption claims linked to Mr
Najib and the 1MDB state investment
fund, whose advisory board he chairs.
Capital controls no longer taboo in fight against flight
Unprecedented outflows are
forcing central bankers to
rethink standard responses
JONATHAN WHEATLEY — LONDON
SHAWN DONNAN — WASHINGTON
When Haruhiko Kuroda, governor of
the Bank of Japan, suggested last week
that China should use capital controls to
support its currency, it was as if he had
broken a taboo.
Asked if she approved, Christine
Lagarde, managing director of the Inter-
national Monetary Fund, sitting with
Mr Kuroda on a panel at the World Eco-
nomic Forum in Davos, dodged the
question, although she did agree that it
would be unwise for Beijing to burn
through its foreign exchange reserves to
support the renminbi.
Her circumspection was not surpris-
ing. Policymakers talk of capital con-
trols at their peril: merely to mention
them can send nervous investors rush-
ing for the exit. Investors in China,
where the Shanghai index is down by 47
per cent from last June’s peak, have been
extremely jittery this year.
Nevertheless, more and more policy-
makers are suggesting the use of unor-
thodox methods. Days before Mr
Kuroda spoke at Davos, Agustín
Carstens, the widely respected governor
of Mexico’s central bank, told the Finan-
cial Times that it might soon be time for
emerging market central bankers “to
become unconventional”.
The reason lies in the recent, unprece-
dented outflows of capital from emerg-
ing markets. The Institute of Interna-
tional Finance, an industry group, esti-
mates that total net capital outflows
from emerging markets amounted to
$735bn last year, the first year of net
outflows since 1988.
“These countries are bleeding,” said
Kevin Gallagher, a professor at Boston
University. He is one of a group of aca-
demics and others who, since the global
financial crisis of 2008-09, have called
on emerging market policymakers to
use capital controls when circum-
stances demand. Between 2010 and
2012, the IMF published guidelines for
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.comma 1, DCB Milano.
FINANCIAL TIMES Thursday 28 January 2016
INTERNATIONAL
Parliamentary report
Regulators
failed in Irish
The anti-corruption agency’s move
comes just a few months after a similar Banker’s relocation produced what one bank executive
the “unnecessary distraction” of the
investigations. Critics have expressed
banking crisis,
face-off between the attorney-general
and the central bank over the 1MDB
Goldman-1MDB dealmaker
takes ‘personal leave’
described as a “golden period”.
He became president of Goldman’s
scepticism about the findings, pointing
to lack of detail about who paid and why.
says inquiry
case. Mr Najib and his loyalists deny Singapore operations in 2006, having The attorney-general has proved a
they are trying to shut down investiga- run its investment banking operation contentious figure since being
tions into the affair. Tim Leissner, the driving force behind there since 2002. In 2014, the bank appointed in July, just weeks after news VINCENT BOLAND — DUBLIN
The anti-corruption commission said high-profile deals between Goldman named him chairman of Southeast of the payments to the prime minister
After a year of hearings and several
it would appeal to a special legal review Sachs and Malaysia’s troubled state Asia as part of efforts to bolster surfaced. His predecessor was removed
weeks of feverish editing, watched over
panel over this week’s decision by investment fund, has taken “personal Goldman’s presence in the region. on grounds of ill health, part of a flurry
by a legion of lawyers, the official three-
Mohamed Apandi Ali, the attorney-gen- leave” from Goldman and moved from Goldman declined to comment on of sackings and repostings of people
volume report into the collapse of Irish
eral, to exonerate Mr Najib. The com- Singapore to Los Angeles. Mr Leissner’s move or his leave. His who were either involved in investiga-
banking between 2008 and 2010 was
mission is also seeking a review of the His departure comes as Najib Razak, Los Angeles relocation, described by tions linked to 1MDB or had been criti-
published yesterday.
attorney-general’s separate order to end Malaysia’s prime minister, fights to people close to the bank, comes as his cal of the prime minister over the affair.
a probe into alleged misappropriation of extricate himself from a donations wife, the model and entrepreneur Mr Apandi clashed with the central The report by the parliamentary com-
funds at SRC International, a former scandal alleged to be linked to the Kimora Lee Simmons, builds a fashion bank in October after he refused to mittee of inquiry is perhaps the last offi-
1MDB subsidiary. Both Mr Apandi’s investment fund, known as 1MDB. business in the US city. He had press criminal charges against 1MDB. cial word on what caused the systemic
decisions were made after receiving Mr Leissner was most recently increasingly commuted between Asia The bank issued a statement saying it failure of almost all of Ireland’s big pri-
investigation dossiers from the anti-cor- Goldman’s Southeast Asia chairman and the US but his prolonged stays in had recommended the fund be prose- vate financial institutions, one of the
ruption commission late last year. and spent more than a decade of his Los Angeles were causing friction cuted for irregularities in the way it had world’s most destructive banking crises.
The agency’s challenge jeopardises 18 years with the bank closely involved within Goldman, the people said. His handled more than $1.8bn of assets held Its aim was to find out what went wrong
efforts by Mr Najib and his allies to use in the region. His close relationships move was first reported by Bloomberg. in the Cayman Islands. 1MDB denied inside the Irish banks, and what deci-
the attorney-general’s findings to end with top officials in Kuala Lumpur Jennifer Hughes wrongdoing. sions were or were not made by the
what the prime minister has branded See Editorial Comment authorities in an acute emergency.
Among other things, the report found
that there was an “explicit threat” from
the European Central Bank that emer-
Emerging markets. Policy options gency support for Irish banks would be
withdrawn if losses were imposed on
senior bondholders. The ECB’s stance
“contributed to the inappropriate plac-
ing of significant banking debts on the
Irish citizen,” it concluded.
The whole episode cost Irish taxpay-
ers an initial €64bn, or about a third of
the country’s gross domestic product at
the time.
The end of the inquiry has left most of
those who participated, either on the
inquiry committee or as witnesses,
exhausted, embittered or out of pocket,
or a combination of all three. Niamh
Brennan, professor of corporate govern-
ance at the Smurfit Business School at
University College Dublin, who gave evi-
dence to the inquiry as a former board
member of Ulster Bank, said its conclu-
sions, and wider benefits for the public,
might not justify its financial cost.
“It was an extremely interesting exer-
cise and a very useful learning experi-
ence personally,” Prof Brennan said.
“But I am very conscious that it was very
costly. Do the benefits of the report out-
weigh the costs?”
The inquiry concluded, to all intents
and purposes, that regulatory and struc-
tural failures contributed to the collapse
of the Irish banks. That is not necessar-
ily news, which is why the verdicts on
the inquiry are relatively harsh. Critics
complain in particular that the conclu-
sions have been emasculated by legal
constraints.
“Everything from central bank confi-
dentiality rules to the need to bend over
backwards when drawing conclusions
seems to trump our right to know as
much as possible,” wrote Cliff Taylor in
Christine their use, a move that surprised many, more,” Prof Gallagher said. “People will of November voted to include China’s the Irish Times.
Lagarde shakes although Prof Gallagher said it did not always find a way to circumvent them renminbi in the elite basket of curren- Still, the inquiry may have been use-
hands with mark abrupt change in IMF thinking. and get their money out.” cies used to value its own de facto cur- ful in holding to account people, includ-
India’s finance “The IMF and many of us in academia Despite such reservations, the IMF rency, the special drawing rights, in part ing bankers, property developers and
minister Arun got on the same page in 2008-09, saying has endorsed the idea of using capital on the basis that the renminbi was civil servants, who played a role in the
Jaitley at Davos, it was important to regulate capital controls as a component of the crisis- becoming increasingly “freely usable”. bubble-era Irish economy that burst in
watched by UK flows in conjunction with better macro fighting tool kit in places like Greece. People at the fund insist that any capi- 2008 but had not offered the public an
chancellor policies,” he said. “Some countries The fund still argues that open econo- tal controls introduced by China in explanation of their actions.
George Osborne, didn’t want to listen, and now it’s all mies fare better than closed ones. Yet response to the current surge in out- John Paul Phelan, MP and committee
second left, and coming home to roost.” the IMF’s recent change in attitude and flows would be temporary. member, said: “It was worthwhile in the
Bank of Japan Prof Gallagher said capital controls practice is facing its biggest test so far in In a 2013 paper IMF staff warned that sense that a whole range of people who
governor work best when they are designed to what is playing out in China and other moving to an open capital account had never been asked before about what
Haruhiko contain potentially destabilising emerging economies. would lead to “substantial” flows in and they were doing were questioned in
Kuroda — Michel
Euler/AP
inflows, accompanied by clear commu- Ms Lagarde wants to start a global ‘People will out of China and that “the likely direc- public. That’s new in an Irish context.”
nication and by fiscal reforms to address conversation on how to encourage long- tion of net flows would be outflows”. He also insisted the inquiry had
the structural issues that can help fuel term flows into productive assets versus
always find The Institute of International Finance unearthed new information on perhaps
financial instability. Using them in an more volatile investments in stocks and a way to said China should not try to prevent the most critical moment in the tangled
attempt to stem outflows, as China, bonds. In a speech this month she people swapping renminbi for dollars. narrative, the moment in September
Azerbaijan, Nigeria and Saudi Arabia, warned it had become more difficult “to
circumvent “[The] authorities don’t want to jeop- 2008 when the government offered a
among others, have done this month, is prevent liquidity shocks from doing them and ardise progress towards renminbi inter- blanket guarantee to all bank creditors,
often much less successful, he said. serious harm to an economy”. nationalisation and capital account lib- including bondholders. That decision,
“If the money is already in the coun- China poses an awkward case, how-
get their eralisation. Gap plugging efforts can be made in the middle of the night, sent
try, capital controls scare markets a lot ever. The fund’s shareholders at the end money out’ futile.” shockwaves around the world.
Debt talks
Zimbabwe close to striking payment deal with western creditors
DAVID PILLING AND ANDREW ENGLAND Some western officials remained cau- embarked on a controversial land prices fell and the economy almost cer-
HARARE
tious, saying any number of factors reform programme around 2000, which tainly contracted, according to analysts.
Zimbabwe is close to striking a land- could scupper a complex deal which saw the seizure of white-owned farms. Western officials said Mr Mugabe had
mark deal with western multilateral would require genuine signs of reform Human rights abuses and a series of dis- tried to persuade Beijing to bail Zimba-
in Zimbabwe, a buy-in from a sceptical puted elections, often accompanied by bwe out, but had been rebuffed by Xi
NOVEMBER 7 2015
institutions that would see it clear bil-
lions in arrears of unpaid debt, access US and even the co-operation of Algeria, violence, worsened relations further. Jinping, China’s president, who had told
new funds for its ravaged economy and which was expected to lend the belea- Harare has been in continuous him to pay off arrears and mend rela-
end more than 15 years of international guered southern African nation up to arrears with the IMF, to the tune of tions with the west.
Spain; Fabripress, C/ Zeus 12, Polígono Industrial Meco-
R2, 28880 Meco, Madrid. Legal Deposit Number isolation. $900m to help it repay its arrears. $110m, since 2001. In addition, it owes Mr Chinamasa said: “For recovery, we
(Deposito Legal) M-32596-1995; Publishing Director, The International Monetary Fund, the World Bank nearly $1.2bn and the need to re-enter the global economy. We
Lionel Barber; Publishing Company, The Financial Times
ROLLING IN THE DEEP
Limited, registered office as above. Local Representative Talks have intensified between Zimba- whose endorsement is key to unlocking a African Development Bank $600m. are saying ‘Let’s move on. We cannot
office; C/ Infanta Maria Teresa 4, bajo 2, 28016, Madrid.
ISSN 1135-8262..
361_Cover.PRESS.indd 1 21/10/2015 10:51
bwe and its creditors in recent weeks deal, was cautiously optimistic an agree- The government has been pushed to maintain this stand-off forever’.”
UAE; Al Nisr Publishing LLC, P.O.Box 6519. Dubai. Editor following Harare’s commitment at a ment could be reached by the end of the re-engage with the west by a desperate The west had also accepted this, he
in Chief: Roula Khalaf. Origin of publication, twofour54, World Bank meeting in Lima last August year. “Both Zimbabwe and the tradi- economic situation as the formal econ- said. “Western powers took a position
Media Zone, Abu Dhabi.
France; Publishing Director, Dominic Good, 40 Rue La to pay back arrears of more than $1.8bn. tional donors and creditors realised that omy grinds to a virtual halt. Last year, on the land issue and in [the] past
Boetie, 75008 Paris, Tel. +33 (0)1 5376 8256; Fax: +33 (01)
5376 8253; Commission Paritaire N° 0909 C 85347; ISSN There is increasing appetite among what both sides have done and tried to fought to reverse it through regime
1148-2753. western governments, particularly in achieveoverthelast15yearshasn’treally change,” he said. “I think they now
Turkey; Dunya Super Veb Ofset A.S. 100. Yil Mahallesi
34204, Bagcilar- Istanbul, Tel. +90 212 440 24 24. Europe, to re-engage with Harare. That worked,” said Christian Beddies, the IMF accept it is irreversible.”
©Copyright The Financial Times 2016.
is partly because of concerns about what representativeinHarare. To clinch a deal, Zimbabwe will need
Reproduction of the contents of this newspaper in any could happen when President Robert In terms of reform efforts, including a IMF endorsement of its reform efforts
manner is not permitted without the publisher’s prior Mugabe, 91, who has ruled since inde- clean-up of some debt-riddled banks, he when a mission visits next month.
consent. ‘Financial Times’ and ‘FT’ are registered trade
marks of The Financial Times Limited. pendence in 1980 and who is frail, leaves said: “Zimbabwe is not fixed, but they Donors will also need convincing that
office or dies. have taken some important steps in the deeper reform efforts are under way.
The Financial Times adheres to a self-regulation regime
under the FT Editorial Code of Practice: “There’s nothing more dangerous right direction.” Mr Chinamasa said Mr Mugabe per-
www.ft.com/editorialcode
than a political transition with an eco- Payment of arrears would almost cer- sonally backed plans to reform govern-
Reprints are available of any FT article with your
company logo or contact details inserted if required
nomic implosion,” said one diplomat. tainly be accompanied by fresh loans, ment spending and to attract foreign
(minimum order 100 copies). Patrick Chinamasa, finance minister, something Mr Chinamasa said was investment. However, western officials
One-off copyright licences for reproduction of FT articles said he hoped a deal could be reached by essential to make a deal worthwhile. complained of mixed signals over pub-
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For both services phone +44 20 7873 4816, or email the end of June. “This is our expectation, Zimbabwe has been treated as pariah Patrick Chinamasa: finance minister lic-sector wages, and of conflicting rhet-
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Thursday 28 January 2016
China struggles
to communicate
with investors
Good cop, bad cop team leads charge
in trying to explain monetary policy
TOM MITCHELL — BEIJING
GABRIEL WILDAU — SHANGHAI
Henry Kissinger’s famous question
about the EU — “who do I call if I want to
call Europe?” — now has a Chinese vari-
ant: who do investors turn to for guid-
ance on Beijing’s monetary and cur-
rency policies?
Until recently, calls for clarity were
met only by resounding silence, even as
turmoil on China’s equity and currency
markets reverberated around the world
at the start of this month.
While the government and central
bank have since woken up to the fact
they face a communications crisis, offi-
cials and analysts say the opacity of the
Communist party makes it a difficult
challenge to overcome.
Senior figures finally came out of their
shells last week at the World Economic
Forum in Davos to address their peers’
concerns about China’s management of
its economy, markets and currency.
Leading the charge was a good cop, bad
cop team featuring Fang Xinghai, one of
three vice-chairmen at China’s securi-
ties regulator, and Li Yuanchao, the
country’s vice-president.
Both hold government positions that
belie their real influence in China’s
power structure. In addition to his post
at the China Securities and Regulatory
Commission, Mr Fang is also affiliated
with the party’s powerful Central Lead-
Fang Xinghai has
said that Chinese
leaders need
to communicate
better with
global markets
ing Group on Economic and Financial
Affairs, where he is believed to have the
ear of President Xi Jinping. Mr Li, mean-
while, though ostensibly Mr Xi’s
number two, does not sit in the party’s
inner sanctum — the seven-member
Politburo Standing Committee.
Mr Fang is a Stanford-educated
former World Bank official. Speaking on
a panel with the likes of Christine
Lagarde, head of the International Mon-
etary Fund, he admitted that Chinese
leaders needed to communicate better
with global markets.
Mr Li, meanwhile, attributed the ren-
minbi’s recent volatility to market
forces, which he said were reacting in
part to the US Federal Reserve’s Decem-
ber interest rate rise. He also repeated
the Chinese leadership’s longstanding
assertion that it has “no intention to
devalue its currency”.
Beijing’s critics say the belated
appearance of two relatively unknown
Chinese officials on a Swiss stage —
while the premier, Li Keqiang, and cen-
tral bank governor Zhou Xiaochuan
Democracy concerns
Turkey journalists charged
with plot to topple Erdogan
PIOTR ZALEWSKI — ISTANBUL
Two of Turkey’s leading journalists
face a possible life prison sentence after
they were charged with plotting to
overthrow the government of Presi-
dent Recep Tayyip Erdogan by report-
ing on secret arms shipments to Syria.
According to an indictment cited by
Turkish news agencies, prosecutors
have accused Can Dundar, editor of
Cumhuriyet, a secularist daily, and
Erdem Gul, the paper’s Ankara bureau
chief, of espionage, “attempting to top-
ple the government by force” and “sup-
porting a terrorist group”.
The indictment appears poised to
raise further concerns about the state of
Turkey’s democracy, even as the coun-
try tries to revive stalled accession talks
with the EU and consolidate its role as a
key US ally in the war against Isis mili-
tants in neighbouring Syria.
Mr Dundar’s paper last year pub-
lished a story, along with video footage,
detailing the interception and search of
Syria-bound trucks by police and gen-
darmerie forces in January 2014. The
trucks, which belonged to MIT, Turkey’s
national intelligence agency, were found
to be loaded with weapons.
Citing Cumhuriyet’s reporting, critics
and the political opposition accused the
Ankara government of funnelling weap-
ons to Islamist rebels in Syria. Turkish
officials initially denied the trucks had
contained arms, then insisted they had
★ FINANCIAL TIMES 3
INTERNATIONAL
Mixed
messages
‘[My clients]
thought they
knew what
the [policy]
was. But now
they don’t
understand
who makes
the decisions’
‘Poor Fang
Xinghai is
maintained a steely silence back in
out there
China — illustrates the larger problem. but in the
“A lot of my clients thought they wrong
understood China,” says one Asian cur-
rency strategist. “They thought they position’
knew what the [policy] framework was.
But now they don’t understand who is
making the decisions and why commu- One voice: an
nication isn’t provided. They are in- army officer at
creasingly becoming more disappointed a meeting of
with China. When the markets have no Premier Li
guidance they expect the worst.” Keqiang’s State
Defenders of the People’s Bank of Council, whose
China argue that the central bank does seniority over
in fact provide good policy guidance — the PBoC limits
investors just have to comb through its the bank’s
publications or the state press to find it. independence
The communications problem stems Wang Zhao/AFP/Getty
in part from the fact that China’s central
bank is technically an advisory body
answerable to Premier Li’s State Council
and does not enjoy the independence
and power of the Fed or European Cen-
tral Bank. As a result, China lacks a Ben
Bernanke or Mario Draghi-type figure
who can reassure markets.
“Zhou Xiaochuan used to be quite
active speaking but was heavily criti-
cised for it,” says one Chinese financial
policy expert, who asked not to be
named. “Now poor Fang Xinghai is out
there but in the wrong [government]
position. The system doesn’t allow for
an active PR posture.”
The central bank has, for example,
published a detailed breakdown of the
currency basket it now advises investors
to benchmark the renminbi against,
rather than the dollar. Confusion over
this policy switch, announced in
December, was blamed by many for this
month’s market and currency turmoil.
One person who advises Chinese poli-
cymakers says the basket is an impor-
tant tool as the renminbi transitions
from a loose dollar peg system to a freely
tradeable currency, but he admits exe-
cution has not been perfect. “There is a
strategy,” the adviser says. “It may not
have been communicated very well but
it is not stupid. They just need to be a lot
clearer and make sure [the renminbi] is
damn stable against the basket.”
Others argue that in terms of commu-
nication, the government and central
bank are on the right path, albeit a long
one. “Markets will always cry out for
more and better information,” says
Richard Yetsenga, head of ANZ
Research in Sydney. “They will particu-
larly cry for guidance when in a new
regime and renminbi depreciation is
new. Some of the recent adjustments
were not ideal.” He believes investors
have been “excessively bearish” on
China. “But China is feeling its way and a
bit of patience is called for.”
See FT Big Read
Jamil Anderlini and Chris Giles
See Comment
been delivering supplies to embattled
Turkmen forces in northern Syria.
Days after the story surfaced, Mr
Erdogan accused its authors of conspir-
ing with the Gulen community, an influ-
ential Islamic movement, to unseat his
government. He also warned that Mr
Dundar, a longtime critic, would “pay a
heavy price” for airing state secrets. “I
will not let him go,” the president said.
The pair were arrested in November.
The indictment names Mr Erdogan
and Hakan Fidan, the head of MIT, as
the plaintiffs. The charges against the
two journalists come amid a mounting
crackdown against dissent in Turkey,
both in the press and in academia, and a
military offensive against the outlawed
Kurdistan Workers’ party in the south-
east of the country.
Hundreds of Turkish troops and
police, Kurdish fighters and civilians
have died in clashes since the summer.
Yesterday three soldiers were killed in
Diyarbakir, a south-eastern town where
fighting has raged since December.
Earlier this month, prosecutors
launched an investigation against more
than 1,100 intellectuals who signed a
petition calling for an end to security
operations against the Kurdish insur-
gents. Twenty-seven of the academics
were briefly detained.
Last week, a group of Kurdish politi-
cians and activists came under a hail of
gunfire while attempting to retrieve
bodies in Cizre, near the Syria border.
4 ★ FINANCIAL TIMES Thursday 28 January 2016

INTERNATIONAL
GLOBAL INSIGHT

Trump and Fox News reap gains WASHINGTON

Edward
from mogul’s feud with TV star Luce

Waging war on conservative network would once have killed any hopes of nomination Tycoon needs female
vote but cannot cope
MATTHEW GARRAHAN — NEW YORK
DEMETRI SEVASTOPULO — WASHINGTON
In a clear sign that the 2016 Republican
Chris Wallace, Megyn Kelly and
Bret Baier of Fox News ahead of
“I doubt he thought: ‘What a market-
ing coup’ [because] doing this might
actually hurt Fox among their core con-
with strong women
primary race has entered uncharted ter- last year’s debate, which drew servative viewership,” he says. “This is
ritory, Michael Moore, the campaigning the ire of Donald Trump, bottom about Ailes and Fox saying: ‘We’re going
Andrew Harnik/AP

leftwing film-maker, appeared on Fox
News Channel this week to sing the
praises of one of its presenters.
Mr Moore has clashed bitterly with
Fox News hosts for years but found him-
self aligned with Megyn Kelly — perhaps
the network’s biggest star — over her
refusal to be cowed by Donald Trump.
The party frontrunner has pulled out of
today’s Republican debate, which will
be screened on Fox News, after he
accused Ms Kelly of bias and called for
her removal.
Fox News rejected Mr Trump’s
demands and is standing by Ms Kelly.
Appearing on her show, Mr Moore said
she had “done something that Jeb Bush,
Chris Christie, [Marco] Rubio, [Ted]
Cruz, none of them have been able to
do . . . which is to essentially frighten
him, make him run, shut him down.”
Fox News is America’s most watched
cable news channel, trouncing CNN, its
main rival, in the ratings for more than a
decade. With an audience that skews
heavily Republican, it would have once
been unthinkable that a candidate
could win the nomination while waging
a feud with the network.
But in a campaign that has upended
conventional wisdom, normal rules no
longer apply. The spat does not seem to
be hurting the Trump campaign or Fox
News itself, which has scored bumper
ratings with its coverage of the primary
race.
The channel is the home of vocal
rightwing commentators such as Sean
Hannity and Bill O’Reilly but Roger
Ailes, the former Nixon aide who cre-
ated Fox News in 1996, and who has run
it ever since, is known to bristle when
journalists and other pundits refer to it
as a conservative network.
In Off Camera, a book about Mr Ailes
by the writer Ze’ev Chafets, the Fox
News chairman said the network was
not “programming to conservatives”
but instead “not eliminating their point
of view”.
The row with the party frontrunner
lends weight to the notion that Fox News
is politically neutral but James Baugh-
man, a professor of journalism at the
University of Wisconsin-Madison, says
this would not have factored in Mr
Ailes’s decision.
Endowments
Richest US universities win
lion’s share of donations
The US’s richest universities are winning
an increasingly large share of donors’
money and enjoying better investment
returns on their endowments than other
institutions, according to new surveys.
A record $40.3bn was raised by US
colleges and universities in 2015,
according to the Council for Aid to
Education, but 18 per cent of that went
to just 10 institutions — and Stanford
University alone raised $1.63bn.
The CAE study was released
yesterday, the same day the National
The dig
‘We learned from a secret
back-channel that the
Ayatollah and
Putin both
intend to treat
Donald Trump
unfairly [if elected]’
FOX NEWS
Association of College and University
Business Officers (Nacubo) said that the
largest endowments returned an
average 4.3 per cent in the most recent
financial year, compared with a 2.3 per
cent average for the sector.
Evidence of the increasing
concentration of wealth among elite
institutions will stoke a debate about
the best places for wealthy individuals
to direct their philanthropy at a time of
concern about inequality.
While opponents argue that giving to
elite schools perpetuates inequality,
many donors say their money supports
scholarships to widen access.
“When donors give money to support
academic activity, endow chairs and
H
to hold our ground.’”
Mr Trump’s focus on Ms Kelly, trig-
gered by a question she asked him at a
party debate last summer about his
views of women, has coincided with her
emergence as the face of the network.
Fox News said Mr Trump had “viciously
attacked” Ms Kelly since August, saying
it would not “give in to terrorisations
toward any of our employees”.
Mr Trump upped the ante in a tweet
to his 5.8m followers, saying the net-
work’s statement was “a disgrace to
good broadcasting and journalism. Who
would ever say something so nasty &
dumb.”
The spat with Fox News fits the
broader pattern of the Trump cam-
paign, which has seen the brash billion-
aire challenge all parts of the Republi-
can establishment, from the media out-
lets traditionally courted by candidates
to wealthy donors such as Sheldon Adel-
son, the casino tycoon.
But with the Iowa caucuses just five
days away, Mr Trump has become the
pivotal figure in a big brawl within the
conservative movement over whether
he is a genuine conservative, or simply a
canny politician wearing the veneer of
an anti-politician that is duping most of
the Republican base.
That ugliest fight is with Ted Cruz, the
Texas senator who claims the mantle of
the true social conservative among the
leading contenders and paints Mr
Trump as a fake.
While Mr Trump has reserved his
harshest criticism of the media for Ms
Kelly, the tycoon has made attacks on
reporters a central plank of his stump
speech on the campaign trail. Mr Trump
has pilloried the journalists covering his
rallies and then watched as his cam-
The rebuff paign has thrived on the media atten-
tion sparked by his remarks.
‘Mr Trump doesn’t play But in this most unusual of cam-
games . . . He will not be paigns, he may have met his match in
participating in the the form of Ms Kelly and the pugnacious
Mr Ailes. “Roger is the only news chief
Fox News debate with the guts to stand up to Trump and
and will instead not allow Fox’s journalism to be com-
host an event promised in order to appease him,” said
a person close to Fox News. “Trump was
in Iowa’ looking for an escape hatch for this
TRUMP CAMPAIGN debate and he’s using Megyn Kelly as the
excuse.”
build buildings that house laboratories Ann Kaplan, survey director at CAE,
or classrooms, that means we do not said: “These institutions receive a lot of
have to cover the cost of those things support in part because they spend a
through tuition,” said John Walda, chief lot — they are more than just colleges;
executive of Nacubo. The 18 per cent they have art museums, hospitals,
share taken by the top 10 is the highest symphonies — and in part because they
18% on record, up from 15 per cent in 2000. are good stewards of assets.
Percentage of Harvard was the next most effective “If a college has a strong endowment
donations received fundraiser in 2015, with a $1.05bn haul. It management team, donors are more
by just 10 US
universities and Stanford have held the two top comfortable giving them large gifts. If
spots for 14 of the past 16 years. The the college cannot do as well or better
top 10 most successful fundraisers have than the donor with the assets, the
4.3% remained largely constant since 2000. donor is less likely to transfer large gifts
Returns earned The next most successful institutions in to a university.”
by the largest 2015 were the University of Southern Giving by wealthy individuals, directly
endowments,
compared with California ($653m) and the University of or through family foundations, accounts
a sector average California-San Francisco ($609m), for over 50 per cent of donations to US
of 2.3% followed by Cornell ($590m). universities. Stephen Foley
illary Clinton should be celebrating. Donald
Trump’s decision to boycott the Fox News
debate was ostensibly about ratings. How can
the cable network make money without his
celebrity pull? Mr Trump may prove his point
when tonight’s viewer numbers come in.
But switching channels is not the same thing as showing
up at a polling booth. More than half of America’s elector-
ate is female — they accounted for 53 per cent of the vote in
the last election. Even the most apathetic will by now have
heard Mr Trump’s opinions on Megyn Kelly, the Fox
anchor, who will co-host the debate. Ms Kelly is a “bimbo”,
according to Mr Trump, who is incapable of objectivity
when there is “blood coming out of her whatever”.
So that is settled. Mr Trump thinks the menstrual cycle
is a handicap. He also recoils at other female bodily func-
tions. When Mrs Clinton took a bathroom break at a recent
Democratic debate, Mr Trump described her as “disgust-
ing”. He used the same word about an opposing lawyer in a
2011 hearing when she asked for a short break to pump
breast milk. Looks are also fair game. Among those
attacked for their appearance are the actress Bette Midler
(“extremely unattractive”), Angelina Jolie (“she’s been
with so many guys she makes me look like a baby”), media
figure Arianna Huffington (“unattractive both inside and
out”), fellow Republican
candidate Carly Fiorina
(“look at that face. Would
Trump thinks the
anyone vote for that?”) menstrual cycle is
and comedian Rosie
O’Donnell (“fat pig”).
a handicap and
None of which has done recoils at other
Mr Trump’s ratings any
harm. The more contro-
female functions
versial a celebrity, the
bigger audiences they attract. The question is whether
there is any longer a meaningful distinction between show
business and US politics. Do ratings equal votes? Italy
answered that for itself with its repeated re-election of Sil-
vio Berlusconi, the nearest western world equivalent to Mr
Trump. Mr Berlusconi also alternated between boasts of
his conquests of women and contempt for their gender.
Mr Trump has bragged of his sexual conquests for dec-
ades. In his first book, The Art of the Deal in 1987, he
referred to his frequent affairs with “married and unmar-
ried women”. This was when he was still on his first mar-
riage to Ivana Trump. Like Mr Berlusconi, little is taboo. “If
Ivanka weren’t my
daughter, perhaps I’d be
Clinton is a blonde
dating her,” Mr Trump
said recently. who answers back.
We will learn soon
He does not
enough if the US is differ-
ent from Italy. On Mon- respond well to
day, Iowa’s Republicans
will choose between Mr
such women
Trump and Ted Cruz, the
Texan senator, who has made a great pitch for the state’s
evangelical vote. It is a fair bet that if heavily churchgoing
Iowa endorses Mr Trump, more secular states, such as
New Hampshire, will have little compunction. But pri-
mary contests are different from general elections. Mr
Trump has pitched his appeal to blue-collar, male Republi-
cans. To become president, however, he will need to win a
higher share of the female vote (44 per cent) than Mitt
Romney, the 2012 nominee. If his opponent were Mrs Clin-
ton, his task would be more difficult. Like Ms Kelly, Mrs
Clinton is a blonde who answers back. Mr Trump does not
respond well to such women.
This is what Mr Trump recently tweeted about Mrs Clin-
ton: “If Hillary can’t satisfy her husband, what makes her
think she can satisfy America?” Mr Trump’s critics, includ-
ing Fox, have mocked him for avoiding the Fox debate: if
he cannot handle Ms Kelly how can he stand up to
Vladimir Putin or Ayatollah Khamenei? It is a good ques-
tion but it misses the point. Mr Trump does not fear strong
men. He thinks he is one of them. Strong women, on the
other hand, are an abiding source of distress.
edward.luce@ft.com

US reforms. Insurance woes

Obamacare shows signs of strain as presidential runners duck complex debate

Critics say health marketplace
has too many sick people and
not enough affordable plans
BARNEY JOPSON — WASHINGTON
From Donald Trump to Ted Cruz to
Marco Rubio, the Republican presiden-
tial contenders are united in wanting to
tear down President Barack Obama’s
signature healthcare reforms. But if
some diagnoses are right, they may not
need to, because a key part of Mr
Obama’s legacy is in danger of unravel-
ling on its own.
At the heart of the new Obamacare
insurance system were government-
backed online shopping centres, or
exchanges, set up to help consumers
secure low-cost private insurance, often
for the first time. But doubts are now
growing about the exchanges’ viability.
Mr Obama has been a passionate
champion of their role in helping 17m
previously uninsured Americans secure
health coverage. Fortunately for him,
memories have faded of the botched
2013 launch in which the healthcare.gov
website that led to the marketplaces
malfunctioned disastrously.
But according to health insurance
practitioners and former policymakers,
the Affordable Care Act is facing a fresh
round of more fundamental troubles
that lie with the insurance markets
themselves. “It’s a thrown-together sys-
tem that is showing some signs of fail-
ing,” says Joseph Minarik, a senior econ-
omist in President Bill Clinton’s White
House who is now at the Committee for
Economic Development, a business-led
think-tank.
At issue is the balance that insurers
need between healthy customers and
those making claims to make their busi-
nesses work. First-time customers on
Obamacare’s exchanges were supposed
to draw in the insurers, while competi-
tion among insurers would push down
premium rates for customers.
But the worry today is that
Obamacare has a potentially unsustain-
able mix of too many sick people and
too few affordable healthcare plans.
UnitedHealth, the US’s biggest private
insurer, lost $720m on the government-
backed exchanges last year and is debat- ralled into a cash flow crisis on Christ- that big government programmes cre-
ing whether to abandon them entirely. mas Eve 2014. “The real issue is: are the ate. They want to replace it with mar-
Other insurers have jacked up premi- premium rates that have increased on ket-based solutions, although Mr
ums while complaining that clients are the health plans attributable to pent-up Trump, the frontrunner, is an outlier
less healthy than expected. And in a demand, or is it just a more chronic pool who says public funding should play an
blow to hopes for more competition, 11 of folk?” he says. important role.
of 23 new insurance start-ups fostered In the cut and thrust of the campaign, On the Democratic side, Bernie Sand-
by the reform legislation have failed. the presidential candidates have ers, the leftwing senator, advocates ban-
Nick Gerhart, Iowa’s insurance com- breezed past such complex questions. ishing private insurers and creating a
missioner, became the first person to The Republicans say Mr Obama’s over- universal healthcare system funded by
shut down one of the start-ups as it spi- haul is simply proof of the harmful mess taxpayers. Hillary Clinton, her party’s
frontrunner, is the biggest supporter of
Obamacare but says more must be done
to reduce the costs of treatment and
drugs that consumers end up paying.
Ron Williams, who was chief execu-
tive of the big health insurer Aetna until
2010, says he has not heard any substan-
tive policy discussions among the candi-
dates. “I seriously doubt that the cam-
paign arena is going to produce anything
meaningful.”
On the exchanges, healthcare experts
say two weaknesses in particular are
beginning to show through. The first is
size. They are divided up by state and
some have such small populations —
fewer than 600,000 people, for exam-
Under pressure: doubts are growing about exchanges’ viability — David McNew/Getty ple, live in Wyoming — that they are not
necessarily attractive to insurers, says
Mr Minarik.
The second weakness is a set of gener-
ous rules that let people sign up for
insurance the moment they need treat-
ment rather than in advance. This has
wreaked havoc with insurers that find
themselves with too many customers
making claims.
The Obama administration has
acknowledged concerns about the via-
bility of the exchanges. Andy Slavitt,
who oversees them as acting head of the
Centers for Medicaid & Medicare Serv-
ices, said this month he was seeking to
create more stable and balanced “risk
pools” on them.
It was too late for Jerry Burgess, head
of a start-up insurer called Consumers’
Choice Health Plan in South Carolina,
which last October become one of the
latest to be closed by regulators.
He blames Republicans for killing his
business by blocking government pay-
ments, but he also disputes Mrs Clin-
ton’s complaint that insurers ask their
customers to contribute too much. “To
tell you the truth,” Mr Burgess says, “I’m
sort of tired of both parties.”
Thursday 28 January 2016 ★ FINANCIAL TIMES 5
6 ★
Computer programming
Machine thrashes Go board game champion
Victory described as
historic milestone for
artificial intelligence
CLIVE COOKSON — LONDON
A computer has comprehensively
beaten a human champion playing Go,
the board game dubbed the world’s
most complex, achieving “a historic
milestone in artificial intelligence”,
according to Nature, the journal pub-
lishing the science behind the feat.
The AlphaGo machine, developed by
Demis Hassabis and colleagues at
Google’s DeepMind subsidiary in Lon-
don, triumphed over Fan Hui, European
Go champion, by five games to nil.
Jon Diamond, president of the British
Go Association, said: “Before this match
I was expecting it to be at least five to 10
VW scandal aftermath
EU looks to
strengthen
auto industry
oversight
JIM BRUNSDEN — BRUSSELS
EU regulators are seeking more powers
to police the auto industry in a sign of
how trust in the sector has collapsed
after last year’s Volkswagen emissions
scandal.
The European Commission wants the
authority to levy fines of as much as
€30,000 per vehicle on manufacturers
that flout emissions standards and
other rules.
Brussels would also have the power to
“suspend, restrict, or withdraw”
licences given to car testing centres, or
to fine them, if investigations show that
they are failing to uphold EU laws.
The proposals are part of an overhaul
of the EU’s car approval system that
would also force makers to hand over
data on vehicles’ software protocols to
regulators, and empower the commis-
sion’s scientists to carry out random
vehicle checks.
Elzbieta Bienkowska, the commission
member responsible for auto industry
regulation, said the plans would “raise
the quality and independence of vehicle
testing and improve the oversight of
cars already in circulation”.
The proposals are the biggest step
taken by Brussels to get on top of the VW
scandal since the German company
admitted in September last year that it
had installed cheating software in mil-
lions of its cars in order to pass emis-
sions tests for dangerous nitrogen
oxides (NOx).
The crisis has been a big embarrass-
ment for the EU, as it was US regulators,
led by the Environmental Protection
Agency, who uncovered the cheating
even though about 8.5m of the esti-
mated 11m affected cars were sold in
Europe.
It has also sparked anger at the failure
of national authorities and Brussels to
tackle problems of cars passing official
laboratory tests while emitting far
higher levels of NOx on the road.
Ms Bienkowska believes the new pow-
ers would allow Brussels to play a more
active role in upholding emissions
standards, many of which are set at EU
level.
The rules would require the national
car approval authorities to report to
Brussels each year on the sanctions that
they have handed down for any
breaches.
The commission’s own fining powers
would kick in if it was deemed that a
member state had failed to uphold the
law. Brussels would also have the right
to order vehicle recalls and even whole-
sale withdrawals of a particular model.
In addition to giving itself a bigger
role, the commission is also seeking to
tackle what officials say are clear con-
flicts of interest in the present system.
Vehicle testing laboratories are paid
by carmakers, creating incentives for
the test centres to go easy on manufac-
turers.
The plans would break up that model
by requiring fee structures to be set by
national authorities, which would also
be responsible for processing the pay-
ments. Test centres would also be sub-
ject to tougher supervision, including
audits by the commission and national
officials, and on-site visits.
The measures require approval from
EU states and the European Parliament
to become law.
Commission officials acknowledge
that the proposals would have stood no
chance of winning enough support
before the VW scandal, and whether
they are adopted now will be a test of
how far attitudes to the industry have
changed after the revelations.
years before a program would be able to
beat the top human players.”
Google, a company at the forefront of
the drive to transform business through
AI, is not just playing for fun. “While
games are the perfect platform for
developing and testing AI algorithms
quickly and efficiently, ultimately we
want to apply these techniques to
important, real-world problems,” Mr
Hassabis said.
Applications will combine pattern
recognition and forward planning. One
early example will be an improved
“intelligent personal assistant” for
smartphones. Another application will
be in medicine, combining images from
scans and other patient data to diagnose
disease and decide treatment.
The ancient game of Go, which origi-
nated in China more than 2,500 years
ago, has an estimated 40m regular play-
Non-performing loans
% of gross loans
France
UK
Spain
Germany
Italy
2005 06 07 08 09 10 11
Sources: Thomson Reuters Datastream; Banca d’Italia
Investors cool on Italy’s bad loans accord
Rome hopes to remove drag
on economy amid concerns
the impact will be limited
JAMES POLITI AND MARTIN ARNOLD
LONDON
It took months of negotiations, and a
sharp drop in financial shares, for Italy
and the EU to strike a deal this week
approving a new government guarantee
scheme to rid the country’s banks of
their large pile of non-performing loans.
But investors gave the agreement a
cool reception yesterday amid concerns
that the programme’s impact would be
too limited to make a difference after its
terms were narrowed considerably over
the course of the talks with Brussels.
The hope in Rome, and among EU
officials, is nonetheless that the new
programme will unleash a massive sale
of bad Italian loans to private asset man-
agers by limiting the losses of potential
buyers and removing one of the biggest
drags on the country’s economy.
“This is a useful tool in the govern-
ment’s structural strategy on the
banks,” said Pier Carlo Padoan, Italy’s
finance minister. “It will help to work off
the non-performing loans efficiently
Berlin and Moscow in war of words over alleged rape of ethnic Russian girl
Lavrov accuses authorities
of trying to hush up events
out of political correctness
GUY CHAZAN — BERLIN
Germany has reacted angrily to an
intervention by the Russian foreign
minister into the case of a 13-year-old
ethnic Russian girl who claimed to have
been abducted and raped by foreign
immigrants in Berlin.
The case has received huge attention
in Russia, where television news reports
claimed the girl was held as a “sex slave”
by a group of migrants for more than 24
hours. But after an initial investigation,
FINANCIAL TIMES
INTERNATIONAL
ers worldwide and 1,000 professionals,
mainly in east Asia.
Although IBM’s Deep Blue computer
famously beat Garry Kasparov at chess
in 1997, Go had a profound complexity
far exceeding that of chess, said Mr Has-
sabis, a keen player of both games.
“There are more positions in Go than
the number of atoms in the universe. Go
has more subtlety and intellectual
depth than chess.”
Google has beaten Facebook, whose
chief executive Mark Zuckerberg
posted yesterday that his team was close
to “building an AI” to win at Go.
Mr Hassabis added: “In March
AlphaGo will face its ultimate challenge,
a five-game match in Seoul against the
legendary Lee Sedol — the top Go player
in the world over the past decade.”
In a statement issued by Nature, Mr
Lee said: “I heard Google DeepMind’s AI
Banks. Guarantee scheme
Italy’s bad loans
As Dec 2014 (€ bn)
Minor banks
20
Small banks
15
Other
10 large banks
5 60
0
12 13 14 15
* UniCredit, Intesa SanPaolo, Monte dei Paschi di Siena,
UBI Banca, Banco Popolare
and quickly.” But even Italian officials
concede that it is no “panacea” for their
financial system, which did not benefit
from large injections of public funds
during the last recession and as a result
has remained saddled with bad debts.
Investors in Italy’s financial sector
seemed unimpressed, with shares in the
country’s three largest banks falling by
the end of the day.
Ideally, Italy would have created a
much more sweeping scheme to directly
buy bad loans off banks’ balance sheets
— perhaps akin to the Spanish banking
rescue of 2012, say analysts. But since
then, EU rules on state aid were tough-
ened significantly, meaning that Rome
had to settle for a government guaran-
tee applied to senior tranches of bundles
of bad loans, priced at a “market rate”.
Davide Serra, head of the Algebris
fund that invests in bank debt and
equity, said the government guarantee
could add 10 to 15 per cent to the value
of Italian bad loans. “It will fill the gap
between market expectations and bank
coverage,” he said. “There is no more
excuse for the banks not to sell this
stuff.”
However, some analysts remain scep-
tical of the deal. “While the guarantees
should certainly support marketing, it is
not immediately clear how exactly a
police said there was no evidence to sug-
gest the girl had been abducted or
raped.
Sergei Lavrov, the Russian foreign
minister, accused the authorities of try-
ing to “hush up” what had really hap-
pened to the girl, known only as “Lisa”.
At a press conference in Moscow on
Tuesday, he said he hoped Germany was
not trying to “paint over reality, out of
political correctness”.
“It’s clear that the girl did not disap-
pear for 30 hours voluntarily,” he said,
adding that Russia was in contact with
lawyers acting for the girl’s family.
Responding to those comments yes-
terday, Steffen Seibert, spokesman for
the German government, said it was
“unacceptable” to exploit the investiga-
is surprisingly strong and getting
stronger, but I am confident that I can
win at least this time.” If he is right,
Google will pay him $1m; if he loses, the
company gives $1m to charity.
Scientists have long used games as a
testing ground for AI, to invent smart
programs that enable computers to
tackle problems with something
approaching human flexibility. But tra-
ditional AI methods, which search out
options for all possible positions on the
board, cannot work with Go.
The game looks simple. Starting with
an empty square ruled with a grid of 19
by 19 lines, players alternately place
white and black stones on the intersec-
tions between the lines; the aim is to
control a larger area of the board than
your opponent. But the simplicity is
deceptive; Go is the most complex
“game of perfect knowledge” — in which
Italian banks’ share price
performance
Rebased
Intesa Sanpaolo
5 largest
UniCredit
30 banks*
Banca Monte
23
Dei Paschi
68 228
Oct
valuation at market prices would help
Italian banks,” said Tilo Hopker, a sen-
ior credit analyst at UniCredit.
Beyond the question of whether dis-
tressed asset investors — such as Cer-
berus or Apollo — will find the condi-
tions of the new scheme appealing, it is
seen as just part of the solution to Italy’s
banking woes. Over the years Italian
financial institutions, particularly the
smaller and medium-sized ones, have
been hampered by poor governance
structures, a high degree of fragmenta-
‘This is a useful tool in the
government’s structural
strategy on the banks’
Pier Carlo Padoan, finance minister
tion, and the clunkiness of the country’s
justice system, which has prevented the
settling of bankruptcy disputes.
“My impression is that the problems
of Italian banks run deeper,” says Nico-
las Véron, a senior fellow at Bruegel, the
think-tank. “Even if there is a govern-
ment stamp [on the loans] there will be
a risk. I don’t think a government guar-
antee can really replace a mechanism to
settle debts when companies fail.”
Mr Serra at Algebris added: “The big-
Germany. Migrants
tion “for political purposes”. “We have
in Germany an independent judiciary
[that] should be able to continue its
investigations in peace and without
external interference,” he said.
Martin Schaefer, spokesman for the
German foreign ministry, said it had
“complete faith” in the Berlin police and
judicial system “and just a little less faith
in the objectivity and transparency” of
Russian journalists reporting on the Lisa
case “and their willingness to ascertain
what really happened”.
He added that Mr Lavrov had also
stressed the positive aspects of German-
Russian relations in the press confer-
ence where he commented on the so-
called “Lisa case”, including the coun-
tries’ close co-operation over the con-
luck and hidden moves play no part —
played regularly anywhere in the world.
Google cracked the problem by creat-
ing “deep neural networks”, which take
a description of the Go board as an input
and process this through different lay-
ers containing millions of neuron-like
connections. The “policy network” nar-
rows down options for the next move,
while the “value network” feeds in pre-
dictions about the ultimate winner.
Initially the networks were trained on
30m moves made by the best human
players. “But our goal is to beat the best
human players not just mimic them,”
said Mr Hassabis.
“To do this, AlphaGo learned to dis-
cover new strategies for itself, by play-
ing thousands of games between its
neural networks and adjusting the con-
nections using a trial-and-error process
known as reinforcement learning.”
Mediobanca
BC.Fin
Banco
Popolare
100
80
40
20
Nov Dec Jan
2015 2016
gest obstacle to the NPL value in Italy is
the slowness of the court process. It
takes three years or more to recoup the
asset, so it is worth 30 per cent less than
other countries.”
The Italian government led by Matteo
Renzi has stepped up its reforms of the
civil justice system — and sought to
modernise the governance of its small
and regional banks, to turn them into
public companies and stoke consolida-
tion in the sector. Italian officials have
signalled that more banking reforms are
in the works, but their impact may be
slow to be felt.
Meanwhile, Italy is having to fend off
concern that the new guarantee scheme
could affect its public finances. Italian
officials said it would generate new reve-
nues, since the fees the government
takes in to provide the guarantees will
exceed any outlays.
But EU officials were more cautious.
“On the fiscal implications, well it is cur-
rently too early to draw firm conclu-
sions because we just have agreement
on principles and it now all needs to be
detailed out,” said Valdis Dombrovskis,
vice-president of the European Com-
mission.
Additional reporting by Jim Brunsden in
Brussels
See Editorial Comment and Lex
flict in eastern Ukraine and their efforts
to find a political solution to the war in
Syria.
“Lisa”, who is the daughter of ethnic
German immigrants from Russia, was
reported missing on January 11 and
resurfaced 30 hours later. Rumours
quickly began circulating on the inter-
net that she had been raped by a group
of men from the Middle East.
Police could find no evidence of an
abduction or rape, and it was reported
that during questioning, the girl had
given four versions of what had
happened during her disappearance.
Later, German prosecutors said they
were investigating two men of Turkish
origin for child abuse.
They were suspected of having sexual
Thursday 28 January 2016
Avoidance
Google backs
£130m deal
with UK tax
authorities
MURAD AHMED, VANESSA HOULDER
AND JIM PICKARD — LONDON
TIM BRADSHAW — SAN FRANCISCO
Google has defended its £130m settle-
ment with British tax authorities for
the first time, arguing it is for the gov-
ernment to legislate for higher tax
receipts in the face of growing public
anger over aggressive tax avoidance.
The intervention comes against the
backdrop of a political battle over the
deal, with David Cameron, the UK
prime minister, facing tough questions
about the transaction in parliament yes-
terday.
Silicon Valley groups and US business
leaders weighed in on the debate, argu-
ing European authorities were unfairly
targeting multinationals over tax.
In a letter in today’s Financial Times,
Peter Barron, one of the technology con-
glomerate’s top executives, writes:
“Governments make tax law, the tax
authorities independently enforce the
law, and Google complies with the law.”
Separately, Apple told the FT that it
should pay nothing over the European
Commission’s investigation into its
alleged sweetheart tax deals with the
Irish government.
Last week, it emerged that Google
reached a deal with the UK’s tax author-
ity, to pay £130m in back taxes going
back to 2005, while also agreeing to pay-
ing higher taxes in future. But ministers,
regulators and Google have struggled to
contain the publish backlash.
Mr Barron, Google’s European public
affairs chief, said media criticism of the
its settlement with HMRC, the UK’s rev-
enues service, overlooked “interna-
tional tax rules and how they work”. The
company is “paying the amount of tax
that HMRC agrees we should pay” fol-
lowing a six-year audit of its practices,
he argued.
‘Tax authorities
independently enforce
the law, and Google
complies with the law’
During prime minister’s questions
yesterday, Jeremy Corbyn, leader of the
opposition Labour party, attempted to
tap into public resentment over corpo-
rate tax avoidance.
Citing analysis that suggests Google
was paying a rate of tax in the UK as low
as 3 per cent, he asked: “Why is there
one rule for big multinational compa-
nies and another for ordinary,
small businesses and self-employed
workers?”
Mr Cameron disputed the figure,
attempting to lay blame with his prede-
cessors. “We have put in place the
diverted profit tax that means this com-
pany and other companies will pay
more tax in future and more tax than
they ever paid under Labour,” he said.
Analysts’ estimates have suggested
Apple could be liable for several billion
dollars in back taxes if the commission
ruling over its tax arrangements goes
against it.
Luca Maestri, Apple’s chief financial
officer, said in an interview: “This is a
case between the European Commis-
sion and Ireland and frankly there is no
way to estimate the impact right now;
we need to see what the final decision is
going to be,” he said, but added: “My
estimate is zero. I mean, if there is a fair
outcome of the investigation, it should
be zero.”
American tech companies are rallying
support in Washington around the idea
that the European authorities are
unfairly targeting US firms over issues
such as tax.
See Letters
relations with the girl before her alleged
disappearance. Thousands of Russian-
speaking Germans, who watch Russian
TV and followed its breathless coverage
of the case, took part in demonstrations
last weekend against violence perpe-
trated by foreigners. Protesters carried
placards saying “our children are in
danger” and “I fear for my grandchil-
dren”.
Migrant violence has been a hot topic
in Germany ever since reports emerged
that hundreds of women had been
molested and robbed by men, many of
them from north Africa and the Middle
East, during New Year’s Eve celebra-
tions in Cologne. But the Russian media
have been known to propagate scare
stories that have no basis in fact.
Thursday 28 January 2016 ★ FINANCIAL TIMES 7
8 ★ FINANCIAL TIMES Thursday 28 January 2016
Thursday 28 January 2016 ★ FINANCIAL TIMES 9

FT BIG READ. HONG KONG

The disappearance of five booksellers trading in titles banned in China has fuelled anxiety that Beijing
is tightening control over the city just a year after pro-democracy protests brought it to a standstill.
By Ben Bland

Beijing opens a new chapter

W
hen the intended
publisher of Xi Jinping,
China’s Godfather, a criti-
cal biography of the
Chinese president, was
jailed in China on smuggling charges in
2014, Jin Zhong stepped in and pub-
lished the book himself.
Mr Jin, the Hong Kong publisher of a
string of sensitive titles about China’s
top leaders over the past 30 years, saw
no reason not to publish another.
However, the unexplained disappear-
ance late last year of five booksellers
from a Hong Kong store specialising in
books banned in China, and the sus-
pected role of Beijing in their fate, has
changed his mind. Mr Jin has pulled the
publication of a follow-up title by the
same writer, an overseas dissident,
called Xi Jinping’s Nightmare.
“The situation now is very worrying,”
he says. “My wife resolutely opposes me
publishing this book. So I’ve decided to
avoid the risk right in front of us.”
Mr Jin, a writer who has been banned
from the mainland since 1996, says the
disappearances are a serious blow to
Hong Kong’s boisterous trade in banned
Chinese books. His view is echoed by
Bao Pu, a Hong Kong publisher who
helped to smuggle the memoirs of Zhao
Ziyang, a deposed former leader, out of
China. Mr Bao says bookstores are
increasingly reluctant to stock his titles.
A little more than a year after the end
of the Occupy protests against Beijing’s
refusal to give Hong Kong full democ-
racy — demonstrations that at one stage
brought the city to a standstill — many
in the former British colony believe the
disappearance of the booksellers is the
most flagrant example yet of the grow-
ing threats to their unique liberties.
From the government covering up
British royal insignia on colonial post-
Special relationship
Top table: books
on Chinese
chaired by Republican presidential can-
didate Marco Rubio, warned last week.
politics for sale “Given recent events, it is unclear when
in a Causeway it will stop or who next will be targeted
Bay store. Left: a — even foreigners and Hong Kong citi-
protest this zens cannot feel entirely safe.”
month over the
disappearance Banned books
of the At least 46m Chinese tourists visited
booksellers. Hong Kong last year and many spent
Right, a time in the glitzy Causeway Bay shop-
customer ping district, in search of Rolex watches,
browses in a Louis Vuitton handbags and books
Hong Kong store banned in the mainland.
Philippe Lopez/AFP/Getty;
Tyrone Siu/Reuters
Up a narrow staircase opposite a
Burberry store sits the shuttered Cause-
way Bay Books shop. It is one of several
in the area that sell everything from
lurid, semi-factual tales of top leaders’
personal lives to weighty re-examina-
tions of historical events like the cul-
the men was taken from Hong Kong, tural revolution.
this would be an “egregious breach” of Though popular with mainland tour-
unknown and, despite repeated
requests, Chinese officials have refused
to tell journalists, the Hong Kong
authorities and the relevant foreign gov-
ernments where they are being held or
even of what they are accused.
Human rights campaigners like Wil-
liam Nee of Amnesty International say
the case looks like the work of China’s
state security apparatus with unex-
plained disappearances, a televised con-
fession, no formal charges and pressure
on family members to reduce publicity.
“It’s very worrying that there are signs
that China is much more aggressive at
going after its critics in regions outside
of mainland China’s jurisdiction,” says
Mr Nee, who is based in Hong Kong.
Bei Ling, an exiled Chinese writer in
the US, says that while government crit-
ics have long known the dangers of their
activities in the mainland, those over-
seas now fear the ever longer arm of
Beijing’s hand Worries about creeping
mainland influence extend to Hong
Kong’s media sector and universities
Increased control The local Journalists
Association says its members face
a growing threat of interference
Buoyant trade Many Chinese tourists
visiting Hong Kong buy banned books
as well as the latest luxury goods
She says she will not bow to such pres-
sure again.
A senior Western diplomat says the
booksellers’ case shows that fears of a
“mainland-isation” of Hong Kong are
well founded. At the University of Hong
Kong, the city’s prestigious educational
institution, students, faculty and
alumni are fighting what they see as a
politically motivated crackdown after
Johannes Chan, a pro-democracy law
professor, was denied promotion.
Mr Chan argues the apparent abduc-
tions are indicative of an escalation of
interference by Beijing. “One of the con-
clusions [by Beijing] after Occupy was
that some tertiary institutions in Hong
Kong were out of control and playing a
supportive role to the demonstrating
students,” he says. “So China has tight-
ened control on Hong Kong.”
He says pro-Beijing figures have been
appointed to key positions at universi-
ties, while the blocking of his promotion
sends a message to academics to steer
clear of politics. The Hong Kong govern-
ment insists it only recruits on merit.
Turning the screw
‘China is Journalists in Hong Kong complain of a
similar trend, with physical attacks on
much more reporters, advertisers withdrawing
business from publications deemed
aggressive at critical of Beijing and growing media
going after control from Chinese investors.
The most high-profile transaction has
its critics in seen Alibaba, the e-commerce group,
acquiring the South China Morning
regions Post, the city’s English-language news-
outside its paper, for $266m. Alibaba has una-
shamedly vowed to make the newspa-
jurisdiction’ per’s coverage of China, already criti-
cised for being soft on Beijing, even
more positive.
The Hong Kong Journalists Associa-
tion reports that since the Occupy pro-
tests, its members have faced a growing
threat of violence and interference from
the police. Its 2015 annual survey said
journalists were “caught between two
fires”, and squeezed by “external pres-
sures from the likes of the Hong Kong

46m
The number of Chinese tourists who
visited Hong Kong last year
the “one country, two systems” arrange-
ment. That constitutional principle was
established in 1997 when Beijing took
back control and pledged to maintain
the territory’s freedom of expression,
legal independence and “a high degree
ists, who take them home and recircu-
late them, the books are less so with the
authorities in Beijing. Some of the titles
on corruption and Communist party
rivalries appear to contain well-sourced
information from disgruntled insiders.
China’s security forces.
Agnes Chow, one of the leaders of the
Occupy movement in 2014, says activ-
ists are worried about the implications
for Hong Kong as well as their own
safety. At the height of the Occupy pro-
government and big business, and inter-
nal pressure in the form of escalating
self-censorship to comply with estab-
lishment viewpoints”.
When asked if it is stepping up control
of the territory, the Chinese foreign min-

50%
The proportion of Hong Kong’s external
trade involving China
18%
The proportion of Hong Kongers who
identify themselves as solely Chinese
boxes to the purchase of the city’s daily
English language newspaper by Ali-
baba, the Chinese e-commerce group,
and ever greater pressure on journalists
to self-censor, Claudia Mo, an opposi-
tion member of Hong Kong’s legislature,
says a trend of “mainland-isation” is
taking hold.
Chasing critics
The case of the booksellers — three of
whom vanished while in mainland
China, one from Thailand and the fifth
from Hong Kong — has crystallised
those concerns. Activists believe they
were taken by Chinese security forces
extending a crackdown on the main-
land, where hundreds are believed to
have been detained, into Hong Kong
and beyond.
Two of them — one British, the other a
Swede — are European citizens and the
UK government says it is “deeply con-
cerned” about the disappearances. The
worries about creeping mainland influ-
ence extend beyond the booksellers to
Hong Kong’s vibrant media sector and
its universities.
Philip Hammond, the British foreign
secretary, says that if it is true that one of
of autonomy”.
While Beijing controls foreign policy,
defence and national security, only
Hong Kong agencies have the right to
enforce the law in the territory. Beijing,
however, maintains a large liaison office
in Hong Kong, a secretive body tasked
with influencing politics and civil
society.
“There is a growing feeling in Hong
Kong of greater mainland pressure on
universities and civil society as well as a
greater security presence from the
mainland,” says Steve Vickers, a former
head of the colonial police’s criminal
intelligence bureau. “The Hong Kong
government appears to have considera-
bly diminished autonomy and the liai-
son office seems to be strengthening its
position.”
The economy of Hong Kong, a city of
7m, is dependent on trade with the
mainland, while China continues to see
the territory as an important financial
centre. But the sense that China is med-
dling in Hong Kong comes after voters in
Taiwan — which China insists is one of
its territories — elected a government
that has pledged to reduce its economic
reliance on the mainland.
While investors hope that the book-
seller disappearances are an isolated
case, any evidence that Beijing is inter-
fering in Hong Kong’s legal system could
deter those who have long used the city
as an entry point to China because of its
respect for the rule of law.
“President Xi’s shift towards a hard
authoritarianism is disturbing and
counterproductive and will have global
implications,” the US Congress execu-
tive commission on China, which is co-
The store has been closed since late tests Ms Chow briefly stepped down as a
December when its co-owner Lee Bo, a campaign spokesperson due to what she
British citizen, disappeared after visit- calls political pressure on her family.
‘One ing the company’s warehouse in Hong
country, two Kong. He was the last of the five book-
sellers to vanish; the other four have
systems is all
been missing since October.
Local police say their Chinese coun-
grey, there’s terparts have told them Mr Lee is in the
no black and mainland. Having initially reported him
missing, his wife now claims Mr Lee
white . . . travelled to the mainland voluntarily
There are and is “assisting with an investigation”.
Gui Minhai, the store’s co-owner and a
signs that Swedish citizen, has been paraded on
Chinese state television, confessing to a
Beijing 12-year-old drink-driving offence and
is losing claiming he went back to the mainland
from Thailand of his own volition. The
patience’ whereabouts of the other three remains
Ties to China a Hong Konger has jumped from
Activists drive youthful 18 per cent to 40 per cent. The trend
towards a separate Hong Kong identity
sense of separate identity is more pronounced among those aged
under 30, the data show.
Just as in Taiwan, which has its own After failing to pressure Beijing into
democratic government but is claimed giving Hong Kong genuine democracy,
by China, Beijing is losing the battle some young protesters have increased
for the hearts and minds of young their demands and are calling for
people in Hong Kong. a referendum on Hong Kong’s
The number of Hong Kongers future or even independence. “We
describing their identity as don’t just want universal suffrage but
Chinese alone dropped from a high self-determination so we can decide the
of 39 per cent just before the Beijing future of Hong Kong,” says Agnes Chow,
Olympics in the summer of 2008 to a 19-year-old student who helped lead
18 per cent in December, according the Occupy movement.
to surveys by the University of Hong Edward Leung, another student, helps
Kong. During the same period, the run HK Indigenous, one of several small,
proportion identifying themselves as radical groups that are pushing for
a more confrontational approach
to Beijing and the Hong Kong
government. “We want to resist the
recolonialisation of Hong Kong by the
Chinese Communist party,” he says.
Mr Leung says young people must be
willing to fight back against the
authorities, but the 24-year-old
philosophy student, who looks more like
a bookworm than a revolutionary, is also
pursuing more conventional means,
standing in a by-election next month for
the legislative council.
His party has only 70 members but he
hopes to use the election to spread his
message of opposition to Beijing.
“Our generation, the post-1990s
generation, is rising and in future we
will be the ones in charge,” he says.
istry insists that Hong Kong citizens
continue to enjoy “full rights and free-
dom in accordance with the law” and
that its commitment to “one country,
two systems” is “unflinching”.
In recent years, however, Beijing has
made its approach to Hong Kong clear.
In 2014, just before the protests began, it
released a white paper on the territory’s
future insisting that it must be “gov-
erned by patriots”. A subsequent cam-
paign against “damaging information”
vowed to wipe out “reactionary and
harmful information from Hong Kong
and Taiwan”. In December at a meeting
with CY Leung, Hong Kong’s pro-Beijing
chief executive, Mr Xi warned against
“deviation and distortion” undermining
one country, two systems.
Michael Tien, a businessman and law-
maker, argues that Hong Kong’s radicals
are reaping what they have sown. “‘One
country two systems’ has always been a
balance, it’s all grey, there’s no black and
white,” he says. “I think we’ve been
crossing a line in forgetting that we’re
part of China and there are signs that
China is losing patience.”
Mr Tien says political divisions risk
damaging Hong Kong’s competitiveness
at a time when its economy is struggling
because of the China slowdown.
The opposition sees it differently.
James To, a member of the city’s legisla-
tive council, says that only true democ-
racy can give the chief executive and the
government the legitimacy to enact the
reforms the city needs to thrive.
“I’m really worried about the future of
Hong Kong,” he says. “I sincerely urge
the top leaders to think again.”
Additional reporting by Gloria Cheung
10
THURSDAY 28 JANUARY 2016
Renzi’s short-term fix to
Italy’s banking challenge
Guarantees for sales of bad debt show the limits of EU bail-in rules
Italy’s financial system produces too
many bankers and not enough credit,
Matteo Renzi has long argued. The deal
the Italian prime minister has reached
this week with the European Commis-
sion, over government guarantees
to assist banks in selling their portfolios
of bad loans, while far from perfect,
could eventually help to address both
problems. However, even if this helps
to calm markets and defuse a combus-
tible political situation, it will be no
substitute for broader reforms
to a fragmented and inefficient sector.
The agreement with Brussels is an
overdue response to an urgent prob-
lem. The €350bn burden of non-
performing loans on banks’ balance
sheets left them vulnerable to a sharp
sell-off during the recent turmoil in glo-
bal markets. It has stopped them
extending new loans, holding back the
economic recovery and it has been a
source of uncertainty hindering much-
needed consolidation of weaker banks.
It is also a dangerous situation for Mr
Renzi, who faced a public outcry after
November’s rescue of four small banks
hurt thousands of retail investors.
The assertion that the scheme will
not represent a subsidy or a drain on
Italy’s public finances is hard to credit.
There should be no need for govern-
ment intervention if the guarantees for
NPLs are to be priced at market rates,
as the commission maintains.
Mr Renzi had wanted to go further
and use public funds to buy bad loans
but this deal still shows how difficult it
will be for the commission to force its
new bail-in rules on reluctant Euro-
pean governments.
It remains far from clear whether the
scheme will work. Only the least risky
portions of NPLs, which banks may not
wish to sell, will be eligible for the guar-
antees. Their price will depend on how
rating agencies assess each package of
loans on a case-by-case basis, leaving
The threat Najib poses
to Malaysia’s reputation
Opaque payments to the PM raise fears over the nation’s body politic
Events this week have done nothing to
dispel a growing sense that Najib Razak
has been a disastrous prime minister
for Malaysia. Just 24 hours after the
country’s attorney-general found that
Mr Najib had no case to answer over a
$680m sum paid into his personal bank
account, the Malaysian Anti-
Corruption Commission announced it
would seek a review of this ruling.
Separately, it emerged that Tim
Leissner, a senior Goldman Sachs
banker and the driving force behind
deals with a troubled Malaysian state
investment fund, had taken “personal
leave” and returned to the US.
Mr Najib and 1MDB, the state fund
with which Goldman Sachs worked,
deny they are guilty of any crimes. But
the web of allegations and investiga-
tions swirling around the prime minis-
ter and his affairs are damaging Malay-
sia’s international reputation and deep-
ening a public trust deficit at home.
The issue is not just that many
Malaysians are dissatisfied with the
attorney-general’s statement that there
was “no reason given” for the $680m
transfer to Mr Najib from the Saudi
royal family. It is also Mr Najib’s atti-
tude towards the issue, which he said
this week had been an “unnecessary
distraction for the country”.
Far from being a distraction, the
questions raised by the transfer and the
dealings of 1MDB are pivotal to Malay-
sia’s future. At stake is whether one of
Southeast Asia’s leading nations, and a
strategic ally of the US and European
powers in the region, can maintain its
equilibrium as a prosperous, free-
market democracy that blends an
adherence to moderate Islam with an
internationally recognised legal
system.
Without a clear accounting of what
transpired between Mr Najib and
1MDB, Kuala Lumpur risks reinforcing
an impression that its democracy is
plenty of scope for wobbles in markets.
The bigger challenge for Mr Renzi,
though, will be to press ahead with
a more fundamental overhaul of Italy’s
banking sector.
A tradition of cautious lending
allowed Italian banks to weather the
financial crisis better than many
of their counterparts across Europe.
This means that Rome is late in tack-
ling problems that other countries
have already confronted. Mr Renzi has
also inherited a problem that succes-
sive Italian leaders dodged because
of its sensitivity: forcing a consolida-
tion of the hundreds of small and mid-
sized popolari or co-operative banks.
These are rooted in local communi-
ties, sometimes serving towns with just
a few thousand residents, and fiercely
defended by regional politicians, who
fear job cuts and branch closures.
The government set the scene for
consolidation of the popolari more than
a year ago, passing a law to force the
10 largest banks — with assets worth
about €500bn in tangible equity —
to convert into joint stock companies
by the end of 2016. This would end
a governance structure in which each
shareholder has an equal vote, making
it harder for local interest groups
to block mergers.
Two of the larger mutuals are in
advanced talks over a tie-up, and one
successful deal could trigger a wave of
further mergers. However, the legisla-
tion still faces court challenges by
shareholders and many senior execu-
tives are opposed to change.
Mr Renzi cannot afford to let this
situation persist. The last month has
shown the risks of serious market
disruption — the first time the prime
minister has had to deal with such
pressures. He has come up with a short-
term response to the most immediate
threat to Italy’s financial stability. Now
he must see the job through.
being shredded by a self-serving Malay
elite. Mr Najib is already vulnerable to
such charges. The treatment of Anwar
Ibrahim, an opposition leader jailed
after he nearly defeated Mr Najib in
2013 elections, has been widely con-
demned, most recently by a UN human
rights group which called his detention
illegal. The prime minister has also
muzzled critics within the ruling party
and dismissed Abdul Gani Patail, the
former attorney-general who led cor-
ruption inquiries into his affairs.
This lurch towards authoritarianism
is unsettling investors in Malaysian
stocks and bonds while applying extra
pressure to the ringgit currency. But a
more acute sense of alienation is
nursed by the country’s ethnic Chinese
and Indian minorities, who make up
more than one-third of the 29m
population.
Long disenfranchised by the fact that
UMNO, the ruling party, stipulates that
its members must adhere to Islam, the
Chinese and Indian minorities have
grown increasingly vocal in their dis-
satisfaction and are swelling a “brain
drain” overseas. UMNO’s response — to
growing signs of disaffection among
young urban Malays — has been to
shore up support among its rural Malay
bedrock by emphasising its Islamic cre-
dentials, further alienating non-
Muslims who worry over a growing
prominence given to sharia law.
Malaysia’s ruling elite should realise
that they stand at a critical juncture.
Many may wish for a more accom-
plished leader, but the problem runs
deeper than personalities. UMNO
needs to rule equally and democrati-
cally on behalf of all Malaysians.
In particular, the practice of provid-
ing political patronage to a group of
crony Malay business people, which
underpins the opacity and favouritism
among the UMNO elite, needs to be
brought to an end.
★ FINANCIAL TIMES
Governments make tax law, Google complies
Sir, In all the coverage of Google’s tax
settlement, little has been said about
the international tax rules and how
they work. Corporation tax is paid on
profits, not revenue, and is collected
where the economic activity that
generates those profits takes place. So,
if a British pharmaceuticals company
sells medicine to Latin America, it is
mostly taxed where those products are
Most young Taiwanese
have positive view of China
Sir, Tsai Ing-wen’s landslide victory in
Taiwan’s presidential election this
month does not represent a
fundamental and lasting change of
attitudes to Beijing among youth in
Taiwan (“Taiwan poll victory poses a
generational challenge for China”,
Global Insight, January 25). Ms Tsai’s
main competitor, the ruling
Kuomintang (KMT), or Nationalist
party, has lost its popularity due to its
disappointing performance and
internal strife over the past two
tenures. Completely attributing Ms
Tsai’s triumph to young voters’
dissatisfaction with KMT’s close ties
with Beijing is narrow-minded.
In reality, most young people in
Taiwan, especially well-educated ones,
tend to hold a positive view on
Taiwan’s economic relationship with
China, as they are aware that growth of
key industries in Taiwan are highly
dependent on China nowadays.
Research also shows a great number of
Taiwan graduates like to work on the
mainland. The vast markets there are
particularly attractive to them when
Taiwan’s economy is experiencing
stagnation. Statistics indicate that
about 10 per cent of Taiwan’s
population works and lives on the
mainland. Setting aside the shared
language, culture and history across
the two sides of the Taiwan Strait, such
a high level of social and economic
interdependency poses conflicting
forces for people in Taiwan regarding
the construction of an independent
Taiwanese identity.
It is true that there has been growing
opposition to China among Taiwan’s
young generation in recent years.
However, people should be aware that
such opposition is nothing new and
unprecedented amid the long history of
the relationship between Taiwan and
China. The cross-strait relationship
resembles a marriage, so how can you
expect there to be no ups and downs
from time to time?
Yiling Pan
School of International and Public Affairs,
Columbia University,
New York, NY, US
Midwesterners’ history
of embracing foreigners
Sir, I grew up just south of
Marshalltown, which features in your
report “Anti-immigrant stance strikes
chord in Iowa” (January 25). Iowa isn’t
the same place it was 45 years ago,
obviously. It is more diverse than even
most Americans realise. After all, most
people who go there are just passing
through.
I like to think that people in my
native state are tolerant, but I know
that some are not. Still, it is a mistake
to let all the noise surrounding Donald
Trump’s rhetoric cloud our
Isis, Iraqi Kurds
and a cycle
of destruction
Notebook
by Roula Khalaf
Letters
created, in the UK, rather than where
they are consumed. The same applies
to Google. As a US company, we pay the
bulk of our corporate tax in the US:
$3.3bn in the last reported year. What
should Google pay in the UK? We pay
tax based on the value added by the
economic activity of our staff here, at
the current standard rate: 20 per cent.
After a six-year audit we are paying
understanding. Historically,
Midwesterners embraced foreigners.
Walter Nugent’s groundbreaking study,
The Tolerant Populists: Kansas Populism
and Nativism (University of Chicago
Press, 1963), demonstrated that the
foreign-born were eagerly embraced,
especially in the struggle against banks
and the government establishment.
A second edition of the book was
issued in 2013. It should be assigned
reading for the current political
campaign. Mr Trump does not
represent core Midwestern values, nor
their historical experience.
Jim Sanders
Burke, VA, US
Two separate Europes
are not incompatible
Sir, Philip Stephens is right: 1,000
years, and the layout of the House of
Commons, matter (“Brexit — hard
interests battle potent emotion”,
January 22).
So does foreign policy. In setting up a
common market as the first step
towards a supranational political
union, the original six sought — not
exclusively, but primarily — to make
sure that Franco-German
confrontation would no longer be a
source of conflicts such as they suffered
for centuries. To the UK, Franco-
German confrontation was historically
not a hindrance but an opportunity, to
exert influence on European affairs
from without. London believed, along
with others, that the entire EC exercise
would be shortlived and felt
constrained to join only after realising
that its calculations had been proven
wrong. It deluded its voters then that it
was entering into a commercial pact,
and not a political construct which had
been gradually moving ahead. The
British approach to Europe has
remained fraught ever since.
The EU has turned into a very
different animal from the original
Common Market and has come closer
in many ways to the sort of union
Margaret Thatcher had in mind. Of
In late 2014, when I visited the
Peshmerga on the northern Iraq
frontline with Isis, the famed Kurdish
warriors were in buoyant mood. After
a wobble when the militant Islamists
captured Mosul that June, the Kurds
had restored their image by
recapturing a swath of land where the
jihadis had massacred, terrorised and
displaced Iraqi ethnic minorities.
Iraq’s Kurds have proved the most
reliable western allies in an anti-Isis
struggle in which other regional forces
have been at best ambivalent and at
worst have colluded with the jihadis.
With the survival of the autonomous
Kurdish enclave at stake, and their
aspirations of statehood closer
to being realised, the Kurds have not
vacillated in their resolve. For that,
they have been celebrated and
supported by western governments.
This tale of determination makes
the Peshmerga’s treatment of towns
and villages seized from Isis all the
more distressing. Stories of abuse have
trickled out but it was only a few days
ago that I read a comprehensive
account. A friend handed me a report
she had written for Amnesty
International based on more than
a year’s investigation into the areas
recovered by the Peshmerga. Through
visits, satellite imagery and interviews
with displaced people, she found
a disturbing pattern. Arab residents
of these towns and villages who fled
to the Kurdish north were deliberately
prevented from returning; in several
cases the Peshmerga have destroyed
or allowed the destruction of homes
the full amount of tax that HM
Revenue & Customs agrees we should
pay, including £130m in additional
back tax. Governments make tax law,
the tax authorities independently
enforce the law, and Google complies
with the law.
Peter Barron
VP Communications and Public Affairs,
Google
such a union the UK remains an
essential component. In declaring that
the king of ever-closer union is without
clothes, David Cameron has at the
same time made clear that political
union of the 28 is over for good. Such
views are only apparently
contradictory; they point to a solution
in which two Europes, one centred on
trade and one aiming at political unity,
would coexist within a wider Union
broadly defined along the principles of
democracy, market economy and
fundamental freedoms. Not concentric
circles, not variable geometries and
other Euro-speak neologisms but two
Europes, separate and not
incompatible, pursuing their aims in
autonomy. A union thus structured
could assuage many British
Eurosceptic fears and keep alive, for
those who deem it important, the
flame of significant parts of the
European continent becoming one.
Leaving of course the door open if, and
when, others wished to come along.
Antonio Armellini
Ambassador (ret) and Commissioner,
IsIAO,
Rome, Italy
Aristotle gives us a
pointer on capitalism
Sir, John Plender notes, correctly, that
the motivations of successful capitalists
are often not pretty (“Capitalists excel
at giving themselves a bad name”,
January 26). As on so many matters,
Aristotle’s analysis remains not only
challenging but, perhaps, gives us a
pointer in the right direction.
He thought that the motivation for
economic activity was all-important.
The improvement of life is a virtuous
end to commerce, even if money is
made. But when money becomes the
primary motivation, sight is lost of that
virtuous end. If Cecil Rhodes had built
this consideration into his business life,
perhaps his statue would not be in the
news. Or maybe it would be a statue of
someone else.
Owen Kelly
Lecturer,
Edinburgh Napier University Business
School, UK
Sir, Commenting on the Rhodes statue
affair at Oxford university, John
Plender writes that “the robber barons
. . . atoned for their misdeeds through
acts of spectacular philanthropic
largesse” (“Capitalists excel at giving
themselves a bad name”, January 26).
He might have made more of the fact
that, in the case of Cecil Rhodes, the
misdeeds were inflicted upon Africans,
while his philanthropic largesse has
historically been directed
overwhelmingly towards people of
other continents, many of them
westerners.
Dr Hugh Goodacre
Dept of Economics,
University College London, UK
to ensure that villagers had nowhere
to return to. The forced displacement
of populations may amount to a war
crime, according to Amnesty.
One example is the town of Jalawla
and its nearby villages in the Diyala
governorate in eastern Iraq. Amnesty
researchers found that the 87,000
residents, most of them Arab, had not
returned more than a year after Isis
was driven out. Amnesty claims this
is in large part because homes were
looted and destroyed — some by Isis
fighters, some during battles, some by
the Peshmerga and allied Shia militia
after the areas were recaptured.
Another example is the Arab village
of Barzanke in Nineveh governorate,
in northern Iraq, which was taken
back from Isis in the summer of 2014.
According to Amnesty, most houses
were blown up one by one; some
Peshmerga fighters justified the
destruction on the grounds that the
village had supported Isis.
Kurdish officials deny that their
strategy is to displace Arabs and say
they are working on a detailed
response to the report. The alleged
abuses should, however, be viewed
in this historic context: the Arab
villages are in the “disputed
territories” whose fate is supposed
to be decided through negotiations
between Baghdad and the Kurdistan
Regional Government. Some of the
villages were Kurdish before they
were subjected to “Arabisation” under
the brutal rule of Saddam Hussein.
Reclaiming Kurdish control over the
land might be seen as an attempt
Thursday 28 January 2016
Email: letters.editor@ft.com or
Fax: +44 (0) 20 7873 5938
Include daytime telephone number and full address
Corrections: corrections@ft.com
Europeans want to use
Greece to salve their
conscience over refugees
Sir, Gideon Rachman, in “Greek debt is
the key to the refugee crisis” (January
26) suggests that the creation of EU-
run refugee camps on Greek islands
may diffuse the pressure on Europe
and enable governments in Germany,
Austria, Denmark and Sweden to sail
in tranquil political waters. In
compensation Berlin, primarily, but
others as well, would take the initiative
to write off a substantial portion of the
Greek debt.
Although there are serious
legal/technical problems with this,
there is also a major political question.
Europe demands from Greece that it
seal its borders to the constant flow of
refugees or immigrants from Muslim
countries. But simultaneously Europe
insists that people (refugees and/or
immigrants) should be rescued from
the rough seas and settled in humane
conditions. Europe’s aim essentially is
for Greece to become a storehouse of
undesirable human souls, keeping in
the process its conscience clean. But
what of Greece? Opening up camps for
humans on Greek islands will bring
back memories of the dark days of the
colonels’ dictatorship — with immense
political repercussions. And what if the
situation in Syria does not improve?
Will these camps then become
permanent? What will Europe then
rethink — and when?
European capitals maintain cordial
relations with countries (including
Turkey) that encourage immigrants or
refugees to flee to the west. They
appear indifferent, however, when
these countries refuse re-entry to their
citizens when they are repatriated.
What should Greece then do?
Europeans have double standards:
demanding orderly entry to frontier
countries like Greece and Italy and
refusing to deal with the consequences
of thousands of marooned souls there,
they care only about making sure the
problem does not reach their own
borders. Threatening Greece with
exclusion from Schengen is doubly
hypocritical. Greece does not have
frontiers with a Schengen country. The
only purpose would be to seal the
borders between Greece and its
northern neighbours — solely in order
to bottle up refugees in Greece!
Andreas Andrianopoulos
Director,
Institute of Diplomacy and Global Affairs,
American College of Greece,
Athens, Greece
Former cabinet minister in the Greek
parliament
Correction
c The chart entitled Diverging fortunes
that accompanied Martin Wolf’s article
“The economic losers are in revolt
against the elite”, published January 27,
was incorrectly labelled. The labels for
productivity growth and pay were
reversed.
COMMENT ON FT.COM
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are jostling for position, says Janan Ganesh
www.ft.com/instant-insight
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to reverse the injustice meted by the
former dictator’s Ba’athists, some
of whom are now aligned with Isis.
It is possible that some Arab residents
sympathised with Isis and others
collaborated, making their return
a threat to security.
Does this justify blowing up homes
and condemning people to a life as
refugees? Surely not. True, Iraq may
never re-emerge as a united state and
the Kurdish minority could well
secede but stirring up new grievances
among Sunni Arabs, who have long
lived among Kurds and other
minorities, is a recipe for trouble.
The Kurds — who are mainly Sunni
but see themselves more as an ethnic
than a religious minority — know all
too well that groups such as Isis feed
on people’s feelings of
disenfranchisement. I’ve heard
Kurdish officials lament the fact that
their pre-2014 warnings to the
Shia-dominated Iraqi government
about its treatment of minority Sunni
Arabs went unheeded. Officials say
Sunni anger about this contributed
to the revival of the jihadi threat.
Shia militias that have retaken
territory from Isis have been accused
of imitating their destructive tactics,
compounding disillusionment among
the Sunni Arab minority. Without
a policy of inclusion, there can be no
hope of defeating Isis. All the bombing
and the fighting would amount
to little more than killing Isis with one
hand and reviving it with the other.
roula.khalaf@ft.com
Thursday 28 January 2016
OPINION
Anne
Applebaum
O
ne day in 2008, a friend
called to tell me that he
thought the world might
be coming to an end. He
was not a religious fanatic;
he worked in markets. Lehman Broth-
ers had just gone bankrupt and the
international financial system appeared
to be in its death agony. As Marx might
have put it, the final “crisis of capital-
ism” seemed to have arrived.
But the world did not end. The inter-
national proletarian revolution did not
arrive either, though a few decades ear-
lier, it might have done. Financial col-
lapse on the scale of 2008 might, once
upon a time, have inspired the formerly
powerful revolutionary Marxist and
near-Marxist political parties of western
Europe to take to the streets. But
because Marxism was so thoroughly
discredited by the collapse of the Soviet
Alphabet and
Apple spell
global tax war
BUSINESS
John
Gapper
T
he uproar about Google
paying £130m in back taxes
and raising the amount it
pays in the UK by just £10m
a year is merely a little local
difficulty compared with what comes
next. Apple could soon be instructed to
pay billions, triggering a showdown
between Europe and the US and a
potential breakdown of the interna-
tional tax system. This sounds apoca-
lyptic but it is a decent bet.
If you doubt it, consider the following.
From irate taxpayers and infuriated
politicians to defiant bosses of multina-
tionals, many are at the ends of their
tethers about corporate tax. Countries
in the Organisation for Economic Co-
operation and Development have spent
two years trying to fix the system; one of
the first results, Google’s UK deal, has
gone down terribly.
Apple disclosed on Tuesday that its
minimally taxed pot of overseas cash
has grown to $200bn. Tim Cook, chief
executive, flew to Brussels last week to
protest at the likelihood of being told by
the European Commission to pay a
chunk to Ireland, where it has operated
since 1980. American politicians are
American naval history offers clues to Beijing’s intent
Asia
Jamil
Anderlini
T
he news from China so far
this year has been all about
tumbling equity markets
and a wobbly currency. But
there is another, less well-
covered story emanating from Beijing
that threatens to have just as much
impact on the rest of the world as the
shredding of the Shanghai stock index
or the plummeting renminbi: the coun-
try has quietly changed its guiding mili-
tary doctrine.
The state-owned Global Times news-
paper offered a pithy summary of this
new stance this month: “Our military
strength has to be demonstrated to the
world,” it said. “With a strong army,
China can be more politically appealing,
influential and persuasive, and will
make it easier to network.” Such hawk-
Europe’s new right sounds like the old left
Union, there was no appetite for radical
revolution two decades later. Economic
fashion, even on the political left,
seemed to have moved on.
Fast forward eight years and the situa-
tion is drastically different. Many have
noticed that the old-fashioned left is
back. Syriza in Greece, Podemos in
Spain and Jeremy Corbyn’s British
Labour party all now contain radicals
who would, if they could, renationalise
industry and put an end to free trade.
But the more remarkable and less obvi-
ous change is taking place on what we
used to call the far right. The nationalist
parties of Europe, long dismissed as
fringe groupings, are now winning votes
by adopting previously discredited
“leftwing” ideas.
Exhibit A is France’s National Front.
Though better known for its anti-
immigration rhetoric, the party, under
Marine Le Pen’s leadership, has also
taken over some of the symbols of the
old left, as well as some of its economic
policies. A few years ago, the party
began holding rallies on May 1, the tra-
ditional international socialists’ holiday.
At one of those rallies in 2014, Ms Le
angry at what some call “a direct threat
to the interests of the US”.
The question on which the future of
global tax harmony rests is not whether
Google should pay more in the UK and
less in Ireland. It is whether US multina-
tionals pay much tax anywhere on over-
seas earnings, and whether they ever
will. For now, billions in profits are
booked in Bermuda and offshore enti-
ties, annoying everyone.
The centre is not holding for Alpha-
bet, Google’s parent group, as France
and Italy reinterpret their laws to make
it pay more tax before local profits
escape to Ireland and then, via the Neth-
erlands, to Bermuda. It will surely frac-
ture over EU cases against Apple and
Amazon since the US lives in hope that
one day, over the rainbow, their cash
will come home to be taxed.
We face a historic moment. The tax
system formed under the League of
Nations in 1928 relies on the idea that
companies should be taxed largely
where profits are created, not where
they sell their products and services. It
could soon fall apart and what happens
then is anyone’s guess, although it will
not be pretty and will probably resem-
ble a global tax war.
Multinationals, especially US corpo-
rations subject to America’s dysfunc-
tional tax laws, stretched rules to the
point where the result appals taxpayers.
They did so with the aquiescence of off-
shore havens and countries such as Ire-
land and Luxembourg.
The European taxpayer in the street
ishness effectively signals the death
knell for the policy of “taoguang Yong-
hui”, or “hiding one’s brilliance and bid-
ing one’s time”, that has defined China’s
foreign policy since the late 1970s.
This shift in fact began several years
ago, but a series of statements issued
since the start of the year by the People’s
Liberation Army have crystallised the
new doctrine encapsulated in the notion
of “active defence”.
In one little-noticed announcement
posted on the ministry of defence’s web-
site this month, a top naval planner
revealed plans for China’s first homeg-
rown aircraft carrier to protect “water-
ways along the 21st century maritime
silk road”.
According to Beijing’s official defini-
tion, the latter includes everything
between China’s eastern seaboard and
Venice, and strategic points along the
way. By any measure this marks an
extraordinary expansion of China’s
naval defence doctrine, which was pre-
viously focused on protecting only its
territorial waters.
China clearly does not yet have the
capability to dominate any of those
★ FINANCIAL TIMES
Comment
Pen attacked the “draconian policy of
austerity” that favoured “globalised
elites at the expense of the people”. She
and her colleagues have also denounced
the “neoliberal” policies that suppos-
edly unite the French left, the French
right and the EU. Instead, the National
Front wants to replace the “establish-
ment” with a “muscular state” that
Nationalist parties are
winning votes by
adopting previously
discredited leftwing ideas
taxes imports and nationalises foreign
companies and banks.
Those who think Le Pen’s plans sound
farfetched may be surprised to discover
that in other places they are already
being realised. In Hungary, the national-
isation of banks — or rather the rena-
tionalisation of previously privatised
banks — is not a distant ideal but a cen-
tral part of the government’s pro-
gramme. Viktor Orban, prime minister,
might just credit the idea that Alphabet
or Apple create, design and manage
their products and services from Cali-
fornia, and so the US should receive a
larger share of its profits than Italy or
the UK. This is the intended outcome of
international tax treaties.
Why, though, should he or she accept
that intellectual property can be shifted
to any convenient spot, according to
which jurisdiction levies the least tax?
Google’s search engine was not invented
in Bermuda and Apple did not develop
the iPhone in a tax-advantaged entity
sitting between Ireland and the US. Such
structures obey the letter of the law but
they are nonsensical.
They exist to hold what is in theory a
US tax liability until Congress gets
A fiscal system formed
under the League of
Nations is about to
fracture and fall apart
waterways. The PLA navy and air force
are currently not able to stop US or Japa-
nese ships and aircraft operating in ter-
ritory in the South and East China Seas
that Beijing claims as its own. But
China’s desire to expand its military
reach is unmistakable. It is also logical,
given the increasingly global nature of
Chinese economic activity.
How this will be greeted in Washing-
ton is arguably the most significant for-
The US government
established its first formal
fleet to fight pirates off the
coast of north Africa
eign policy question in the world today.
President Xi Jinping himself has warned
of the “Thucydides Trap”, in which an
established power’s fear of an emerging
rival escalates into war, as in the case of
Sparta challenged by the rise of Athens
in Greek antiquity.
It is critical, therefore, that US and
other western policymakers properly
has used punitive taxes and regulations
to scare away foreign banks and has pur-
chased others outright. His purpose, he
says, is to give the Hungarian state more
control over the country’s financial sec-
tor. He may also be hoping to revive the
favouritism that state banks tradition-
ally show to politicians’ friends (the
elimination of that favouritism having
been a major goal of privatisation in the
1990s).
Banks are also a target for Poland’s
nationalist Law and Justice party, which
has just brought in a hefty bank tax and
has also called for the “re-Polonisation”
of foreign banks and other foreign-
owned companies. More important to
its recent electoral victory, however,
were promises of major increases in
social spending. Such promises, which
used to be considered “leftwing”, are
now very common on the new “right”.
The UK Independence party wants to
spend £3bn on the National Health
Service. Nationalist parties in Denmark
and Sweden also advocate an expanded
welfare state, though only for native-
born Danes and Swedes.
Even Austria’s Freedom Party, which
around to cutting the US corporate tax
rate from 40 per cent (including federal
and state taxes) and luring the cash
back. Yet the chance of Apple repatriat-
ing the entire $200bn is slim; some of it
will never return, being invested instead
in overseas expansion.
Mr Cook would leap out of his chair to
protest at this point. These were and are
the rules, he would say. By all means
change them but do not impugn Apple’s
honour by calling it a tax dodger or raid-
ing its coffers retrospectively for alleged
underpayments going back a decade.
The EU should not use the device of
state aid rules to interfere in Ireland’s
right to set corporate tax rates.
Well, perhaps. Without attributing
malice to Steve Jobs, both Apple, the
company he co-founded, and Ireland
were pretty ingenious about tax; they
can hardly complain if Margrethe
Vestager, EU competition commis-
sioner, is ingenious in return. As to
Apple’s complaint of retrospective legis-
lation, the Supreme Court often strikes
down US state laws long after they were
understand Beijing’s intentions and its
likely next moves.
Unfortunately, thanks to a combina-
tion of Chinese opacity and western
ignorance, very few people outside the
policymaking elite in Beijing have a
decent grasp of what China wants and
how it plans to get it.
One of the most misleading assertions
you will hear about China — whether
from party officials in Beijing or visiting
western politicians and bankers — is
that it has never been an expansionist
power. A quick glance at some historical
maps will show how China’s borders
have waxed and waned through millen-
nia of bloody conquest.
For instance, Qin Shihuang, the first
emperor to unify the country in 221 BC,
did not achieve that feat through
friendly overtures and cultural attrac-
tion, but through slaughter, book-burn-
ing and burying scholars alive.
The more foreign observers repeat
fantasies of a benign and pacific China,
the more threatening its rise will
become. Rather than listen to the rheto-
ric coming out of Beijing, western poli-
cymakers should pay attention to what
used to speak the language of classical
liberalism, now tries to appeal to
leftwing voters. Its current leader,
Heinz-Christian Strache, sounds very
much like Ms Le Pen when he attacks
the “neoliberal” consensus, the depre-
dations of globalisation, the evils of
international capital and the need for a
mass revolution. He also sounds very
much like the Marxists of yore.
Opportunist, perhaps. But it is a mis-
take to dismiss this kind of language on
the grounds that it sounds ridiculous or
extreme. To younger voters, even the
most discredited ideas can seem fresh,
especially when they are backed by
internet campaigns and trolling opera-
tions that are impervious to counter-
argument. Just because nationalisation,
protectionism, fiscal irresponsibility or
punitive taxation have been tried and
have failed before does not mean that
someone will not someday try them
again, especially if they are branded
with a shiny new national flag rather
than a worn-out hammer and sickle.
The writer is director of the Transitions
Forum at the Legatum Institute
passed, no matter how inconvenient it is
for anyone who is affected.
The US Treasury is lining up on its
companies’ side. It worries about tax-
payers footing the bill in forgone tax
receipts if more is taken by European
countries. The Senate finance commit-
tee wants it to consider retaliating by
double taxing European companies if
billions are bitten from Apple.
The incentive to carry on co-operat-
ing is slim. The UK tax authorities tried
to raise Google’s bill while still treating
its British arm as a minor contributor to
global profits — a plausible view under
revised OECD guidelines. They are now
in disgrace for not being tough enough
while France and Italy, which have
changed tack to enforce far higher local
taxes, bask in approval.
It is clear where this ends. When the
global tax consensus cannot hold, it is
every nation for itself. This was what
they tried to remedy in 1928 but the
goodwill is fading fast.
john.gapper@ft.com
China actually does. They need to
develop a much deeper understanding
of the forces shaping modern Chinese
culture and politics.
The history of other rising powers is
instructive. Like China today, the US
once explicitly rejected the notion of
imperialism and expansionism.
The age of American global domi-
nance began as most other empires have
begun — with the need to protect mer-
chants and citizens far from its own
shores.
At the beginning of the 19th century,
the fledgling US government estab-
lished its first formal navy specifically to
fight pirates off the coast of north Africa.
As a result, the oldest war memorial in
the US is the Tripoli Monument, in the
grounds of the US Naval Academy in
Annapolis and honours the heroes of
the First Barbary War (1801-1805).
In China’s case, the first time it sent
naval ships on a mission beyond its ter-
ritorial waters in over 600 years was in
2008. The mission? To fight Somali
pirates off the coast of Africa.
jamil.anderlini@ft.com
11
Chinese turmoil
teaches three
basic truths
about Brexit
ECONOMICS
Chris
Giles
alk does not cook rice.
T Invoking this Chinese prov-
erb last week, George
Osborne urged action not
words to mitigate a danger-
ous cocktail of global risks. Britain
would play its role, the chancellor of the
exchequer said, by keeping its public
finances in order.
If Mr Osborne thinks a trite Chinese
saying and a commitment to continue
existing policy are the most valuable
lessons from the current turbulence, he
lacks imagination. China’s economic
troubles can teach Britain three basic
truths about holding a referendum on
EU membership in 2016.
The first and most obvious is that no
one should underestimate the difficulty
of economic transitions. China needs to
shift its economic focus from industry to
services, from investment to consump-
tion and from exports to domestic sales.
The world wants Beijing to succeed but
no one is certain it will. Compounded by
poor policy communication, consump-
tion has barely risen as a share of gross
domestic product, from 49 per cent to
52.5 per cent over the past five years.
A vote for Brexit would likewise
unleash powerful transitions in Britain’s
economy. The UK would need to secure
access to the single European market,
renegotiate EU trade deals with 60 other
countries, rewrite thousands of EU reg-
ulations into UK law and come to a deal
on EU citizens living in Britain and Brits
abroad. None of these transitions would
be easy; all have uncertain outcomes.
Sensible politicians
gamble on big economic
transitions only if there is
little alternative
The second lesson from China and the
current turmoil is that when uncer-
tainty over the outcome is high, money
is but a fair-weather friend. About
$700bn escaped from China in 2015,
putting downward pressure on the ren-
minbi and threatening to undermine
Beijing’s efforts to shift demand from
exports to domestic consumption. The
exodus has overcome China’s capital
controls and a current account surplus,
guaranteeing an underlying flow of cash
in the opposite direction.
In contrast, as Mark Carney, Bank of
England governor, put it this week, Brit-
ain already relies on “the kindness of
strangers” to finance its current account
deficit, equivalent to 4 per cent of GDP.
No one should assume that large quanti-
ties of foreign money in London, Man-
chester or Glasgow would stay in a tran-
sition to Brexit. British citizens holding
liquid domestic assets would also be
wise to consider greater foreign diversi-
fication as an insurance policy.
For a nation with a need to finance a
large overseas deficit and without capi-
tal controls, a run on sterling is a serious
risk. I am not talking about a welcome
depreciation, such as the 6 per cent
decline in sterling since November.
Instead, the danger is a currency plunge
on the back of an increase in perceived
risk of holding British assets. The result
would require government, banks,
households and companies to pay more
to persuade others to lend to them.
With these two big risks to the health
of the UK economy in 2016, the third
lesson from China is that sensible
policymakers gamble on these eco-
nomic transitions only if there is little
alternative.
China faces such a constraint. Its
economy is so large that foreign demand
is insufficient for sustained export-led
growth; officials know that building
ghost cities and roads to nowhere ends
in tears; and its peoples’ desire for better
health, education and environmental
services must be satisfied as the nation
grows richer. Transition is essential.
Britain is different. Its economy could
usefully avoid big upheavals. At close to
full employment, the goals should be
stability, higher productivity and
greater prosperity for all. Leaving the
EU is less an economic necessity and
more a peculiarly British indulgence.
Mr Osborne talks a lot about mitigat-
ing a dangerous cocktail of global risks
to the British economy. The lessons
from China suggest his actions add to its
potency.
chris.giles@ft.com
12
English deficit
causes more
harm than the
digital divide
Michael Skapinker
Businessandsociety
Alan Smith, the FT’s data
visualisation editor, meets
a Seattle software maker
helping managers bring
their dry charts to life
I
n 1993, Pat Hanrahan was part of
the Pixar team that won an Oscar
for animation software. A decade
later, he co-founded a company
that aimed to bring a similar visual
flair to the presentation of business
data.
Tableau Software has not yet won as
many garlands as Pixar, the maker of
the Toy Story series. But rapid sales
growth, partly at the expense of Micro-
soft’s Excel, has given it a $6bn market
capitalisation and an evangelical follow-
ing among managers trying to make
sense of today’s data deluge.
There is something Apple-like about
the zeal with which Tableau users dis-
cuss the product. More than 10,000
attended an annual conference in Octo-
ber in Las Vegas, sitting in on sessions
with titles such as “Data in the Wild:
Taming it in Tableau”, “Hot. Dirty. Sets”,
“Tableau Jedi Calcs: Welcome to the
Dark Side” and “Dashboarding on the
Edge of Impossible”.
Many of these attendees will harbour
an ambition to get one over on peers by
being granted “Zen Master” status by
Tableau, the Seattle-based company’s
answer to Microsoft’s “MVP” or “Most
Valuable Professional” designation for
users of tools such as Excel and Power-
Point. The Zen Master honour is
accorded for willingness to share knowl-
edge with others as well as individual
expertise; it is announced with a suit-
ably enigmatic gesture: the delivery of
an inscribed pebble.
Tableau’s software pulls in business
data from a number of internal and
external sources (spreadsheets, data-
The coveted pebble
sent to Tableau users
who have been
deemed worthy of
the ‘Zen Master’ title
bases, the cloud), allows rapid manipu-
lation of that data and various ways of
visualising it.
Outputs can be viewed individually,
merged into dashboards or presented as
more of a narrative. Ease of use is upper-
most in Tableau design considerations
— it describes itself as “self-service ana-
lytics”.
Customers supplying enthusiastic
testimonials about the product on the
company’s website include Deloitte, the
auditor and consultant; Tesla Motors;
and Barclays, the UK bank.
Zen Masters can spring from less
obvious quarters, though. Among the 21
users who bear that title is Robert Rad-
burn, research and insight team leader
at Leicestershire county council in the
UK. “It’s tough financial times for local
government so we are using more and
more data to help us understand how to
redesign our services,” he says, adding
that Tableau lets him do this in meetings
faster than Excel.
Mr Radburn believes that such tools
mean an analyst does not need to know
a particular domain inside out: “I don’t
have to be an expert in social work or
highways maintenance to bring fresh
insight to that data.”
Chatting with Christian Chabot, Tab-
leau’s chief executive and one of the co-
founders of the business with Prof Han-
rahan (who still teaches computer
David Cameron last week highlighted
the disadvantage immigrants in Britain
suffer when they cannot speak English.
He pointed to the 190,000 Muslim
women who could not speak the
language. Although the government
denied it planned to deport non-
English speakers, it said their language
skills would be “taken into account”
when they requested visa extensions.
The UK prime minister linked failure
to learn English with the “slide towards
radicalisation and extremism”. He is
wrong about that. The people who join
extremist groups usually speak perfect
English. But he is right about the
economic damage that lack of fluent
English brings.
It is not just a British problem.
Worldwide, opportunities increasingly
go to those who speak English.
Whether they want to work as
diplomats or hotel porters, speaking
the language puts them ahead of those
who do not.
When companies make English their
language they reorder their hierarchy.
Staff who speak good English suddenly
acquire a higher status.
A study last month in the
Management International Review,
looking at Air France’s 2004 takeover
of KLM, the Dutch airline, said the
decision to make English the merged
company’s language thrilled some
employees and scared others.
Those who did not speak English well
disliked the merger. They thought their
careers had taken a dive. Those who
spoke better English were not only
more cheerful about their prospects,
they were also more enthusiastic about
Tableau thrives as it bids to
free data from ‘Excel hell’
graphics at Stanford University), it
becomes clear that he greatly admires
Apple and its early spirit of innovation.
Mr Chabot enthusiastically quotes the
late Steve Jobs (“computers are like a
bicycle for our minds”), and echoes
Jobs’ passion for the power of computers
to augment human intellect.
And then there is a shared willingness
to tweak the tail of Microsoft.
Mr Chabot says managers trap them-
selves in “Excel hell” when they choose
to track and visualise data using the
ubiquitous spreadsheet software. He
even goes so far as to argue that spread-
The competition
At December’s Information is
Beautiful data visualisation awards
in London, the “Free Dataviz Tool”
category was dominated by open
source software.
The overall winner was D3, an
open source software library for
creating interactive web graphics
and, like Tableau, a tool with a
Stanford University origin.
Second place went to R, an open
language for statistical and
graphical computing. But third
place went to Tableau Public, a free
version of Tableau’s software that,
along with a free iPad app, will be
key to building a new generation of
visual analyst, the company hopes.
Tools like D3 and R, which require
programming knowledge, do not
represent direct competition for
Tableau. Instead, new players such
as Sweden’s Qlik and US-based
Alteryx as well as renewed efforts
from traditional heavyweights such
as IBM, SAP, Oracle and Microsoft,
form the market reference points.
★ FINANCIAL TIMES
BUSINESS LIFE
the merged company. Another group of
researchers found the same pattern
when interviewing managers and staff
at eight companies that either had
head offices in Japan and subsidiaries
in Germany or the other way round.
In almost every case, the common
language adopted was English. This
study, published in the Journal of
World Business in 2011, said: “Nearly
every single interviewee indicated that
English language capabilities were very
important for promotion within the
company, and many indicated that it
played a role in recruitment as well.”
The article cited a study of the
imposition of English as the corporate
language in a German company with a
Japanese subsidiary. The result was
“conflict between junior and senior
Japanese managers, because the former
had better English language skills than
the latter. This effectively gave the
junior managers better access to
decision-making and more power than
their seniors.”
These advantages are relative. Not
many non-native speakers are entirely
comfortable in English. Goran Lindahl,
former chief executive of ABB, once
described the Swiss-Swedish group’s
language as “poor English”.
Mr Lindahl’s point, as the MIT Sloan
Management Review said, was that “no
one should be embarrassed to express
an idea because of a lack of perfection
in English”, but, of course, people are
embarrassed, or less able to express
themselves, if their English is limited.
It is no surprise that ambitious
parents the world over regard learning
English as a priority for their children.
sheets have provided “no contribution
to the human understanding of facts”
over the past 30 years.
Tableau is not pitched as a direct
replacement for Excel: it is more expen-
sive and its licensing model is not
designed to put a copy of the software on
the desktop of every employee.
But Mr Chabot has a strong conviction
that there is a big opportunity in the
middle ground between desktop tools
such as Excel and the beefier “enter-
prise business intelligence” software
sold by the likes of Oracle, IBM and SAP.
The Tableau boss is equally dismiss-
ive of this latter sector, which he sees as
having stagnated. “The name alone
[enterprise business intelligence soft-
ware] instils fear in most people,” he
says, accusing the products of being
“architecture-heavy, development-
intensive, slow-moving and understood
only by technical specialists — that’s
more than one minor annoyance”.
Tableau releases its 2015 fourth-quar-
ter results next Thursday. It posted sales
of $451m for the first nine months of the
year, a 67 per cent increase on the same
period in 2014, although the net loss for
the period — a byproduct of the group’s
land-grab strategy — widened to $42m.
Amid stock market volatility and a
more sceptical approach to technology
company valuations, the group’s
shares have shed about 40 per
cent of their value since peaking
last summer. Mr Chabot, how-
ever, believes that there are “dec-
ades of growth ahead” based on the
fact that its success to date has delivered
Tableau just “1 per cent or 2 per cent” of
the market.
Among data visualisation diehards,
such as those who thronged the Tableau
conference last year, there is perhaps no
greater crime than simply accepting the
default charts offered by Excel, the
‘
The gap between those who are
competent in English and those who
are not is far more significant than the
“digital divide” that Satya Nadella,
chief executive of Microsoft, wrote
about in the Financial Times last week.
Mr Nadella was worried that some
When people had access to cloud computing,
which gave them information about
companies “health, education and development”
make and some did not. I am not sure this is
a big problem. We all managed without
English cloud computing until recently and
their official once you have access to digital
technology it does not take long to
language work out how to use it.
they Learning a language, on the other
hand, takes most of a lifetime, and the
reorder the sooner you start the better. It is
corporate desperately difficult for adults to learn
a new language to a competent level.
’
hierarchy Freed, as they see it, from the need to
learn anyone else’s language, few native
English speakers understand this.
Judging by Mr Cameron’s short, and
apologetic, attempt at French in an
address to the Canadian parliament in
2011, he has advanced no further in
learning other people’s languages than
those non-English speaking
immigrants have in learning his, in
spite of his far greater educational
advantages.
English is not innately superior to
any other tongue. But it is the language
of business, science and tourism. Mr
Cameron is right that learning it is the
road to opportunity, in the UK or
anywhere else.
michael.skapinker@ft.com
Twitter: @Skapinker
Spreadsheet dreaded three-dimensional pie chart
sceptic: Tableau being the biggest culprit of all.
CEO Christian This is a trap Tableau has been keen to
Chabot. His co- avoid, seeing “intelligent defaults” as a
founder Pat source of market differentiation. Keep-
Hanrahan was a ing up with best practice in visualisation
leading light at consequently forms an important part
Pixar, creator of of its research and development activ-
the Luxo lamp ity, headed by Jock Mackinlay.
character, below An early recruit to the Tableau team,
Michael Clinard/FT montage
Mr Mackinlay was part of the influential
Xerox Palo Alto Research Center, where
he worked with experts on computer
graphics and user interfaces in the late
1980s. That team coined the phrase
“information visualisation” making Mr
Mackinlay well placed to assess how the
industry has progressed since.
Kinder on Excel than his CEO (“a fan-
tastic tool for a different kind of prob-
lem”), his prime concern is keeping
rank-and-file humans — and not ever-
advancing technology — in charge of
decision-making. “There’s nothing
wrong with building up predictive ana-
lytics algorithms, but the problem is
that there are so few data scientists in
the world. If that was the only way you
could do it, it would take too long —
machine learning or predictive al-
gorithms are only part of the solution.”
Businesses need to respond to
advances in computing by giving man-
agers on the ground the access to the
data they need to make informed deci-
sions, rather than falling back on old
habits of centralisation, Mr Chabot says.
“The most important thing a leader
needs to do now within an organisation
is to start fomenting the cultural change
and the belief system that we should
trust our people with access to the
data.”
To read the first article in this two-part
series, ‘Charts that can withstand the
data deluge’, visit ft.com/smartcharts
The review
The ability of Hawking to
shine a light on black holes
ANJANA AHUJA
The Reith Lectures on
Black Holes, Stephen
Hawking, on BBC iPlayer
Black holes are,
appropriately, a bête noire
of modern physics:
gravitationally ravenous
ghosts of collapsed stars
that supposedly swallow
everything in their
immediate environs, even
light. These cosmic objects
with infinitely small and
dense cores (called
singularities) are brought to
life in this year’s BBC radio
Reith Lectures by Stephen
Hawking, a scientist whose
own existence appears
similarly to defy the odds.
Professor Hawking may
have soared from humble
scientist to wheelchair-
bound cultural icon — both
his brilliance and his battle
with motor neurone disease
are depicted in the film The
Theory of Everything, in
which he is played by an
Oscar-winning Eddie
Redmayne — but the 74-
year-old is still most famous
in scientific circles for his
pioneering theoretical
research into black holes, a
term coined by US physicist
John Wheeler. Their
existence — one lurks at the
centre of our own galaxy —
is inferred from their
gravitational effects on
nearby objects; the
boundary of a black hole is
known as an event horizon.
Prof Hawking, based at
Cambridge university,
describes traversing this
boundary as “a bit like going
over Niagara Falls in a
canoe . . . once you are over
the edge you are lost, there
is no way back”. The
gravitational pull on your
body, he says, would
probably turn you into
human spaghetti, a long thin
string of particles pulled
inexorably into the core.
Before you enter the black
hole, you constitute what
cold-hearted physicists
would call “information” —
your every particle has a
defined position and speed.
But as you become
squeezed and stretched and
Guffipedia
A deep filling of jargon
LUCY KELLAWAY
Two of the latest reader
submissions at Guffipedia,
Lucy Kellaway’s dictionary
of corporate nonsense:
Deepen food-to-go
leadership
3 Translation into plain
English: Sell more
sandwiches
3 Perpetrator: Greencore
3 Usage example: “We will
deepen our leadership of
food-to-go by
investing for
growth with our
existing
customers and
by expanding
our offering to
serve new
customers, new
channels, and in adjacent
food-to-go categories.”
(Spotted by Paul Dunne)
3 Lucy’s commentary:
Sandwiches do not need
leadership. They are
sandwiches. And even if
they did they don’t need
deep leadership. That
something so simple should
be talked about in such an
elaborate, ugly way makes
me want to weep.
Thursday 28 January 2016
crushed to an infinitesimally
small point, that information
is lost. In the 1970s, Prof
Hawking, along with Jacob
Bekenstein, realised that,
contrary to received wisdom,
matter swallowed up could
be spat out later as the
black hole decayed — as
“Hawking radiation”.
But this spawned a
problem: the “information
paradox”. Put very simply,
the Hawking radiation
leaking out did not allow an
observer to deduce
anything about the particles
that originally fell in. This
idea that information
vanishes inside a black hole
made cosmologists
unhappy; the preservation
of information is sacrosanct
because it underpins the
predictability of the
universe: “If . . . the
predictability of the universe
breaks down at black holes
it could break down in other
situations. Even worse, if
determinism breaks down
we can’t be sure of our past
history either. The history
books and our memories
could just be illusions.”
Prof Hawking recently
suggested a solution: that
information is imprinted on
the event horizon before
matter falls into the black
hole. This allows it to be
seen by observers both
inside and outside the black
hole, providing an element
of preservation between the
two realms. The
mathematics behind
“supertranslations”, as he
calls these imprints, is now
undergoing intense scrutiny.
His two lectures show
how much cosmology
overlaps with philosophy
and make an excellent
addition to the Reith canon,
which since 1948 has
encouraged leading thinkers
to enrich the public
discourse. Prof Hawking
additionally triumphs over
the limitations of his voice
synthesiser to show how
even the most difficult life
can be lived with optimism,
ambition and humour: “If
you feel you are in a black
hole, don’t give up. There’s a
way out.”
Real-time chops
3 Translation into plain
English: Skill
3 Perpetrator: Wall Street
Journal job ad
3 Usage example: “The
editor also needs the real-
time chops to handle posts
by our two-person team of
market Maniacs (fast-
metabolism, digital-first
market chroniclers who
produce inventive, high-
intellect coverage of
markets and the
things that move
them — as they
happen).”
(Spotted by A
Williams)
3 Lucy’s commentary:
In Britain, the only things
allowed to call themselves
chops come from dead
animals and are sold at the
butchers’. In the US the word
has long meant skill; while I
can only admire someone
with real-time chops to deal
with high-intellect maniacs,
it makes me somewhat
disinclined to buy the Wall
Street Journal.
Guffipedia: ft.com/guff
Thursday 28 January 2016 ★ FINANCIAL TIMES 13

ARTS

Thoroughly T H E AT R E

Pink Mist

believable
Bush Theatre, London
aaaae
Sarah Hemming

breakdown With its refrains, repetitions and vivid

THEATRE
The Mother
Tricycle Theatre, London
aaaae
Ian Shuttleworth
Gina McKee is terrific at “fiddly” acting:
those tiny movements that are inconse-
quential but go to build up a detailed
picture of natural behaviour. She pol-
ishes the screen of her phone or picks at
a toe through her thick sock or gathers
up a batch of magazines that she has
allowed to slide off a breakfast tray.
It all goes to make her character,
47-year-old Anne, more believable in
her depression following her grown-up
children’s departure from home. Para-
doxically, she is believable even when
we see the same scenes replayed in radi-
cally differing versions and have no idea
what to believe.
Florian Zeller’s play is, broadly speak-
ing, a companion piece to The Father,
which is about to return to the West
End. In each play, shifts of reality and
perspective interrogate the protago-
nist’s state of mind. In The Father, the
cause is Alzheimer’s, in The Mother, it is
Anne’s jealousy regarding her son and
the girlfriend whom she perceives as
robbing her of him, and also a pathologi-
cal (and, as far as we can tell, justified)
mistrust of her husband’s fidelity.
The repetition of scenes can be inter-
preted as presenting matters from the
point of view of different participants.
Thus, Anne in her own view is quiet and
reasonable, except when she is forensi-
cally interrogating husband Peter
(Richard Clothier), while in the percep-
tion of girlfriend Elodie she speaks in a
low, menacing rumble, the classic
wicked stepmother only without the
“step”. It is possible to find some misog-
yny in the play, but only by ignoring the
misandry: no one here gets off lightly.
Shifts of reality: Like The Father, this work is trans-
from left, Gina lated from the French sensitively and
McKee, Frances cleverly by Christopher Hampton; also
McNamee and like that play, it comes to London from
William Bath’s Ustinov Studio already garlanded
Postlethwaite in with acclaim. (The difference is that this
‘The Mother’. production is helmed by the Ustinov’s
Below right: the artistic director Laurence Boswell.) Zel-
City of London ler’s The Truth opens off-West End in
Sinfonia March; the snowballing sense that he
Alistair Muir/Rex/Shutterstock
constitutes a significant theatrical dis-
James Berry covery is palpable.
To March 5, tricycle.co.uk
C L A S S I CA L M U S I C
The Viennese Salon
Sam Wanamaker Playhouse, London
aaaee
Hannah Nepil
For many the “musical salon” is a quaint
concept, with overtones of elitism. But
in 19th- and early 20th-century Vienna,
home concerts for family and friends
were an integral part of cultural life.
The repertoire ranged from sacred
Renaissance works to contemporary
music, and guests were also expected to
participate in activities such as parlour
games, poetry-reading and dance.
So hats off to the City of London
Sinfonia for re-enacting all this in one
afternoon. As part of the CLS’s “Re-
imagined” series, the concert featured
mostly Viennese composers reworked
for drawing room dimensions. The
“drawing room” in question was the Sam
Wanamaker Playhouse, whose Jacobean
interior conjured up the wrong period
entirely. But it did at least offer a sense of
intimacy, as well as a session of Viennese
waltzes after the concert.
If only the orchestra had lived up to
the programme. At times it would have
been better left out altogether, as in
Berg’s Four Pieces for Clarinet, which
Colin Matthews had arranged for cham-
ber orchestra. Despite Michael Collins’s
luminous clarinet playing, the overall
result sounded somewhat bloated. And
the same could be said of David Mat-
thews’s three arrangements: Bach’s Prel-
ude and Fugue in C plodded along pleas-
antly enough under Collins’s baton, with
little resembling dynamic contrast.
“Im Dorfe” from Schubert’s Winterre-
ise was a little too ungainly to convey any
real hint of magic. Even in the closing
scene of Capriccio — Richard Strauss’s
fond farewell to opera — the string play-
ers sounded muddy. It was left to
soprano Felicity Lott to remind us of the
music’s sensuousness, and she seemed
to relish every moment as the Countess
torn between two lovers.
So it was good to be reminded that
these instrumentalists are more than
capable of vigour. It came out in Hasen-
horl’s perky arrangement of Strauss’s
Till Eulenspiegel, which showcased a
kaleidoscope of colours. It was still more
obvious in Schoenberg’s heady Kam-
mersymphonie Op 9, played here in
Webern’s clean-cut arrangement. And
by the final item — three salacious Lehár
and Oscar Straus songs performed by
Lott with characteristic spirit — the
orchestra was fully into its stride.
cityoflondonsinfonia.co.uk
descriptions, Owen Sheers’s verse
drama in some ways evokes the epic oral
war poems of antiquity. But this moving
piece (written first for radio) focuses on
conflict much closer to home and on
those left to pick up the pieces once the
world’s attention has moved on.
By turns witty, tough and lyrical, it
traces the story of three Bristol lads who
join the army and end up in Afghani-
stan. Each is catastrophically scarred by
what happens to them and Sheers takes
us through their stories, without flinch-
ing, without sensationalising, to create a
shattering piece of theatre that had
many in the first-night audience in tears.
It’s the life in the lads that gets you: the
easy vitality of youth. In this powerfully
acted production (first seen at Bristol
Old Vic), the young men — Arthur, Taff
andHads—arerestless,toofullofenergy
fortheirdead-endjobs,boredbytherou-
tineofworkfollowedbydrinking.
Directors John Retallack and George
Mann use muscular choreography to
evoke the streets of Bristol and the pub
where Arthur first tells his friends he has
joined up and convinces them to come
with him. But the six-strong ensemble
use that same physical discipline to
evoke life in battle, bringing to life
Sheers’s descriptions (drawn from inter-
views with soldiers). We see the tense
dark nights on watch, the jittery patrols,
the precise work of mine-sweeping and
the sudden explosion that can send a
man somersaulting through the air to
land, in Hads’s case, without his legs.
Alex Stedman conveys the numbing
shock of Hads’ experience; Peter
Edwards, as Taff, plagued by nightmares
and flashbacks, seems to hollow out over
the course of the evening; and Phil Dun-
ster brings a mix of breezy, affable vig-
our and crippling guilt to the narrator
Arthur. Rebecca Hamilton, Rebecca Kil-
lick and Zara Ramm suggest the pain of
the women trying to cope with their bro-
ken men. And the very nature of the
staging — an ensemble working together,
but then split by particular griefs —
neatly meets the stories it tells.
To February 13, bushtheatre.co.uk

Perfect storm makes less than perfect drama

Scandal:
THEATRE Clément
Carabédian in
Bettencourt Boulevard ‘Bettencourt
Théâtre de la Colline, Paris Boulevard’
aaaee Elizabeth Carecchio

Laura Cappelle

The “Bettencourt affair”, which first

came to light in 2010, was a perfect
storm. Centring on L’Oréal heiress
Liliane Bettencourt, France’s richest
woman, it featured associates suspected
of exploiting her mental frailty, as well
as tax evasion and illegal donations to
Nicolas Sarkozy’s 2007 presidential
campaign. No wonder Michel Vinaver,
one of the few French playwrights con-
sistently to find inspiration in current
affairs, chose to tackle it in his new play.
Christian Schiaretti directs the pro-
duction that has just opened at La
Colline in Paris after an initial run in
Lyon, but it is mainly a showcase for
Vinaver’s richly complex writing; at 89,
he shows no sign of slowing down. The
play’s 30 non-linear fragments summon
all the characters the French public
came to know over the course of the
scandal, from Eric Woerth, the minister
accused of receiving cash-stuffed enve-
lopes, to Bettencourt’s estranged daugh-
ter, Françoise, who started legal pro-
ceedings to have her mother declared
mentally incompetent.
Vinaver’s vignettes are thoroughly
researched, with excerpts from tape
recordings made by Bettencourt’s butler
woven in, but the text resonates beyond
the headlines. Two family ancestors
crop up time and again: Robert Meyers,
a rabbi who died in a Nazi concentration
camp, and Eugène Schueller, founder of
L’Oréal, who was part of an anti-Semitic,
Vichy-supporting group. The play’s full
title, Bettencourt Boulevard or A History of
France, suggests that the family’s saga
acts as a mirror for the country.
Yet for all its topicality, the play’s frag-
mented structure dissipates dramatic
tension, and Schiaretti’s production
struggles for momentum. “What does it
all have to do with theatre?” asks the
narrator at the end; on opening night,
this was met with a resounding
“Nothing!” from an audience member.
There is a sense of excessive deference
to Vinaver’s text, with the cast rewind-
ing through excerpts from every scene,
script in hand.
Schiaretti’s excellent actors serve the
text to the best of their abilities. Gaston
Richard’s impression of Sarkozy’s verbal
tics is uncanny, and Francine Bergé, by
turns whimsical and frail, is a powerful
presence as Bettencourt. Comedy comes
from Jérôme Deschamps’ languid dic-
tion as her financial adviser, Patrice de
Maistre. It is a solid starting point; per-
haps subsequent productions will do
more to convey the storm’s energy.
To February 14, colline.fr

Music Pop album reviews

By Ludovic Hunter-Tilney
Lucinda Williams
The Ghosts of Highway 20
Highway 20 Records
aaaae
Lucinda Williams’s The
Ghosts of Highway 20 is a
double album about
doubling back on oneself. In
the grand tradition of road-
themed Americana, it
revisits her southern roots in
places based around
Interstate 20, which runs
from Texas to South
Carolina. Old flames are
remembered (“Place
in My Heart”) alongside
self-portraits of the
songwriter as a troubled
young woman (“I Know All
About It”). Parents are
mourned in “Louisiana
Stories”, in which Williams
depicts her mother as
damaged by a strict southern
upbringing, and more
straightforwardly in “If
There’s a Heaven”, a
spiritual-inflected tribute to
her poet-father. Williams’s
slurred voice settles over the
music like an old ache, her
tone sliding between
worldliness (she who has
seen it all) and world-
weariness (she who has tired
of seeing it all).
The stance is familiar from
previous albums, but an
inspired twist gives this
particular act of doubling
back a fresh feel: guitarists
Bill Frisell and Greg Leisz are
recorded in stereo, one
occupying the left speaker,
the other the right, each side
complementing the other.
Shearwater
Jet Plane and Oxbow
Sub Pop
AAAAE
Like the eponymous seabird,
Shearwater’s latest album
is built for flight: a mix of
propulsive power and
streamlined grace. The
Texan band’s frontman
Jonathan Meiburg describes
the album as a “protest
record” of sorts, decrying
the corruptions of US power
yet registering deep
attachment to the country
itself, its lyrics suffused
with naturalist imagery.
There is also the defiance
of an indie band that has
never quite made the
commercial breakthrough
it deserves.
Instead Jet Plane and
Oxbow achieves its own
breakthrough, an intense
and invigorating set of rock
songs with guitars streaming
like contrails, high-velocity
drumming and Meiburg’s
declamatory baritone
demanding attention.
14 ★ FINANCIAL TIMES Thursday 28 January 2016

State paid
Elevated levels of non-performing loans have weighed heavily on the shares of Italian banks. The government
will provide guarantees to help banks securitise and sell the loans – but will charge the banks market rates

Italian banks Non-performing loans

Twitter: @FTLex Email: lex@ft.com €bn Selected Italian banks, 2015 (% of total loans)
Other non-performing loans* FTSE Italia All share

400
Bad debt* bank index price (’000)
20
Monte dei
Paschi di Siena 33
Royal Bank of Scotland: climate and a government grown tired Apple:
Banco
define ‘one-off’
of treating banks as a political piñata.
After years of nasty one-offs, all that
Popolare 25 changing the subject
300
will be left to worry about is that
15 Intesa
The one-offs keep on coming. If one did
not know better, one might suspect
generic perennial, a slowdown and turn
in the credit cycle. Only that. Sanpaolo 17 Apple is trying to fix the reality
distortion field. For decades it helped
them of being two-, three-, or more- 200 Steve Jobs inspire developers and
offs. RBS, the UK bank usually prefixed Banca Popolare customers. Now it is backfiring; the
with “beleaguered”, yesterday warned Zoomlion: 10
di Milano 17 shares have fallen a quarter since July
of £4.1bn in charges. As a result, next and were stagnant after-hours on
month it will probably report an eighth no pain, no crane 100 Tuesday even following record
successive annual loss. UniCredit 16 quarterly results.
In fairness, the £4.1bn breaks down Is the merger game tilted in favour of The most profitable company in the
into items that are idiosyncratic, the irrational player? It depends on 0 5 UBI world is now valued at just 8 times
including some for changes to pension
accounting, a slug for provisions
how you define victory. On Tuesday
Terex, the US heavy equipment maker, 12 13 14 15 16
Banca 15 earnings, excluding cash. That does
seem unreal. Investors, though, have a
*Bad debts are not expected to be recovered. Other NPLs are overdue or otherwise doubtful
against mis-sold mortgage securities, said it had received an all-cash buyout FT graphic Sources: Barclays; Banca di Italia; Thomson Reuters Datastream laser focus on projections for iPhone
and more for payment protection offer from Chinese competitor growth, which Apple’s own revenue
insurance. Most concern mis-steps long Zoomlion at $30 a share, or $3.3bn. guidance now implies will fall into
predating the current management. The bid values Terex — which had When is a government guarantee not from banks at an appropriate discount banks an incentive to use the negative territory for the first time in
Eventually the past will be past. The already agreed to another from state aid? And when is a “bad bank” to face value. The Italian alternative is facilities quickly. Cleaned-up balance the next quarter.
regulator has decreed a two-year Finland’s Konecranes — at 16 times not a bank at all? When it is Italian, it a securitisation facility for each bank. sheets, it is hoped, will stimulate Apple’s solution is to provide new
guillotine for PPI claims, albeit while 2016 forecast earnings, a 100 per cent seems. Italy’s struggling banks will There are plenty of unknowns. At what credit creation and help clear the way numbers on its installed base — 1bn
demanding banks run a £42m closing- premium to Monday’s price and to the now, under a deal announced price will the banks be able to sell their for industry consolidation. active devices — and to remind people
down-sale ad campaign that RBS value of Konecranes’ all-share offer. yesterday, be able to bundle non- dud loans into the securitisation Buyers may appear. The bad loans that they are enticing their users to
estimates will raise its liability by The deal is the latest instance of the performing loans for securitisation vehicle? If it is less than their value in have already received scrutiny in the part with billions of dollars for apps
£500m. US litigation is more difficult Chinese corporate scramble for and sale. The banks can then make banks’ accounts there will be capital- 2014 asset quality review and the and music.
to circumscribe, but by increasing its overseas assets. Over the past decade the bundles more appealing by consuming impairments. How will European Central Bank’s latest probe This is not simply a hardware
provisions to $5.6bn, RBS has now set more than $550bn has left China to adding government guarantees to the rating agencies assess such loan into credit quality. Further haircuts business, Apple is saying. We are selling
aside a greater share of past mortgage- purchase offshore assets in industries senior tranches. The banks will buy bundles, given their inglorious history on impaired loans may be limited. high-margin digital goods at greater
backed security sales than rivals. from food to technology, says Dealogic. the guarantees at prices based on with tranched mortgage debt Securities with state guarantees can scale than most internet companies.
JPMorgan settled for $4bn over a Buyers have sought market share, credit default swaps for similarly securities? Will there be ready buyers be used as collateral with the ECB Services revenue jumped 26 per cent
similar amount of securities sold to brands, technology or resources in rated securities. for large volumes of this debt — Italian and carry a lower risk weighting. year-on-year to $6bn. At that rate it
federal housing agencies, the plaintiff. short supply back home. The Zoomlion The news was not followed by a banks have over €200bn of loans that That should make them attractive. will soon leapfrog revenues from Macs
Other obstacles remain, including a deal hardly fits into any of those euphoric rally in bank shares. EU are downright bad, rather than merely Still, these are not bad banks by and iPads.
forced sale of retail bank Williams & patterns, though. The benefits to the rules now, in effect, prohibit bad non-performing — given the additional another name. In Ireland and Spain, Yet Alphabet — which recently
Glyn for competition reasons and the buyer — or China — are unclear. banks in the fashion of Ireland’s cost of the guarantee? the state simply bought the bad stuff. overtook Apple by enterprise value —
threat of further litigation from the US. The companies have at least one big Nama or Spain’s Sareb, where a That cost will go up with time. The The Italian banks must find private gets a multiple of 25 times forward
Yet amid the fog and swirl of these product in common: cranes account for publicly backed entity bought loans pricing scheme is designed to give buyers. That difference will count. earnings; Facebook is at 45 times and
challenges, the vague outlines of a bull a quarter of revenues at each. And the Amazon 111 times.
case can be made out. Indeed, UBS, two operate in different geographies, so Telling a different story with new
with unlucky timing, published such a cross-selling might be possible. But detail on the business — particularly if,
case on Tuesday. It calculates that, as of even if Terex has technology to share, best bid in an auction almost invariably impress the masses. But orders alone perfected, some are in peak as in this case, it happens to be true —
last September, RBS’s tier one equity in a declining market price will pays too much, and which Zoomlion’s are not enough. As a mature industrial production, and some (like the iconic is a legitimate stock-boosting tactic.
capital stood three points above its continue to be decisive. Zoomlion will victory may well come to epitomise. company, its task is to turn big orders 747) are being slowly wound down. Just as hitting the debt markets hard in
target of 13 per cent of risk-waited still struggle to sell its products into big cash flow that can fund Boeing’s long-term prospects are order to return additional tens of
assets. There should be a considerable overseas (it gets just one-tenth of its dividends and buybacks. largely tied to its newer 737 jets that billions of dollars in cash to
buffer even after this week’s revenues from Italy), or to break peer Boeing: It is a tough job: fixed investment are being snapped up by Asian and shareholders is understandable (when
writedowns, which will take 1.5 points XCMG’s dominant 50 per cent share of costs at the outset of new plane Middle Eastern airlines. In the near you have $200bn “trapped” offshore).
off the ratio. Further restructuring the domestic market. technical difficulties programmes run into billions. Still, if term, orders of its 777 have fallen more Yet the reality distortion field is
charges and the divestment of capital- Then there is that premium. Perhaps development and production costs sharply than expected while a new still haywire. Tim Cook and his team
hungry assets will reduce or increase necessary to break Terex’s attachment A grounded earnings call may just be come in line with expectations, the variant is being rolled out. are not going to talk the stock out
this excess but, set against a share price to the first deal, it will be hard to the perfect metaphor for Boeing. Early returns can be massive once jets roll off Execution at Boeing is usually a of its malaise. Now that the first
of 255p, such an excess raises the hope finance. The company has net debt of yesterday, it announced sharply the assembly line. The 787 Dreamliner, bright spot. A slowing economy in iPhone revenue decline is all but
of a sound cash dividend, one day. $3.3bn. Even excluding Terex, doubling disappointing orders and earnings with nearly $30bn in cumulative emerging markets and cheaper oil baked-in, the pressure will be on to
RBS’s net asset value per share of 447p this takes it to 100 per cent of equity, forecasts for 2016. Its shares fell nearly production costs to be recovered, has prices — which reduce the incentive to staunch the bleeding and produce
provides shareholders some protection on top of falling profits, negative free a tenth (a market value loss of $6bn). It so far been an exception. replace older planes with newer, more another product that can raise
against further corrosive charges. cash flow and rising receivables. was all set to explain itself to investors Boeing’s earnings for 2016 will be fuel-efficient ones — raise worries that expectations once more.
RBS ought to be profitable. When If Terex holders take the cash, — until technical problems forced the more than a tenth below expectations. the fat order book could be thinned by
shorn of past encumbrances, what Konecranes may wonder how its postponement of the conference call. Total forecast deliveries of 745 are also cancellations from wobbling national
remains will be a retail and corporate sensible offer could fail. A modest If only Boeing were like those hot set to be lower than 2015. Over its airlines. When it finally sorts out its Lex on the web
For notes on today’s breaking
bank largely focused on the UK, a comfort would be to reflect on the cloud-software companies, and could various narrow- and wide-body jet phone system, Boeing has a lot of stories go to www.ft.com/lex
growing economy with a good business “winner’s curse” — the rule that the simply wave its $500bn order book to models, some are new and being explaining to do.

980 Today’s temperatures

980
Abu Dhabi Sun 24 Malta Sun 17
990 4 1020 Amsterdam Sun 9 Manila Fair 31
L Ankara Cloudy 2 Miami Thunder 25
4 Athens Sun 17 Milan Cloudy 11
1000 3
Bahrain Sun 17 Montreal Snow 0
28 Barcelona Fair 16 Moscow Rain 4
1010 Beijing Sun 4 Mumbai Sun 31
8
Belfast Shower 9 Munich Drizzle 13
10 1020 Belgrade Fair 12 Naples Fair 15
8 6 Berlin Fair 10 New York Sun 4
9 10 Brussels Sun 9 Nice Fair 15
10 Budapest Cloudy 9 Nicosia Sun 13
1030 8 9 14 Cairo Fair 14 Oslo Sun 4
Cardiff Rain 10 Paris Cloudy 9
9 9 Chicago Cloudy 4 Prague Cloudy 10
11 Cologne Fair 9 Reykjavik Snow 0
5
Copenhagen Sun 7 Riga Sleet 8
3 13
HIGH Delhi Sun 23 Rio Thunder 31
16 2 Dubai Sun 24 Rome Fair 15
7
Dublin Rain 10 San Francisco Fair 16
5 Edinburgh Shower 9 Singapore Shower 31
12
13
17 HIGH15 1
Frankfurt Rain 11 Stockholm Sleet 5
Geneva Cloudy 13 Strasbourg Rain 11
13
1030 Hamburg Fair 8 Sydney Thunder 27
Helsinki Sleet 4 Tokyo Sun 13
20 20 17 3 Hong Kong Thunder 20 Toronto Snow 2
Istanbul Fair 10 Vancouver Shower 11
19
HIGH Lisbon Rain 13 Vienna Cloudy 13
Wind speeds in KPH 15
London Sun 10 Warsaw Rain 8
Forecasts by Los Angeles Sun 22 Washington Fair 6
Wind speed Luxembourg Rain 8 Zagreb Fair 14
in KPH Madrid Cloudy 12 Zurich Rain 11

CROSSWORD ACROSS
1 Pledge to rest after overturning
4 Shocking hoax almost secures
gold rug (9)
No. 15,149 Set by MAGWITCH moped without a helmet (7) 5 I sort out public disturbances (5)
       
5 Ice-creams produced by non-US 6 Practise without note I’d revised
suppliers (7) explicitly (9)
9 Starts to paint oils to hide stolen 7 With a fresh approach, desire to
picture (5) become skilful (5)
  10 Intensely dislike a dessert pub 8 Marshal turns up in part of a
reportedly had for dinner (9) wetsuit with ripped edges (7)
11 Arrives on the heels of past 14 This document supports your
masters (9) claim for publication of French
 
12 Found in spot on Galapagos edition (5,4)
archipelago (5) 16 Endless messy mud I let in (9)
13 Precise piece of legislation now 17 Changed sides for money to get
     repealed? (5) shelter with soldier in return (9)
15 Violently denounced journalist 18 Overruns popular party with
following turn he’d messed up (9) socialists primarily (7)
18 The same model initially includes 20 Worries about German trap set by
   numbers trimmed in chrome (9) the French (7)
19 Long period at the centre of 22 Acting doctor has a higher degree
attention (5) (5)
    21 Sweet compromise (5) 23 At first background laughter leads
23 Complaining about Naomi to hearing being indistinct (5)
returning after I left off being 24 Get ready to go away from
around (9) embargo muddle (5)
  25 Government reportedly intended
to make a declaration (9)
26 Top UN official has a student flat Solution 15,148
 
(5) + < 6 6 2 3 & / ( 0 $ 7 , 6
27 It smooths over Labour leader’s , 7 & $ 2 ( 8
9 , 2 / ( 7 & < & / $ 0 ( 1
false report (7)
CROSSWORD
No. 14,845 Set by NEO
        ACROSS DOWN
1 Important Viking one among best 1 Hard maths topic written up to find
friends (5,4) circumference (5)
  6 Socialite with appeal makes left- 2 Love comes in no time, wildly, for
side entry (5) passion (7)
9 Brazilian city as far as we’re 3 Disagreed also with a thousand
concerned ungovernable (7) children (4,5)
  
10 Obscure English knight against 4 Bond gets to a casino and is
European rebuffed (7) beaten (11)
11 Poor nation’s little island in hot 5 Beast summarising Tokyo-London-
   current (5) Tokyo trip? (3)
12 Caught flamboyant cardinal in 6 Painter died hungry (5)
Seventh Heaven? (5,4) 7 Discount supermarket name in
  
14 Notice flock encircles houses (3) GB’s upturn with loss on top (7)
15 Alarmist financier reversed into 8 As 007 mission to Spectre might
second vehicle bearing right (11) be? (3-6)
17 German poet’s the writer 13 Dope sheathes weapon in open
   
embracing pub vocalist (11) coat (11)
19 Moggy fur with hole concealed? (3) 14 Soul an unknown factor in some
20 Earl, King and Queen on men? Fearless pilots? (9)
   Hampshire river’s banks (9) 16 Girl having paddle round saw
22 Ambassador in temple finds grain manor demolished (9)
(5) 18 Mistress Gwynne about to be
 
24 Ardent Green must change leader announced in sport (7)
(7) 19 Side issue for Clintons (7)
26 As one’s despicably mean, small 21 Having ducks in horses area
tips for servants materialise (2,5) causes commotion (3-2)
JOTTER PAD 27 Sauce unfortunately knocked over 23 Crime article Financial Times
contains sulphur (5) provides (5)
28 Related martial artist stops at 25 Sick at first, old man here for
Bedouin residence (9) healthy holiday (3)
Solution to Saturday’s prize puzzle on Saturday February 14
Solution to yesterday’s prize puzzle on Monday February 16
Winners’ names will be printed in Weekend FT

( 1 $ ) 6 ( 3 6
28 Ridicules extremely disagreeable 2 / ( $ 1 ' ( 5 7 + 5 , ) 7
JOTTER PAD fairground attractions (7) ) : 6 ' 2 , $
DOWN ) / $ * & 2 5 1 ) / 2 : ( 5
5 3 5 ( / $
1 Deeply regret daughter learning 2 ; ( < ( ' $ , 6 < , 5 , 6
about record (7) 8 7 6 ( ( 2 ,
2 In favour of people getting stated 7 ( $ 6 ( / * / 2 ; , 1 , $
equipment to help walk (9) / 3 5 + ) 3 : 0
$ 6 3 + 2 ' ( / % 2 5 $ * (
3 Resigned to supporting son and : / 8 % 6 1 6
niece regularly (5) 6 : ( ( 7 3 ( $ 1 ( 7 7 / (
Thursday 28 January 2016 ★ 15

VMware JustEat Apple FTSE 100 US 2-year Gold Dollar/yen Brent oil
Rocket man Group’s founder Treasury
certainly has chutzpah 9.1% 9.8% 6% 1.3% 3bp $3 0.5% 4.7%
SARAH GORDON, PAGE 16
$44.81 379.4p $94.09 5990.37 0.88% $1,117 ¥118.94 $33.28

Five acquitted in Libor fixing case Short

View
Setback for Serious Fraud Office after trial clears men of manipulating bank rates
to defraud, had sought to fix the rate to these charges should not have been of his clients to help another client fix
Roger
LINDSAY FORTADO — LONDON
benefit his own trading positions, which brought and considered by a jury,” said ‘Nobody the benchmark rate because he would Blitz
A broker nicknamed “Lord Libor” was were tied to yen Libor. David Green, director of the SFO. could have lost their business if they thought
one of five men cleared by a London The jury was told to continue deliber- Prosecutors said the men acted as go- he was favouring another trader.
court yesterday of acting as middlemen ating a count today against a sixth man, betweens, passing along requests sensibly Matthew Frankland, a lawyer for Less than a couple of months ago, investors appeared to
between convicted former UBS trader Darrell Read, a former ICAP broker. between traders for what the rate suggest that Mr Wilkinson, said the decision “fur- feel neutral about political risk. Terror attacks in Paris and
Tom Hayes and others to help them The others — Danny Wilkinson and should be set at on a given day. The SFO ther underlines that the Libor system the shooting down of a Russian jet over Turkish airspace
manipulate bank rates, in a setback for Colin Goodman, dubbed “Lord Libor”, also alleged that Mr Goodman, in daily these was broken well before this indictment had little impact on the market.
the UK’s Serious Fraud Office. previously at ICAP; Noel Cryan, emails to his contact list where he would charges period”. It feels different now. Frazzled markets seem to be con-
The men, formerly of ICAP, Tullett ex-Tullett Prebon; and Jim Gilmour and suggest where he thought Libor would Mr Read, Mr Goodman and Mr Farr tributing to political risk. Market fear is amplifying every
Prebon and RP Martin, faced a total of Terry Farr, formerly at RP Martin — be set that day, would alter the figure to should not each faced two counts of conspiracy to danger out there: Syria-Iran tensions, Isis, migrant crisis
five counts from the SFO, which alleged were unanimously found not guilty adhere to Mr Hayes’s requests. have been defraud, while the other three defend- and far-right election success.
that they helped Mr Hayes, one of their after a 15-week trial at Southwark The court heard that the brokers, with ants faced one count. This is also why sterling is under attack, analysts say.
biggest clients, to manipulate the Lon- Crown Court. nicknames such as “Big Nose” and brought’ Mr Hayes, the first person to stand With astonishing rapidity, a British vote to leave the EU
don interbank offered rate tied to the The case is the second UK trial in the “Sarge”, were rewarded by Mr Hayes David Green trial in the global investigation, was sen- has shot up the worry scale for investors.
yen while he worked for UBS and Citi- global investigation, which has spanned with extra commission for their help. SFO director tenced to 14 years in prison, but that was UBS notes a rise in web searches for “Brexit” on Google
group. Mr Hayes, who was found guilty several continents in nearly eight years. But Mr Read said in evidence at the reduced to 11 years by an appeal court in since the start of 2016. But are investors Brexit-fixated just
in August of eight counts of conspiracy “Nobody could sensibly suggest that trial that he never would have asked one December. because the EU referendum year has probably arrived?
The pound has fallen 6.4 per cent over the past three
months, but the pace of its decline has quickened as mar-
kets turned nasty in the new year.
Sterling is in investors’ sights because market anxiety is
turning them away from anything deemed risky. Prices of
Cabin pressure UK credit default swaps have shot up since January 1. Right
Boeing earnings to now, Brexit makes the UK feel like a risky asset.
That was far from the market’s view last year, as the
fall short of forecasts pound drove on towards $1.60 and the Bank of England
turned hawkish on rates.
There may be better reasons why sterling should fall.
Shares in Boeing fell sharply yesterday One of these is the dormant issue of the UK’s current
after the US group said its full-year core account deficit, which is currently coming in at about
earnings per share for 2016 would fall 4.5 per cent of GDP. Another is the BoE’s new dovish tone.
short of analysts’ forecasts, reports However, political risk is the flavour of this sour month
Robert Wright in New York. when it comes to bashing the pound. It is wilting even
It added that it would deliver fewer before David Cameron, prime minister, has set his EU ref-
passenger jets this year than it did in erendum date.
2015. Robert Stallard, an analyst at RBC, Sterling came under some pressure ahead of the 2014
contrasted Boeing’s statement that it Scottish referendum and the 2015 general election. But to
would deliver up to 745 jets this year nothing like this extent — and never this early.
with his estimate of 778, but added the Wider market turmoil seems to be the explanation for
company had a recent record of issuing this latest decline, not the prospect of the UK leaving the
conservative earnings guidance. EU. If some normality is restored, it still may not be
“The earnings per share forecast is enough to stop the pound weakening further. But it may
significantly lower than [analysts’] put Brexit — and sterling’s real value — in a better context,
consensus,” he said. and make investors more sanguine about political risk.
Boeing’s guidance follows its
announcement last week that it would
cut production of its 747 jumbo jet — Sterling
once its flagship aircraft — to just six a Against the dollar ($ per £) Sterling fell ahead
year from September. It blamed 1.7 of the 2014
lacklustre demand in air cargo, the main Scottish
market for the company’s only four- referendum and
engine aircraft. 1.6 the 2015 general
The fall in Boeing’s stock comes as election, but its
shares of US industrial companies have 1.5 latest decline has
declined nearly 8 per cent this year, been much
making them the fourth worst- steeper — and the
performing group in the S&P 500 index. 1.4 EU referendum
Lex page 14 2011 12 13 14 15 16 date has not even
Companies page 18 Source: Thomson Reuters Datastream been set
Markets page 26
roger.blitz@ft.com

Global businesses urge Brussels to

rewrite rules governing derivatives
PHILIP STAFFORD — LONDON 40 institutions have written to policy- reform closes on January 31. We will
JIM BRUNSDEN — BRUSSELS
makers at the European Commission duly analyse all the responses and set
Ford, IBM, Airbus, BP and General urging them to rewrite the rules to be out the way forward in due course.”
Electric are among dozens of global more like those in the US, which exempt Although many European rules have
businesses that have sharply criticised non-financial corporations from some yet to come into effect, parts of the legis-
Europe’s rules for the use of deriva- of the more onerous requirements. lation are tougher than the US, raising
tives, claiming they unfairly push up “We have serious concerns that cor- costs for users and creating tension
EDF poised to invest in costs for companies “that did not cause porates using derivatives for hedging between officials over the best way to
nuclear business Areva the financial crisis”. purposes today are unnecessarily and monitor the global market.
disproportionately burdened by such The letter adds to growing pressure on
The board of state-owned EDF was on Regulators have sought to strengthen requirements,” said the letter sent on European policymakers to rethink large
course last night to agree a big the financial system since the crisis by Tuesday to Jonathan Hill, the commis- parts of the legislation introduced to
investment in the reactor business of crafting tougher rules for derivatives, sioner for financial services, and seen by cover opaque derivatives markets after
Areva, putting further pressure on the which are used by companies to protect the Financial Times. “These corporates the financial crisis. Regulators want to
French energy group as it scrambles to their earnings from adverse shifts in do not pose systemic risk and did not ensure that taxpayers are not required
secure the financing for an £18bn currencies, interest rates and commodi- cause the financial crisis.” to bail out banks in the future. Tougher
nuclear project in the UK. ties, including oil. A European Commission spokesman rules for banks, however, limit their
Report IPAGE 16 The approach by European officials said: “The ongoing consultation on the ability to buy and sell derivatives with
has rankled big companies. More than cumulative impact of the regulatory companies as they did in the past.

Companies / Sectors / People

Companies
AT&T..............................................................16
AbbVie...........................................................18
Abbott Laboratories..............................18
Admiral..........................................................27
Aetna................................................................4
Air France....................................................12
Airbus.............................................................15
Alibaba......................................................9,20
Alphabet.............................................11,14,17
Altria...............................................................27
Amazon.............................................14,16,27
Apollo...............................................................6
Apple..............................6,11,14,16,17,18,27
Areva.........................................................15,16
Arm Holdings............................................27
Artisan Partners.......................................18
BG Group.....................................................16
BP......................................................................15
Bank of America.....................................28
BlackBerry....................................................17
Boeing...........................................14,15,18,27
British American Tobacco.................27
Caterpillar....................................................26
Cerberus.........................................................6
Cisco................................................................16
Citigroup......................................................28
Continental Resources........................26
Daihatsu........................................................18
Daimler..........................................................18
Deezer............................................................16
Deliveroo......................................................27
Dell...................................................................27
Deutsche Telekom..................................16
Dropbox........................................................16
EDF.............................................................15,16
EE......................................................................16
EMC.................................................................27
Evraz...............................................................27
Facebook.......................................6,14,16,17
Fastenal........................................................26
Ferrari.............................................................18
Fiat Chrysler Automobiles.................18
FoodPanda..................................................16
Ford..................................................................15
Fuji Heavy Industries............................18
Gannett..........................................................16
General Dynamics...................................18
General Electric..................................15,26
General Motors...................................15,18
Generali........................................................20
Google...................................................6,16,17
HelloFresh....................................................16
Hino.................................................................18
Honda.............................................................18
Honeywell....................................................15
Huawei...........................................................16
IBM...................................................................15
Iliad..................................................................27
Imperial Tobacco....................................27
JPMorgan..............................................14,28
Johnson & Johnson...............................18
JourneyApps.............................................20
Just Eat.........................................................27
KLM..................................................................12
Konecranes.................................................14
Linio.................................................................16
M-Kopa.........................................................20
Maruti Suzuki............................................18
Mazda.............................................................18
Media General...........................................16
MercadoLibre.............................................16
Meredith Corp...........................................16
Microsoft...........................................12,18,27
Naspers............................................................1
News Corp...................................................16
Nexstar Broadcasting...........................16
Nissan.............................................................18
Nokia...............................................................17
Pandora.........................................................16
Pfizer .............................................................18
RBS..................................................................14
Renault..........................................................18
Rocket Internet.........................................16
Royal Dutch Shell...................................16
SK Telecom ...............................................16
Safaricom.....................................................20
Sage................................................................27
Santander....................................................20
Santander Consumer USA................20
Sendy.............................................................20
SnapScan.....................................................20
Snapchat.......................................................16
South China Morning Post..................9
Spotify............................................................16
Square............................................................16
Standard Bank.........................................20
Suzuki Motor..............................................18
TalkTalk........................................................27
Tencent............................................................1
Terex...............................................................14
Time Warner.........................................15,16
Toyota............................................................18
Transneft.....................................................26
Tribune..........................................................16
US Steel........................................................27
Uber.................................................................17
UniCredit........................................................6
United Technologies.............................18
UnitedHealth...............................................4
VMware.........................................................27
ValueAct.......................................................18
Verizon..........................................................16
Vodafone...............................................15,20
Volkswagen.................................................18
Volvo...............................................................15
Wells Fargo................................................28
Weza Tele...................................................20
XCMG.............................................................14
Yahoo..............................................................17
Zoomlion.......................................................14
Zurich Insurance.....................................20
iHub................................................................20
Sectors
Aerospace & Defence.....................15,18
Automobiles............................................6,18
Banks...........................................14,15,20,26
Energy............................................................16
Financials......................................................16
Healthcare...............................................4,18
Industrial Goods......................................26
Industrials....................................................26
Insurance.................................................4,20
Media...................................................11,16,20
Oil & Gas................................................16,28
Technology..........................11,14,16,17,20
Telecoms....................................14,16,17,20
People
Botín, Ana...................................................20
Cook, Tim...............................................14,17
Ehlers, Kobus............................................20
Gore-Coty, Pierre-Dimitri....................17
Gorsky, Alex...............................................18
Greco, Mario..............................................20
Henry, Simon.............................................16
Hofmeyr, Conrad....................................20
Icahn, Carl....................................................18
Jobs, Steve............................................14,17
Kimpel, Peter.............................................16
Lacy, Stephen............................................16
Maestri, Luca..........................................6,17
Marchionne, Sergio................................18
Moore, Jesse..............................................20
Rotich, Juliana..........................................20
Samwer, Oliver..........................................16
Senn, Martin..............................................20
Simphal, Thibaud.....................................17
Sook, Perry..................................................16
van Beurden, Ben....................................16
Williams, Ron...............................................4
Zuckerberg, Mark......................................6

© The Financial Times Limited 2016 Week 4

16 ★ FINANCIAL TIMES Thursday 28 January 2016

COMPANIES
INSIDE BUSINESS
Oil & gas
EUROPE

Shell investors approve BG takeover Sarah

More than 83% support
deal despite fears over
sliding price of crude
CHRISTOPHER ADAMS — LONDON
DUNCAN ROBINSON — THE HAGUE
Investors in Royal Dutch Shell yester-
day gave a green light to the group’s
£35bn takeover of rival producer BG
Group, making it a near certainty that
major is paying too much for BG after a
70 per cent-plus slide in Brent crude
prices since mid-2014, to just $31 a bar-
rel, 83.1 per cent of votes cast at a meet-
ing in The Hague backed the deal.
However, a sizeable minority, some
16.9 per cent, were opposed to the deal,
in which Shell is paying through a com-
bination of cash and shares.
Ben van Beurden, Shell chief execu-
tive, told the company’s shareholders
ahead of the vote that the BG takeover
tors focused more on whether Shell
could cope with new targets aimed at
cutting carbon dioxide emissions agreed
in Paris by world leaders in December,
rather than the merits of the BG deal
and the recent further drop in oil prices.
A handful of shareholders spoke out
against the transaction, worrying about
whether the deal remained viable with
oil at spot prices of $30 per barrel.
Mark van Baal, who leads a group of
1,000 small “green” shareholders in
Gordon
the oil price goes down so much that the
assets cost more to get out the ground
than they are worth, that is not an asset,
that is a liability,” said Gavin Palmer, a
small shareholder.
Exodus from Rocket’s
But Simon Henry, Shell’s chief finan-
cial officer, played down the prospects
mission control gives
of oil staying at low levels, of $40 to $50
a barrel, over the long term. “Shell on its
own would have challenges in that sce-
investors reason to fret
nario,” said Mr Henry, who also pointed
£35bn out that the average cost of much of BG’s

the biggest energy deal in more than a
decade will go ahead.
Barring an unexpected upset at a
meeting of BG shareholders today, the
transaction will formally become effec-
tive on February 15, ending almost 20
years of independence for BG, which
was spun out of the old British Gas.
Despite fears among some Shell
shareholders that the Anglo-Dutch oil
Media
would “provide a springboard to
reshape” the group. Shell will gain bil-
lions of barrels in Brazilian deepwater
oil reserves and become a global lique-
fied natural gas giant.
“It is a tremendous opportunity to
create value for BG shareholders and
our Shell holders,” he said. “It will accel-
erate and de-risk our strategy.”
In an even-tempered meeting, inves-
Shell who declined to back the deal,
said: “There are a lot better ways to
spend €50bn.” He added: “We are afraid
of Shell being the . . . new Kodak.”
One Dutch investor said: “In a world
with $30, the number that will roll out of
the model will look terrible . . . at $100
[oil price], this deal will look the steal of
the century.”
“When you are buying something and
Energy. Reactor investment
Y
Value of Royal production was $20 per barrel. ou have to admire Oliver Samwer’s chutzpah.
Dutch Shell’s Shell has previously said the BG take- The German tech entrepreneur, founder of
cash-and-shares over, which will lead to $30bn in asset Rocket Internet, knows he is in a tight corner.
offer for BG sales and 10,000 job losses, should But his latest announcement that Rocket has
“break even” with an oil price in the raised $420m for an investment fund to back
70% “mid-$60s”. its underlying businesses is a greater testament to his
However, at least one institutional audacity than to Rocket’s future.
Slide in the Brent
crude price since shareholder, Standard Life, had said The company, once touted as Europe’s Amazon, listed to
mid-2014, to $31 a before the vote that it would oppose the great fanfare in 2014. Since then, though, it has faced per-
barrel yesterday deal, calling it “value destructive”. sistent questions about whether the range of ecommerce,
online marketplace and financial services start-ups that it
invests in will ever make any money. Concerns over profit-
ability have been exacerbated by Rocket’s decision to pro-
vide detailed financial information only on a small group
of its “proven winners” rather than its entire portfolio.

Nexstar sees Investors’ anxieties have been further stoked by Rocket’s

off Meredith Areva move piles pressure on EDF frequent return to the market to raise capital.
Last September, after the share price had halved from its
post-float high, Mr Samwer set out to reassure investors
that all was well. Operating losses at the “proven winners”,

to secure deal
SHANNON BOND AND
RICHARD BLACKDEN — NEW YORK
The battle for Media General has ended
after the US television station owner
that began life in 1850 with a newspa-
per in Virginia agreed to be acquired by
Nexstar Broadcasting for $4.6bn.
Nexstar, which has been vying for
months with Meredith Corp to combine
with Media General, will secure its tar-
get after the publisher of Better Homes
and Gardens accepted $60m to walk
away from its own agreement with
Media General struck in September.
Under the terms of Nexstar’s deal,
Media General shareholders will pocket
$10.55 a share in cash and 0.1249 of Nex-
star stock in an acquisition that will cre-
ate the second-largest local TV operator
in the US.
Perry Sook, Nexstar chief executive,
insisted that the bid battle will be worth
it. “The acquisition of Media General’s
broadcasting and digital media assets
represents a transformational growth
opportunity for Nexstar and is strategi-
cally and financially compelling.”
The renamed Nexstar Media Group
will control 171 stations in 100 markets,
reaching about 39 per cent of US televi-
sion households.
Meredith agreed in September to be
acquired by Media General for $3.1bn
including debt. But Nexstar made its
own series of bids to Media General,
eventually reaching an agreement this
month that was dependent on Meredith
dropping its claim.
The outcome raises questions for
Meredith, which aimed to capitalise on
its stations by combining with Media
General. Unlike other media compa-
nies, Meredith has not separated its TV
business from its publishing arm.
The dissolution of its Media General
agreement means Meredith is left with
17 local stations that reach 11 per cent of
US homes at a time when competitors
are scaling up to hold their own in nego-
tiations with pay-television providers.
Meredith will have a chance to negoti-
ate for some of the Media General assets
that the company may need to divest to
complete the Nexstar deal.
That deal includes a contingent value
right entitling Media General share-
holders to cash proceeds from the sale of
Media General spectrum in an upcom-
ing federal auction.
The transaction is subject to approval
by shareholders and the Federal Com-
munications Commission.
It is expected to be completed by the
end of this year.
Shares in Media General rose 0.74 per
cent at midday in New York.
Nexstar shares fell nearly 2 per cent
while Meredith jumped 3.6 per cent.
Concern centres on plans
to build first nuclear power
plant in UK for a generation
MICHAEL STOTHARD — PARIS
JIM PICKARD — LONDON
EDF was on course yesterday to agree a
major investment in the troubled reac-
tor business of Areva, putting further
pressure on the French utility as it
scrambles to secure financing for a con-
tentious £18bn UK nuclear project.
The EDF board was expected to
approve taking a controlling stake in
Areva NP, valuing the reactor unit at
around €2.5bn, according to people
close to the group. The move — part of a
government-backed bailout of Areva —
would raise the financial burden on EDF
at a time when some analysts and trade
unions are worrying that the utility may
be biting off more than it can chew.
Concern rests primarily around EDF’s
plans to build the first nuclear power
plant in the UK for a generation at Hin-
kley Point, in the south-west of the
country — a project that presents a
major construction risk for the group.
The EDF board was due to hold back
on giving final approval for the Hinkley
project yesterday, with people close to
the company saying that it had not man-
aged to line up the financing. “This is
definitely not good news,” said one per-
son close to the UK government. “There
were expectations only a few weeks ago
that they would have signed by now.”
Another person familiar with the situ-
ation said: “The financing was not quite
in place, which is not good.” They
stressed the project should still be done.
Part of the reason for concern about
the Hinkley plans is that EDF’s other
projects involving similar nuclear tech-
nology — in Finland and northern
France — are delayed and over budget.
Other problems for EDF include a
drop in European power prices and its
shrinking domestic market share. The
group faces an estimated €55bn bill to
increase the life expectancy of the 58
French nuclear power plants from their
current 40 years to 50.
Even the Areva deal is unlikely to be
finalised quickly. While the EDF board
was expected to approve in principle the
company taking a majority stake in
Areva NP, a final agreement is thought
to be dependent on resolving the ques-
tion of which company would assume
liabilities at the troubled Olkiluoto 3
nuclear power plant in Finland. Shares
in EDF, in which the French government
Part of the has an 85 per cent stake, have fallen by
reason for 50 per cent over the past year, reducing
worries about its market capitalisation to €23bn. The
the Hinkley group has net debt of €37bn.
plans is that The CFE-CGC union, which has a seat
EDF’s other on EDF’s board, suggested this month
projects that the Hinkley project should be
involving delayed or even cancelled given “signifi-
similar nuclear cant” financial issues that could “put
technology — in EDF in danger”.
Finland and EDF is set to take a 66.5 per cent stake
France — are in Hinkley, with CGN, a Chinese com-
delayed and pany, holding the remainder.
over budget There was speculation yesterday that
Charlie Bibby
some on the board of EDF wanted its
stake in Hinkley to be no more than 30
per cent, although one person close to
the company said this was unlikely.
Jean-Bernard Levy, EDF’s chief exec-
utive, said last weekend in an interview
with Journal du Dimanche that the final
investment decision on Hinkley was
close, adding that the company may sell
part of its stake in the project once con-
struction is “well under way”.
Moody’s and Standard & Poor’s have
warned that the French group could
struggle to keep its existing credit rating
after taking the lead in the Hinkley
project unless it makes significant dis-
posals. Last week, EDF announced job
cuts as part of a plan to find €700m in
cost savings by 2018 compared to 2015.
he said, would peak this year; three would break even
within two years; and one would go public in the next 18
months. Meanwhile, he
pledged not to raise more
capital or dilute sharehold-
The question
ers further for the next three now is whether
years.
But the question now is
Mr Samwer is
whether Mr Samwer is living living up to his
up to his promises. He says
pension funds, foundations
promises
and asset managers have
contributed to the new investment fund, alongside Rocket
itself, but would not go into specifics. Peter Kimpel,
Rocket’s chief financial officer, says this is standard prac-
tice for funds of this type, but the coyness only adds to a
sense that Mr Samwer is following the letter rather than
the spirit of his September announcement.
True, the new fund will not directly dilute current
Rocket shareholders. But since Rocket has itself put $50m
into the fund, it constitutes a doubling-down on risk. Mr
Kimpel says that, rather than diluting shareholders, the
fund will simply allow existing third-party investment in
underlying Rocket businesses to be replaced by money
from the fund. As Rocket also has a stake in the fund, he
argues that shareholders will only be “diluting ourselves”
— while gaining another way to capture any upside. How-
ever, it must also mean, by implication, that they are more
exposed to any downside.
That is not the only reason for shareholders to fret.
They have also witnessed an unexplained exodus of sen-
ior staff from Rocket’s headquarters in Berlin. Andreas
Winiarski, the head of communications, who left in Octo-
ber, has not been replaced. Franziska Leonhardt, the head
of the group’s legal department, and Uwe Gleitz, the sec-
ond-in-command of corpo-
rate finance, have also left.
Rocket says none was part of
There is no sign
the “core team”, yet all were in the foreseeable
closely involved with the
company’s flotation.
future of
More worrying, perhaps, is investors getting
the fact that Mr Samwer,
although only four months
any money out
into the 18 months’ grace
period he gave himself, shows little sign of meeting his
commitment to bring a Rocket business to market. In
November, he postponed a planned IPO of HelloFresh, a
food-delivery group. Admittedly, the market for so-called
unicorn companies had cooled, but potential investors
seemed unconvinced by HelloFresh’s €2.6bn price tag.
Concerns over the way Rocket values its business extend
beyond HelloFresh. In December, Rocket said its proven
winners had increased their revenues by an average of 120
per cent in the first nine months of 2015. But Rocket’s own
valuation of its portfolio, at €6.06bn, has barely budged
since September. Any rise is due mainly to increased valu-
ations of FoodPanda, a takeaway service, and online
retailer Linio. But as analysts at Aviate point out, Linio has
an adjusted operating earnings margin of -84 per cent and
an order growth rate of -18 per cent. Rocket claims that
Linio is the “biggest online store in Latin America”, yet its
nine-month revenues of €52m are dwarfed by the $470m
of its well-established rival, MercadoLibre.
Using a new investment fund to pump more money into
Rocket’s companies may not just be audacious — but
another way of pumping up their value, too. Rocket’s mar-
ket capitalisation is €3bn, less than half the amount it says
that its companies are worth. “Money in” is no measure of
that. And there is absolutely no sign in the foreseeable
future of investors getting any money out.
sarah.gordon@ft.com

Media Telecoms

Sweden’s Spotify looks to raise $500m in debt Telecoms groups like Facebook data project
ROBERT COOKSON — LONDON
MATTHEW GARRAHAN — NEW YORK
Spotify is seeking to borrow $500m
from investors, just eight months after
the world’s biggest music streaming
service raised the same amount by sell-
ing equity at a valuation of $8.5bn.
The Swedish company has already
raised more than $1bn since it was
founded nine years ago, making it one of
the best-funded start-ups in Europe. But
it is facing increasingly heavy competi-
tion from rivals including Google, Ama-
zon and Apple, which entered the sub-
scription streaming market last year.
A person close to Spotify said that the
company planned to issue $500m of
convertible loan notes, a form of debt
that can be converted into equity at a
later date.
Swedish newspaper Svenska Dag-
bladet, which first reported the planned
funding round, said the loans would pay
an annual interest rate of 4 per cent. In
addition, they would convert into equity
at a 17.5 per cent discount to Spotify’s
share price if the company goes public
in the next year.
This financial structure would guar-
antee lenders hefty returns if Spotify
completes an initial public offering,
whatever the value of its equity. If Spot-
ify does not float within a year, the dis-
count at which the loan converts to
equity will increase by 2.5 percentage
points every six months.
Spotify’s decision to raise funds by
issuing debt rather than equity comes as
investors have become worried that the
valuations of many private technology
companies are unsustainably high.
Square went public last November at
a share price $6 lower than the level at
which investors had valued the pay-
ments group a year ago. Investors in
other internet companies including
Dropbox, the online storage business,
and social media site Snapchat have also
marked down the value of their stakes.
Spotify declined to comment.
DANIEL THOMAS — LONDON
Telecoms groups including AT&T,
Deutsche Telekom, EE, SK Telecom
and Verizon have agreed to back a
Facebook-led initiative that could chal-
lenge the role of traditional data centre
equipment providers.
The Open Compute Project (OCP) was
started by the social network in 2011 to
create servers and data centre hardware
using open source technology. Such
services are typically provided by tele-
coms equipment providers such as
China’s Huawei and Cisco of the US.
The group said yesterday it had
gained backing from some of the world’s
largest telecoms groups to create data
centre technologies for the industry.
One telecoms executive said this
could replace the sort of basic hardware
and software that dominates with
cheaper, more flexible alternatives.
He added that the agreement could
lead to further work between the tele-
coms groups and the Facebook-backed
initiative to bring down costs and
extend the reach of mobile services.
Andre Fuetsch, senior vice-president
of architecture and design at AT&T, said
that the US carrier was aiming to “virtu-
alise” 75 per cent of its network func-
tions by 2020, referring to the idea of
moving the management and content of
a network to a cloud-based platform.
This would make dealing with problems
and adding users quicker and easier.
Virtualised networks are an aspira-
tion for many telecoms groups and such
cloud services are based in data centres.
Jason Taylor, Facebook’s vice-presi-
dent of infrastructure, said the involve-
ment of the telecoms groups would
“enable better designs, easier adoption
and efficiency gains across the board”.
Mansoor Hanif, director of radio
access networks at EE said that the OCP
technology would change the way it
could “build and deploy mobile com-
munications networks in developed
markets like the UK”.
Thursday 28 January 2016 ★ FINANCIAL TIMES 17

COMPANIES

Apple tries to change how core business is seen

Slowing iPhone sales
see tech leader push
mantra that it is not a
hardware group, but
Wall Street investors
remain unconvinced
TIM BRADSHAW — SAN FRANCISCO
Apple does not like to be thought of as
“the iPhone company”.
Back in 2011, co-founder Steve Jobs
declared that “technology alone is not
enough — it’s technology married with
the liberal arts, married with the
humanities, that yields us the results
that make our heart sing”.
Tim Cook, Jobs’s successor as chief
executive, is less given to lyricism but
has often repeated the mantra that
“only Apple” can combine hardware,
software and services into a single cohe-
sive whole. “We haven’t been a hard-
ware company since I’ve been with
Apple,” he told a Goldman Sachs tech
conference last February. “I don’t think
Apple was ever a hardware company,
even at the beginning.”
Yet despite the efforts to persuade
them otherwise, investors tend to see,
and value, Apple as a hardware group.
And when growth in its most lucrative
piece of hardware is about to go into
reverse for the first time, they punish its
share price accordingly: Apple has lost
about a quarter of its value since it hit an
all-time high last February.
On Tuesday those fears were con-
firmed: iPhone sales grew by less than 1
per cent last quarter and Apple warned
that overall revenues were about to see
their first quarterly decline since 2003.
So the group is taking a new approach
to spreading its message that it is not
going to go the way of BlackBerry and
Nokia. Alongside Tuesday’s earnings,
Apple published new data to highlight
the scale and pace of its services unit, led
by the App Store. It also disclosed that
more than 1bn Apple devices were in
active use over the past 90 days, includ-
ing iPhones, Apple Watches and Macs.
“We have a huge number of devices
actively engaged with our services and
that number is growing very fast,” Luca
Maestri, Apple’s chief financial officer,
told the Financial Times.
He pointed to figures showing that
“install base related purchases”, a new
metric that includes customers’ spend-
ing on apps, music and movies before
Apple pays out a roughly 70 per cent
share of the revenue to their creators,
increased 23 per cent last year to
$31.2bn. This metric rose 24 per cent in
the December quarter, even as iPhone
sales plateaued.
“A high portion of services business is
directly related to our install base and
not to our shipments or current quarter
sales,” Mr Maestri said. “This part of our
business, which is very much recurring
in nature because it’s related to the
install base, is actually quite large; it’s
growing very fast and it’s also quite prof-
itable.”
The timing of the disclosure, along-
side the warning of the iPhone’s decline,
was not lost on observers.
“They are trying to change the narra-
tive,” said Ben Bajarin, analyst at Crea-
tive Strategies. “They are trying to tell
the story that they are not just a hard-
ware company. But Wall Street will only
believe that when they show them the
money.”
Changing the perception that Apple is
Device squad
iPhone: Apple’s growth driver
Sales ($bn)
iPhone
Macintosh
iPad
iPhone (1st gen)
2006 07
Apple iPhone
iPhone (units, m)
80
60
40
20
0 0
08 09 10 11 12 13
Sources: Bloomberg; companies
dependent on the iPhone may take
some time. Even with services growing
much more rapidly than hardware
sales, the iPhone still made up 68 per
cent of Apple’s total revenues in its latest
quarter — less than 1 percentage point
below the same period a year earlier.
Apple’s $5.5bn in services revenues
last quarter made up only 7 per cent of
total sales.
Revenue from apps, iCloud and other
services may be small by the standards
‘They are trying to change
the narrative [and] tell
the story that they are not
just a hardware company’
of what is still the world’s biggest com-
pany by market capitalisation. But that
single quarter for Apple services was
larger than Yahoo’s sales are expected to
be for the whole of last year, and on par
with what Facebook is likely to report
for its fourth quarter.
“If you look at other internet services
companies, they enjoy a different multi-
ple” to Apple, Mr Maestri said, a much
higher valuation for each dollar of
profit.
Investors tend to prefer businesses
iPhone 4
iPhone 3GS
08 09 10
Apple Services’ revenues
% of revenues Revenue ($bn)
80 6 100
5
60
4 Japan $4bn
40 3 So severe was the impact of foreign
2 China
20
1 500 company”, Mr Cook pointed out.
0 0
14 15 16 2007 08 09 10
Q1 2016 excludes $548m received from a patent win
that sell software or services to hard-
ware vendors because they are less
prone to the wild fluctuations in growth
that Apple has seen in recent years.
“The key thing Apple is trying to get
across here is that analysts have it wrong
when they say that Apple’s revenue is
inherently unpredictable,” said Jan
Dawson, analyst at Jackdaw Research.
But a direct comparison between the
likes of Facebook and Alphabet,
Google’s parent, is still not possible
based on the figures Apple released on
Tuesday. For one thing, the company’s
internet business is based mainly on
consumer purchases, whereas its Silicon
Valley neighbours rely on free, advertis-
ing-funded services.
Unlike Google and Facebook’s stand-
ard measure of monthly unique users,
Apple’s billion-device figure inflates the
number of individuals who buy those
apps by counting one person who owns
an iPhone, an iPad and an Apple Watch
as three constituents of its “active install
base”. Mr Bajarin estimated that the
actual number of unique Apple custom-
ers is closer to 600m. “The number we
would need to know is the absolute
unique user base — is that growing?
What is the annual revenue per user and
is that going up?” he said.
While the App Store is by far the big-
gest driver of its services revenue line,
Apple is also including an indetermi-
nate amount of sales from decidedly
offline items such as replacement
screens or accessories that bear its Made
for iPhone branding, which it licenses to
third parties in return for royalties.
iPhone 6S/6S Plus
“The numbers are impressive, but we
don’t have enough history,” said Amit
50 Daryanani, analyst at RBC Capital Mar-
kets, suggesting that last year might
have been unusually strong for services
owing to the leap in iPhone 6 purchases.
iPhone 6 “The reality is the services recurring
40
revenue stream only works if your
iPhone 5S/5C install base is alive and well.”
If Apple intended its focus on its huge
iPhone 5 install base and the rapid growth of its
30 services business to distract from slow-
ing iPhone sales, the gambit may have
backfired.
The sudden transparency prompted
iPhone 4S some to wonder about what Apple’s
20
other motives might be. “The feedback
from clients is, ‘Is the services revenue
disclosure being done ahead of iPhone
being ex-growth over the next several
10 quarters?’” Mr Daryanani said.
Investors were more interested in Mr
Cook’s sudden change in tone on the
impact of the “turbulent” macroeco-
0 nomic environment on Apple’s business
around the world. After its earnings call
11 12 13 14 15 ended on Tuesday night, Apple’s shares
fell 2.5 per cent.
“We are seeing extreme conditions,
unlike anything we’ve seen before, just
Apple sales by region about everywhere we look,” Mr Cook
Annual % change Revenue
warned, despite dismissing looming
worries about the global economy just
three months ago. “Major markets
including Brazil, Russia, Japan, Canada,
Rest of Asia-Pacific $5bn
80 Southeast Asia, Australia, Turkey and
the eurozone have been impacted with
Americas slowing economic growth, falling com-
60 modity prices and weaker currencies.”
exchange rates that on a constant cur-
40 Greater $29bn rency basis, sales in the quarter would
$18bn have been $5bn higher — or “about the
size of the annual revenue of a Fortune
20
But he could have used a different
$18bn comparator: fluctuating exchange rates
11 12 13 14 15 16 Europe had roughly the same impact on Apple’s
business as its entire services unit.
See Lex
See Comment
Global Appointments

Technology

Uber fined over French minicab law

ADAM THOMSON — PARIS
A Paris court has ordered ride-hailing
service Uber to pay €1.2m to a French
taxi union for failing to enforce an
aspect of a 2014 law governing minicab
services.
The payment to the National Union of
Taxis came after complaints that driv-
ers using the app were not returning to
their bases between rides, a require-
ment of the law.
Uber said yesterday that it had been
ordered to pay the fine, relating to a
period between December 2014 and
February 2015. However, it said it would
appeal against the decision, which is
linked to a wider case brought against
the company and its French operations.
Uber said: “This dates back to 2014
and the practical way in which we used
to talk about how driver-partners use
our service — it is not about the Uber
app or the way it works.”
The company added: “The merits
of the case on which today’s decision
was based are already under appeal.
Clearly, we will appeal this particular
outcome, too.”
Last year, Thibaud Simphal, who
heads Uber’s operations in France, and
Pierre-Dimitri Gore-Coty, head of Uber
in Western Europe, were detained by
police and subsequently charged with
“misleading commercial practices” and
“complicity in the illegal exercise of the
taxi profession”.
They are scheduled to face trial in
February.
The fine comes as traditional taxi
drivers in France have taken to the
streets to protest against what they
insist is unfair competition from the
likes of Uber and other ride-hailing
apps, such as Paris-based Heetch.
Uber said it would appeal against
the court’s order to pay €1.2m
On Tuesday, hundreds of irate drivers
blocked traffic at a big entry point into
Paris, burning car tyres and hurling
smoke bombs. They also disrupted traf-
fic at the city’s two main airports,
prompting airlines to cancel some of
their flights.
Striking taxi drivers continued their
action yesterday, though in fewer num-
bers and with less disruption.
Uber suspended its controversial
UberPop service last year after France’s
highest court upheld a law that banned
the service. The decision to stop the
service, which allowed private-car own-
ers without any formal training to offer
rides, came amid widespread, violent
protests by taxi drivers as well as gov-
ernment pressure.
But the company has continued to
develop other services in France,
including a recent push to promote its
UberPool ride-sharing scheme. Uber
said that 12,000 drivers used its app in
the country, with about 10,000 of them
working in and around the capital.
This week, the company plans to hold
several “open doors” events in Paris that
will serve in part as a recruitment drive.
18 ★ FINANCIAL TIMES Thursday 28 January 2016

COMPANIES

Automobiles Healthcare

Fiat Chrysler defies doubters over targets J&J investors

Group lifts goals despite
scepticism that lower
aims could be achieved
ANDY SHARMAN — LONDON
Fiat Chrysler Automobiles shot back at
sceptical analysts and investors yester-
day by raising its financial targets for
2018, which had already been widely
derided as fantasy.
In a bullish presentation that quoted
Mark Twain — who said “reports of my
death have been greatly exaggerated” —
the Italian-American company revised
upward most goals in its medium-term
performance plan, including revenue,
earnings and net cash.
This was in spite of the economic
slowdowns in China and Brazil — Fiat
Chrysler is the market leader in the
Latin American country — and the spin-
off of the Ferrari brand, which
accounted for almost 10 per cent of the
group’s earnings before interest and tax
in 2015.
“We have been able to accomplish a
lot in less than two years,” said Sergio
Marchionne, chief executive, referring
back to May 2014 when Fiat Chrysler
presented its medium-term plan
through to 2018. “At the end of this proc-
ess we’ll be in a much better position
than we’re in today.”
The plan has seemingly become Mr
Marchionne’s last big project at the car-
maker, which he has run since 2004.
Efforts to bring about another big
merger or acquisition, following the
tie-up between Fiat and Chrysler, have
failed to make progress — notably with
General Motors, which has rebuffed
overtures.
Aerospace & defence. Trading turbulence
Fiat Chrysler now aims to generate
annual revenue of €136bn in 2018, ver-
sus a previous €132bn target and almost
a fifth more than the €113bn it reported
for 2015. Adjusted net income should
exceed €4.7bn in three years’ time,
more than double the €2bn recorded
last year.
The company is also seeking to swing
to a €5bn net cash position by 2018,
from net debt of €5bn at the end of
December. It had previously expected
net cash of about €2bn.
“There are clearly huge issues for any
investor over the credibility of these
estimates — especially in a year when
[Fiat Chrysler] has vocally stated its
desire to engage in industry M&A and
consolidation talks,” said analysts at
Exane BNP Paribas.
Several analysts have previously
expressed doubts that the targets in Fiat
Fiat Chrysler plans to double 2015’s
net income in three years’ time
Chrysler’s original 2018 plan could be
achieved. Targets for 2016 were seen as
conservative, with Fiat Chrysler aiming
for revenue of more than €110m and net
income exceeding €1.9bn.
Fiat Chrysler said it had met its tar-
gets for 2015, partly due to the perform-
ance of the Jeep brand, and this gave it
the confidence to revise the 2018 goals.
However, it no longer planned to focus
on the proposal to achieve 7m sales in
2018 — as this “fundamentally doesn’t
matter”, said Mr Marchionne.
During 2015, Fiat Chrysler sold 4.6m
vehicles. Earnings before interest and
tax increased to €5.3bn including Fer-
rari, topping analysts’ forecasts of
€4.6bn, and up from €3.8bn in 2014.
In Europe, Fiat swung to a profit
before interest and tax of €213m in 2015
from a €41m loss in 2014 — its first year
in the black in the region since 2007.
rally activists
to buy stakes
and push
for change
DAVID CROW AND STEPHEN FOLEY
NEW YORK
Two frustrated shareholders in John-
son & Johnson are pressing activist
investors to take a stake in the world’s
largest healthcare company and push
for a radical shake-up, after what they
describe as years of poor performance.
Artisan Partners, an investment man-
ager with a $480m holding in the group,
has sounded out several activist inves-
tors about buying into J&J and agitating
for the company to break itself up.
One prominent activist group, which
asked not to be named, said it had been
encouraged to “run the numbers” on J&J
by a separate disgruntled shareholder
with a similar point of view.
Despite the entreaties, several activ-

Boeing buffeted by bleak profit predictions
Aircraft maker’s shares dip on
news of fewer orders even as
others in sector remain upbeat
ROBERT WRIGHT — NEW YORK
Shares in Boeing fell sharply yesterday
amid concerns over the health of the
civil aerospace market after the US
manufacturer predicted that it would
deliver fewer passenger jets this year
than in 2015.
The shares were at one point 10 per
cent down in New York after the com-
pany said it would deliver between 740
and 745 jets this year, against 762 in
2015. However, they recovered slightly
after the company said it expected man-
ufacturing of its 787 Dreamliner to turn
profitable this year. They were 8.1 per
cent down in mid-morning, at $117.64.
Announcing fourth-quarter results
for 2015, Boeing also said that it
expected core earnings per share, which
exclude certain pension expenses, of
$8.15-$8.35 this year, short of analysts’
expectations.
However, other US aerospace compa-
nies were far more upbeat yesterday.
Fourth-quarter net income at General
The company said it
expected manufacturing
of its 787 Dreamliner to
turn profitable this year
Dynamics, the military contractor and
builder of Gulfstream business jets, rose
9 per cent to $764m in spite of revenue
down 6.6 per cent at $7.81bn. Its profits
beat analysts’ expectations and the
share price was up 3 per cent to $131.34.
United Technologies announced
fourth-quarter net income of $3.53bn,
up sharply year on year from $1.47bn in
2014.
It reported a $6.11bn gain on the sale
of Sikorsky helicopters but was then hit
by an exceptional $2.54bn income tax
bill for the transaction.
Its shares were up close to 2 per cent to
$87.20
Boeing’s guidance on passenger-jet
Boeing was deliveries came less than a week after
buoyed by the company announced that it would
quarterly costs cut production of its 747 jumbo jet, once
for its 787 jet, its flagship aircraft, to just six per year
which exceeded because of lacklustre air-cargo demand.
revenue by Richard Aboulafia, an analyst at the
$5.9m per Virginia-based Teal Group, said that
aircraft, down some of Boeing’s issues were short term,
from $15.9m —
Brent Lewin/Bloomberg
such as the switchover to new jet mod-
els, they also included “seriously worry-
ing big picture concerns”.
Those included cheap fuel, which is
reducing demand for new jets, and weak
economic growth.
Boeing’s fourth-quarter results
exceeded expectations, recording net
income of $1.03bn for the last three
months of 2015, down 30 per cent from
the same period in 2014. Revenue fell 4
per cent to $23.6bn.
At the core commercial-aircraft divi-
sion, a pre-tax charge of $885m for the
cut in 747 production helped to push
operating earnings down 64 per cent to
$566m in the fourth quarter.
Revenue fell 4 per cent to $16.1bn, as
changes made in response to customer
demands meant that the number of jets
delivered to airlines and leasing compa-
nies fell 7 per cent to 182.
There was encouraging news, how-
ever, about costs for the 787.
The company revealed on a confer-
ence call that costs per aircraft built in
ists said they had so far declined to take
a stake in J&J, arguing that the com-
pany’s $280bn market capitalisation
made it too large for them to build a
meaningful position.
No single investor owns more than 6
per cent of J&J shares, and its roster is
dominated by passive funds, which
would also make it difficult to build sup-
port for far-reaching change, these
activists said.
However, J&J’s $18bn of net cash could
make it attractive for activists seeking
to boost shareholder returns through
stock buybacks, one investor said.
An investor could agitate for a
shake-up at J&J without amassing a sig-
nificant stake, this person said, citing
the examples of Carl Icahn and Value-
Act. Mr Icahn convinced Apple to
return more cash to shareholders after
initially taking a stake of less than 0.4
per cent, while ValueAct secured a
board seat at Microsoft after building a
position of 0.8 per cent.
J&J is the last of the large healthcare
groups to maintain a conglomerate
structure that spans pharmaceuticals,
medical devices and a consumer prod-
ucts arm, which makes products includ-
ing baby shampoos and cold remedies.
It has eschewed the trend to slim
down into a more focused group, as
Pfizer did when it sold its consumer
products division to J&J for $17bn in
2006, and as Abbott Laboratories did
when it spun its pharmaceuticals divi-
sion off into a new company, AbbVie, in
2014.
However, Daniel O’Keefe, a portfolio
manager at Artisan Investors, told the
Financial Times that the company
should split itself into three separate
groups, which he said could boost its
enterprise value by almost $90bn.
Mr O’Keefe said he made the argu-
ment in a presentation last year, which
$1.03bn the quarter had exceeded revenue by an he sent to J&J’s board of directors and
Boeing’s fourth-
average $5.9m per aircraft, down from executives, as well as to several promi-
quarter profits $15.6m in the third quarter. nent activist investors. He is planning to
which were better The company said that it expected send an open letter to the board in the
than expectations revenue to surpass costs on individual next day or so.
and down 30% on aircraft this year. “I would love to see a long-term ori-
last time
Operating earnings at Boeing’s ented, sensible activist get involved
defence, space and security division with the company and help make the
6 rose 5 per cent to $963m in the fourth argument to repair the damage done to
The number of 747 quarter. Revenue increased 3 per cent to the company and its investors,” Mr
jets, once Boeing’s $7.8bn. O’Keefe said.
flagship aircraft, The Seattle Times reported on Tues- J&J declined to comment.
that the group is to day that Boeing was planning to cut pro- Glenn Novarro, an analyst at RBC,
produce per year duction of its 777 wide-body jet but the said it would be “an absolute surprise” if
from now on
company made no mention of such Alex Gorsky, chief executive, were to
plans in yesterday’s results statement. split up such a renowned company after
See Lex less than four years in the job.

Automobiles

Toyota retains top-selling spot and explores link-ups

KANA INAGAKI — TOKYO
Toyota is exploring business partner-
ships to strengthen its position in
emerging markets, even as the Japa-
nese group extended its reign as the
world’s top-selling carmaker for a
fourth year.
The company said yesterday that its
group, which includes subsidiaries
Daihatsu and Hino, sold 10.15m cars
and trucks in 2015. That put it ahead of
Germany’s Volkswagen, which sold
9.9m vehicles as it was engulfed by an
emissions scandal last year, and General
Motors, which sold 9.8m.
Still, a slowdown in emerging markets
such as Indonesia and Thailand has
already prompted Toyota to warn that
sales will probably be flat this year.
In a move that analysts say could be
aimed at tackling that challenge, Toyota
said yesterday that it was considering
taking full control of Daihatsu, a maker
of small cars with strength in Japan,
Malaysia and Indonesia.
The news sent shares in Daihatsu,
which is owned 51 per cent by Toyota,
racing ahead by 16 per cent in Tokyo
trading. Separately, a person familiar
with the matter said Toyota was consid-
ering a partnership with Suzuki Motor,
which also specialises in small cars and
has a strong foothold in India, as one of
various options it was exploring.
Shares in Suzuki surged 11 per cent
while Toyota jumped 3.8 per cent after
the Nikkei business daily reported that
the two carmakers were in talks to co-
operate in safety and energy-saving
technologies, and in the Indian market.
In separate statements, both compa-
Toyota says a slowdown in emerging
markets will mean flat sales this year
nies denied they were discussing a address rising environmental problems
partnership. in India.
Joint projects and partnerships Suzuki and Daihatsu could also co-
between car rivals have become increas- operate loosely by using common parts
ingly common worldwide amid rising and cutting costs as they seek opportu-
costs to develop new technologies and nities outside their shrinking home
tighter regulations to reduce carbon market for compact cars, says Mr Endo.
dioxide emissions. Analysts have predicted Suzuki could
Honda and GM work together in fuel- link up with either GM or Toyota, after it
cell technology, while Daimler and the spent Y460bn ($3.9bn) last year to buy
Renault-Nissan alliance have a similar back a 19.99 per cent stake from VW,
partnership. Toyota also has tie-ups which came after a court ended a long-
with Mazda and Subaru maker Fuji running spat between the two groups.
Heavy Industries.
Toyota has long struggled in India,
where sales of its Etios compact saloon
have fallen since its 2010 launch. Suzuki Legal Notices
controls nearly half the market in India
via its Maruti Suzuki affiliate.
Koji Endo, an analyst at Advanced
Research Japan, questioned whether
Maruti Suzuki would allow Toyota to
use its sales network to expand in India
even if a tie-up were agreed. “There is no
incentive for Maruti to help Toyota,” Mr
Endo said.
Another possibility would be for
Suzuki to tap into Toyota’s expertise in
hybrid technology and cost controls, to
Thursday 28 January 2016 ★ FINANCIAL TIMES 19
20 ★ FINANCIAL TIMES Thursday 28 January 2016

COMPANIES

Banks Media

Botín looks to tackle Santander’s US woes China’s censor

forces video
Executive chairman asks do. But it would not be in shareholders’
interests to sell it now.”
The Spanish bank also owns a control-
ling stake in Santander Consumer USA,
cover claims for mis-sold payment pro-
tection insurance in the UK.
set of numbers”. Bad debts rose in Brazil
from 5 per cent to 6 per cent of its loan
hosting sites
investors for two years to
fix unit as profits tumble
The US operation, representing about
8 per cent of Santander’s overall profits
a separately listed car-loans provider,
which suffered a 15 per cent drop in its
The results were a mixed bag. Reve-
nue growth beat most analysts’ fore-
book in the country last year, but Ms
Botín said this still beat its main local
to pull plug
MARTIN ARNOLD — LONDON
and 10 per cent of its loans, yesterday
reported a 90 per cent drop in fourth-
quarter earnings. Rising regulatory
share price after reporting a sharp fall in
quarterly profits.
Santander’s US operation has failed
casts, rising 6.2 per cent in spite of low
interest rates. But operating costs rose
even faster to reflect higher regulatory
rivals. “When times are tough, we tend
to outperform as margins increase,” she
said.
on hit shows
Ana Botín has set a deadline to turn requirements meant costs outweighed the Federal Reserve’s stress test for the requirements, gaining 7.6 per cent. She added that Santander did not
round Banco Santander’s struggling US revenue growth, and full-year profits in past two years and is expected to flunk it The bank, with 193,863 staff, is the need to raise fresh funds even though it CHARLES CLOVER — BEIJING
business as the Spanish lender’s execu- the US business fell more than a fifth to again this year. That imposes severe largest in the eurozone by market capi- had one of the lowest capital ratios
Efforts by China’s online video plat-
tive chairman seeks to address the €678m. restrictions on dividend payments and talisation. But its shares have fallen among big European banks.
forms to make and show their own con-
issues that made the unit its weakest Santander has been struggling to makes a short-term disposal almost more than a third in the past year, Its core measure of capital — the
tent are in disarray after the govern-
performer last year. improve the performance of its US oper- impossible. mostly due to concern over its large Bra- so-called common equity tier one ratio
ment banned a number of productions
“I have asked investors for two years ation since its 2009 acquisition of Sover- Overall, Spain’s largest bank reported zilian operation. They fell 1 per cent yes- — rose 0.4 percentage points to slightly
for excessive violence, sex, subversion
to fix the US bank,” Ms Botín told the eign, a midsized retail lender based in a 2.6 per cent rise in annual net profits to terday. above 10 per cent. The bank aims to
and superstition.
Financial Times. “In two years it will be Philadelphia that was hit by a wave of €5.97bn, missing analyst expectations But Ms Botín said the bank had out- lift its capital ratio above 11 per cent by
much better, and we can decide what to mortgage defaults in the financial crisis. after it put aside an extra £450m to performed rivals in Brazil with “a strong 2018. Industry figures yesterday privately
confirmed the crackdown, described by
one executive as an “ambush” last week
at meetings between representatives
Technology. Innovation from the sites and the State Administra-
tion for Radio, Film and Television

Entrepreneurs rush to join mobile payments race

(Sarft), the broadcast regulator.
Sarft made no public comment on
what was discussed, nor did any of those
attending. But at least six hit shows
across several websites appear to have
been pulled. These include the runaway
hit Go Princess, Go! produced by Chinese
Africa’s old infrastructure video portal LeEco, which changed its
deficit is bolstering a new name two weeks ago from Letv.
All 37 episodes of the series — about a
generation of tech ventures man who travels back in time 1,000
years and wakes up as an imperial con-
cubine, “with the body of a woman, and
JOHN AGLIONBY — NAIROBI
ANDREW ENGLAND — CAPE TOWN the desires of a man” — have been
removed from LeEco’s site.
The race to develop mobile payment LeEco said last week that the show
systems across Africa is spawning a new had been taken down for “content opti-
generation of tech entrepreneurs, misation” and would be back up soon.
searching for innovative ways to reach No other video portals commented on
their customers. the reasons why their shows had been
From finance and farming to educa- shut down in what appears to have been
tion and healthcare, dozens of apps are
being created to help overcome the con-
tinent’s infrastructure deficits and help
‘Sarft does not have the
meet the aspirations of an increasingly resources to censor the
tech-savvy urbanising population.
“The conventional thing to say about
hundreds of online series
Africa is it’s cursed by a lack of infra- created each year’
structure,” says Jesse Moore, the chief
executive of M-Kopa, a four-year-old
Nairobi-based company that uses a sweeping decision. In addition to Go
mobile phone technology to lease off- Princess, Go! Sarft targeted Lost Tomb, a
grid, solar powered lighting and show produced by iQiyi, a video portal
power systems in Kenya, Uganda and owned by search engine Baidu, about
Tanzania. Raiders of the Lost Ark-style treasure
On the contrary, Mr Moore argues, the hunters. It was banned for sowing “feu-
continent’s old infrastructure deficit is dal superstitions”, according to two peo-
ple familiar with the matter.
Crime drama Evil Minds, another pri-
‘In terms of listings on the vately produced show broadcast by
Nairobi stock exchange iQiyi, reportedly got into trouble for
showing policemen swearing and vio-
we’re not there yet, but lently interrogating a suspect, according
companies are coming up’ to one of the show’s producers, quoted
in a Chinese online news article that has
Nairobi residents transfer money using Safaricom’s m-pesa system, which is used by 22m Kenyans and handles transactions of $150m a month — Trevor Snapp/Bloomberg since been deleted.
Feng Jun, an analyst at consultancy
spurring innovation, pointing to ENT Group, said regulators singled out
m-pesa, the mobile money transfer sys- business, it still only represents 20 per was that there is an enormous amount larger and be able to absorb a lot more neyApps’ co-founders, says the the most popular series to send a signal
tem pioneered by Kenya’s main tele- cent of the group’s total sales. The plat- of businesses — about 400,000 of them capital. Then we’ll see real growth.” demands in the world’s most developed to the industry. “Sarft does not have the
coms company, Safaricom, which is 40 form earned Safaricom Ks19.4bn in South Africa — who are trading today One of the best-known incubators is economy are not always so different resources to censor the literally hun-
per cent owned by Vodafone of the UK. ($190m) in the six months to Septem- but who don’t have access to the formal iHub in Nairobi, which has spawned 150 from those in Africa. dreds of online series created each year.
M-pesa is now used by 22m Kenyans ber 2015. payment infrastructure.” says Kobus companies, including Weza Tele, a “The kinds of attributes that we had Instead, the ones that get censored are
— or more than 70 per cent of the adult But it has inspired dozens of copycats Ehlers, one of SnapScan’s founders. financial services tech company that to build into the product, like the fact ones that gain immense popularity and
population. Safaricom is now backing such as South Africa’s SnapScan, a “So we tried to ask, well, how can we was sold to South Africa’s AFB last year that it works offline, that it’s very simple get the attention of the authorities.”
Sendy, a Nairobi-based package deliv- mobile payments system backed by use technology to address that? Because for $1.7m. to use . . . it turns out that’s actually User-generated content has become a
ery start-up offering a marketplace for Standard Bank. that’s incredibly local, it’s a real problem “There’s more to be done but Rome very useful for the US market as well central theme for China’s online video
last-mile package delivery and logistics “The problem that we tried to tackle — we’ve quantified the size of it — and was not built in a day,” says Juliana Rot- because now we’ve learnt things not in sites including Youku Tudou — recently
services, allowing customers to send now it’s a case of can we do something to ich, one of iHub’s founders. “Yes, in this theoretical bubble but in this practi- acquired for $4.3bn by Alibaba — and
packages and documents in the Nairobi address that.” terms of listings on the Nairobi stock cal real-world challenge of operating in iQiyi, as censorship has put strict limits
area using a mobile application that Joe Mucheru, who resigned in Decem- exchange we’re not there yet, but there Africa,” he says. “And we can go and take on the purchase of broadcast rights to
SMART
AFRICA
A
connects them to motorcycle riders and ber as head of Google Kenya to become are a lot of companies coming up.” that valuable thing that we’ve built and foreign shows, and a bidding war for
drivers of vans and pickup trucks. the country’s technology minister, says The level of ambition among African use it in the US as well.” domestic content has prompted a
Much of this innovation has arisen that despite myriad problems — from tech companies is demonstrated by the But with intra-African trade account- search for cheaper alternatives.
from commercial necessity. Across opaque regulatory systems to the short- fact that some are extending their hori- ing for only 12 per cent of trade on the But the government has grown
Africa telecoms companies have been age of skills — the success stories are zons beyond the continent. Jour- continent, those involved in the tech increasingly uncomfortable with the
forced to look for ways to boost reve- likely to continue. neyApps, a South African company that sector are optimistic about the future. profusion and soaring popularity of
nues and retain subscribers as competi- “Today we’ve got tens of incubators; started in 2009 by designing apps to “A lot of the solutions that are made in online video content, as the prospect of
tion from rivals has driven airtime there’s a lot of start-ups in place that are support local community health work- one country can be customised and pro- fame and easy money has unleashed an
More on ft.com
prices down. For the full FT series on Smart
coming up with very innovative prod- ers, last year opened an office in the US vided to another country,” says Ms Rot- army of amateur Chinese videogra-
Monthly m-pesa transactions now Africa, go to ucts,” he said. “But they’re at their in a bid to transfer African technology to ich. “So I still think there’s a lot of possi- phers trying to outdo each other in
total about $150m. While this accounts infancy. When they get to the seven, the American market. bility . . . all over Africa if we can be a audacity and the breaking of taboos.
ft.com/africa
for a growing proportion of Safaricom’s eight-year space they hopefully will be Conrad Hofmeyr, one of Jour- bit more open.” Additional reporting by Ma Fangjing

Contracts & Tenders

Insurance

Greco move lifts hopes for Zurich turnround

RALPH ATKINS AND OLIVER RALPH
LONDON
The move by Zurich Insurance to
poach the chief executive of Italian
rival Generali has boosted hopes of a
turnround at the Swiss insurer after
setbacks over the past six months.
The appointment of Mario Greco from
May 1 was a significant coup, analysts
said yesterday, which offered the pros-
pect of an improvement in earnings and
tougher leadership in an increasing tur-
bulent insurance sector. “We are some-
what surprised that Generali let Mario
Greco go that easily,” said Stefan Schür-
mann, analyst at Vontobel in Zurich.
The move was “good news” for Zurich
Businesses For Sale as Mr Greco knows the group well — he
spent five years at the Swiss company
before 2012, as head of the international
Business for Sale, Business Opportunities, Business Services, business. His immediate tasks would be
to accelerate a restructuring pro-
Business Wanted, Franchises
Runs Daily gramme, improve underwriting skills
.....................................................................................................................................................................................................................................................................................................................................................................................................................
Classified Business Advertising
and expand Zurich’s “global footprint”,
UK: +44 20 7873 4000 | Email: acs.emea@ft.com Mr Schürmann said.
Andy Hughes, insurance analyst at
Macquarie Securities, added that Mr
Greco was joining Zurich after a sharp
fall in its share price and when investor
perceptions of Zurich are very low.
“He perhaps sees something in Zurich
that many investors do not,” Mr Hughes
said.
Zurich’s shares have fallen almost 27
per cent over the past year, but in early
European trading yesterday rose almost
1 per cent to SFr223.80.
By contrast, shares in Generali were
down 2.26 per cent at €13.83 in morning
trading in Milan as Mr Greco’s departure
leaves the Italian insurer looking for a
replacement to continue the turnround
at the group.
Zurich has been under pressure since
‘The attraction for any
CEO to joining Zurich
must be the opportunity
to improve . . . earnings’
September, when it pulled out of the
proposed £5.6bn acquisition of UK
insurer RSA, citing problems in its own
general insurance business.
It was hit by the explosions at the port
of Tianjin in China and in December
Martin Senn stepped down as chief
executive.
Then last week Zurich warned on
profits, blaming $275m of losses from
the UK winter floods, and credit and
property losses elsewhere in the busi-
ness for the shortfall. Analysts at Jeffer-
ies responded to the warning by cutting
their 2016 dividend forecast for the
company.
The underperformance had led to
investor fears of a dividend cut — but
analysts said Mr Greco’s appointment
had reduced the danger.
Barclays analysts wrote in a note:
“The attraction for any CEO to joining
Zurich must be the opportunity to
improve the earnings profile. Greco is
the best placed executive to take an
informed view of this potential and so
we see this as a very positive sign.”
Thursday 28 January 2016 ★ FINANCIAL TIMES 21
22 FINANCIAL TIMES Thursday 28 January 2016

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 $

-0.32% -0.488%
0.42% 0.20% 1.33% 0.36% 2.72% 1.02% 0.73% 0.184% 0.262% 0.793% 0.52% 0.24%
Stock Market movements over last 30 days, with the FTSE All-World in the same currency as a comparison
AMERICAS EUROPE ASIA
Dec 28 - Jan 27 Index All World Dec 28 - Jan 27 Index All World Dec 28 - Jan 27 Index All World Dec 28 - Jan 27 Index All World Dec 28 - Jan 27 Index All World Dec 28 - Jan 27 Index All World

S&P 500 New York S&P/TSX COMP Toronto FTSE 100 London Xetra Dax Frankfurt Nikkei 225 Tokyo Kospi Seoul
2,060.99 13,309.80 6,254.64 10,727.64 18,789.69 1,966.31
5,990.37 1,897.87
1,911.69 12,476.63 9,880.82 17,163.92

Day 0.42% Month -7.28% Year -7.10% Day 1.18% Month -6.18% Year -15.82% Day 1.33% Month -4.61% Year -12.41% Day 0.59% Month 5.21% Year NaN% Day 2.72% Month -8.55% Year -1.74% Day 1.40% Month -4.66% Year -1.95%

Nasdaq Composite New York IPC Mexico City FTSE Eurofirst 300 Europe Ibex 35 Madrid Hang Seng Hong Kong FTSE Straits Times Singapore
5,048.49 43,391.78 42,359.79 9,670.40
1,432.22 21,919.62 2,875.32
4,553.12 1,340.76 8,741.00
19,052.45 2,546.18
Day -0.32% Month -9.88% Year -4.65% Day 1.02% Month -2.67% Year -0.62% Day 0.36% Month -7.16% Year -9.42% Day 0.56% Month -9.73% Year -18.28% Day 1.02% Month -13.94% Year -23.51% Day 0.02% Month -11.52% Year 11.76%

Dow Jones Industrial New York Bovespa São Paulo CAC 40 Paris FTSE MIB Milan Shanghai Composite Shanghai BSE Sensex Mumbai
17,552.17 43,653.97 4,701.36 21,456.36
3,533.78 26,034.13
4,380.36 24,492.39
16,199.80 18,848.03
38,605.30 2,735.56
Day 0.20% Month -7.73% Year -8.39% Day 2.95% Month -12.28% Year -20.54% Day 0.54% Month -6.06% Year -6.31% Day -0.40% Month -12.16% Year -8.71% Day -0.52% Month -24.60% Year -19.14% Day 0.03% Month -5.21% Year -16.35%

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 10847.29 10493.32 CyprusCSE M&P Gen 66.81 66.74 Italy FTSE Italia All-Share 20511.50 20580.19 Philippines Manila Comp 6507.22 6311.60 Taiwan Weighted Pr 7849.83 7828.67 Cross-Border DJ Global Titans ($) 219.74 219.17
Australia All Ordinaries 5000.80 5057.10 Czech Republic
PX 902.56 892.81 FTSE Italia Mid Cap 31519.29 31485.11 Poland Wig 43033.06 42924.60 Thailand Bangkok SET 1278.29 1268.07 Euro Stoxx 50 (Eur) 3036.32 3032.84
S&P/ASX 200 4946.40 5006.60 OMXC Copenahgen 20
Denmark 968.75 962.46 FTSE MIB 18848.03 18923.83 Portugal PSI 20 4979.69 4923.10 Turkey BIST 100 71808.91 70539.01 Euronext 100 ID 863.73 858.94
S&P/ASX 200 Res 2133.50 2167.70 Egypt EGX 30 5896.56 5893.54 Japan 2nd Section 4400.11 4346.01 PSI General 2391.84 2363.86 UAE Abu Dhabi General Index 3827.82 3800.02 FTSE 4Good Global ($) 5033.39 5014.25
Austria ATX 2137.96 2158.36 Estonia
OMX Tallinn 879.88 872.67 Nikkei 225 17163.92 16708.90 Romania BET Index 6281.91 6244.56 UK FT 30 2753.90 2736.40 FTSE All World 244.39 242.62
Belgium BEL 20 3461.09 3475.05 Finland
OMX Helsinki General 8255.69 8286.61 S&P Topix 150 1152.43 1119.52 Russia Micex Index 1747.57 1705.01 FTSE 100 5990.37 5911.46 FTSE E300 1340.76 1335.90
BEL Mid 5581.09 5601.24 FranceCAC 40 4380.36 4356.81 Topix 1400.70 1360.23 RTX 704.87 683.05 FTSE 4Good UK 5424.00 5362.05 FTSE Eurotop 100 2653.99 2644.84
Brazil Bovespa 38605.30 37497.48 SBF 120 3463.52 3444.75 Jordan Amman SE 2139.02 2135.71 Saudi-Arabia TADAWUL All Share Index 5698.56 5637.31 FTSE All Share 3286.57 3248.36 FTSE Global 100 ($) 1220.86 1217.10
Canada S&P/TSX 60 733.13 724.15 Germany M-DAX 19318.64 19369.69 Kenya NSE 20 3759.86 3745.38 Singapore FTSE Straits Times 2546.18 2545.61 FTSE techMARK 100 3812.07 3789.19 FTSE Gold Min ($) 929.03 890.98
S&P/TSX Comp 12476.63 12331.32 TecDAX 1695.45 1688.01 Kuwait KSX Market Index 496.93 493.65 Slovakia SAX 307.09 303.67 USA DJ Composite 5630.25 5601.67 FTSE Latibex Top (Eur) 1854.00 1822.90
S&P/TSX Met & Min 255.00 255.14 XETRA Dax 9880.82 9822.75 Latvia OMX Riga 600.39 589.80 Slovenia SBI TOP 678.63 680.67 DJ Industrial 16199.80 16167.23 FTSE Multinationals ($) 1374.04 1360.73
Chile IGPA Gen 17514.50 17526.41 Greece Athens Gen 545.27 546.22 Lithuania OMX Vilnius 483.09 481.00 South Africa FTSE/JSE All Share 47923.92 47532.40 DJ Transport 6887.03 6815.76 FTSE World ($) 434.34 431.23
China FTSE A200 7550.26 7580.92 FTSE/ASE 20 152.28 152.12 Luxembourg LuxX 1310.53 1296.21 FTSE/JSE Res 20 24174.51 24087.75 DJ Utilities 592.50 588.47 FTSEurofirst 100 (Eur) 3760.90 3741.72
FTSE B35 9761.03 9741.71 Hong Kong Hang Seng 19052.45 18860.80 Malaysia FTSE Bursa KLCI 1631.54 1626.66 FTSE/JSE Top 40 42938.94 42625.80 Nasdaq 100 4210.28 4233.85 FTSEurofirst 80 (Eur) 4111.79 4096.68
Shanghai A 2862.75 2877.70 HS China Enterprise 7959.51 7895.16 Mexico IPC 42359.79 41932.39 South Korea Kospi 1897.87 1871.69 Nasdaq Cmp 4553.12 4567.67 MSCI ACWI Fr ($) 367.63 364.84
Shanghai B 341.15 341.36 HSCC Red Chip 3376.19 3331.22 Morocco MASI 8866.59 8865.63 Kospi 200 230.96 227.19 NYSE Comp 9497.64 9429.12 MSCI All World ($) 1535.76 1521.15
Shanghai Comp 2735.56 2749.79 Hungary Bux 23769.46 23522.08 Netherlands AEX 424.41 421.97 Spain IBEX 35 8741.00 8692.50 S&P 500 1911.69 1903.63 MSCI Europe (Eur) 1325.27 1314.10
Shenzhen A 1777.38 1792.36 India BSE Sensex 24492.39 24485.95 AEX All Share 649.11 645.70 Sri Lanka CSE All Share 6316.46 6322.87 Wilshire 5000 19632.04 19563.10 MSCI Pacific ($) 2064.89 2098.88
Shenzhen B 1131.57 1131.88 S&P CNX 500 6242.40 6234.45 New Zealand NZX 50 6141.94 6142.15 Sweden OMX Stockholm 30 1364.13 1375.74 Venezuela IBC 14031.14 14465.56 S&P Euro (Eur) 1365.44 1360.94
Colombia COLCAP 1146.36 1139.32 Indonesia Jakarta Comp 4583.63 4510.47 Nigeria SE All Share 23832.03 23963.64 OMX Stockholm AS 470.23 473.87 Vietnam VNI 542.69 537.73 S&P Europe 350 (Eur) 1373.34 1368.93
Croatia CROBEX 1601.59 1597.47 Ireland ISEQ Overall 6341.96 6377.23 Norway Oslo All Share 585.01 589.22 Switzerland SMI Index 8322.68 8314.47 S&P Global 1200 ($) 1706.12 1695.53
Israel Tel Aviv 100 12.51 12.51 Pakistan KSE 100 31101.38 31074.38 Stoxx 50 (Eur) 2879.33 2877.29
(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 Jan 27 %Chg %Chg Jan 27 %Chg %Chg Jan 27 %Chg %Chg Jan 27 %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 65.9 95.41 -4.59 Royal Dutch Shell 269.5 1462.00 -18.97 Novartis N 1030.5 75.64 0.00 Softbank . 829.6 5187.00 338.00 Glencore 92.03 29.3 1.7 Tullow Oil 152.90 28.1 -8.6 Lonmin 57.50 50.3 -31.1 Mining 6736.68 13.5 -8.7
Boeing 20.8 119.10 -8.91 Bg 240.9 1029.50 9.52 Siemens Ag Na 428.5 90.60 0.00 Toyota Motor 722.4 6881.00 252.00 Pearson 771.50 17.1 4.6 Acacia Mining 194.10 20.0 7.8 Imagination 145.75 31.2 4.9 Oil & Gas Producers 5614.20 13.0 -1.4
Hospira 11.8 89.95 -0.01 Royal Dutch Shell 231.8 1463.00 40.50 Nestle N 406.8 66.24 0.00 Mitsubishi Ufj Fin,. 554.7 634.00 30.00 Royal Dutch Shell 1463.00 15.6 -4.1 Ophir Energy 89.50 17.1 -9.1 Enquest 14.25 29.5 -25.0 Oil Equipment & Services 12320.50 10.5 -5.6
Facebook Class A 11.7 96.71 -0.63 Bp 150.3 362.90 -2.99 Roche Gs 395.7 240.27 0.00 Sumitomo Mitsui Fin,. 542.8 4106.00 199.00 Bhp Billiton 669.90 15.3 -11.9 Nmc Health 869.50 15.9 3.5 Oxford Instruments 733.50 27.5 -4.4 Industrial Transportation 2526.14 7.6 -3.2
Amazon.com 11.5 593.45 -7.80 Glaxosmithkline 141.3 1436.00 20.50 Unicredit 367.8 3.89 0.00 Suzuki Motor 436.0 3590.00 366.00 Anglo American 253.75 14.8 -15.3 Virgin Money Holdings (uk) 316.30 15.0 -16.9 Lamprell 80.00 24.5 -19.6 Software & Computer Services 1616.37 7.3 -2.4
Netflix 8.5 95.01 -2.82 Hsbc Holdings 137.2 480.10 5.60 Basf Se Na O.n. 348.1 62.08 0.00 Sony 321.3 2512.00 82.00 Bg 1029.50 11.9 2.0 Onesavings Bank 323.90 14.8 -7.8 Hochschild Mining 50.75 23.8 5.2 Health Care Equip.& Services 7022.36 6.5 -3.3
At&t 7.9 35.45 0.05 Diageo 132.7 1867.00 -3.64 Santander 330.1 3.98 -0.01 Mizuho Fin,. 298.8 210.80 6.80 Aberdeen Asset Management 240.00 10.9 -17.1 Halfords 373.80 14.4 10.8 Gem Diamonds 118.75 20.9 -9.7 Fixed Line Telecommunication 5361.81 5.9 0.4
Johnson & Johnson 7.5 101.97 0.79 Sabmiller 124.9 4199.00 -2.96 Royal Dutch Shella 286.3 19.35 0.38 Fast Retailing Co., 290.2 37610.00 620.00 Fresnillo 706.50 10.3 -0.2 Telecom Plus 984.50 13.8 -8.2 Kaz Minerals 107.50 16.5 4.8 Mobile Telecommunications 5130.86 5.7 0.0
Verizon Communications 5.9 49.15 0.90 Bhp Billiton 112.5 669.90 4.40 Eni 280.4 13.08 0.00 Fuji Heavy Industries 244.3 4521.00 190.00 Royal Dutch Shell 1462.00 9.7 -9.2 Amec Foster Wheeler 388.90 12.4 -9.3 Hunting 278.25 16.1 -8.9 Construction & Materials 4860.39 5.6 -6.3
Bank Of America 5.5 13.62 0.31 Lloyds Banking 111.4 64.92 -1.14 Total 265.2 40.15 0.50 Nippon Telegraph And Telephone 243.2 4813.00 184.00 Dixons Carphone 471.00 9.6 -6.0 Genus 1445.00 11.5 -8.0 Stock Spirits 133.25 14.9 -4.5 Personal Goods 26277.88 5.6 1.4
Randgold Resources Ld 4815.00 9.0 16.2 Petrofac 750.00 11.4 -7.2 Centaur Media 67.75 14.8 -4.2 Tobacco 46323.50 5.2 0.3
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
Sage 610.00 8.8 -1.9 Crest Nicholson Holdings 558.00 11.3 0.2 Soco Int 138.00 14.0 -6.3 Media 7167.82 5.1 -3.7
price change chng% price change chng% price change chng% price change chng%
Ups Ups Ups Ups Losers Losers Losers Losers
Freeport-mcmoran 4.82 0.62 14.76 Cls Holdings 1675.00 115.00 7.37 Alstom 24.65 0.81 3.42 Suzuki Motor 3590.00 366.00 11.35 Kingfisher 320.40 -2.5 -3.7 Bwin.party Digital Entertainment 120.00 -5.0 -7.4 Premier Oil 19.00 -56.1 -60.8 Forestry & Paper 12591.72 -0.3 -12.6
Chesapeake Energy 3.54 0.35 10.82 Glencore 92.03 4.93 5.66 Publicise Sa 53.88 1.66 3.18 Toho Z Co., 244.00 17.00 7.49 Shire 4050.00 -2.4 -14.4 Nostrum Oil & Gas 286.70 -4.9 -29.2 Rps 178.75 -14.5 -24.6 Automobiles & Parts 6555.94 0.9 -9.5
Hess 38.16 3.35 9.62 Britvic 715.50 35.12 5.18 Orange 16.30 0.44 2.77 Softbank . 5187.00 338.00 6.97 Easyjet 1573.00 -1.7 -8.5 Pz Cussons 257.60 -4.7 -9.6 Chemring 154.00 -13.5 -18.7 Banks 3345.41 1.5 -12.8
Southwestern Energy 9.36 0.76 8.78 Jimmy Choo 127.30 6.00 4.95 Ses 23.99 0.64 2.74 Teijin 424.00 27.00 6.80 Barclays 181.80 -1.0 -17.7 Electra Private Equity 3465.00 -4.5 -8.9 Premier Foods 34.25 -12.7 -12.7 Industrial Metals 597.32 1.8 -17.2
Consol Energy 6.79 0.54 8.64 Sage 610.00 24.71 4.35 Iliad 231.35 5.35 2.37 Hino Motors, 1298.00 77.00 6.31 Sainsbury (j) 235.50 -0.8 -10.7 Workspace 800.00 -3.2 -16.3 Avon Rubber 841.00 -11.9 -13.7 General Industrials 4220.70 1.9 -4.2
Lloyds Banking 64.92 -0.7 -13.0 P2p Global Investments 930.00 -2.5 -4.9 Kainos 221.25 -10.8 -20.5 Aerospace & Defense 3994.33 2.1 -4.0
Downs Downs Downs Downs
Mondi 1169.00 -0.7 -13.0 Gcp Infrastructure Investments 114.80 -2.4 -4.4 Raven Russia Ltd 33.75 -7.5 -16.7 Life Insurance 6991.51 2.5 -11.0
Total System Services 40.68 -5.32 -11.57 Just Eat 379.40 -41.16 -9.79 Grifols Sa 14.99 -14.40 -48.99 Citizen Holdings Co., 727.00 -16.00 -2.15
Provident Fin 2872.00 0.1 -15.1 Qinetiq 231.70 -2.0 -14.5 Stv 456.50 -5.9 -11.4 Real Estate Investment Trusts 3022.40 2.6 -7.5
Textron 34.66 -3.08 -8.15 Evraz 60.65 -4.25 -6.55 Airbus 55.46 -1.96 -3.41 Tokai Carbon Co., 300.00 -6.00 -1.96
Prudential 1334.50 0.2 -13.6 Hicl Infrastructure Ld 150.50 -1.6 -0.5 Hostelworld 196.00 -5.4 -10.1 Chemicals 9902.77 2.7 -8.3
Boeing 119.10 -8.91 -6.96 Bwin.party Digital Entertainment 120.00 -5.30 -4.23 Zodiac Aerospace 18.97 -0.59 -2.99 Alps Electric Co., 2674.00 -38.00 -1.40
Royal Bank Of Scotland 255.70 0.7 -15.3 Mitie 276.30 -1.4 -11.5 Hilton Food 517.50 -5.2 -5.8 Travel & Leisure 8505.14 2.9 -6.4
Williams Companies 19.14 -1.28 -6.27 Wood (john) 602.50 -23.10 -3.74 Kbc 51.24 -1.50 -2.84 Tokyo Dome 557.00 -7.00 -1.24
Gkn 280.40 0.8 -9.6 Playtech 753.50 -1.2 -9.5 Puretech Health 144.25 -5.1 -11.5 Real Estate & Investment Servic 2776.66 3.2 -9.7
Welltower 62.48 -3.52 -5.33 Allied Minds 286.90 -8.72 -3.11 Ryanair Holdings 13.84 -0.36 -2.54 Casio Computer Co., 2351.00 -19.00 -0.80
Legal & General 237.40 0.8 -12.0 P2p Global Investments 945.00 -0.9 -5.7 Exova 135.75 -4.3 -8.8 Beverages 15643.18 3.2 1.1
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
Jan 27 Currency Mid Change Mid Change Mid Change Jan 27 Currency Mid Change Mid Change Mid Change Jan 27 Currency Mid Change Mid Change Mid Change Jan 27 Currency Mid Change Mid Change Mid Change
Argentina Argentine Peso 13.9126 0.0717 15.1244 0.1091 19.8338 0.0072 Indonesia Indonesian Rupiah 13877.5000 -22.5000 15086.2101 6.8475 19783.7635 -127.4326 Poland Polish Zloty 4.1183 -0.0029 4.4769 0.0061 5.8710 -0.0324 ..Three Month 0.7015 0.0034 0.7624 0.0052 - -
Australia Australian Dollar 1.4198 -0.0088 1.5434 -0.0064 2.0240 -0.0224 Israel Israeli Shekel 3.9710 0.0011 4.3169 0.0101 5.6610 -0.0257 Romania Romanian Leu 4.1740 -0.0057 4.5375 0.0032 5.9504 -0.0368 ..One Year 0.7018 0.0034 0.7617 0.0052 - -
Bahrain Bahrainin Dinar 0.3771 - 0.4099 0.0008 0.5375 -0.0026 Japan Japanese Yen 118.7350 0.3100 129.0766 0.6038 169.2684 -0.3706 Russia Russian Ruble 78.2744 -0.6606 85.0920 -0.5403 111.5878 -1.4834 United States United States Dollar - - 1.0871 0.0023 1.4256 -0.0069
Bolivia Bolivian Boliviano 6.9000 -0.0100 7.5010 0.0047 9.8366 -0.0617 ..One Month 118.7349 0.3099 129.0767 0.6038 169.2683 -0.3708 Saudi Arabia Saudi Riyal 3.7515 0.0001 4.0782 0.0086 5.3481 -0.0256 ..One Month - - 1.0870 -0.3454 1.4256 -0.0069
Brazil Brazilian Real 4.0669 -0.0037 4.4211 0.0052 5.7977 -0.0331 ..Three Month 118.7348 0.3095 129.0767 0.6039 169.2681 -0.3713 Singapore Singapore Dollar 1.4301 0.0039 1.5547 0.0075 2.0387 -0.0042 ..Three Month - - 1.0868 -0.3454 1.4256 -0.0069
Canada Canadian Dollar 1.4097 0.0004 1.5324 0.0036 2.0096 -0.0092 ..One Year 118.7336 0.3071 129.0768 0.6041 169.2683 -0.3724 South Africa South African Rand 16.3774 -0.0117 17.8038 0.0241 23.3476 -0.1292 ..One Year - - 1.0856 -0.3454 1.4259 -0.0069
Chile Chilean Peso 716.2400 -2.2950 778.6233 -0.8764 1021.0704 -8.2020 Kenya Kenyan Shilling 102.2000 -0.2500 111.1014 -0.0410 145.6961 -1.0594 South Korea South Korean Won 1202.6000 -1.5500 1307.3445 1.0274 1714.4242 -10.4721 Venezuela Venezuelan Bolivar Fuerte 6.3053 0.0203 6.8544 0.0362 8.9888 -0.0143
China Chinese Yuan 6.5779 -0.0019 7.1508 0.0128 9.3774 -0.0479 Kuwait Kuwaiti Dinar 0.3036 -0.0002 0.3300 0.0005 0.4327 -0.0024 Sweden Swedish Krona 8.5203 -0.0405 9.2625 -0.0247 12.1466 -0.1165 Vietnam Vietnamese Dong 22305.0000 -27.5000 24247.7734 20.4436 31798.0190 -192.4606
Colombia Colombian Peso 3382.2000 18.2000 3676.7842 27.3623 4821.6589 2.8648 Malaysia Malaysian Ringgit 4.2565 -0.0350 4.6272 -0.0284 6.0681 -0.0793 Switzerland Swiss Franc 1.0173 -0.0006 1.1059 0.0017 1.4502 -0.0078 European Union Euro 0.9199 -0.0019 - - 1.3114 -0.0090
Costa Rica Costa Rican Colon 535.0900 0.2000 581.6955 1.4223 762.8233 -3.3850 Mexico Mexican Peson 18.4673 -0.0157 20.0757 0.0246 26.3269 -0.1491 Taiwan New Taiwan Dollar 33.5910 -0.0310 36.5167 0.0420 47.8873 -0.2749 ..One Month 0.9198 -0.0019 - - 1.3113 -0.0090
Czech Republic Czech Koruna 24.8579 -0.0492 27.0230 0.0026 35.4374 -0.2411 New Zealand New Zealand Dollar 1.5375 -0.0052 1.6714 -0.0022 2.1919 -0.0180 Thailand Thai Baht 35.8100 -0.0900 38.9290 -0.0170 51.0507 -0.3746 ..Three Month 0.9196 -0.0019 - - 1.3112 -0.0090
Denmark Danish Krone 6.8646 -0.0141 7.4624 0.0002 9.7861 -0.0673 Nigeria Nigerian Naira 199.0500 - 216.3869 0.4484 283.7653 -1.3658 Tunisia Tunisian Dinar 2.0433 0.0016 2.2213 0.0063 2.9129 -0.0118 ..One Year 0.9184 -0.0019 - - 1.3105 -0.0090
Egypt Egyptian Pound 7.8313 0.0233 8.5133 0.0429 11.1642 -0.0204 Norway Norwegian Krone 8.6758 -0.0376 9.4314 -0.0212 12.3682 -0.1133 Turkey Turkish Lira 2.9908 -0.0187 3.2513 -0.0136 4.2637 -0.0474
Hong Kong Hong Kong Dollar 7.7929 -0.0035 8.4717 0.0138 11.1096 -0.0584 Pakistan Pakistani Rupee 104.9050 -0.0050 114.0421 0.2309 149.5524 -0.7270 United Arab Emirates UAE Dirham 3.6731 0.0000 3.9930 0.0083 5.2363 -0.0251
Hungary Hungarian Forint 288.3728 0.4942 313.4895 1.1857 411.1036 -1.2708 Peru Peruvian Nuevo Sol 3.4665 -0.0010 3.7684 0.0067 4.9418 -0.0252 United Kingdom Pound Sterling 0.7015 0.0034 0.7626 0.0052 - -
India Indian Rupee 68.0450 0.2600 73.9716 0.4353 97.0048 -0.0945 Philippines Philippine Peso 47.8400 -0.1500 52.0068 -0.0550 68.2006 -0.5431 ..One Month 0.7015 0.0034 0.7625 0.0052 - -
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 Jan 27 Jan 26 Jan 25 Jan 22 Jan 21 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 2783.90 2753.90 2736.40 2756.00 2695.70 0.00 2875.90 2642.30 Food & Drug Retailer 1.64 FTSE SmallCap Index -5.87 Electronic & Elec Eq -8.12 FTSE 100 Price Change FTSE 100 Price Change
Jan 27 chge% Index Jan 26 Jan 25 ago yield% Cover ratio adj Return FT 30 Div Yield 1.79 1.81 1.81 1.81 1.85 0.00 3.93 2.74 Leisure Goods -0.38 Health Care -5.88 Chemicals -8.18 3I Group PLC 439.60 4.50 Kingfisher PLC 320.40 3.00
FTSE 100 (100) 5990.37 1.33 6127.77 5911.46 5877.00 6825.94 4.15 1.47 16.44 3.26 4696.21 P/E Ratio net 24.96 24.67 24.61 24.60 24.13 0.00 19.44 14.26 Gas Water & Multi -1.71 Media -5.98 Construct & Material -8.35 Aberdeen Asset Management PLC 240.00 7.20 Land Securities Group PLC 1086 -2.00
FTSE 250 (250) 16280.98 0.63 16654.40 16179.02 16146.98 16425.73 2.78 1.93 18.68 10.68 11338.83 FT 30 since compilation: 4198.4 high: 19/07/1999; low49.4 26/06/1940Base Date: 1/7/35 Aerospace & Defense -1.96 NON FINANCIALS Index -6.06 Technology -8.38 Admiral Group PLC 1740 43.00 Legal & General Group PLC 237.40 2.00
FTSE 250 ex Inv Co (209) 17676.42 0.63 18081.84 17565.00 17521.43 17731.29 2.80 2.02 17.61 8.99 12551.17 FT 30 hourly changes Beverages -2.03 Equity Invest Instr -6.11 Oil & Gas Producers -8.51 Anglo American PLC 253.75 0.40 Lloyds Banking Group PLC 64.92 0.19
FTSE 350 (350) 3337.59 1.21 3414.14 3297.62 3280.62 3727.03 3.91 1.52 16.79 1.88 5273.92 8 9 10 11 12 13 14 15 16 High Low Fixed Line Telecomms -2.63 Industrial Transport -6.30 Oil & Gas -8.56 Antofagasta PLC 375.40 -2.60 London Stock Exchange Group PLC 2444 19.00
FTSE 350 ex Investment Trusts (309) 3315.20 1.23 3391.24 3275.03 3257.64 3707.05 3.94 1.53 16.61 1.78 2697.23 2753.9 2748 2737.8 2742.7 2740.6 2746.8 2756.1 2761.1 2766.3 2783.9 2735.3 Telecommunications -2.68 Industrials -6.34 Automobiles & Parts -8.66 Arm Holdings PLC 995.50 -19.50 Marks And Spencer Group PLC 426.70 6.00
FTSE 350 Higher Yield (108) 3055.32 1.62 3125.40 3006.74 2982.07 3654.30 5.70 1.28 13.66 1.74 4951.67 FT30 constituents and recent additions/deletions can be found at www.ft.com/ft30 Mobile Telecomms -2.71 Software & Comp Serv -6.73 Industrial Eng -8.89 Ashtead Group PLC 965.00 1.00 Merlin Entertainments PLC 409.80 2.00
FTSE 350 Lower Yield (242) 3302.57 0.80 3378.32 3276.39 3269.70 3435.57 2.07 2.20 21.98 1.84 3497.57 Utilities -2.85 Food Producers -6.92 Financials -9.68 Associated British Foods PLC 3078 63.00 Mondi PLC 1169 9.00
FTSE SmallCap (289) 4311.18 0.20 4410.06 4302.69 4317.71 4434.61 3.03 1.40 23.55 6.34 5918.83 Tobacco -3.79 Real Est Invest & Tr -6.94 Tech Hardware & Eq -9.95
FTSE SmallCap ex Inv Co (154) 3906.03 0.03 3995.62 3904.97 3920.41 3848.58 2.99 1.87 17.90 4.34 5629.24 FX: EFFECTIVE INDICES Consumer Goods -4.05 FTSE 100 Index -7.02 Oil Equipment & Serv -10.14
Astrazeneca PLC 4473 57.50 National Grid PLC 965.70 17.70
Aviva PLC 473.20 7.90 Next PLC 6950 140.00
FTSE All-Share (639) 3286.57 1.18 3361.95 3248.36 3232.59 3659.72 3.88 1.52 16.96 1.96 5253.70
Jan 26 Jan 25 Mnth Ago Jan 27 Jan 26 Mnth Ago Personal Goods -4.81 FTSE All{HY-}Share Index -7.02 Banks -10.76 Babcock International Group PLC 924.50 4.00 Old Mutual PLC 159.70 3.50
FTSE All-Share ex Inv Co (463) 3251.49 1.20 3326.07 3212.84 3196.36 3627.16 3.92 1.53 16.64 1.79 2689.22 Nonlife Insurance -5.23 Electricity -7.21 Forestry & Paper -11.09 Bae Systems PLC 507.00 4.50 Pearson PLC 771.50 2.00
FTSE All-Share ex Multinationals (574) 1118.70 0.90 948.47 1108.77 1106.47 1170.33 3.00 1.56 21.31 0.85 1908.47 Australia 88.99 88.75 91.91 Sweden 79.48 79.52 80.18 Household Goods & Ho -5.42 Support Services -7.26 Life Insurance -11.30 Barclays PLC 181.80 -1.20 Persimmon PLC 1998 44.00
FTSE Fledgling (100) 7324.62 -0.20 7492.62 7339.47 7374.09 7006.64 2.62 1.28 29.88 9.05 13214.88 Canada 83.51 82.71 84.80 Switzerland 156.44 157.01 159.87 Pharmace & Biotech -5.72 FTSE 250 Index -7.28 Financial Services -12.35 Barratt Developments PLC 593.00 13.00 Provident Financial PLC 2872 21.00
FTSE Fledgling ex Inv Co (50) 10232.06 -0.66 10466.75 10299.82 10343.79 8733.04 2.71 1.67 22.03 4.01 17944.21 Denmark 106.17 106.18 105.78 UK 88.37 88.11 90.93 General Retailers -5.77 Health Care Eq & Srv -7.50 Basic Materials -14.69 Berkeley Group Holdings (The) PLC 3558 20.00 Prudential PLC 1334.5 15.50
FTSE All-Small (389) 2991.66 0.18 3060.28 2986.38 2996.99 3066.75 3.01 1.40 23.80 4.36 5273.61 Japan 130.93 130.88 127.81 USA 106.50 106.90 105.76 Consumer Services -5.86 Travel & Leisure -7.72 Mining -16.24 Bg Group PLC 1029.5 34.60 Randgold Resources LD 4815 -5.00
FTSE All-Small ex Inv Co Index (204) 2918.84 0.00 2985.79 2918.85 2930.43 2857.61 2.98 1.86 18.03 3.16 5329.68 New Zealand 110.91 110.92 115.71 Euro 86.92 86.94 86.26 Real Est Invest & Se -7.96 Industrial Metals & -16.89 Bhp Billiton PLC 669.90 4.40 Reckitt Benckiser Group PLC 6169 57.00
FTSE AIM All-Share Index (849) 686.14 0.35 701.88 683.72 688.81 690.46 1.63 0.63 97.36 0.37 738.85 Norway 84.82 84.68 83.89
BP PLC 362.90 6.40 RELX PLC 1199 26.00
FTSE Sector Indices Source: Bank of England. New Sterling ERI base Jan 2005 = 100. Other indices base average 1990 = 100. British American Tobacco PLC 3764 81.00 Rio Tinto PLC 1717 28.50
Oil & Gas (18) 5921.14 2.45 6056.94 5779.81 5682.88 7660.23 6.36 0.20 78.74 0.00 4959.33 Index rebased 1/2/95. for further information about ERIs see www.bankofengland.co.uk British Land Company PLC 730.00 -3.00 Rolls-Royce Holdings PLC 539.50 -4.00
Oil & Gas Producers (11) 5640.01 2.55 5769.37 5499.80 5409.74 7300.58 6.37 0.16 96.94 0.00 4884.56 Bt Group PLC 478.30 10.00 Royal Bank Of Scotland Group PLC 255.70 -5.20
Oil Equipment Services & Distribution (7)12804.99 -0.57 13098.68 12878.55 12515.08 16254.48 5.95 1.41 11.92 0.00 9417.54 FTSE GLOBAL EQUITY INDEX SERIES Bunzl PLC 1819 19.00 Royal Dutch Shell PLC 1462 41.50
Basic Materials (28) 2508.98 1.47 2566.53 2472.64 2376.08 4591.49 8.17 1.88 6.51 1.30 2461.37 Burberry Group PLC 1190 -21.00 Royal Dutch Shell PLC 1463 40.50
Chemicals (7) 10595.07 -0.34 10838.08 10631.34 10616.87 12300.83 2.71 2.27 16.29 35.08 9137.46 Jan 27 No of US $ Day Mth YTD Total
YTD Gr Div Jan 27 No of US $ Day Mth YTD Total YTD Gr Div Capita PLC 1142 -25.00 Royal Mail PLC 457.50 4.20
Forestry & Paper (1) 13739.88 0.78 14055.01 13634.10 14010.21 13833.91 2.62 3.37 11.29 0.00 14272.61 Regions & countries stocks indices % % % retn
% Yield Sectors stocks indices % % % retn % Yield Carnival PLC 3616 48.00 Rsa Insurance Group PLC 411.80 9.40
Industrial Metals & Mining (2) 604.86 -5.37 618.73 639.17 618.69 1777.63 1.90 -18.64 -2.82 0.00 527.85 FTSE Global All Cap 7742 414.27 0.8 -8.7 -8.1 567.20
-8.1 2.7 Oil & Gas 166 279.56 2.7 2.7 -8.3 427.36 -8.3 4.6 Centrica PLC 210.10 3.40 Sabmiller PLC 4199 7.00
Mining (18) 6463.88 1.92 6612.13 6342.17 6016.20 13095.97 9.66 1.85 5.59 0.00 3318.66 FTSE Global All Cap 7103 425.74 0.7 -8.8 -8.2 572.71
-8.2 2.7 Oil & Gas Producers 116 262.31 2.7 2.7 -8.1 408.05 -8.1 4.6 Coca-Cola Hbc AG 1409 22.00 Sage Group PLC 610.00 42.50
FTSE Global Large Cap 1415 367.30 0.7 -8.5 -7.9 514.46
-7.8 2.9 Oil Equipment & Services 41 252.13 2.9 2.9 -9.2 351.75 -9.1 5.2 Compass Group PLC 1171 45.00 Sainsbury (J) PLC 235.50 4.50
Industrials (119) 4103.36 0.48 4197.47 4083.80 4083.25 4422.81 2.68 1.21 30.85 0.99 4078.39
Construction & Materials (14) 5038.69 1.41 5154.26 4968.66 4999.16 4489.73 2.33 -0.81 -53.08 0.00 5148.78 FTSE Global Mid Cap 1640 549.85 1.0 -9.1 -8.7 718.46
-8.6 2.3 Basic Materials 261 312.93 0.8 0.8 -10.9 458.83 -10.9 3.8 Crh PLC 1865 29.00 Schroders PLC 2677 27.00
Aerospace & Defense (9) 4142.21 0.18 4237.22 4134.92 4119.59 5165.84 2.76 1.04 34.75 1.32 4283.51 FTSE Global Small Cap 4687 569.58 1.2 -9.7 -9.2 722.87
-9.1 2.2 Chemicals 122 528.59 0.2 0.2 -10.7 777.32 -10.6 2.9 Dcc PLC 5245 110.00 Severn Trent PLC 2152 26.00
General Industrials (6) 3426.57 0.56 3505.16 3407.65 3430.51 3180.70 3.33 1.67 18.02 0.00 3730.41 FTSE All-World 3055 242.62 0.7 -8.6 -8.0 350.46
-7.9 2.8 Forestry & Paper 16 173.29 -0.1 -0.1 -11.6 278.34 -11.6 3.9 Diageo PLC 1867 -5.00 Shire PLC 4050 -73.00
Electronic & Electrical Equipment (10) 5027.16 0.58 5142.46 4998.04 4982.73 5103.11 2.45 1.97 20.73 0.00 4452.10 FTSE World 2539 431.23 0.8 -8.4 -7.8 836.40
-7.7 2.8 Industrial Metals & Mining 67 222.38 0.6 0.6 -13.6 327.48 -13.6 3.7 Direct Line Insurance Group PLC 377.50 8.10 Sky PLC 1062 16.00
Industrial Engineering (14) 7053.15 0.39 7214.92 7025.59 6955.40 9217.50 3.47 1.57 18.29 0.00 8258.61 FTSE Global All Cap ex UNITED KINGDOM In 7418 425.86 0.8 -8.6 -8.1 574.98
-8.1 2.6 Mining 56 291.33 3.2 3.2 -10.0 426.93 -10.0 7.3 Dixons Carphone PLC 471.00 14.50 Smith & Nephew PLC 1163 21.00
Industrial Transportation (8) 3813.73 0.72 3901.20 3786.64 3743.92 4137.59 3.98 0.94 26.78 0.00 3208.38 FTSE Global All Cap ex USA 5742 379.81 0.0 -9.3 -9.0 551.46
-8.9 3.3 Industrials 534 273.55 0.7 0.7 -8.6 380.30 -8.5 2.5 Easyjet PLC 1573 -6.00 Smiths Group PLC 909.50 15.00
Support Services (58) 6209.15 0.36 6351.57 6186.95 6194.12 6524.25 2.45 1.52 26.96 2.30 6233.16 FTSE Global All Cap ex JAPAN 6480 422.78 1.1 -8.7 -7.9 583.99
-7.8 2.8 Construction & Materials 109 384.38 0.2 0.2 -8.3 559.36 -8.2 2.3 Experian PLC 1161 8.00 Sports Direct International PLC 414.00 -3.50
FTSE Developed 2103 393.80 0.9 -8.3 -7.7 543.23
-7.6 2.7 Aerospace & Defense 28 471.01 1.1 1.1 -7.0 649.29 -6.9 2.3 Fresnillo PLC 706.50 12.00 Sse PLC 1432 25.00
Consumer Goods (40) 18257.43 1.26 18676.18 18031.12 17956.45 17225.80 3.01 1.75 18.93 0.57 12879.89
FTSE Developed All Cap 5734 412.14 0.9 -8.4 -7.9 562.39
-7.8 2.6 General Industrials 56 200.44 1.9 1.9 -7.6 299.21 -7.6 2.8 Gkn PLC 280.40 -1.20 St. James's Place PLC 929.50 17.00
Automobiles & Parts (1) 6589.53 -0.43 6740.67 6617.73 6697.63 8674.02 3.03 1.53 21.55 0.00 6060.00
FTSE Developed Large Cap 915 365.06 0.8 -8.1 -7.5 510.46
-7.5 2.8 Electronic & Electrical Equipment 69 280.56 -0.7 -0.7 -11.3 359.66 -11.3 2.1 Glaxosmithkline PLC 1436 20.50 Standard Chartered PLC 471.35 -5.95
Beverages (6) 15659.22 0.09 16018.38 15645.69 15504.72 15009.55 2.44 1.65 24.88 0.00 10665.87
FTSE Developed Europe Large Cap 219 306.49 1.1 -8.2 -7.1 483.10
-7.1 3.8 Industrial Engineering 104 481.76 0.5 0.5 -10.1 659.34 -10.0 3.0 Glencore PLC 92.03 4.93 Standard Life PLC 359.60 1.70
Food Producers (10) 8484.86 1.92 8679.47 8324.67 8323.10 8358.63 1.93 1.39 37.14 3.94 7103.79
FTSE Developed Europe Mid Cap 304 469.57 0.8 -9.0 -8.4 672.84
-8.4 2.8 Industrial Transportation 96 448.07 0.8 0.8 -9.5 621.26 -9.5 2.7 Hammerson PLC 573.50 2.00 Taylor Wimpey PLC 189.00 4.70
Household Goods & Home Construction (13)13382.08 1.37 13689.01 13201.42 13208.33 11072.52 2.18 2.54 18.07 0.00 9103.45
FTSE Dev Europe Small Cap 720 665.01 0.7 -9.3 -9.1 928.05
-9.1 2.4 Support Services 72 256.00 0.3 0.3 -7.2 342.17 -7.2 2.1 Hargreaves Lansdown PLC 1323 5.00 Tesco PLC 161.00 0.65
Leisure Goods (2) 5309.30 -0.07 5431.08 5313.03 5324.13 4767.31 4.51 1.32 16.77 0.00 4496.65
FTSE North America Large Cap 317 406.59 1.4 -7.7 -6.8 535.90
-6.7 2.4 Consumer Goods 423 390.46 0.3 0.3 -6.3 555.76 -6.2 2.6 Hikma Pharmaceuticals PLC 1994 -6.00 Travis Perkins PLC 1820 29.00
Personal Goods (6) 22879.00 1.26 23403.75 22594.29 22532.95 23537.96 2.86 3.22 10.87 1.04 14761.47
FTSE North America Mid Cap 394 586.38 2.0 -9.3 -8.4 724.27
-8.4 1.9 Automobiles & Parts 103 332.73 -0.6 -0.6 -12.8 454.57 -12.8 2.9 HSBC Holdings PLC 480.10 5.60 Tui AG 1215 7.00
Tobacco (2) 46323.58 2.19 47386.05 45332.69 45105.06 44030.80 4.31 1.18 19.74 0.00 28230.64
FTSE North America Small Cap 1518 582.85 2.2 -10.3 -9.1 700.61
-9.1 2.0 Beverages 48 555.10 0.4 0.4 -2.9 800.90 -2.9 2.5 Imperial Tobacco Group PLC 3667 77.50 Unilever PLC 3005 49.50
Health Care (19) 9260.60 0.88 9473.00 9179.91 9191.22 9869.29 3.78 3.53 7.50 0.18 6752.42
FTSE North America 711 270.71 1.5 -7.9 -7.1 365.62
-7.0 2.4 Food Producers 106 528.66 1.0 1.0 -5.4 774.32 -5.3 2.3 Inmarsat PLC 1071 6.00 United Utilities Group PLC 946.50 22.50
Health Care Equipment & Services (7) 7117.91 1.66 7281.16 7001.37 6940.89 6811.20 1.60 2.16 29.02 1.60 6036.38
FTSE Developed ex North America 1392 207.20 0.0 -8.8 -8.6 322.69
-8.6 3.3 Household Goods & Home Construction 47 379.67 1.4 1.4 -5.4 538.70 -5.1 2.4 Intercontinental Hotels Group PLC 2323 46.00 Vodafone Group PLC 223.20 4.55
Pharmaceuticals & Biotechnology (12)12507.84 0.81 12794.72 12407.70 12434.19 13469.40 3.98 3.58 7.02 0.00 8100.99
FTSE Japan Large Cap 177 290.72 -2.3 -9.7 -11.3 363.66
-11.3 2.2 Leisure Goods 28 119.90 -1.6 -1.6 -9.1 154.34 -9.1 1.5 International Consolidated Airlines Group S.A. 552.50 -8.50 Whitbread PLC 3984 93.00
Consumer Services (97) 4698.38 1.17 4806.14 4644.00 4651.17 4815.48 2.43 1.59 25.92 7.19 4247.61 FTSE Japan Mid Cap 303 445.53 -2.0 -7.3 -9.4 538.31
-9.4 1.7 Personal Goods 80 572.94 0.5 0.5 -4.1 776.92 -4.1 2.1
Food & Drug Retailers (7) 2630.11 1.13 2690.44 2600.61 2556.53 3315.65 2.03 -1.50 -32.71 0.00 3007.55 Intertek Group PLC 2763 11.00 Wolseley PLC 3444 33.00
FTSE Global wi JAPAN Small Cap 782 473.04 -2.0 -7.2 -10.1 589.92
-10.1 2.0 Tobacco 11 1197.30 0.6 0.6 -1.6 2339.75 -1.6 4.0 Intu Properties PLC 290.00 0.70 Worldpay Group PLC 302.00 -0.70
General Retailers (32) 2793.48 0.74 2857.55 2772.97 2791.35 2921.82 2.60 2.24 17.19 1.98 3064.15
FTSE Japan 480 121.49 -2.2 -9.2 -10.9 170.76
-10.9 2.1 Health Care 173 430.57 0.5 0.5 -6.1 600.05 -6.0 2.0 Itv PLC 266.70 6.70 Wpp PLC 1481 18.00
Media (22) 7253.27 1.36 7419.63 7155.61 7192.26 7056.42 2.82 1.62 21.91 1.47 4283.11
FTSE Asia Pacific Large Cap ex Japan 530 483.24 -1.3 -10.9 -10.7 722.97
-10.7 3.6 Health Care Equipment & Services 61 618.89 0.2 0.2 -4.7 709.91 -4.7 1.0 Johnson Matthey PLC 2461 4.00
Travel & Leisure (36) 8306.57 1.26 8497.08 8202.92 8208.18 8242.75 2.11 1.91 24.83 29.43 7597.96
FTSE Asia Pacific Mid Cap ex Japan 431 670.23 -1.1 -9.9 -10.3 967.17
-10.2 3.2 Pharmaceuticals & Biotechnology 112 325.38 0.6 0.6 -6.5 471.17 -6.4 2.3
Telecommunications (7) 4021.91 2.06 4114.15 3940.87 3944.32 3955.20 4.06 0.18 134.22 0.00 4214.37 FTSE Asia Pacific Small Cap ex Japan 1425 455.15 -0.9 -8.0 -8.8 648.03
-8.8 3.0 Consumer Services 386 364.98 0.7 0.7 -6.4 474.45 -6.3 1.8
Fixed Line Telecommunications (5) 5448.39 2.19 5573.35 5331.74 5345.33 4887.07 2.84 1.74 20.21 0.00 4725.13
Mobile Telecommunications (2) 5123.10 1.97 5240.60 5024.33 5022.94 5339.98 4.91 -0.44 -46.36 0.00 4791.48
FTSE Asia Pacific Ex Japan
FTSE Emerging All Cap
961
2008
383.73
507.43
-1.3
-0.9
-10.8
-11.9
-10.6 610.19
-10.6
-11.2 723.93
-11.1
3.6 Food & Drug Retailers
3.5 General Retailers
53 282.13
121 498.44
0.5
0.5
0.5
0.5
-5.9 381.85
-6.5 632.11
-5.7
-6.4
2.0
1.6
UK STOCK MARKET TRADING DATA
Utilities (7) 8377.75 1.74 8569.90 8234.53 8196.12 9034.14 4.84 1.36 15.16 28.76 8954.16 FTSE Emerging Large Cap 500 476.70 -1.0 -12.3 -11.5 684.24
-11.5 3.6 Media 87 272.89 1.3 1.3 -5.7 355.45 -5.6 2.0 Jan 27 Jan 26 Jan 25 Jan 22 Jan 21 Yr Ago
Electricity (2) 8248.42 1.65 8437.60 8114.39 7977.47 9326.51 6.13 1.34 12.15 145.17 11177.16 FTSE Emerging Mid Cap 452 638.30 -0.3 -10.7 -10.1 906.50
-10.0 3.2 Travel & Leisure 125 353.70 0.7 0.7 -7.3 464.31 -7.2 1.8 SEAQ Bargains 4982.00 5143.00 5260.00 5260.00 5260.00 5071.00
Gas Water & Multiutilities (5) 7948.18 1.76 8130.48 7810.66 7797.37 8470.21 4.53 1.37 16.13 0.00 8498.06 FTSE Emerging Small Cap 1056 553.23 -0.8 -9.8 -10.1 760.78
-10.1 3.3 Telecommunication 92 152.46 0.6 0.6 -3.2 269.34 -2.8 4.3 Order Book Turnover (m) 55.92 49.42 - - - 55.29
Financials (285) 4116.43 0.68 4210.84 4088.54 4072.41 4791.48 3.98 1.87 13.42 3.48 3598.24 FTSE Emerging Europe 99 243.81 0.4 -10.9 -8.7 358.30
-8.6 4.6 Fixed Line Telecommuniations 44 132.59 1.3 1.3 0.0 256.88 0.7 4.7 Order Book Bargains 981073.00 977310.00 39.00 39.00 39.00 454.00
Banks (9) 3303.25 0.37 3379.01 3291.17 3261.28 4291.94 4.97 1.37 14.72 0.00 2277.03 FTSE Latin America All Cap 243 529.90 0.3 -12.8 -11.5 783.49
-11.4 4.1 Mobile Telecommunications 48 152.14 -0.4 -0.4 -7.6 242.78 -7.6 3.8 Order Book Shares Traded (m) 1473.00 1308.00 1.00 1.00 1.00 1.00
Nonlife Insurance (11) 2729.41 1.60 2792.01 2686.42 2688.41 2365.98 2.76 2.06 17.59 0.00 4587.06 FTSE Middle East and Africa All Cap 220 550.84 0.9 -12.8 -11.0 821.61
-10.9 3.1 Utilities 161 231.13 0.6 0.6 -2.6 423.96 -2.4 4.1 Total Equity Turnover (£m) 3005.07 0.00 0.00 0.00 0.00 0.16
Life Insurance/Assurance (11) 7093.22 1.25 7255.91 7005.53 6954.36 8288.82 4.27 1.59 14.74 0.00 6511.66 FTSE Global wi UNITED KINGDOM All Cap In 324 301.67 1.0 -9.7 -8.3 477.02
-8.2 4.0 Electricity 110 252.60 0.5 0.5 -2.4 458.70 -2.2 3.8 Total Mkt Bargains 1095729.00 9.00 46.00 46.00 46.00 457.00
Index- Real Estate Investment & Services (21) 2797.99 -0.14 2862.16 2801.96 2802.87 2767.69 2.27 5.73 7.69 0.57 7194.51 FTSE Global wi USA All Cap 2000 464.19 1.5 -8.2 -7.4 595.47
-7.3 2.2 Gas Water & Multiutilities 51 244.66 0.7 0.7 -2.9 459.73 -2.8 4.5 Total Shares Traded (m) 4945.00 0.00 1.00 1.00 1.00 1.00
Real Estate Investment Trusts (25) 2749.90 -0.13 2812.97 2753.57 2766.21 3001.79 3.21 5.94 5.25 6.48 3257.28 FTSE Europe All Cap 1402 352.41 1.0 -8.5 -7.6 538.67
-7.5 3.5 Financials 674 176.91 0.7 0.7 -11.9 275.06 -11.8 3.3 † Excluding intra-market and overseas turnover. *UK only total at 6pm. ‡ UK plus intra-market turnover. (u) Unavaliable.
General Financial (32) 7238.06 1.57 7404.07 7125.98 7137.73 7707.94 3.20 2.19 14.24 24.67 7880.86 FTSE Eurobloc All Cap 639 332.54 1.1 -8.3 -7.3 514.14
-7.3 3.2 Banks 243 153.97 0.9 0.9 -13.7 255.14 -13.6 3.9 (c) Market closed.
Equity Investment Instruments (176) 7232.40 0.52 7398.28 7195.29 7209.49 7685.63 2.81 1.07 33.17 12.51 3809.96 FTSE RAFI All World 3000 3006 4962.35 0.8 -9.3 3.4 Nonlife Insurance
-8.5 6255.86
-8.5 70 196.85 0.5 0.5 -8.2 274.12 -8.2 2.5
Non Financials (354) 3878.52 1.34 3967.48 3827.13 3807.38 4252.48 3.85 1.40 18.60 1.98 5434.42 FTSE RAFI US 1000 996 8195.63 1.8 -8.3 -7.3 10373.19
-7.2 2.8 Life Insurance 51 171.13 -0.1 -0.1 -13.7 259.66 -13.7 3.3
Technology (19) 1398.78 0.91 1430.86 1386.22 1385.49 1281.37 1.44 1.99 34.90 0.00 1749.15 FTSE EDHEC-Risk Efficient All-World 3055 292.02 0.9 -7.9 -7.4 392.68
-7.4 2.5 Financial Services 141 194.62 0.7 0.7 -12.5 259.41 -12.4 2.2 All data provided by Morningstar unless otherwise noted. All elements listed are indicative and believed
Software & Computer Services (13) 1809.68 3.70 1851.19 1745.03 1748.18 1400.16 1.97 1.83 27.80 0.00 2372.25 FTSE EDHEC-Risk Efficient Developed Europe 523 260.48 0.9 -7.3 -6.7 380.39
-6.7 2.9 Technology 185 161.47 0.5 0.5 -7.3 192.68 -7.3 1.9 accurate at the time of publication. No offer is made by Morningstar or the FT. The FT does not warrant nor
Technology Hardware & Equipment (6) 1527.45 -1.35 1562.49 1548.37 1544.65 1593.00 1.00 2.25 44.55 0.00 1753.37 Software & Computer Services 85 289.06 0.4 0.4 -6.8 331.83 -6.8 1.1 guarantee that the information is reliable or complete. The FT does not accept responsibility and will not be
Technology Hardware & Equipment 100 116.31 0.7 0.7 -8.0 142.78 -7.9 2.7 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 5887.33 5891.35 5876.41 5884.07 5882.59 5896.78 5920.55 5932.11 5952.91 5990.37 5870.90 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 16198.89 16162.74 16113.22 16140.58 16110.90 16145.19 16184.58 16198.01 16210.91 16280.98 16105.43 (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 4305.63 4305.21 4308.15 4310.19 4308.77 4309.73 4311.25 4312.36 4316.05 4321.29 4297.32
FTSE All-Share 3238.55 3239.07 3230.77 3235.27 3233.64 3240.98 3252.75 3258.20 3267.94 3286.57 3228.37 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:16:35:29 Day's Low09:54:45 FTSE 100 2010/11 High: 6242.32(01/01/2016) Low: 5673.58(20/01/2016) Group companies and is used by FTSE International Limited under licence.
Time of FTSE All-Share Day's high:16:46:00 Day's Low09:55:00 FTSE 100 2010/11 High: 3444.26(01/01/2016) Low: 3123.43(20/01/2016)
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 Aberforth Smaller Companies Trust Pre 112.178 7.587L 35.03 27.24 17.85 17 Mar 4 26 24.75 date price(p) Sector code Stock price(p) +/- High Low Cap (£m)
price up date High Low Stock Price p +or- Ebiquity Int 35.633 34.971 2.494 0.577 2.12 0.27L - - - - - 12/24 144.00 AIM DNL Diurnal Group PLC 146.00 -0.50 155.00 147.80 7622.8
94p Nil 23-02-16 158.75 152.75 Chemring Group PLC 154.00 -1.50 Ediston Property Investment Company Pre 5.901 - 3.986 - 4.15 - 0.4583 - Oct 30 0.917 - 12/17 2.00 LVRT Levrett PLC 2.25 0.00 3.10 1.75 215.4
F&C Managed Portfolio Trust Int 3.37L 2.471 2.83 2.68 1.2 1.15 Jan 4 2.75 2.65 12/17 100.00 AIM PURP Purplebricks Group PLC 84.50 2.90 106.50 72.00 20301.9
Scancell Holdings Int - - 1.356L 1.49L 0.52L 0.6L - - - - -
Staffline Group Pre 702.206 503.167 5.476 10.453 9.5 28.6 12.5 8.5 Jul 5 20 13.5
Wynnstay Group Pre 377.382 413.558 8.337 8.493 34.66 35.28 7.4 6.8 Apr 29 11.1 10.2

Figures in £m. Earnings shown basic. Figures in light text are for corresponding period year earlier. §Placing price. *Intoduction. ‡When issued. Annual report/prospectus available at www.ft.com/ir
For more information on dividend payments visit www.ft.com/marketsdata For a full explanation of all the other symbols please refer to London Share Service notes.
Thursday 28 January 2016 FINANCIAL TIMES 23

MARKET DATA

FT500: THE WORLD'S LARGEST COMPANIES

52 Week 52 Week 52 Week 52 Week 52 Week 52 Week
Stock Price Day Chg High Low Yld P/E MCap m Stock Price Day Chg High Low Yld P/E MCap m Stock Price Day Chg High Low Yld P/E MCap m Stock Price Day Chg High Low Yld P/E MCap m Stock Price Day Chg High Low Yld P/E MCap m Stock Price Day Chg High Low Yld P/E MCap m
Australia (A$) Finland (€) Japan (¥) Sweden (SKr) AT&T♦ 35.45 0.05 36.45 30.97 4.99 39.71 218088.4 Lockheed 209.08 -0.85 227.91 181.91 2.70 19.72 64249.34
ANZ 23.68 -0.47 37.25 23.08 10.25 9.81 48661.96 Nokia 6.63 -0.10 7.87 4.91 2.04 -47.16 28756.72 AstellasPh 1630.5 35.00 2047 1499.5 1.83 22.67 30510.65 AtlasCpcoB 183.90 0.50 270.00 168.50 1.56 16.72 8422.34 AutomData 81.66 0.77 90.67 64.29 2.26 28.88 37662.13 Lowes♦ 70.78 0.78 78.13 64.22 1.33 24.21 64771.1
BHPBilltn 15.01 -0.27 34.29 14.06 15.16 17.86 33954.9 SampoA 43.38 -0.95 49.40 40.38 4.34 14.91 26352.07 Bridgestne 4135 110.00 5182 3753.5 2.71 12.85 28316.65 Ericsson 77.25 -4.85 120.00 73.25 4.21 24.72 29964.88 Avago Tech 124.26 -0.13 150.50 99.16 1.15 27.19 34356.59 Lyondell 78.07 0.45 107.32 69.10 3.57 8.90 35088.08
CmwBkAu 77.60 -1.40 96.69 70.15 7.53 14.84 93330.14 France (€) Canon 3287 26.00 4539 3162 4.54 17.56 36923.24 H&M 295.60 2.30 368.50 273.20 3.07 24.34 57420.09 BakerHu 41.35 1.38 70.45 37.58 1.55 -70.45 18032.18 Marathon Ptl 40.94 -0.62 60.38 38.95 2.46 6.88 21819.96
CSL 105.83 -1.76 108.68 81.48 1.30 28.11 34498.56 Airbus Grpe 55.46 -1.96 68.50 46.56 2.09 15.85 47348.81 CntJpRwy 21285 390.00 24800 18255 0.53 15.33 36928.54 Investor 285.70 -0.80 363.40 271.40 3.01 14.51 25545.63 BankAm 13.62 0.31 18.48 12.94 1.38 10.85 141807.56 Marsh&M♦ 52.25 0.32 59.99 50.81 2.63 20.23 27256.12
NatAusBk 26.90 -0.86 39.71 26.39 9.80 11.74 49980.03 AirLiquide 95.08 -0.64 123.95 90.77 2.49 20.04 35573.14 Denso 5032 147.00 6548 4815 2.28 16.58 37466.91 Nordea Bk 84.95 -5.10 115.50 82.80 6.53 10.34 40379.03 Baxter 37.10 0.56 43.44 32.18 4.25 11.81 20296.38 MasterCard♦ 86.58 -0.42 101.76 74.61 0.70 28.30 95258.22
Telstra 5.53 -0.05 6.74 5.06 7.67 16.30 47619.54 AXA 22.53 0.09 26.02 20.12 3.92 11.62 59429.62 EastJpRwy 10330 265.00 12815 9065 1.13 20.52 34147.68 SEB 80.90 -1.35 111.50 75.95 5.61 10.55 20604.16 BB & T 32.25 0.78 41.90 30.99 2.98 12.69 25159.85 McDonald's 121.16 0.73 121.90 87.50 2.64 27.88 111252.73
Wesfarmers 41.88 -0.23 46.95 36.65 7.79 19.63 33218.78 BNP Parib 44.16 0.12 61.00 42.14 3.28 7.93 59834.29 Fanuc 18435 370.00 28575 17710 3.92 18.84 31974.94 SvnskaHn 104.10 -0.30 426.00 95.85 3.83 14.20 22869.23 BectonDick 147.72 2.21 157.50 128.87 1.53 46.85 31341.12 McGraw Hill 84.88 0.52 109.13 79.64 1.43-245.68 22943.06
Westpc 30.33 -0.58 40.07 29.10 8.12 13.36 71261.89 ChristianDior 154.40 0.90 195.35 140.80 1.90 12.56 30502.52 FastRetail 37610 620.00 61970 34540 0.85 47.11 33599.45 Swedbank 178.60 -1.60 223.90 165.10 6.08 13.25 23728.63 BerkshHat 191100 1460 227450 186900 - 14.66 155006.75 McKesson 171.37 0.38 243.61 156.31 0.55 20.47 39433.8
Woolworths 24.11 -0.18 34.71 22.42 8.15 14.31 21582.88 Cred Agr 9.19 -0.08 14.49 8.69 3.68 20.31 26356.56 Fuji Hvy Ind 4521 190.00 5223 3669 2.25 11.05 29808.71 TeliaSonera 39.24 0.04 55.85 37.54 7.31 12.26 19941.95 Biogen 280.66 20.79 480.18 254.00 - 19.48 62558.87 Medtronic 76.21 0.62 79.50 55.54 1.66 47.26 107163.13
Belgium (€) Danone 61.44 1.05 67.74 51.73 2.27 43.66 43745.06 Hitachi 586.10 6.80 916.30 572.30 1.91 12.31 23858.94 Volvo 80.55 1.00 120.50 72.20 3.56 17.99 15343 BkNYMeln 36.23 0.67 45.45 34.24 1.77 16.66 39600.4 Merck 51.31 -0.14 63.02 45.69 3.30 14.46 143336.42
AnBshInBv 114.00 1.05 124.20 87.73 2.54 23.68 199308.18 EDF 11.75 -0.25 24.89 10.96 9.89 6.65 24516.28 HondaMtr 3316 75.00 4499 3161 2.48 11.69 50589.1 Switzerland (SFr) BlackRock 306.09 6.83 382.84 275.00 2.60 16.72 50196.48 Metlife 43.97 0.46 58.23 40.77 3.10 9.05 48878.22
KBC Grp 51.24 -1.50 66.00 47.09 3.77 8.75 23288.67 Engie SA 14.60 0.22 20.08 13.61 6.36 42.18 38651.97 JapanTob 4293 42.00 4848 3185.5 2.22 20.00 72312.3 ABB 17.32 0.37 22.16 15.94 - 16.76 39411.51 Boeing 119.10 -8.91 158.83 115.02 2.73 15.90 79795.72 Microsoft 52.04 -0.14 56.85 39.72 2.24 36.86 415651.06
Esslr Intl 113.85 1.40 125.15 93.87 0.83 42.79 26789.98 KDDI 2896.5 130.50 8550 2519 1.93 16.25 65643.37 CredSuisse 17.90 0.21 28.94 17.21 3.77 8.58 34442.95 BrisMySq♦ 62.55 -0.14 70.87 51.82 2.23 62.78 104351.31 Mnstr Bvrg 138.96 -0.09 160.50 114.70 - 51.18 28170.31
Brazil (R$)
Hermes Intl 311.65 6.50 365.55 280.10 0.88 37.93 35766.3 Keyence 58380 2370 70100 50700 0.33 30.76 29895.28 Nestle 73.90 0.65 77.00 65.70 2.94 16.60 231627.18 Broadcom 54.47 - 58.51 40.21 0.93 25.15 30557.67 MondelezInt 41.66 0.31 48.58 33.97 1.40 8.64 66204.72
Ambev 17.66 0.82 20.46 15.99 8.98 22.73 68252.64
LOreal 154.25 1.70 181.30 140.40 1.63 31.64 93855.74 MitsbCp 1851.5 55.00 2837 1722 2.77 10.67 24794.94 Novartis 80.55 -3.10 103.20 79.00 3.24 24.08 211975.2 CapOne 64.59 4.21 92.10 58.49 2.04 9.65 34364.8 Monsanto♦ 88.73 0.23 126.00 81.22 2.15 24.68 39072.74
Bradesco 18.99 0.49 32.40 17.90 4.94 6.87 11787.42
LVMH 146.10 1.20 176.60 130.75 2.03 13.88 80711.02 MitsubEst 2171 24.00 2975 2048 0.64 42.38 25422.59 Richemont 65.65 1.45 87.55 60.85 2.38 21.62 33688.18 CardinalHlth 83.19 0.48 91.91 74.76 1.65 22.13 27367.94 MorganStly♦ 26.02 0.68 41.04 24.67 1.81 17.00 50380.55
Cielo 32.84 1.09 46.27 30.83 2.01 16.27 15235.01
Nmrcble-SFR 35.50 0.72 60.01 32.19 - -45.18 16912.76 MitsubishiEle 1117 28.50 1718 1053.5 2.26 11.19 20199.8 Roche 268.40 2.70 283.90 241.10 2.94 26.21 185370.19 Carnival 49.33 -0.49 55.77 42.51 1.97 29.58 29110.15 MylanNV 53.21 -0.72 76.69 37.59 - 31.56 26165.86
ItauHldFin 22.07 0.17 32.66 21.49 2.24 5.12 16535.68
Orange 16.30 0.44 16.98 12.21 3.42 46.17 46937.45 MitsuiFud 2628.5 80.00 3879 2419.5 0.99 23.15 21947.69 Swiss Re 92.65 - 99.75 76.85 4.67 37.72 33763.58 Caterpillar♦ 59.05 -0.11 89.62 56.36 4.57 12.96 34380.91 Netflix 95.01 -2.82 133.27 58.46 - 269.70 40606.16
Petrobras 6.57 0.61 16.26 5.67 - -2.56 12023.28
PernodRic 104.00 0.20 117.75 88.00 1.47 34.55 30008.09 MitUFJFin 634.00 30.00 936.80 595.00 2.65 6.18 75656.3 Swisscom 498.60 7.60 580.50 463.20 4.32 18.66 25390.46 CBS 48.14 0.63 63.95 38.51 1.17 16.52 20878.45 NextEraE 107.44 0.88 112.64 93.74 2.66 16.38 49479.98
Vale 9.41 0.46 27.89 8.63 24.99 -4.10 7444.03
Renault 81.29 0.35 100.25 59.59 2.17 9.45 26133.04 Mizuho Fin 210.80 6.80 280.40 191.00 3.43 7.00 44167.07 Syngent 369.50 6.70 435.20 288.50 2.92 25.46 33761.04 Celgene 105.43 -0.56 140.72 92.98 - 56.15 83346.65 Nike 60.65 -0.46 68.20 45.35 1.12 31.13 81871.23
Canada (C$) Murata Mfg 14580 90.00 22220 12520 1.28 15.42 27661.12 CharlesSch 25.89 0.44 35.72 24.37 0.87 27.71 34084.79 NorfolkS 70.31 1.41 112.05 66.51 3.13 13.51 20992.44
Safran 58.00 -0.94 72.45 54.00 1.92 -18.95 26294.42 UBS 16.67 0.10 22.57 15.07 4.41 10.52 63082.77
BCE 55.60 0.09 60.20 51.56 4.57 18.45 34141.79 NipponTT 4813 184.00 5066 3423.5 1.84 18.20 84978.71 ChevrnTx 85.47 1.35 112.93 69.58 4.71 19.72 160857.68 Northrop 180.80 -1.70 193.99 152.04 1.56 18.53 32974.85
Sanofi 77.16 0.28 101.10 70.94 3.43 22.67 109522.51 Zurich Fin 225.10 3.30 334.60 212.80 - 11.48 33281.68
BkMontrl 74.21 1.43 80.76 64.01 4.34 11.35 33863.21 Nissan Mt 1103 32.50 1350 996.00 3.17 9.08 41995.59 Chubb 109.05 0.47 134.49 94.35 2.28 14.16 24760.44 NXP 71.27 -0.39 114.00 66.93 - 26.16 17942.33
Sant Gbn 37.32 0.41 44.84 34.98 1.54 26.95 22757.76 Taiwan (NT$)
BkNvaS 54.63 1.37 67.72 51.17 4.92 9.81 46651.34 Nomura 616.80 20.30 909.20 568.20 3.48 9.29 19857.3 Cigna 132.94 -2.48 170.68 105.23 0.03 17.30 34249.05 Occid Pet 65.47 2.24 83.74 58.24 4.23 -8.80 49997.97
Schneider 48.94 0.42 75.29 45.57 3.64 18.22 31261.84 Chunghwa Telecom 102.00 - 103.00 93.10 4.57 20.77 23555.72
Brookfield 41.13 0.50 48.64 38.13 1.48 11.08 28821.67 Nppn Stl 2124 27.50 3505 1987.5 2.86 9.35 16999.9 Cisco 23.83 0.11 30.31 22.47 3.18 13.83 121201.42 Oracle 35.44 0.21 45.24 33.13 1.52 17.99 148904.68
SocGen 35.37 -0.39 48.77 33.69 3.28 10.07 30996.07 HonHaiPrc 75.30 -0.20 99.70 72.70 4.61 8.18 35055.88
CanadPcR 163.70 0.10 245.05 140.02 0.85 18.42 17762.03 NTTDCMo 2411 99.50 2873.5 1955 2.71 21.58 82964.54 Citigroup 41.44 0.94 60.95 39.44 0.27 9.92 123459.79 Pepsico 97.14 0.82 103.44 76.48 2.63 30.68 141518.48
Total 40.15 0.50 50.30 36.16 5.98 113.88 107109.89 MediaTek 211.00 2.00 504.00 195.50 10.01 10.77 9871.81
CanImp♦ 88.14 1.14 102.90 82.19 4.85 9.99 24852.99 Panasonic 1111 27.50 1853.5 1044.5 1.37 84.21 22953.15 CME Grp 87.47 1.10 100.87 81.87 2.12 24.86 29585.26 Perrigo 147.80 -1.15 215.73 138.74 0.31 155.54 21637.49
UnibailR 227.15 -2.55 262.00 212.30 3.99 13.88 24370.93 TaiwanSem 139.50 2.00 155.00 112.50 3.10 12.39 107686.28
CanNatRs 27.55 1.13 42.46 21.27 3.29 70.78 21394.03 Seven & I 5066 76.00 5998 4270 1.35 28.70 37821.32 Coca-Cola 42.34 0.26 43.91 36.56 2.88 28.86 184114.29 Pfizer 30.89 0.22 36.46 28.47 3.35 24.66 190210.42
Vinci 62.61 1.24 62.61 46.39 2.63 19.23 40101.37
CanNatRy 72.53 1.24 88.89 66.62 1.62 17.26 40578.94 ShnEtsuCh 5994 136.00 8310 5593 1.63 19.88 21813.68 Thailand (THB) Cognizant 62.31 0.37 69.80 53.33 - 25.98 37979.77 Phillips66 79.22 1.46 94.12 67.52 2.52 9.83 42259.14
Vivendi 20.09 0.35 24.83 18.10 9.62-241.37 29883.9
Enbridge 46.23 0.36 66.14 40.03 3.74-120.47 28453.69 Softbank 5187 338.00 7827 4540 0.72 11.84 52451.47 PTT Explor 222.00 3.00 382.00 197.00 4.60 -71.78 17707.32 ColgtPlm♦ 64.78 0.45 71.56 50.84 2.15 25.47 58102.61 PhilMorris 88.96 1.65 90.27 75.27 4.25 20.32 137825.35
GtWesLif 34.01 0.58 37.70 30.42 3.74 12.55 23966.13 Germany (€)
Sony 2512 82.00 3970 2426.5 0.84 32.42 26707.92 United Arab Emirates (Dhs) Comcast 55.23 0.39 64.99 50.01 1.66 18.41 115679.75 PNCFin♦ 86.48 2.03 100.52 82.54 2.15 12.37 44789.75
ImpOil 41.31 0.59 55.37 37.25 1.14 21.00 24839.02 Allianz 147.50 0.40 170.15 131.05 4.49 10.80 73278.58
SumitomoF 4106 199.00 5770 3785 3.52 9.02 48899.75 Emirtestele 16.00 0.40 16.50 10.05 3.79 18.41 34439.54 ConocPhil 36.83 1.48 70.11 32.71 7.49 -47.75 45471.86 PPG Inds 93.34 0.76 118.95 82.93 1.40 23.19 25133.59
Manulife 18.75 0.34 24.20 17.13 3.43 14.99 26228.69 BASF 60.95 -1.13 97.22 59.00 4.44 11.43 60857.15
Takeda Ph 5695 95.00 6657 5086 2.95 -31.36 37900.86 United Kingdom (p) Corning 18.10 0.39 25.16 15.42 2.39 12.57 21406.1 Praxair 99.38 1.24 130.38 95.94 2.65 21.52 28307.89
Potash♦ 21.50 0.28 47.10 20.88 9.01 9.19 12758.92 Bayer 105.05 -0.30 146.45 98.64 2.07 24.14 94437.18
TokioMarine 4154 134.00 5504 3839 2.41 17.74 26502.35 AscBrFd 3078 63.00 3606 2705.75 1.10 43.13 34738.59 Costco 149.43 0.93 169.73 117.03 0.99 29.57 65713.72 Prec Cast 234.84 - 234.87 187.00 0.05 26.21 32309.56
RylBkC 68.85 1.23 81.53 64.95 4.45 10.31 72606.32 BMW 79.96 0.56 123.75 72.05 3.50 9.65 52328.06
Toyota 6881 252.00 8783 6392 3.05 10.11 193445.57 AstraZen 4473 57.50 4931.68 3746 4.15 50.53 80609.31 CrownCstl 84.04 0.43 89.44 75.71 3.67 58.24 28050.14 Priceline 1068.64 -42.90 1476.52 992.13 - 23.72 53201.1
Suncor En 31.64 0.64 40.93 27.32 3.53 482.22 32456.2 Continental 199.60 2.10 234.25 171.30 1.57 15.52 43398.26
Mexico (Mex$) Aviva 473.20 7.90 578.68 428.40 3.83 12.38 27310.58 CSX 22.53 0.26 37.67 21.33 2.84 11.90 21960.63 ProctGmbl♦ 79.73 0.92 87.21 65.02 3.19 26.74 216908.54
ThmReut 51.49 -0.13 55.92 47.25 3.44 15.42 27928.2 Daimler 65.93 0.84 96.07 62.06 3.59 9.45 76677.81
AmerMvl 12.38 0.30 17.17 10.87 2.07 22.05 28168.41 Barclays 181.80 -1.20 289.90 175.15 3.58 80.26 43553.16 CVS♦ 94.98 0.94 113.65 81.37 1.31 22.68 105174.75 Prudntl 70.01 0.90 92.60 65.07 3.12 9.70 31435.39
TntoDom♦ 51.74 0.87 56.48 47.75 3.84 12.35 68118.07 Deut Bank 17.11 -0.02 33.42 15.98 4.24 -5.80 25647.34
FEMSA UBD 164.89 1.02 169.74 124.27 0.68 31.34 31949.2 BG 1029.5 34.60 1301.62 808.80 1.85 -19.88 50164.35 Danaher♦ 84.97 0.29 97.62 81.25 0.56 25.09 58228.69 PublStor 252.12 -1.36 254.66 182.08 2.31 44.92 43589.65
TrnCan♦ 48.13 1.00 59.50 40.58 4.19 20.63 23989.51 Deut Tlkm 16.10 0.26 17.63 13.39 3.00 34.38 80626.91
WalMrtMex 44.65 0.30 47.00 28.32 1.24 33.33 42219.62 BP 362.90 6.40 499.25 252.55 7.42 -13.26 95094.14 Deere♦ 74.59 1.02 98.23 70.16 2.97 14.00 23622.66 Qualcomm 48.33 -0.19 74.09 44.39 3.51 15.95 72241.48
ValeantPh 137.86 -1.01 347.84 92.65 - 59.39 33367.57 DeutsPost 22.52 -0.08 31.19 22.05 - 19.49 29651.45
BrAmTob 3764 81.00 3931.5 3231.5 3.93 17.47 100033.19 Delphi 66.79 0.42 90.57 63.47 1.41 14.95 18707.09 Raytheon♦ 119.69 0.16 129.99 95.32 2.06 18.78 36038.42
E.ON 9.64 0.27 14.85 7.08 1.40 -2.15 20963.22 Netherlands (€)
China (HK$) BSkyB 1062 16.00 1180 899.50 3.04 13.58 26025.66 Delta 45.99 -0.13 52.77 34.61 0.83 14.08 36165.99 Regen Pharm 455.05 -8.51 605.93 393.00 - 95.58 46484.01
Fresenius Med 81.35 3.26 83.17 62.65 0.91 27.31 27668.19 Altice 12.79 0.29 47.73 9.98 - 236.90 11418.1
AgricBkCh 2.70 -0.01 4.55 2.63 7.90 4.25 10650.08 BT♦ 478.30 10.00 502.60 404.00 2.38 18.02 57046.63 DiscFinServ 49.50 1.11 61.50 47.29 1.98 10.85 21160.45 ReynoldsAm 48.08 0.97 49.56 33.71 2.67 19.25 68711.2
Fresenius SE 61.31 0.67 70.00 46.20 0.69 27.64 36320.32 ASML Hld 83.13 0.13 104.85 70.25 0.81 26.68 39160.46
Bk China 2.95 -0.01 5.68 2.92 7.55 4.56 31655.21 Compass♦ 1171 45.00 1223.36 963.00 2.35 22.43 27447.38 Disney 96.15 -0.12 122.08 90.00 1.77 20.83 157843.38 Salesforce 69.28 -0.59 82.90 55.45 - -559.55 46001.92
HenkelKgaA 82.83 0.53 99.44 75.76 1.51 20.99 23393.15 Heineken 78.40 1.10 85.90 63.71 1.30 23.95 49091.84
BkofComm 4.56 0.07 8.61 4.47 6.94 4.39 20486.84 Diageo 1867 -5.00 2055 1592.5 2.87 19.74 66949.23 DominRes 70.01 0.29 79.89 64.54 3.42 24.64 41679.31 Schlmbrg 66.73 1.40 95.13 59.60 2.68 26.79 84153.45
Linde 123.10 -1.15 195.55 116.40 2.47 20.75 24855.15 ING 10.65 -0.03 16.00 10.23 - 24.33 44781.65
BOE Tech 1.86 -0.02 4.78 1.17 1.96 27.63 47.49 GlaxoSmh 1436 20.50 1645 1227.5 5.57 7.11 99692.38 DowChem♦ 42.80 0.34 57.10 35.11 3.69 12.26 49561.78 Shrwin-Will 250.53 1.11 294.35 218.27 0.96 25.50 23324.47
MuenchRkv 175.75 2.30 206.50 156.00 4.26 9.80 31876.8 Unilever 39.98 0.22 42.84 32.86 2.69 25.40 74516.51
Ch Coms Cons 6.35 0.25 17.00 5.77 3.12 6.41 3607.7 Glencore 92.03 4.93 318.46 66.67 12.44-214.02 18885.61 DukeEner 72.82 0.60 89.97 65.50 4.15 22.48 50124.51 SimonProp 187.03 -3.11 208.14 170.99 2.89 37.16 57870.46
SAP 73.38 0.89 75.75 53.91 1.45 29.41 97999.34 Norway (Kr)
Ch Evrbrght 3.50 0.11 5.65 3.22 6.23 4.81 3084.89 HSBC 480.10 5.60 674.57 461.80 6.98 9.47 134709.73 DuPont 53.59 0.13 76.61 47.11 3.18 16.35 46966.65 SouthCpr 25.15 0.16 33.31 21.55 1.57 20.97 19752.21
Siemens 88.47 -2.13 106.35 77.91 3.60 14.53 84730.69 DNB 97.60 -1.40 143.00 90.10 3.89 7.19 18323.47
Ch Rail Cons 6.90 0.15 17.70 6.72 2.55 6.29 1838.39 ImpTob 3667 77.50 3667 2921 3.60 20.73 50118.22 Eaton 49.62 0.60 73.82 46.19 4.06 12.21 22964.14 Starbucks 58.40 -0.21 64.00 42.05 1.13 37.03 86486.72
Volkswgn 126.15 1.20 254.50 95.00 3.68 10.37 40467.87 Statoil 107.20 -1.50 161.70 97.25 6.43 -9.57 39399.59
Ch Rail Gp 4.83 0.20 12.30 4.21 1.89 8.47 2607.7 LlydsBkg 64.92 0.19 89.35 61.00 2.31 38.71 66131.28 eBay 26.74 0.09 29.83 22.11 - 11.48 32105.48 StateSt 53.78 -2.15 81.26 52.60 2.24 13.37 21699.48
ChConstBk 4.55 0.08 7.98 4.46 7.75 4.29 140370.06 Hong Kong (HK$) Telenor 144.10 - 186.10 132.10 2.52 36.81 24938.35 Ecolab 104.34 0.21 122.48 99.99 1.19 29.72 30811.97 Stryker♦ 99.61 3.59 105.34 86.68 1.30 34.36 37405.77
Natl Grid 965.70 17.70 968.57 806.40 4.44 16.83 51586.78
China Vanke RMB 24.43 - 24.43 10.93 2.05 16.75 36586.73 AIA 42.95 1.15 58.20 38.85 0.95 21.07 66403.15 Qatar (QR) EMC 24.10 -0.20 29.24 22.66 1.80 21.47 46725.98 Sychrony Fin 28.41 -0.25 36.40 26.28 - 11.48 23688.99
Prudential 1334.5 15.50 1761.5 1045.99 2.77 13.58 48924.28
ChinaCitic 4.42 0.07 7.40 4.22 - 4.35 8440.87 BOC Hold 19.76 0.04 33.70 19.40 5.16 8.86 26808.66 QatarNtBk 155.40 4.30 208.50 147.00 4.67 9.98 29858.71 Emerson 43.19 0.09 62.75 41.25 4.10 11.46 28270.32 Target 71.37 0.93 85.81 66.46 2.74 17.30 43967.6
RBS 255.70 -5.20 414.00 246.00 - -11.47 42374.44
ChinaLife 18.36 0.24 41.00 18.02 2.51 11.62 17531.26 Ch OSLnd&Inv 21.40 0.45 34.05 20.45 2.34 6.47 27077.85 EOG Res♦ 66.76 0.73 101.36 57.15 0.94 -10.19 36700.21 TE Connect 56.89 -0.13 73.73 54.32 2.18 21.15 21288.08
Russia (RUB) ReckittB 6169 57.00 6450 5400 2.25 26.21 62199.53
ChinaMBank 14.52 0.04 26.85 14.34 5.41 5.42 8553.86 ChngKng 39.15 0.30 77.55 38.55 - 9.05 19390.14 EquityResTP 78.86 -0.88 82.53 61.90 2.57 36.34 28725.69 Telsa Mtrs 191.30 -2.26 286.65 181.40 - -38.13 25050.99
Gzprm neft 134.00 2.11 166.94 122.75 6.03 9.92 40527.4 RELX 1199 26.00 1232 988.50 2.17 27.54 35064.43
ChinaMob 83.70 1.40 118.00 79.00 3.17 13.82 219916.52 Citic Ltd 10.82 -0.06 16.40 10.44 1.81 5.61 40389.79 Exelon 28.33 0.49 37.77 25.09 4.12 13.38 26051.26 TexasInstr 51.27 0.57 59.99 43.49 2.50 19.57 52003.83
Lukoil 2400.5 80.50 3297.7 2040.1 8.14 18.92 26084.86 RioTinto 1717 28.50 3280 1557 7.95 17.08 33633.22
ChinaPcIns 25.80 0.60 47.10 24.80 2.21 13.24 9188.13 Citic Secs 13.98 0.08 40.50 12.82 2.36 6.56 4087.16 ExpScripts 74.00 1.02 94.61 68.06 - 24.41 50044.42 TheTrvelers 104.40 1.15 116.48 95.21 2.09 9.86 31760.44
MmcNrlskNckl 8991 111.00 12247 7840 16.78 9.93 18176.89 RollsRoyce 539.50 -4.00 1061 504.50 4.28 -39.67 14141.41
ChMinsheng 6.69 0.06 11.88 6.30 3.24 4.53 5952.27 CK Hutchison 93.15 0.10 174.90 92.00 3.57 4.03 46135.17 ExxonMb 77.19 0.49 93.45 66.55 3.46 17.32 321337.22 ThrmoFshr 136.35 2.25 143.65 117.10 0.41 29.47 54416.97
Novatek 600.00 23.00 646.30 410.80 10.97 48.70 23274.32 RylDShlA 1463 40.50 2216.5 1256 8.59 88.43 83236.66
ChMrchSecs RMB 14.63 -0.33 40.00 13.85 2.78 8.62 10682.62 CNOOC 7.01 0.26 13.78 6.41 7.38 6.66 40161.73 Facebook 96.71 -0.63 110.65 72.00 - 103.75 218541.38 TimeWrnr 72.52 0.53 91.34 62.94 1.77 17.70 59141.89
Rosneft 264.40 8.50 294.20 214.80 3.49 6.35 35799.16 SABMill 4199 7.00 4206.5 2773 1.77 34.78 96993.05
Chna Utd Coms RMB 4.08 -0.08 10.74 3.86 1.61 28.47 13147.4 HangSeng 121.60 -1.30 162.10 121.10 4.20 9.55 29832.11 Fedex 131.02 3.74 185.19 119.71 0.65 35.30 36111.19 TimeWrnrC 180.24 1.07 194.22 134.21 1.96 28.62 51043.53
Sberbank 95.75 4.25 110.70 57.20 0.53 9.19 26406.45 Shire 4050 -73.00 5870 3855 0.37 11.95 34203.32
ChShenEgy 11.04 0.26 22.50 10.12 7.73 8.02 4814.67 HK Exc&Clr 161.80 -1.30 311.40 160.10 3.06 25.51 25092.06 FordMtr♦■ 12.01 0.15 16.74 10.44 4.51 10.70 46795.55 TJX Cos 70.01 0.32 76.93 63.53 1.02 23.11 46874.74
Surgutneftegas 36.20 0.99 39.80 28.10 - 1.22 16522.56 StandCh 471.35 -5.95 1166 455.50 10.88 11.02 22027.79
ChShpbldng RMB 6.69 -0.29 20.19 6.40 0.55-419.65 18263.86 MTR 35.05 0.20 40.00 33.10 2.73 14.13 26348.26 Franklin 33.77 0.40 54.85 31.87 1.67 10.90 20283.37 T-MobileUS 39.27 -0.16 43.43 29.27 - 69.08 32045.79
Saudi Arabia (SR) Tesco 161.00 0.65 252.52 137.00 0.72 -2.32 18685.44
ChStConEng RMB 5.12 0.03 12.52 4.88 3.27 6.74 23272.75 SandsCh 24.55 1.50 40.55 20.75 7.38 14.67 25420.56 GenDyn♦ 132.41 5.03 153.76 121.61 2.35 15.85 41858.53 UnionPac 70.12 0.08 124.52 67.06 2.89 12.87 59890.94
AlRajhiBnk 47.53 0.29 69.00 44.70 3.70 12.80 20588.1 Vodafone♦ 223.20 4.55 258.00 201.25 5.03 -41.80 84496.5
ChUncHK 8.29 0.12 16.00 7.87 2.82 18.48 25474.43 SHK Props 80.35 -0.35 137.60 80.05 2.72 8.03 29832.55 GenElectric 28.50 0.19 31.49 19.37 3.04 58.71 288113.31 UPS B 91.82 0.89 107.32 87.30 2.93 22.40 63919.82
Natnlcombnk 38.69 0.24 72.75 36.60 1.95 9.32 20571.07 WPP 1481 18.00 1616 1273 2.58 15.31 27336.13
CNNC Intl RMB 7.12 -0.13 14.38 4.07 - 20.57 4211.66 Tencent 140.50 -1.30 171.00 124.00 0.24 41.14 169544.47 GenMills♦ 55.51 0.38 59.87 47.43 2.95 24.21 32936.59 USBancorp 39.77 0.75 46.26 37.97 2.37 13.39 69564.77
SaudiBasic 66.01 1.51 110.50 59.50 7.33 8.91 52786.89 United States of America ($)
CSR 6.77 -0.01 20.70 6.68 - 15.80 3797.28 India (Rs) GenMotors 29.79 0.14 39.00 24.62 4.17 11.61 46358.51 UtdHlthcre 114.11 0.15 126.21 95.00 1.44 19.24 108759.2
SaudiTelec 59.86 0.41 73.25 52.75 6.29 13.00 31912.56 21stC Fox A 27.11 0.20 35.85 22.81 1.04 7.50 31733.23
Daqin RMB 6.96 - 15.15 6.80 6.72 7.52 15730.4 Bhartiartl 297.80 - 452.45 291.55 0.73 21.15 17494.7 GileadSci 90.82 -1.39 123.37 86.00 0.89 8.87 130887.98 UtdTech 87.18 1.53 124.45 83.39 2.71 14.55 77330.49
Singapore (S$) 3M 147.33 2.55 170.50 134.00 2.51 20.26 90712.99
Gree Elec Apl 0.17 0.01 0.45 0.13 - -1.94 257.12 HDFC Bk 1035.65 - 1128 944.20 0.75 24.43 38431.99 GoldmSchs 157.92 3.47 218.77 151.12 1.49 11.02 67357.74 ValeroEngy 66.98 -0.73 73.88 50.50 2.07 7.91 32251.1
DBS 13.66 -0.10 21.50 13.60 4.16 10.93 23878.31 AbbottLb♦ 41.23 1.07 51.74 39.00 2.15 26.03 61503.61
GuosenSec RMB 14.25 -0.44 34.94 13.76 1.37 8.87 4755.25 Hind Unilevr 767.90 - 981.00 766.45 1.84 36.48 24419.67 Halliburton 29.54 0.60 50.20 27.64 2.29 101.98 25280.73 Verizon♦ 49.15 0.90 50.86 38.06 4.24 20.94 199985.11
JardnMt US$ 51.04 0.09 67.00 45.00 2.58 13.10 35848.18 Abbvie♦ 58.72 0.46 71.60 45.45 3.09 36.09 95992.34
HaitongSecs 10.96 0.22 27.90 10.00 2.67 7.10 4795.22 HsngDevFin 1169.95 - 1402.3 1093.2 1.25 20.91 27144.38 HCA Hold 68.15 1.19 95.49 43.91 - 15.14 27782.55 VertexPharm 94.97 2.77 143.45 89.97 - -36.78 23335.77
JardnStr US$ 26.43 -0.08 36.93 25.24 0.93 10.34 29417.88 Accenture 103.50 0.97 109.86 83.47 1.94 24.29 83444.11
Hngzh HikVDT RMB 24.98 0.78 56.48 23.72 1.56 18.25 11983.99 ICICI Bk 237.30 - 393.40 217.80 2.04 11.33 20269.9 Hew-Pack 9.76 0.12 17.64 9.24 6.36 4.26 17488.62 VF Cp 59.50 0.75 77.83 52.21 2.02 26.34 25366.24
OCBC 7.62 -0.07 10.92 7.55 4.47 8.94 21920.48 Adobe 87.29 0.40 96.42 69.04 - 74.25 43499.26
Hunng Pwr 5.97 0.03 11.90 5.89 7.42 5.92 3600.87 Infosys 1138.5 - 2336 932.65 3.56 19.60 38242 HiltonWwde 18.25 -0.24 31.60 16.16 0.36 25.62 18021 Viacom 44.33 0.47 73.52 36.32 3.10 9.96 15389.89
SingTel 3.43 0.03 4.57 3.38 4.83 14.91 38239.55 AEP 58.71 0.51 65.38 52.29 3.40 17.31 28815.89
IM Baotou Stl RMB 2.95 0.03 7.50 2.83 - -38.74 7059.83 ITC 312.95 - 409.95 294.00 2.00 24.97 36962.02 HomeDep 123.96 1.76 135.47 92.17 1.67 25.17 157166.56 Visa Inc 72.12 0.24 81.01 60.00 0.63 29.75 140377.43
UOB 17.44 -0.03 25.05 17.01 4.61 9.33 19600.81 Aetna♦ 103.08 -1.90 134.40 90.20 0.89 16.80 35944
In&CmBkCh 3.87 0.02 7.10 3.82 7.74 4.35 43101.92 L&T 1107.8 - 1893.8 1069.1 1.34 20.68 15160.55 Honywell 98.07 -0.44 107.41 87.00 1.99 18.26 75581.71 Walgreen 79.92 0.48 97.30 73.00 1.65 20.52 86213.45
Aflac 57.99 0.47 66.53 51.41 2.53 10.78 24746.58
IndstrlBk RMB 14.49 0.04 21.42 11.90 3.83 5.68 41969.06 OilNatGas 218.40 - 373.80 205.95 4.42 9.76 27460.04 South Africa (R) HumanaInc♦ 163.67 -0.99 219.79 143.44 0.66 20.01 24259.84 WalMartSto 64.90 0.90 88.46 56.30 2.77 15.07 207802.87
AirProd♦ 120.29 1.88 158.20 114.64 2.50 21.74 25921.29
Kweichow RMB 199.93 0.92 290.00 166.20 2.13 16.04 38181.13 RelianceIn 999.35 - 1089.75 796.45 1.00 11.11 47575.79 Firstrand 40.50 -0.86 58.47 34.08 5.74 8.37 13871.82 IBM 122.62 0.03 176.30 118.00 3.68 8.93 118950.05 WellsFargo 49.11 0.85 58.77 46.88 2.78 12.62 252099.27
Alexion 155.23 2.59 208.88 142.02 - 149.39 34977.09
Midea 1.75 -0.08 2.68 1.65 5.21 12.08 48.29 SBI NewA 184.40 - 336.00 171.50 1.85 7.81 21036.89 MTN Grp 125.85 3.33 250.00 109.56 12.10 6.17 14181.45 IllinoisTool 87.07 2.76 100.14 78.79 2.17 18.21 31649.23 Williams Cos 19.14 -1.28 61.38 12.77 11.70 45.41 14350.5
Allegran 294.58 -0.02 340.34 237.50 - -42.48 116101.2
New Ch Life Ins 25.60 -0.10 56.55 25.45 0.95 7.47 3397.06 SunPhrmInds 821.15 - 1200.8 704.00 - 70.93 29042.32 Naspers N 1870 22.51 2270 1521.98 0.28 52.72 49997.49 Illumina 170.15 -2.75 242.37 130.00 - 52.78 24909.96 Yahoo 30.36 0.38 50.32 27.20 - 126.31 28670.62
Allstate 59.22 1.04 72.87 54.12 1.88 10.96 22936.27
PetroChina 4.51 0.14 11.04 4.16 4.09 16.60 12210.57 Tata Cons♦ 2319.75 - 2812.1 2243 1.72 21.26 67174.67 South Korea (KRW) Intcntl Exch 253.97 2.33 266.74 202.24 0.80 25.52 27876.39 Yum!Brnds♦ 70.10 0.23 95.90 66.35 2.20 35.60 30230.04
Alphabet 732.09 -1.71 798.69 503.48 - 35.89 213276.7
PingAnIns 33.80 -0.15 62.90 33.30 2.34 9.40 32302 Indonesia (Rp) HyundMobis 255500 12000 262000 185500 1.12 13.51 20681.32 Intel 30.10 0.16 35.59 24.87 2.96 13.69 142018.31 Venezuela ()
Altria 59.77 0.81 61.74 47.31 3.35 23.90 117189.81
PngAnBnk RMB 9.88 0.01 17.50 9.30 1.72 6.45 17729.69 Bk Cent Asia 13100 100.00 15600 11000 1.01 20.51 23273.59 KoreaElePwr 51700 100.00 54000 40800 0.92 2.85 27598.16 Intuit 92.81 0.17 109.21 79.63 1.04 61.35 24502.24 Bco de Vnzla 97.50 - 143.95 30.00 - - 26340.4
Amazon 593.45 -7.80 696.44 299.33 - 909.81 278186.81
Pwr Cons Corp RMB 6.35 -0.08 20.00 6.05 1.53 12.83 3185.66 SK Hynix 27650 -200.00 51700 25800 1.04 4.57 16244.72 John&John 101.97 0.79 105.49 81.79 2.68 20.79 282145.24 Bco Provncl 3800 -299.00 4400 850.00 0.13 50.74 30351.44
Israel (ILS) AmerAir 40.09 0.45 56.05 34.10 0.94 6.12 25269.75
SaicMtr RMB 17.89 -0.10 29.18 14.00 7.08 7.03 29986.34 SmsungEl 1175000 38000 1510000 1033000 1.67 9.02 124166.07 JohnsonCn 36.24 1.03 54.52 33.62 2.70 17.66 23480.2 Mrcntl Srvcs 5000 - 5900 1310 0.15 39.11 22000.5
TevaPha 250.70 -0.40 275.90 214.70 1.97 32.36 64452.39 AmerExpr♦ 55.43 0.34 86.18 54.14 1.87 10.48 54551.83
ShenwanHong 0.13 -0.01 0.41 0.12 - -2.01 40.05 Spain (€) JPMrgnCh♦ 57.93 0.85 70.61 50.07 2.73 10.48 213243.06
Italy (€) AmerIntGrp 55.70 -0.21 64.93 48.68 1.11 17.16 68901.6
ShgPdgBk RMB 16.68 0.02 20.12 11.91 4.42 6.47 47300.73 Kimb-Clark 126.00 1.11 130.05 103.04 2.60 80.61 45737.3 Closing prices and highs & lows are in traded currency (with variations for that
Enel 3.81 0.05 4.50 3.49 3.55 65.65 38906.39 BBVA 5.91 0.00 9.77 5.55 2.61 15.56 40925.08 AmerTower 93.14 0.67 104.12 86.21 1.72 73.88 39449.21
Sinopec Corp 4.11 0.05 7.79 3.86 5.66 20.20 13455.79 KinderM 14.97 - 44.71 11.20 11.69 29.65 33405.77 country indicated by stock), market capitalisation is in USD. Highs & lows are
ENI 13.14 0.06 17.66 12.01 7.06 -17.84 51912.41 BcoSantdr 3.98 -0.01 7.17 3.70 12.04 7.92 62484.46 Amgen 154.25 0.47 181.81 130.09 1.82 19.58 116355.07
Sinopec Oil RMB 6.15 0.08 14.23 5.71 - -182.18 420.73 Kraft Heinz 76.85 0.87 81.20 61.42 0.67 -53.54 93254.07 based on intraday trading over a rolling 52 week period.
Generali 13.96 -0.19 19.21 13.74 4.15 11.68 23626.94 CaixaBnk 2.75 -0.02 4.53 2.59 2.81 24.02 17417.28 Anadarko 35.29 0.70 95.94 28.16 2.88 -3.27 17932.36
Denmark (kr) Iberdrola♦ 6.50 0.14 6.71 5.66 2.31 17.24 44749.65 Kroger 37.61 0.83 42.75 27.32 0.94 20.06 36659.32 ♦ ex-dividend
IntSPaolo 2.65 -0.03 3.65 2.47 2.55 15.77 45654.01 Anthem 134.74 -3.02 173.59 126.25 1.62 13.70 35164.93
DanskeBk 181.70 -3.00 218.00 161.20 2.93 27.78 26697.49 Inditex 30.00 0.58 35.38 25.46 1.26 35.14 101643.22 L Brands 94.76 -0.90 101.11 75.11 1.79 25.82 27426.8 ■ ex-capital redistribution
Luxottica 56.40 -0.55 67.80 50.10 1.23 35.45 29653.92 Aon Cp 86.19 0.16 107.08 83.83 1.20 20.92 23608.21
MollerMrsk 8370 15.00 16450 7550 3.36 7.94 12976.95 Repsol 8.83 -0.20 18.75 7.95 10.47 26.76 13439.13 LasVegasSd 41.88 1.01 61.59 34.88 5.51 16.00 33397.26 # price at time of suspension
Unicred 3.77 -0.12 6.61 3.61 3.08 12.20 24442.69 Apple 95.41 -4.59 134.54 92.00 1.95 11.00 528971.78
NovoB 384.60 6.40 415.00 274.30 1.26 31.13 115559.23 Telefonica 9.59 0.10 14.31 8.74 4.03 16.70 50701.52 LibertyGbl 34.72 0.04 58.66 31.63 - -23.80 8775.69
ArcherDan 34.20 0.57 53.31 29.86 2.97 12.55 20408.5
Lilly (E) 82.99 1.03 92.85 68.31 2.26 39.89 91959.27

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
Glencore 92.03 87.10 4.93 5.66 20.83 29.3 -0.40 ChShpbldng 6.69 6.98 -0.29 -4.15 -1.54 -18.7 -31.24 Jan 27 date Coupon S* M* F* price yield yield yield US Jan 27 date Coupon S* M* F* price yield yield yield US
KinderM 14.97 14.97 0.00 0.00 2.96 24.6 -6.78 Gree Elec Apl 0.17 0.16 0.01 3.09 -0.04 -18.5 -30.71 High Yield US$ US$
Williams Cos 19.14 20.42 -1.28 -6.27 3.65 23.6 -22.92 Chna Utd Coms 4.08 4.16 -0.08 -1.92 -0.79 -16.2 -34.72 Navient Corporation 06/18 8.45 BB- Ba3 BB 101.34 7.97 0.00 1.26 7.11 Halliburton Company 02/27 6.75 A A2 A- 116.22 4.89 0.00 0.21 2.89
China Vanke 24.43 24.43 0.00 0.00 4.53 22.8 74.50 GuosenSec 14.25 14.69 -0.44 -3.00 -2.58 -15.3 -29.10 High Yield Euro Korea Electric Power Corporation 08/27 6.75 AA- Aa2 AA- 100.60 6.79 0.00 -0.26 4.79
RylDShlA 1463.00 1422.50 40.50 2.85 197.00 15.6 -6.04 ChMrchSecs 14.63 14.96 -0.33 -2.21 -2.36 -13.9 -35.47 Kazkommerts Intl BV 02/17 6.88 B Caa1 B 97.50 - 0.00 0.00 - SouthTrust Bank 12/27 6.57 A Aa3 A+ 119.90 4.44 0.00 -0.05 2.45
Anadarko 35.29 34.59 0.70 2.02 4.75 15.6 -31.00 CNNC Intl 7.12 7.25 -0.13 -1.79 -1.05 -12.9 -26.29 FleetBoston Financial Corp. 01/28 6.88 BBB Baa3 A- 120.89 4.64 0.00 -0.23 -
CanNatRs 26.42 26.42 0.00 0.00 3.52 15.4 -11.11 Hngzh HikVDT 24.98 24.20 0.78 3.22 -3.58 -12.5 -29.24 Emerging US$ SunTrust Banks, Inc. 01/28 6.00 BBB+ Baa1 A- 112.59 4.67 0.00 -0.43 -
BG 1029.50 994.90 34.60 3.48 131.90 14.7 1.82 ChngKng 39.15 38.85 0.30 0.77 -5.50 -12.3 -23.39 Mexico 09/16 11.40 BBB+ A3 BBB+ 106.80 1.49 0.03 0.01 0.44 E.I. du Pont de Nemours and Company 01/28 6.50 A- A3 A 116.81 4.71 0.00 0.04 -
Siemens 90.60 90.60 0.00 0.00 10.30 12.8 10.17 CSR 6.77 6.78 -0.01 -0.15 -0.94 -12.2 -31.20 Brazil 01/18 8.00 BB+ Baa3 BB+ 104.30 5.67 0.00 0.00 4.81
Russia 07/18 11.00 BB+ Ba1 BBB- 116.46 4.01 0.00 0.50 3.15 Euro
LasVegasSd 41.88 40.87 1.01 2.47 4.67 12.6 -5.64 AmerExpr 55.43 55.09 0.34 0.61 -7.61 -12.1 -21.02 Credit Agricole S.A. 03/27 2.63 BBB Baa3 A- 94.32 3.24 0.00 0.12 1.24
Rosneft 264.40 255.90 8.50 3.32 28.35 12.0 7.57 Netflix 95.01 97.83 -2.82 -2.88 -12.73 -11.8 -19.14 Peru 03/19 7.13 BBB+ A3 BBB+ 113.45 2.69 0.00 0.09 1.84
Peru 03/19 7.13 BBB+ A3 BBB+ 114.01 2.60 0.00 0.20 0.84 BHP Billiton Fin Ltd 09/27 3.25 A+ A1 A+ 99.70 3.28 0.00 0.66 1.28
E.ON 9.37 9.37 0.00 0.00 1.00 11.9 15.14 ChinaLife 18.36 18.12 0.24 1.32 -2.44 -11.7 -29.25 B.A.T. Netherlands Fin B.V. (Re - British American Tobacco) 03/29 3.13 A- A3 A- 108.57 2.36 0.00 -0.08 -
Lukoil 2400.50 2320.00 80.50 3.47 250.50 11.7 3.91 ShenwanHong 0.13 0.13 -0.01 -4.58 -0.02 -10.7 -24.70 Brazil 01/21 7.88 BB+ Baa3 BB+ 94.85 6.18 0.00 -0.52 4.75
Colombia 07/21 4.38 BBB Baa2 BBB 99.44 4.54 0.00 0.14 3.11 Philip Morris Intl, Inc. 05/29 2.88 A A2 A 108.62 2.12 0.00 -0.07 -
Enbridge 45.87 45.87 0.00 0.00 4.64 11.3 -0.15 ChStConEng 5.12 5.09 0.03 0.59 -0.61 -10.6 -23.35
Poland 03/22 5.00 A- A2 A- 109.98 3.22 0.00 0.12 1.79 Yen
SouthCpr 25.15 24.99 0.16 0.64 2.49 11.0 -6.61 SaicMtr 17.89 17.99 -0.10 -0.56 -2.12 -10.6 -18.12
Turkey 09/22 6.25 - Baa3 BBB- 107.59 4.96 0.00 0.18 3.53 Wal-Mart Stores, Inc. 07/15 0.94 NR WR NR 100.00 0.31 0.00 0.00 -
EOG Res 66.76 66.03 0.73 1.11 6.52 10.8 -8.87 Pwr Cons Corp 6.35 6.43 -0.08 -1.24 -0.75 -10.6 -22.28
Verizon 49.15 48.25 0.90 1.87 4.73 10.6 5.14 Potash 21.22 21.22 0.00 0.00 -2.36 -10.0 -14.35 Turkey 04/26 4.25 - Baa3 BBB- 92.99 5.21 0.00 0.10 3.21 £ Sterling
BP 362.90 356.50 6.40 1.80 34.75 10.6 -3.40 Daqin 6.96 6.96 0.00 0.00 -0.67 -8.8 -22.84 Emerging Euro IPIC GMTN Limited 03/26 6.88 AA Aa2 AA 122.65 4.11 0.06 0.12 1.82
Sberbank 95.75 91.50 4.25 4.64 9.07 10.5 -5.52 HK Exc&Clr 161.80 163.10 -1.30 -0.80 -15.30 -8.6 -20.37 Brazil 02/15 7.38 BBB- Baa2 BBB 111.75 0.73 0.00 0.00 0.09 B.A.T. Intl Fin plc (Re - British American Tobacco) 09/26 4.00 A- A3 A- 104.67 3.47 0.06 0.29 1.18
Vivendi 20.09 19.75 0.35 1.75 1.85 10.1 2.47 IM Baotou Stl 2.95 2.92 0.03 1.03 -0.26 -8.1 -20.49 Mexico 07/17 4.25 BBB+ A3 BBB+ 111.13 1.50 0.00 0.00 0.64 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+ A3 BBB+ 121.63 2.06 0.00 0.00 0.62 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- 113.63 4.07 0.00 0.13 2.08
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
Jan 27 Rate Current Since Last Mnth Ago Year Ago Day's Month's Year Return Return Jan 27 Day Chng Prev 52 wk high 52 wk low Red Change in Yield 52 Week Amnt
US Fed Funds 0.25-0.50 16-12-2015 1.00 0.00-0.25 0.00-0.25 Index change change change 1 month 1 year VIX 21.87 -0.63 22.50 53.29 10.88 Jan 27 Price £ Yield Day Week Month Year High Low £m
US Prime 3.50 16-12-2008 3.50 3.25 3.25 Markit IBoxx VXD 21.26 -0.59 21.85 56.32 7.04 Tr 4pc '16 102.21 0.35 0.00 -82.50 0.00 0.00 102.23 100.00 0.35
US Discount 0.75 18-02-2010 0.75 0.75 0.75 ABF Pan-Asia unhedged 172.24 -0.26 -0.60 -0.60 -0.83 -4.89 VXN 25.71 -0.71 26.42 46.72 11.15 Tr 1.75pc '17 101.39 0.33 -2.94 -10.81 -26.67 -26.67 102.63 101.34 0.29
Euro Repo 0.05 10-09-2014 0.05 0.05 0.25 Corporates( £) 294.99 -0.14 -0.06 -0.06 -0.23 -3.33 VDAX 25.54 -0.83 26.37 30.63 - Tr 5pc '18 109.64 0.40 -2.44 5.26 -36.51 -38.46 113.51 109.34 0.35
UK Repo 0.50 05-03-2009 0.50 0.50 0.50 Corporates($) 249.34 0.13 -0.05 -0.05 -0.05 -0.05 † CBOE. VIX: S&P 500 index Options Volatility, VXD: DJIA Index Options Volatility, VXN: NASDAQ Index Options Volatility. Tr 4.5pc '19 111.81 0.65 -1.52 4.84 -28.57 -21.69 115.07 111.04 0.36
Japan O'night Call 0.00-0.03 05-10-2010 0.03 0.00-0.10 0.00-0.10 Corporates(€) 211.05 0.08 -0.11 -0.11 -0.03 -1.50 ‡ Deutsche Borse. VDAX: DAX Index Options Volatility. Tr 4.75pc '20 115.56 0.88 -1.12 4.76 -22.12 -12.00 119.04 114.45 0.33
Switzerland Libor Target 0.00-0.25 15-01-2015 0.00-0.75 -1.25--0.25 0-0.25 Eurozone Sov(€) 228.22 0.29 1.29 1.29 1.35 0.73 Tr 1.5pc '21 101.67 1.15 -0.86 3.60 -19.01 3.60 142.92 99.91 0.16
Gilts( £) 294.67 0.05 2.72 2.72 2.43 -0.32 BONDS: BENCHMARK GOVERNMENT Tr 4pc '22 116.43 1.20 0.00 5.26 -17.24 0.00 119.85 113.65 0.38
INTEREST RATES: MARKET Global Inflation-Lkd 238.39 0.29 0.03 0.03 -0.76 -5.24 Red Bid Bid Day chg Wk chg Month Year Tr 5pc '25 128.96 1.57 0.00 5.37 -13.74 7.53 134.70 124.47 0.35
Over Change One Three Six One Markit iBoxx £ Non-Gilts 296.73 -0.10 0.61 0.61 0.43 -2.47 Date Coupon Price Yield yield yield chg yld chg yld Tr 4.25pc '27 125.70 1.83 0.00 3.39 -12.02 11.59 131.90 119.79 0.31
Jan 27 (Libor: Jan 26) night Day Week Month month month month year Overall ($) 227.33 0.12 1.03 1.03 1.03 1.03 Australia 10/18 3.25 103.49 1.93 0.01 0.02 -0.07 -0.15 Tr 4.25pc '32 128.97 2.14 -0.47 0.94 -10.08 13.23 136.85 121.93 0.35
US$ Libor 0.36570 0.000 0.000 0.000 0.43060 0.62110 0.86425 1.15120 Overall( £) 292.61 0.00 2.09 2.09 1.84 -0.95 11/27 2.75 98.73 2.90 0.00 0.07 0.00 0.00 Tr 4.25pc '36 130.91 2.32 -0.43 0.43 -9.38 14.85 140.37 123.52 0.28
Euro Libor -0.28286 -0.001 0.001 -0.001 -0.22714 -0.16929 -0.09357 0.01500 Overall(€) 222.78 0.21 0.95 0.95 1.00 0.33 Austria 10/19 0.25 99.98 0.26 0.00 0.00 0.00 0.00 Tr 4.5pc '42 141.03 2.41 -0.41 0.42 -8.37 14.76 153.16 132.20 0.26
£ Libor 0.48063 0.000 -0.001 -0.001 0.50944 0.58938 0.73813 1.01000 Treasuries ($) 220.41 0.13 1.67 1.67 1.67 1.67 10/25 1.20 104.98 0.67 -0.02 -0.08 -0.24 0.00 Tr 3.75pc '52 134.61 2.34 0.00 0.43 -8.59 10.38 145.21 121.95 0.22
Swiss Fr Libor 0.000 -0.78300 -0.75100 -0.69200 -0.62500 FTSE Belgium 06/18 0.75 101.79 -0.01 0.00 0.00 0.00 0.00 Tr 4pc '60 147.65 2.28 0.00 0.00 -9.16 8.57 159.23 131.72 0.22
Yen Libor 0.000 0.04857 0.07929 0.11229 0.21829 Sterling Corporate (£) 109.87 -0.10 - - -0.13 -6.93 06/26 1.00 101.34 0.86 -0.02 -0.10 0.00 0.00 xd Ex dividend. Closing mid-prices are shown in pounds per £ 100 nominal of stock. Red yield: Gross redemption yield.
Euro Euribor 0.000 -0.23100 -0.15800 -0.08200 0.02500 Euro Corporate (€) 105.37 0.05 - - 0.03 -4.90 Canada 11/17 0.25 99.65 0.45 0.00 0.00 0.00 0.00 This table shows the gilts benchmarks & the non-rump undated stocks.
Sterling CDs 0.000 0.50000 0.60000 0.77500 Euro Emerging Mkts (€) 758.49 1.45 - - -12.38 -23.61 06/26 1.50 100.99 1.40 0.00 0.00 0.00 0.00
US$ CDs
Euro CDs
0.000
0.000
0.42000
-0.24500
0.59000
-0.18500
0.83000
-0.09500
Eurozone Govt Bond 114.53 0.03 - - 1.13 -2.10 Denmark 11/18 0.25 101.47 -0.27 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 1.75 110.03 0.69 -0.02 -0.06 -0.23 0.20
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 99.60 1.18 0.00 0.05 -0.21 0.00
Fixed Coupon Jan 27 chg % Return 1 month 1 year Yield
Jan 27 term notice month month month year Markit iTraxx 09/25 0.88 101.57 0.71 0.00 -0.03 -0.21 0.00
1 Up to 5 Years 98.76 0.01 2382.07 0.65 1.30 0.78
Euro -0.35 -0.25 -0.35 -0.25 -0.32 -0.17 -0.26 -0.11 -0.17 -0.02 -0.07 0.08 Crossover 5Y 366.61 -4.14 -28.02 41.26 397.02 280.05 France 05/19 1.00 104.18 -0.25 0.00 0.00 0.00 0.00
2 5 - 10 Years 181.72 -0.01 3289.26 1.56 1.45 1.43
Sterling 0.40 0.55 0.40 0.55 0.45 0.55 0.55 0.65 0.70 0.85 0.98 1.13 Europe 5Y 91.98 -0.47 -6.70 12.63 99.07 68.39 11/20 0.25 101.60 -0.08 0.00 0.00 0.00 0.00
3 10 - 15 Years 208.45 0.05 3882.45 2.46 0.53 1.92
Swiss Franc - - - - - - - - - - - - Japan 5Y 90.25 -2.50 -4.08 16.03 94.85 65.01 11/25 1.00 102.55 0.73 -0.02 -0.10 -0.26 0.00
4 5 - 15 Years 188.03 0.01 3432.57 1.82 1.15 1.63
Canadian Dollar - - - - - - - - - - - - Senior Financials 5Y 87.92 -0.71 -7.87 14.26 99.56 65.28 05/45 3.25 133.51 1.77 -0.02 -0.08 -0.24 0.32
5 Over 15 Years 304.20 0.10 4434.86 3.92 -2.18 2.34
US Dollar 0.32 0.42 0.32 0.42 0.40 0.50 0.60 0.70 0.80 0.90 1.10 1.20 Germany 04/19 0.50 102.92 -0.40 0.00 0.00 0.00 0.00
Markit CDX 7 All stocks 174.66 0.05 3283.49 2.24 -0.27 2.07
Japanese Yen -0.03 0.07 -0.05 0.05 -0.15 0.05 -0.10 0.10 -0.10 0.10 0.00 0.20 10/20 0.25 102.38 -0.25 0.00 0.00 0.00 0.00
Emerging Markets 5Y 378.87 -7.71 -17.78 25.06 400.12 299.17 02/26 0.50 100.70 0.43 -0.02 -0.06 0.00 0.00
Libor rates come from ICE (see www.theice.com) and are fixed at 11am UK time. Other data sources: US $, Euro & CDs: Day's Month Year's Total Return Return
Nth Amer High Yld 5Y 523.20 -12.88 -34.10 50.79 557.56 416.39 08/46 2.50 133.85 1.17 -0.02 -0.05 -0.31 0.10
Tullett Prebon; SDR, US Discount: IMF; EONIA: ECB; Swiss Libor: SNB; EURONIA, RONIA & SONIA: WMBA. Index Linked Jan 27 chg % chg % chg % Return 1 month 1 year
Nth Amer Inv Grade 5Y 104.03 -2.64 -6.36 15.57 110.98 75.52 Greece 07/17 3.38 86.75 13.86 0.38 1.30 6.67 -0.01
Nth AmerHiVol 5Y 0.00 0.00 0.00 0.00 283.44 100.00 1 Up to 5 Years 308.74 0.01 0.16 -1.32 2368.65 0.58 0.12
02/26 3.00 62.76 9.46 -0.03 -0.47 1.36 -0.31 2 Over 5 years 579.08 0.16 3.52 -2.34 4279.53 3.65 -1.61
Websites: markit.com, ftse.com. All indices shown are unhedged. Currencies are shown in brackets after the index names. Ireland 10/17 5.50 110.08 -0.34 0.00 0.00 0.00 0.00 3 5-15 years 430.75 0.02 1.53 -2.23 3284.33 1.87 -0.95
05/26 1.00 99.97 1.00 -0.02 0.00 0.00 0.00 4 Over 15 years 717.11 0.21 4.32 -2.27 5197.46 4.36 -1.74
COMMODITIES www.ft.com/commodities BONDS: INDEX-LINKED Italy 10/18 0.30 100.71 0.04 0.00 -0.09 -0.09 0.00 5 All stocks 535.00 0.14 3.02 -2.18 4006.28 3.19 -1.35
11/20 0.65 100.78 0.48 -0.01 -0.16 -0.14 0.00
Energy Price* Change Agricultural & Cattle Futures Price* Change Price Yield Month Value No of
12/25 2.00 104.74 1.49 -0.03 -0.16 -0.11 0.00 Yield Indices Jan 27 Jan 26 Yr ago Jan 27 Jan 26 Yr ago
Crude Oil† Feb 30.90 0.16 Corn♦ Mar 368.75 0.00 Jan 26 Jan 26 Prev return stock Market stocks
09/46 3.25 113.31 2.63 -0.02 -0.13 -0.07 -0.01 5 Yrs 1.03 1.02 0.96 20 Yrs 2.36 2.37 2.04
Brent Crude Oil‡ 33.39 2.58 Wheat♦ Mar 481.50 -2.75 Can 4.25%' 21 125.99 -0.172 -0.138 -0.90 5.18 69868.06 7
Japan 01/18 0.10 100.25 -0.03 0.00 0.00 0.00 0.00 10 Yrs 1.74 1.74 1.51 45 Yrs 2.30 2.30 2.13
RBOB Gasoline† Jan 1.02 -0.02 Soybeans♦ Mar 879.25 3.25 Fr 2.25%' 20 113.57 -0.713 -0.697 -0.52 20.31 213329.34 14
02/21 0.05 100.06 0.04 0.00 0.00 0.00 0.00 15 Yrs 2.17 2.18 1.85
Heating Oil† Feb 0.99 0.01 Soybeans Meal♦ Mar 270.60 0.80 Swe 0.25%' 22 108.10 -0.854 -0.855 0.91 32.00 234951.89 7
12/25 0.30 100.83 0.21 -0.01 -0.01 -0.05 0.00
Natural Gas† Feb 2.18 0.03 Cocoa (ICE Liffe)X Mar 2005.00 -36.00 UK 2.5%' 20 358.84 -1.213 -1.210 1.19 6.58 494442.76 25
12/45 1.40 105.57 1.15 -0.02 -0.06 -0.12 0.00 inflation 0% inflation 5%
Ethanol♦ - - Cocoa (ICE US)♥ Mar 2813.00 -7.00 UK 2.5%' 24 339.13 -0.822 -0.831 2.08 6.82 494442.76 25
Netherlands 04/17 0.50 101.14 -0.44 0.00 0.00 0.00 0.00 Real yield Jan 27 Dur yrs Previous Yr ago Jan 27 Dur yrs Previous Yr ago
Uranium Feb 36.75 0.00 Coffee(Robusta)X Mar 1416.00 26.00 UK 2%' 35 231.93 -0.785 -0.779 3.17 9.08 494442.76 25
07/25 0.25 97.40 0.53 -0.02 -0.08 -0.27 0.00 Up to 5 yrs -0.90 2.30 -0.89 -0.94 -1.68 2.32 -1.68 -1.60
Carbon Emissions - - Coffee (Arabica)♥ Mar 118.70 2.20 US 0.625%' 21 101.81 0.291 0.339 0.96 35.84 1124878.27 36
Diesel Mar - - White SugarX 414.70 -4.70 New Zealand 03/19 5.00 107.33 2.55 0.00 0.07 -0.23 -0.71 Over 5 yrs -0.85 23.53 -0.84 -0.93 -0.88 23.62 -0.88 -0.97
US 3.625%' 28 131.93 0.865 0.339 0.78 16.78 1124878.27 36
Unleaded (95R) - - Sugar 11♥ 13.79 -0.26 04/27 4.50 111.50 3.27 0.01 0.04 -0.32 -0.12 5-15 yrs -0.75 9.55 -0.75 -0.91 -0.87 9.56 -0.87 -1.05
Representative stocks from each major market Source: Merill Lynch Global Bond Indices † Local currencies. ‡ Total market
Norway 05/19 4.50 112.55 0.65 0.00 0.03 -0.05 -0.09 Over 15 yrs -0.86 29.09 -0.86 -0.94 -0.88 29.14 -0.88 -0.96
Base Metals (♠ LME 3 Months) Cotton♥ Mar 61.21 -0.06 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 1.75 103.11 1.38 -0.02 0.03 -0.07 0.00 All stocks -0.85 20.48 -0.85 -0.93 -0.90 20.64 -0.89 -0.98
Aluminium 1515.50 19.00 Orange Juice♥ Mar 124.90 0.00 amount.
Aluminium Alloy 1550.00 -70.00 Palm Oil♣ Jan 562.00 - Portugal 06/19 4.75 112.89 0.86 0.01 0.03 0.20 -0.40 See the FTSE website for more details: http://www.ftse.com/products/indices/gilts
Copper 4545.50 23.50 Live Cattle♣ Feb 132.55 -0.05 BONDS: TEN YEAR GOVT SPREADS 07/26 2.88 99.21 2.97 -0.03 -0.20 0.00 0.00
Lead 1671.00 25.00 Spain 04/18 0.25 100.38 0.08 -0.01 -0.08 -0.06 0.00 All data provided by Morningstar unless otherwise noted. All elements listed are indicative and believed accurate
Feeder Cattle♣ Mar 158.73 1.63
Nickel 8750.00 65.00 Lean Hogs♣ Feb 64.63 0.20 Spread Spread Spread Spread 04/26 1.95 102.32 1.70 -0.04 -0.19 0.00 0.00 at the time of publication. No offer is made by Morningstar or the FT. The FT does not warrant nor guarantee
Tin 14405.00 395.00 Bid vs vs Bid vs vs Sweden 10/18 1.00 99.40 1.23 0.00 0.03 -0.23 0.00 that the information is reliable or complete. The FT does not accept responsibility and will not be liable for any
Zinc 1603.50 13.00 % Chg % Chg Yield Bund T-Bonds Yield Bund T-Bonds 05/25 2.50 116.38 0.67 -0.01 -0.03 -0.32 -0.04 loss arising from the reliance on or use of the listed information. For all queries e-mail
Precious Metals (PM London Fix) Jan 26 Month Year Australia 2.90 2.47 0.90 Italy 1.49 1.06 -0.51 Switzerland 05/19 3.00 113.16 -0.92 0.00 0.00 0.00 0.00 ft.reader.enquiries@morningstar.com
Gold 1116.25 2.65 S&P GSCI Spt 293.29 -6.55 -22.30 Austria 0.67 0.24 -1.33 Japan 0.21 -0.21 -1.78 05/26 1.25 115.40 -0.22 0.00 0.00 0.00 0.00
Silver (US cents) 1438.00 5.00 DJ UBS Spot 76.19 -2.91 -24.36 Belgium 0.86 0.44 -1.13 Netherlands 0.53 0.10 -1.46 United Kingdom 07/18 1.25 101.61 0.60 -0.01 0.02 -0.32 -0.20 Data provided by Morningstar | www.morningstar.co.uk
Platinum 876.00 9.00 R/J CRB TR 164.79 -6.71 -23.92 Canada 1.40 0.97 -0.60 Norway 1.38 0.96 -0.61 01/21 1.50 101.70 1.15 -0.02 0.03 -0.35 0.00
Palladium 494.00 -6.00 Rogers RICIX TR 1897.21 - - Denmark 0.69 0.26 -1.31 Portugal 2.97 2.54 0.97 09/25 2.00 102.82 1.68 -0.01 0.06 -0.31 0.00
Bulk Commodities M Lynch MLCX Ex. Rtn 231.14 -9.84 -33.05 Finland 0.71 0.28 -1.29 Spain 1.70 1.27 -0.29 12/46 4.25 140.59 2.38 -0.01 -0.01 -0.27 0.26
Iron Ore (Platts) 42.60 1.10 UBS Bberg CMCI TR 11.46 -5.42 -25.13 France 0.73 0.30 -1.27 Switzerland -0.22 -0.65 -2.22 United States 12/17 1.00 100.28 0.85 0.01 0.02 -0.22 0.00
Iron Ore (The Steel Index) 41.30 0.50 LEBA EUA Carbon 5.96 -14.86 -14.98 Germany 0.43 0.00 -1.57 United Kingdom 1.68 1.25 -0.32 12/20 1.75 101.50 1.43 0.01 0.02 -0.36 0.00
GlobalCOAL RB Index 52.00 -0.50 LEBA CER Carbon 0.39 -17.02 -13.33 Greece 9.46 9.03 7.46 United States 2.00 1.57 0.00 11/25 2.25 102.25 2.00 0.01 0.00 -0.30 0.00
Baltic Dry Index 337.00 -8.00 LEBA UK Power 1800.00 42.74 -19.39 Ireland 1.00 0.58 -0.99 11/45 3.00 104.30 2.79 0.01 0.02 -0.25 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.
24 FINANCIAL TIMES Thursday 28 January 2016

MANAGED FUNDS SERVICE

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

Far East $ 600.40 - -11.02 0.00 Franklin Emg Mkts Debt Opp USD $ 16.71 - -0.47 7.19 Invesco Energy A $ 14.08 - 0.67 0.00 US Government Bond A1 $ 17.20 - 0.02 0.00

ACPI Global UCITS Funds Plc (IRL) Chartered Asset Management Pte Ltd DSM Capital Partners Funds (LUX) Invesco Euro Corporate Bond Fund (A) € 16.74 - 0.01 0.00 Lloyds Investment Fund Managers Limited (1000)F (JER) Value A1 $ 20.21 - 0.35 0.00
www.acpishard.com Other International Funds www.dsmsicav.com PO Box 311, 11-12 Esplanade, St Helier, Jersey, JE4 8ZU 01534 845555
Regulated Atlantis Investment Management Ltd (IRL) Regulated Frontier Capital (Bermuda) Limited Invesco Euro Inflation Linked Bond A € 15.49 - 0.06 0.00 Other International Funds
2nd Floor, 13 St Swithin's Lane, London EC4N 8AL CAM-GTF Limited $ 265175.46 265175.46 622.65 0.00 Other International
ACPI Emerging Mkts FI UCITS Fund USD A $ 102.45 - 0.06 0.00 www.atlantis-investmenet.com, Tel: 0207 877 3377 Global Growth I2 Acc € 128.45 - 0.05 0.00 Invesco Euro Reserve A € 322.65 - 0.00 0.00 Lloydstrust Gilt £ 12.3200xd - 0.0000 2.29 MMIP Investment Management Limited (GSY)
CAM GTi Limited $ 605.58 - -7.40 0.00 Commercial Property-GBP Class £ 71.42 - -0.53 - Regulated
ACPI Global Credit UCITS Funds USD A $ 13.80 - 0.00 0.00 Regulated Global Growth I1 Eur € 96.05 - 0.04 - Lloyds Investment Funds Limited
Invesco Euro Bond A € 7.10 - 0.02 0.00 Multi-Manager Investment Programmes PCC Limited
Atlantis China Fund $ 6.44 - 0.00 0.00 Raffles-Asia Investment Company $ 1.56 1.56 0.01 5.51 Global Real Estate-GBP C Class £ 45.26 - -0.50 - Euro High Income € 1.5900xd - 0.0020 2.98
ACPI Global Fixed Income UCITS Fund USD A $ 152.08 - 0.02 0.00 Invesco European Growth Equity A € 22.79 - 0.10 0.00 European Equity Fd Cl A Initial Ser € 2642.19 2642.19 62.94 0.00
Atlantis China Healthcare Fund $ 1.74 - -0.03 0.00 Edinburgh Partners Limited (IRL) European £ 7.2080 - 0.0600 1.42
Q ACPI India Fixed Income UCITS Fund USD A $ 9.76 - -0.04 - Invesco Global Absolute Return Fund A Class € 11.70 - 0.01 0.00 Japanese Equity Fd Cl A Initial Ser ¥ 368031.00 368031.00 6127.00 0.00
Atlantis Japan Opportunities Fund $ 2.45 - 0.06 0.00
27-31 Melville Street, Edinburgh, Edinburgh, EH2 4DJ +353 1 434 5143 GYS Investment Management Ltd (GSY)
High Income £ 0.8503 - -0.0010 5.04
ACPI India Fixed Income UCITS Fund USD A3 $ 83.47 - -0.27 0.00 Dealing - Fax only - +353 1 434 5230 Regulated Invesco Global Bond A Inc $ 5.44 - 0.02 0.75 MMIP - US EQUITY CLASS A 01 June 07 Series $ 1304.31 1304.31 168.32 0.00
Atlantis Asian Fund $ 6.18 - 0.02 0.00 FCA Recognised Taurus Emerging Fund Ltd $ 155.03 158.19 -7.12 0.00 International £ 3.7980 - 0.0360 1.28
ACPI International Bond UCITS Fund USD A $ 18.00 - 0.03 0.00 Invesco Global Conservative Fund 90 (EUR) A € 11.81 - 0.02 0.00 Pacific Basin Fd Cl A Initial Ser $ 2059.34 2059.34 -82.99 0.00
Edinburgh Partners Opportunities Fund PLC
North American £ 15.0500 - 0.1400 0.27
European Opportunities I EUR € 2.29 - 0.04 2.30 Invesco Global Equity Income Fund A $ 53.65 - 0.44 0.00 UK Equity Fd Cl A Series 01 £ 2318.62 2346.23 -38.83 0.00
ACPI Select UCITS Funds PLC (IRL) Generali Worldwide Sterling Bond £ 1.4390xd - -0.0020 3.75

AXIOM European Opportunities I GBP £ 1.73 - 0.03 2.46 Invesco Global Inc Real Estate Sec A dist $ 8.87 - 0.11 2.24 Diversified Absolute Rtn Fd USD Cl AF2 $ 1589.37 - 2.97 0.00
Regulated Cheyne Capital Management (UK) LLP (IRL) PO Box 613, Generali House, Hirzel Street, St Peter Port, Guernesy, GY1 4PA 01481 714108
UK £ 6.0110 - 0.0610 1.71
Regulated European Opportunities I USD $ 2.50 - 0.05 2.08 International Insurances Invesco Global Inv Grd Corp Bond A Dist $ 11.77 - 0.01 3.04 Diversified Absolute Return Stlg Cell AF2 £ 1609.96 - 2.21 0.00
ACPI Balanced UCITS Fund USD Retail $ 13.19 - -0.04 0.00 ALTERNATIVE INVESTMENTS Lloyds Gilt Fund Limited
Cheyne Convertibles Absolute Return Fund € 1313.66 - 2.22 0.00 Global Multi-Strategy Managed $ 4.37 4.71 -0.15 0.00
European Opportunities A EUR € 2.24 - 0.05 1.60 Invesco Global Leisure A $ 33.67 - 0.47 0.00
ACPI Balanced UCITS Fund EUR Retail € 9.94 - -0.03 0.00 Lloyds Gilt Fund Quarterly Share £ 1.2840xd - 0.0000 1.82
Cheyne Global Credit Fund € 114.40 - -0.05 0.00 UK Multi-Strategy Managed £ 4.54 4.89 -0.18 0.00 LNG Capital (CYM)
Global Opportunities I USD $ 1.48 - 0.00 2.12 Invesco Global Smaller Comp Eq Fd A $ 52.58 - 0.62 0.00
ACPI Balanced UCITS Fund GBP Retail £ 10.05 - -0.03 0.00 Monthly Share £ 1.2370 - 0.0000 1.82
Axiom Alternative Investments (FRA) Cheyne European Mid Cap Fund € 1103.40 - 4.80 0.00 EU Multi-Strategy Managed € 2.85 3.07 -0.12 0.00
Kingsbury House, 15-17 King St, London SW1Y 6QU
1 Conduit Street - 4th floor - London W1S 2XA Global Opportunities I GBP £ 1.04 - 0.00 1.93 Invesco Global Structured Equity A $ 43.72 - 0.50 0.74 www.lngcapital.com, Tel: 0207 839 3456
ACPI Balanced UCITS Fund USD Institutional $ 10.00 - - - Lloyds Money Fund Limited
www.axiom-ai.com Tel: +44 330 822 0374 Global Bond USD $ 3.39 3.65 -0.02 0.00 Regulated
Global Opportunities I EUR € 1.52 - -0.01 1.98 Invesco Global Total Ret.(EUR) Bond Fund A € 12.89 - 0.00 0.00 Sterling Class £ 52.6220 - 0.0000 0.10
ACPI Balanced UCITS Fund EUR Institutional € 10.00 - - - Regulated
Cheyne Capital Management (UK) LLP LNG Europa Credit Fund EUR (Est) € 1196.70 - 65.31 -
Axiom Contingent Capital € 1002.31 - -0.93 - Global Opportunities A GBP £ 0.97 - 0.00 1.46 Invesco Gold & Precious Metals A $ 3.35 - 0.14 0.00 Lloyds Multi Strategy Fund Limited
ACPI Balanced UCITS Fund GBP Institutional £ 10.00 - - - Other International Funds
Genesis Asset Managers LLP Invesco Greater China Equity A $ 38.53 - -0.04 0.00 Conservative Strategy £ 1.0860 - -0.0010 1.97 LNG Europa Credit Fund GBP (Est) £ 1196.70 - 56.94 -
ACPI Horizon UCITS Fund $ 12.26 - 0.01 0.00 Axiom Contingent Capital £ 1007.07 - -0.96 - Cheyne European Event Driven Fund € 134.54 - -11.29 0.00 Pan European Opportunities I EUR € 1.40 - 0.02 -
Other International Funds
Growth Strategy £ 1.4300 - 0.0010 1.32 LNG Europa Credit Fund USD $ 1183.45 - -15.60 -
Axiom Equity $ 758.87 - 14.79 - Invesco India Equity A $ 47.01 - -0.36 0.00
Cheyne Real Estate Credit Holdings Fund £ 162.87 - 1.01 0.00 Emerging Mkts NAV £ 4.79 - -0.03 0.00
Invesco Japanese Equity Adv Fd A ¥ 3551.00 - 108.00 0.00 Aggressive Strategy £ 1.7170 - 0.0040 0.00
Axiom Equity € 797.30 - 15.52 0.00 Cheyne Real Estate Credit Holdings Fund III £ 112.40 - 0.42 0.00
Global USD Growth Strategy $ 1.2630 - 0.0100 0.00
Marlborough International Management Limited (GSY)
Axiom Obligataire $ 1726.34 - 0.47 0.00 HPB Assurance Ltd Invesco Japanese Value Eq Fd A ¥ 1175.00 - 28.00 0.00 Tudor House, Le Bordage, St Peter Port, Guernsey, CI, GY1 1DB +44 1481 71520
Cheyne Real Estate Debt Fund Class A1 £ 132.13 - 0.48 0.00
Anglo Intl House, Bank Hill, Douglas, Isle of Man, IM1 4LN 01638 563490 Dealing Daily FCA Recognised
Axiom Obligataire € 1721.09 - 0.50 0.00 Invesco Latin American Equity A $ 4.90 - 0.05 0.00
Cheyne Total Return Credit Fund - December 2017 Class $ 152.88 - -20.24 0.00 International Insurances Marlborough North American Fund Ltd £ 30.15 32.12 -0.06 0.00
Axiom Obligataire £ 1734.09 - 0.34 0.00 Invesco Nippon Small/Mid Cap Equity A ¥ 965.00 - 22.00 0.00
Cheyne Total Return Credit Fund 2020 $ 100.78 - -2.61 - Holiday Property Bond Ser 1 £ 0.50 - 0.01 0.00 M & G (Guernsey) Ltd (GSY)
Marlborough Tiger Fund Ltd F £ 23.75 25.31 -0.65 0.00
EFG Hermes Invesco Pan European Equity A EUR Cap NAV € 17.08 - 0.03 0.00 Regulated
Algebris Investments (IRL) Holiday Property Bond Ser 2 £ 0.60 - 0.01 0.00
Regulated DIFC, The Gate Building, West Wing Level 6, PO BOX 30727, Dubai UAE The M&G Offshore Fund Range
BLME Asset Management (LUX) Cohen & Steers SICAV (LUX) Invesco Pan European High Income Fd A € 13.27 - 0.01 2.48
Contact: Telephone + 971 4 363 4029 Email AMsales@EFG-HERMES.com
Algebris Financial Credit Fund - Class I EUR € 130.53 - -0.27 0.00 BLME Sharia'a Umbrella Fund SICAV SIF Regulated
Corporate Bond 1294.73 1334.77 -1.33 3.20 Marwyn Asset Management Limited (CYM)
Other International Funds Invesco Pan European Small Cap Equity A € 20.93 - -0.08 0.00 Regulated
Regulated Haussmann
Algebris Financial Income Fund - Class I EUR € 109.52 - 0.78 0.00 European Real Estate Securities € 22.1452 - 0.1120 1.58 Global Basics 2183.30 2250.83 21.76 0.34
The EFG-Hermes Egypt Fund $ 29.93 - - 0.00 Other International Funds Invesco Pan European Structured Equity A € 16.36 - 0.12 0.00 Marwyn Value Investors £ 450.92 - -7.87 0.00
Income Fund - Share Class A Acc $ 1134.83 - 0.05 0.00
Algebris Financial Equity Fund - Class B EUR € 87.02 - 1.79 - Europ.RealEstate Sec. IX € 29.7000 - 0.1502 0.00 Global Leaders 3140.65 3271.51 26.51 1.16
EFG-Hermes Frontier Equity UCITS Fund Class I $ 1000.00 - - - Haussmann Cls A $ 2574.62 - -108.37 0.00
Income Fund - Share Class G Acc £ 1076.65 - 0.07 0.00 Invesco UK Eqty Income A £ 30.25 - 0.08 0.00
Algebris Asset Allocation Fund - Class B EUR € 96.65 - 0.52 - Gbl Listed Infrastructure I $ 9.4030 - 0.1058 - Global High Yield Bond 912.67 940.90 2.36 4.86
EFG-Hermes MENA Equity UCITS Fund Class A $ 1000.00 - - - Haussmann Cls C € 2248.78 - -95.69 0.00 Meridian Fund Managers Ltd
Gl Sukuk Fund - Share Class A Acc $ 1203.43 - -1.92 0.00 Invesco UK Investment Grade Bond A £ 0.98 - 0.00 2.89
Gbl Listed Infrastructure IX $ 9.4438 - 0.1062 - Global Macro Bond Fund 11437.84 11791.59 -26.95 1.97 Other International Funds
Middle East & Developing Africa Fund (Final) $ 19.81 - - 0.00 Haussmann Cls D SFr 1188.89 - -51.05 0.00
Gl Sukuk Fund - Share class B Acc £ 1074.45 1074.45 -1.67 0.00 Invesco US Structured Equity A $ 19.68 - 0.32 0.00
Alken Asset Management (LUX) Gbl RealEstate Sec. I $ 10.2820 - 0.1091 1.40 North American Dividend Fund 151.47 157.79 1.58 2.43 Global Gold & Resources Fund $ 184.00 - 2.35 -
Saudi Arabia Equity Fund SR 10.43 - -0.27 0.00 Invesco US Value Eq Fd A $ 27.61 - 0.54 0.00
61 Conduit Street, London, W1S 2GB
Gbl RealEstate Sec. IX $ 12.2420 - 0.1299 0.00 Optimal Income Fund 137.63 141.89 0.01 2.82 Global Energy & Resources Fund $ 31.18 - -3.49 -
www.alken-am.com Heartwood Wealth Management Limited (IRL)
Bank of America Cap Mgmt (Ireland) Ltd (IRL)
Regulated
Invesco USD Reserve A $ 87.02 - 0.00 0.00
Regulated Recovery Fund Limited 'A' Participating Shares 9037.85 9414.43 10.94 0.56
Regulated Ennismore Smaller Cos Plc (IRL)
Alken European Opportunities € 191.52 - 1.93 0.00 Heartwood Caut Multi Asset B Acc 136.49 - -0.06 0.00
Global Liquidity USD $ 1.00 - 0.00 0.55 5 Kensington Church St, London W8 4LD 020 7368 4220 Recovery Fund Limited 'I' Participating Shares 9020.00 9111.12 11.15 1.45 Mirabaud Asset Management (LUX)

Alken European Opportunities £ 116.06 - 0.87 0.00

FCA Recognised Invesco Global Asset Management Ltd (IRL) www.mirabaud.com, marketing@mirabaud.com
Dublin 00 353 1 439 8100 Hong Kong 00 852 2842 7200 Strategic Corporate Bond Fund 130.70 136.14 -0.09 3.10 Regulated
Ennismore European Smlr Cos NAV £ 103.44 - -0.07 0.00
Alken Absolute Return € 137.10 - 0.82 0.00 FCA Recognised
Barclays Investment Funds (CI) Ltd (JER) UK Select 1389.87 1447.78 5.49 1.01
Mir. Conv. Bds Eur A EUR € 132.00 - 0.18 0.00
39/41 Broad Street, St Helier, Jersey, JE2 3RR Channel Islands 01534 812800 Ennismore European Smlr Cos NAV € 136.58 - 0.25 0.00 Invesco Stlg Bd A QD F £ 2.57 - 0.00 3.34
Alken Absolute Return £ 111.34 - 0.66 0.00 Mir. Conv. Bds Glb A USD $ 108.80 - 0.15 0.00
FCA Recognised
Invesco Asian Equity A $ 5.53 - 0.03 0.53
Alken Small Cap € 176.50 - 1.10 0.00 Bond Funds Mir. - Eq Asia ex Jap A $ 154.47 - 1.58 0.00
Crèdit Andorrà Asset Management (LUX) Ennismore European Smlr Cos Hedge Fd MFS Investment Funds (LUX)
Sterling Bond F £ 0.45 - -0.01 3.34 www.creditandorra.com Invesco ASEAN Equity A $ 83.58 - 1.08 0.29 FCA Recognised
Other International Funds Mir. - Eq Glb Emrg Mkt A USD $ 77.33 - 0.90 0.00
FCA Recognised Blend.Research Gb.Eq.Fd. € 95.62 - 1.37 -
Hermes Investment Funds Plc (IRL) Invesco Bond A $ 26.65 - 0.07 1.99
Amundi Funds (LUX) NAV € 493.94 - -2.06 0.00 Mir. - Eq Global Focus A USD $ 92.78 - 0.65 0.00
Crediinvest SICAV Money Market Eur I € 11.21 - 0.00 0.00 Hermes Investment Management Limited, 1 Portsoken Street, London E1 8HZ +44 (0) 207 680 2121
5 Allee Scheffer L-2520 Luxembourg + 44 (0)20 7074 9332 Blend.Research Gb.Eq.Fd. £ 97.30 - 1.16 -
Baring International Fd Mgrs (Ireland) (IRL)
FCA Recognised
Invesco Continental Eurp Small Cap Eqty A $ 183.97 - 0.12 0.00
www.amundi-funds.com Crediinvest SICAV Money Market Usd A $ 10.03 - 0.00 0.00 Mir. -Eq Spain A € 23.00 - 0.26 0.00
Northern Trust, George Court 54-62 Townsend Street, Dublin 2 Rep of Ireland 020 7214 1004
FCA Recognised Hermes Abs Return Credit Fund Class F Acc £ £ 1.06 1.06 0.00 - Invesco Emerging Markets Equity A $ 31.11 - 0.25 0.00 Blend.Research U.S.Core Eq.Fd. ¥ 9377.00 - 130.00 -
FCA Recognised Equinox Fund Mgmt (Guernsey) Limited (GSY) Mir. - Eq Swiss Sm/Mid A SFr 319.61 - 2.61 0.00
Crediinvest SICAV Fixed Income Eur € 10.39 - 0.00 0.00 Regulated
Bd. Euro Corporate AE Class - R - EUR € 18.29 - 0.00 0.00 Invesco Emerging Markets Bond A $ 20.04 - -0.02 4.66 Blend.Research Gb.Eq.Fd. $ 91.58 - 1.45 -
ASEAN Frontiers A GBP Inc £ 108.81 - 0.74 0.58 Hermes Abs Return Credit Fund Class R Acc € € 2.00 2.00 0.00 -
Crediinvest SICAV Fixed Income Usd $ 10.31 - 0.01 0.00 Mir. - Glb High Yield Bds A $ 104.74 - 0.05 -
Equinox Russian Opportunities Fund Limited $ 119.68 - 0.92 0.00
Bd. Global AU Class - R - USD $ 25.10 - 0.07 0.00 Invesco Continental European Equity A € 7.89 - 0.00 0.20 Em.Mk.Eq.Fund Euro € 99.04 - 0.03 0.00
Asia Growth A GBP Inc H £ 44.28 - 0.07 0.00 Hermes Active UK Inflation Fund Class F Acc £ 1.31 1.31 0.00 0.00
Crediinvest SICAV Spanish Value € 223.35 - 1.25 0.00 Mir. - Glb Eq High Income A USD $ 92.25 - 0.76 0.00
Eq. Emerging Europe AE Class - R - EUR € 26.83 - -0.24 0.00 Invesco Gilt A £ 15.22 - 0.00 1.39 Em.Mk.Eq.Fund Sterling £ 88.20 - -0.20 0.00
Australia A GBP Inc £ 67.27 - -0.78 1.82 Hermes Asia Ex-Japan Equity Fund Class F Acc £ 1.49 1.49 0.01 0.00
Crediinvest SICAV International Value € 190.96 - 3.97 0.00 Euronova Asset Management UK LLP (CYM) Mir. - Glb Inv Grade Bds A € 99.59 - 0.06 -
Eq. Emerging World AU Class - R - USD $ 71.58 - -0.68 0.00 Invesco Global Small Cap Equity A NAV $ 108.10 - 1.38 0.00 Em.Mk.Eq.Fd.US Dollar $ 82.06 - 0.15 0.00
Baring China Bond Fund $ 9.59 - -0.02 0.00 Regulated Hermes Asia Ex-Japan Equity Fund Class R Acc € 3.10 3.10 0.01 0.00
Crediinvest SICAV Big Cap Value € 14.18 - 0.20 0.00 Mir. - Glb Strat. Bd A USD $ 102.48 - -0.01 0.00
Eq. Greater China AU Class - R - USD $ 483.12 - -8.34 0.00 Smaller Cos Cls One Shares (Est) € 34.02 - 0.33 0.00 Invesco Global High Income A NAV $ 11.48 - 0.01 6.06 Gb.Conc.Eq.Fd.Euro € 265.87 - 3.15 0.00
Baring Emerging Markets Corporate Debt Fund $ 9.03 - 0.02 0.00 Hermes Global Emerging Markets Fund Class F Acc £ 1.10 1.10 0.00 0.00
Crediinvest SICAV US American Value $ 16.77 - 0.20 0.00
Eq. Latin America AU Class - R - USD $ 272.57 - 1.33 0.00 Smaller Cos Cls Two Shares (Est) € 23.85 - 0.20 0.00 Invesco Gbl R/Est Secs A GBP F F £ 7.84 - 0.10 0.88 Gb.Conc.Eq.Fd.Sterl.UK T £ 168.48 - 1.57 0.00
Baring European Opportunities Fund Class A EUR Acc € 12.69 - 0.04 0.00 Hermes Global Emerging Markets Fund Class R Acc € 2.68 2.68 0.00 0.00
MW Japan Fund Plc (IRL)
Crediinvest SICAV Sustainability € 14.11 - -0.12 0.00
Gl. Macro Bds & Curr Low Vol AHG - GBP £ 98.35 - 0.00 0.00 Smaller Cos Cls Three Shares (Est) € 11.86 - 0.13 0.00 Invesco Global Health Care A $ 115.85 - 0.30 0.00 Gb.Conc.Eq.Fd.Sterling £ 254.96 - 2.38 0.00 FCA Recognised
Baring Global Mining Fund - Class A GBP Inc £ 3.24 - 0.03 0.65 Hermes Global Equity Fund Class F Acc £ 1.45 1.45 0.01 0.00
MW Japan Fund PLC A $ 23.77 - 0.81 -
Dynamic Emerging Markets A GBP Acc F £ 8.24 - 0.05 0.00 Smaller Cos Cls Four Shares (Est) € 15.43 - 0.16 0.00 Hermes Global Equity Fund Class R Acc € 3.67 3.67 0.04 0.00 Invesco Global Select Equity A $ 11.60 - 0.14 0.00 Gb.Conc.Eq.Fd.US $ 182.62 - 2.43 0.00
The Antares European Fund Limited Daiwa SB Investments (UK) Ltd (LUX) MW Japan Fund PLC B $ 23.94 - 0.80 -
Gb.Eq.Hdg Fd.Euro IRE T € 171.33 - 2.35 0.00
Asset Management
Eastern Europe A GBP Inc £ 37.85 - 0.77 1.84 5 King William Street, London EC4N 7DA Hermes Global ESG Equity Fund Class F Acc £ 1.12 1.12 0.01 0.00 Invesco Jap Eqty Core A $ 1.72 - 0.05 0.00
Other International

Asset Management Asset Management

www.daiwasbi.co.uk 0207 597 7000 MW Japan Fund PLC C $ 89.99 - 2.96 -
Emerging Mkt Debt LC A GBP Hedged Inc £ 6.72 - 0.07 6.72 Hermes Global High Yield Bond Fund Class F Acc £ 1.06 1.06 0.00 0.00 Invesco Japanese Equity A $ 17.75 - 0.42 0.00 Gb.Eq.Euro Hdg Fd. € 242.75 - 3.34 0.00
AEF Ltd Usd (Est) $ 634.92 - 11.11 - Regulated
Emerging Opportunities A GBP Inc H £ 17.83 - -0.15 0.00 Hermes Global High Yield Bond Fund Class R Acc € 2.65 2.65 0.00 0.00 Invesco Korean Equity A $ 34.29 - -0.25 0.00 Gb.Eq.Fund Euro € 266.08 - 3.48 0.00
AEF Ltd Eur (Est) € 636.55 - 11.04 0.00 DSBI Japan Equity Fundamental Active I JPY ¥ 11299.52 11299.52 315.72 0.00
Morant Wright Funds (Ireland) PLC (IRL)
Glb Emerging Markets A GBP Inc H £ 17.31 - 0.06 0.00 Hermes Global Small Cap Fund Class F Acc £ £ 0.95 0.95 0.01 - Invesco PRC Equity A $ 42.98 - 0.21 0.00 Gb.Eq. Fd Euro IRE T € 168.38 - 2.20 0.00
DSBI Japan Equity Fundamental Active I GBP £ 111.57 111.57 3.49 0.00 FCA Recognised

Glb Resources A GBP Inc H £ 9.84 - 0.12 0.38 Hermes Global Small Cap Fund Class R Acc € € 1.80 1.80 0.02 - Invesco Pacific Equity A $ 42.68 - 0.58 0.07 Gb.Eq.Fd.Sterling UK T £ 203.90 - 2.15 0.00 Morant Wright Fuji Yield EUR Dist Hedged € 10.20 - 0.30 -
Arisaig Partners DSBI Japan Equity Fundamental Active A EUR € 107.11 112.47 3.14 0.00
Other International Funds High Yield Bond A GBP Hedged Inc H £ 6.00 - 0.01 7.21 Eurobank Fund Management Company (Luxembourg) S.A. Hermes Multi Asset Inflation Fund Class F GBP Acc £ 0.96 0.96 0.01 0.00 Invesco Global Technology A $ 14.22 - 0.04 0.00 Gb.Eq.Fd.US Dollar $ 288.53 - 4.19 0.00 Morant Wright Fuji Yield GBP Acc Hedged £ 10.57 - 0.32 0.00
Regulated
Arisaig Africa Consumer Fund Limited $ 12.83 - 0.12 0.00 Gb.Eq.Fund Sterling £ 201.49 - 2.13 0.00
Hong Kong China A GBP Inc £ 520.46 - 0.65 0.58 DAVIS Funds SICAV (LUX) Hermes Multi Strategy Credit Fund Class F Acc Hed £ 1.00 1.00 0.00 0.00 Invesco UK Eqty A £ 7.29 - 0.02 1.38 Morant Wright Fuji Yield GBP Dist Hedged £ 10.27 - 0.31 -
(LF) Absolute Return € 1.31 - 0.00 0.00
Arisaig Asia Consumer Fund Limited $ 57.46 - -0.38 0.00 Regulated
India Fund - Class A GBP Inc £ 13.87 - -0.10 0.00 Hermes Sourcecap EU Alpha Fund Class F Acc £ 1.27 1.27 0.00 0.00 Gb.Val.Ex-Jap.Fd.USD $ 110.02 - 1.66 0.00 Morant Wright Fuji Yield USD Acc Hedged $ 10.30 - 0.31 0.00
(LF) Eq Emerging Europe € 0.63 - 0.01 0.00
Arisaig Global Emerging Markets Consumer UCITS € 10.88 - -0.05 0.00 Davis Value A $ 35.98 - 0.53 0.00
Latin America A USD Inc H $ 22.74 - 0.22 0.24 Hermes Sourcecap EU Alpha Fund Class F Dis £ 1.23 1.23 0.00 1.30 Invest AD Gb.Val.Ex-Japan Fd.Yen ¥ 12812.00 - 177.00 0.00 Morant Wright Fuji Yield USD Dist Hedged $ 10.33 - 0.32 2.14
(LF) Eq Flexi Style Greece € 0.94 - -0.05 0.00
Arisaig Global Emerging Markets Consumer UCITS STG £ 10.53 - -0.07 0.00 Davis Global A $ 25.39 - 0.33 0.00 Client services: +971 2 692 6101 clientservices@InvestAD.com
MENA A GBP Inc F * £ 11.04 - 0.13 0.64 Hermes Sourcecap EU Alpha Fund Class R Acc € 2.96 2.96 0.01 0.00 Gb.Val.Fd. Euro € 125.83 - 1.80 0.00 Morant Wright Fuji Yield YEN Acc ¥ 1063.30 - 32.04 0.00
(LF) Eq Mena Fund € 11.49 - -0.09 0.00 Other International Funds
Arisaig Latin America Consumer Fund $ 18.33 - 0.01 0.00
Hermes Sourcecap EX UK Fund Class F Acc £ 1.35 1.35 0.01 0.00 Invest AD - Iraq Opportunity Fund $ 55.89 - -3.47 0.00 Gb.Val.Fd.Sterling £ 116.05 - 1.36 0.00 Morant Wright Fuji Yield B YEN Acc ¥ 937.17 - 28.05 -
(LF) Greek Government Bond € 16.58 - -0.16 -
Baring International Fd Mgrs (Ireland) (IRL)
(LF) Greek Corporate Bond € 11.56 - -0.06 - Hermes Sourcecap EX UK Fund Class R Acc € 3.04 3.04 0.02 0.00 Invest AD - Emerging Africa Fund $ 842.39 - -0.82 0.00 Gb.Val.Fd.USD $ 98.39 - 1.55 0.00 Morant Wright Fuji Yield YEN Dist ¥ 1041.24 - 31.37 2.13
Artisan Partners Global Funds PLC (IRL) Regulated
Hermes UK Small & Mid Cap Fund Class F Acc £ 1.60 1.60 0.01 0.00 Invest AD - GCC Focus Fund $ 1201.56 - -5.88 0.00 Low Volatility Gb.Eq.Fd.Euro € 100.56 - 1.02 - Morant Wright Sakura Fund Sterling Acc Hedged £ 12.89 - 0.42 0.00
Beaux Lane House, Mercer Street Lower, Dublin 2, Ireland China A-Share A GBP Inc £ 5.70 - 0.14 0.00 (LF) FOF Dynamic Fixed Inc € 11.64 - -0.01 0.00
Tel: 44 (0) 207 766 7130 Low Volatility Gb.Eq.Fd.Sterl £ 102.32 - 0.78 - Morant Wright Sakura Fund Euro Acc Hedged € 12.88 - 0.42 0.00
(LF) FOF Real Estate € 16.08 - 0.06 0.00 Hermes UK Small & Mid Cap Fund Class R Acc € 4.62 4.62 0.02 0.00
FCA Recognised
Artisan Partners Global Funds plc Hermes US All Cap Equity Class F Stg £ Acc £ 0.97 0.97 0.01 - Low Volatility Gb.Eq.Fd.USD $ 96.30 - 1.11 - Morant Wright Sakura Fund Yen Acc Unhedged ¥ 1318.15 - 43.31 0.00
Barings (Luxembourg) (LUX)
Dodge & Cox Worldwide Funds (IRL)
Artisan Emerging Markets I USD Acc $ 6.00 - -0.02 0.00 FCA Recognised 6 Duke Street,St.James,London SW1Y 6BN Hermes US All Cap Equity Class R € Acc € 1.82 1.82 0.01 - Low Volatility Gb.Eq.Fd.Yen ¥ 8895.00 - 91.00 - Morant Wright Sakura Fund Dollar Acc Hedged $ 12.84 - 0.43 0.00
FIL Fund Management (LUX)
Russia A GBP Inc F £ 22.46 - -0.08 0.00 www.dodgeandcox.worldwide.com 020 3713 7664 2a, rur Albert Borschette, BP 2175, L-1021, Luxembourg
Artisan Global Equity Fund Class I USD Acc $ 13.25 - 0.06 0.00 Hermes US SMID Equity Fund Class F Acc £ 1.55 1.55 0.02 0.00 Morant Wright Sakura Fund Swiss Franc Acc HedgedSFr 12.74 - 0.42 0.00
FCA Recognised Phone: 800 22 089, 800 22 088
Artisan Global Opportunities I USD Acc $ 11.28 - 0.01 0.00 Dodge & Cox Worldwide Funds plc - Global Bond Fund Regulated Hermes US SMID Equity Fund Class R Acc € 3.19 3.19 0.04 0.00
MFS Meridian Funds SICAV (LUX)
BlackRock (JER) Regulated
EUR Accumulating Class € 11.46 - 0.03 0.00 China Consumer A-GBP £ 13.29 - -0.20 0.00
Artisan Global Value Fund Class I USD Acc $ 14.46 - 0.18 0.00
Regulated GAM Absolute Return A1 € 19.79 - -0.03 0.00
EUR Accumulating Class (H) € 8.89 - 0.02 0.00 China Focus A-GBP £ 3.79 - -0.09 0.69 funds@gam.com, www.jbfundnet.com
Artisan US Value Equity Fund Class I USD Acc $ 9.39 - 0.22 0.00 BlackRock UK Property £ 41.67 - 0.46 3.26 INDIA VALUE INVESTMENTS LIMITED (INVIL) Regulated Asia ex-Japan A1 $ 20.49 - 0.12 0.00
EUR Distributing Class € 10.85 - 0.02 3.62 Global Financial Services A-GBP £ 0.41 - 0.00 0.11 www.invil.mu
Blackrock UK Long Lease £ 1079.95 - 8.43 0.00 Ms EF Special Val. EUR/A € 130.07 - 2.01 1.15
Other International Funds Bond A1 $ 10.28 - 0.01 0.00
Ashmore Sicav (LUX) EUR Distributing Class (H) € 8.41 - 0.02 3.71 Global Health Care A-GBP £ 0.56 - 0.00 0.00
BLK Intl Gold & General $ 3.84 4.05 0.16 0.00 NAV £ 8.07 - 0.00 0.00 Strategy Balanced-CHF/B SFr 144.80 - 0.72 0.00
China Equity Fd A1 $ 9.28 - -0.01 0.00
2 rue Albert Borschette L-1246 Luxembourg
GBP Distributing Class £ 9.99 - -0.04 3.57 Global Industrials A-GBP £ 0.59 - 0.00 0.00 Morgan Stanley Investment Funds (LUX)
FCA Recognised Strategy Balanced-EUR € 149.17 - 0.67 0.00
Continental European Eqty A1 € 16.51 - 0.17 0.00
6b Route de Trèves L-2633 Senningerberg Luxembourg (352) 34 64 61
Ashmore SICAV Emerging Market Debt Fund $ 86.55 - 0.13 9.02 BONHOTE GBP Distributing Class (H) £ 8.49 - 0.02 3.71 Global Inflation-Linked Bd A-GBP-Hdg £ 1.14 - 0.00 0.56
Intercapital Asset Management Ltd (HRV) Strategy Balanced-USD/B $ 124.50 - 0.60 0.00
Emer Mkts Debt Lo Curr Fd A1 $ 10.36 - 0.06 0.00 www.morganstanleyinvestmentfunds.com
Other International Funds Global Real Asset Securities £ 1.26 - 0.00 0.00 Masarykova ul. 1, 10000, Zagreb, Croatia FCA Recognised
Ashmore SICAV Emerging Market Frontier Equity Fund $ 128.06 - 0.79 0.98 USD Accumulating Class $ 8.97 - 0.02 0.00 Strategy Growth-CHF/B SFr 88.12 - 0.67 0.00
Bonhôte Alternative - Multi-Arbitrage (USD) Classe (EUR) € 6607.00 - -42.00 2.29 www.icam.hr, Tel; +385 1 4825 868 Emerging Markets Debt A1 $ 32.01 - 0.03 0.00
Dodge & Cox Worldwide Funds plc-Global Stock Fund US Advantage A F $ 53.38 - -0.55 0.00
Ashmore SICAV Emerging Market Total Return Fund $ 73.91 - 0.11 6.41 Global Technology A-GBP £ 0.25 - 0.00 0.00 Other International Funds Strategy Growth-EUR € 110.09 - 0.75 0.00
Bonhôte Alternative - Multi-Performance (USD) Classe (EUR) € 9749.00 - -171.00 0.93 Emerging Markets Eq.A1 $ 9.06 - 0.03 0.00
USD Accumulating Share Class $ 13.96 - 0.21 0.00 Asian Equity A F $ 36.57 - -0.30 0.00
Ashmore SICAV Global Small Cap Equity Fund $ 111.55 - -0.18 0.00 Global Telecomms A-GBP £ 0.28 - 0.00 1.15 Capital One Bond Fund (Ex-YU) HRK 204.00 - 0.00 -
Strategy Inc-CHF/B SFr 117.00 - 0.35 0.00
European Concentrated A1 € 16.04 - 0.20 0.00
GBP Accumulating Share Class £ 15.99 - 0.12 0.00 Asian Property A F $ 15.62 - -0.03 0.00
Ashmore SICAV Local Currency Fund $ 78.86 - 0.08 0.32 India Focus A-GBP £ 4.17 - -0.03 0.00 Capital Two Equity Fund (Ex-YU) HRK 88.23 - 0.08 -
Strategy Inc-EUR/B € 156.35 - 0.42 0.00
Braemar Group PCC Limited (GSY) European Core Eq A1 € 29.26 - 0.32 0.00
GBP Distributing Share class £ 11.63 - 0.08 0.98 Asian Property AX F £ 10.78 - -0.01 0.54
EM Mkts Corp.Debt USD F $ 80.56 - 0.03 9.18 Regulated Latin America A-GBP £ 1.21 - -0.01 0.67
Strategy Inc-USD/B $ 143.13 - 0.44 0.00
European Res.A1 € 30.19 - 0.44 0.00
EUR Accumulating Share Class € 19.30 - 0.27 0.00 Intrinsic Value Investors (IVI) LLP (IRL) Diversified Alpha Plus A F € 29.40 - 0.10 0.00
EM Mkts Loc.Ccy Bd USD F $ 72.16 - 0.24 4.41 UK Agricultural Class A £ 1.25 - -0.02 0.00 Sterling Cash Fund A-ACC-GBP £ 1.00 - 0.00 -
Dodge & Cox Worldwide Funds plc-International Stock Fund 1 Hat & Mitre Court, 88 St John Street, London EC1M 4EL +44 (0)20 7566 1210 European Smaller Companies A1 € 48.87 - 0.40 0.00
Emerg Europ, Mid-East & Africa Eq A F € 57.80 - 0.28 0.00
UK Agricultural Class B £ 1.37 - -0.02 0.00 FCA Recognised
USD Accumulating Share Class $ 11.84 - 0.19 0.00 European Value A1 € 34.45 - 0.40 0.00
Findlay Park Funds Plc (IRL) IVI European Fund EUR € 16.67 - 0.11 0.00 Emerging Markets Debt A F $ 72.42 - -0.18 0.00
Student Accom Class B £ 0.55 - -0.17 0.00
EUR Accumulating Share Class € 12.83 - 0.19 0.00 30 Herbert Street, Dublin 2, Ireland Tel: 020 7968 4900 Global Conc.A1 $ 34.01 - 0.45 0.00
IVI European Fund GBP £ 17.01 - 0.05 0.67 Emerging Markets Domestic Debt AX F £ 10.22 - -0.04 5.66
FCA Recognised
Dodge & Cox Worldwide Funds plc-U.S. Stock Fund Global Credit Fund $ 10.12 - 0.02 0.00
CG Asset Management Limited (IRL) American Fund USD Class $ 75.56 - 0.69 0.00 Emerging Markets Equity A F $ 29.09 - -0.17 0.00
USD Accumulating Share Class $ 16.19 - 0.27 0.00
Northern Trust, George's Court, 54-62 Townsend Street, Dublin 2, Rep of Ireland Global Energy Fund A1 $ 11.11 - 0.37 0.00
American Fund GBP Hedged £ 41.16 - 0.37 0.00 Euro Bond A F € 15.77 - 0.00 0.00
00 353 1 434 5098 GBP Accumulating Share Class £ 17.54 - 0.17 0.00 Kames Capital VCIC (IRL)
Global Equity A1 $ 41.76 - 0.61 0.00
FCA Recognised American Fund GBP Unhedged £ 52.79 - 0.03 - 1 North Wall Quay, Dublin 1, Ireland +35 3162 24493 Euro Corporate Bond AX F £ 22.12 - 0.03 1.54
Aspect Capital Ltd (UK) GBP Distributing Share Class £ 11.15 - 0.10 0.61
Capital Gearing Portfolio Fund Plc £ 27179.73 27179.73 -104.64 0.61 FCA Recognised Global Equity A1 € 24.37 - 0.30 0.00
Other International Funds Latin American Fund USD Class $ 9.87 - 0.12 0.00 Euro Strategic Bond A F € 43.15 - 0.05 0.00
CG Portfolio Fund Plc EUR Accumulating Share Class € 19.34 - 0.32 0.00 Absolute Return Bond B GBP Acc 1079.83 - 0.24 -
Aspect Diversified USD $ 461.74 - 14.50 0.00 Global High Yield Fund $ 23.23 - 0.03 0.00
Latin American Fund GBP Unhedged £ 6.99 - 0.02 - European Currencies High Yield Bd A F € 20.89 - -0.03 0.00
Real Return Cls A £ 173.92 173.92 -0.61 1.74 Eq Market Neutral B Acc 1023.64 - -0.23 -
Aspect Diversified EUR € 277.27 - 8.62 - Global High Yield Fund € 15.57 - -0.02 0.00
Invesco (LUX) European Equity Alpha A F € 39.08 - 0.16 0.00
Dollar Fund Cls D £ 136.06 136.06 -0.34 1.62 Eq Market Neutral Plus B Acc 1038.73 - -0.49 -
Aspect Diversified GBP £ 142.14 - 4.57 0.00 Dublin 00 353 1 439 8100 Hong Kong 00852 3191 8282 Global Multi-Asset A1 $ 14.30 - 0.11 0.00
Foord Asset Management FCA Recognised
European Property A F € 33.08 - -0.08 0.00
Capital Value Fund Cls V £ 131.69 131.69 -0.46 0.27 High Yield Global Bond A GBP Inc 507.92 - 0.49 5.47
Aspect Diversified CHF SFr 132.45 - 4.10 0.00 Other International Funds Global Res.A1 $ 23.44 - 0.32 0.00
Invesco Management SA Eurozone Equity Alpha A F € 10.53 - 0.04 0.00
Foord International Trust $ 32.64 - 0.08 0.00 High Yield Global Bond B GBP Inc 1055.89 - 1.04 5.47
Aspect Diversified Trends USD $ 133.69 - 0.81 0.00 Invesco Active Multi-Sector Credit Fund A € 2.82 - 0.00 0.00 Global Total Return A1 € 17.15 - 0.13 0.00
Global Bond A F $ 37.85 - 0.01 0.00
Cedar Rock Capital Limited (IRL) Foord Global Equity Fund_Class B $ 11.35 - 0.05 0.00 Investment Grade Global Bd A GBP Inc 551.21 - 0.15 2.49
Aspect Diversified Trends EUR € 133.79 - 0.81 0.00 Invesco Asia Balanced A dist $ 13.22 - 0.02 3.82 Inflation-Adjusted Bond A1 $ 13.82 - 0.04 0.00
Regulated Global Brands A F $ 94.24 - 0.04 0.00
Dragon Capital Group Kames Global Equity Income B GBP Acc 1162.64 - 7.08 -
Japan Equity A1 $ 9.54 - 0.11 0.00
Aspect Diversified Trends GBP £ 139.02 - 0.85 0.00 Cedar Rock Capital Fd Plc $ 345.33 - -24.08 0.00 Invesco Asia Consumer Demand Fund A income $ 11.26 - 0.05 0.24
c/o 1901 Me Linh Point, 2 Ngo Duc Ke, District 1, Ho Chi Minh City, Vietnam Global Convertible Bond A F $ 39.74 - -0.32 0.00
Fund information, dealing and administration: funds@dragoncapital.com Franklin Templeton International Services Sarl (IRL) Kames Global Equity Income B GBP Inc 1108.28 - 6.75 -
Cedar Rock Capital Fd Plc £ 376.67 - -16.82 0.00 Invesco Asia Infrastructure (A) $ 11.14 - 0.06 0.78 Latin American Equity Fd A1 $ 9.77 - 0.14 0.00
JPMorgan House - International Financial Services Centre,Dublin 1, Ireland Global Property A F $ 25.51 - -0.13 0.00
Other International Funds Strategic Global Bond A GBP Inc 1078.15 - 0.48 0.77
Atlantas Sicav (LUX) Cedar Rock Capital Fd Plc € 331.66 - -22.35 0.00 Other International Funds Invesco Asia Opportunities Equity A $ 93.39 - 0.07 0.00 Limited Maturity A1 $ 13.99 - 0.01 0.00
Indian Equity A F $ 31.31 - -0.08 0.00
Regulated Vietnam Enterprise Inv. (VEIL) NAV $ 3.29 - -0.15 0.00 Franklin Emerging Market Debt Opportunities Fund Plc Strategic Global Bond B GBP Inc 612.26 - 0.26 1.27
Invesco Balanced Risk Allocation Fund A € 14.17 - 0.06 0.00 Prudent Wealth Fd A1 $ 14.47 - 0.05 0.00
American Dynamic $ 3107.96 - 16.51 0.00 Vietnam Growth Fund (VGF) NAV $ 23.26 - 0.42 0.00 Latin American Equity A F $ 31.34 - -0.32 0.00
Franklin Emg Mkts Debt Opp CHFSFr 16.83 - -0.61 8.30
Charles Schwab Worldwide Funds Plc (IRL) Invesco Emerging Europe Equity Fund A $ 6.75 - 0.13 0.00 Research Bond A1 $ 16.54 - 0.02 0.00
American One $ 2945.57 - 20.68 0.00 Vietnam Property Fund (VPF) NAV $ 0.92 - 0.11 0.00 Short Maturity Euro Bond A F € 20.33 - 0.01 0.00
Regulated Franklin Emg Mkts Debt Opp EUR € 11.85 - -0.42 7.39
Invesco Emerging Local Currencies Debt A Inc $ 6.38 - 0.05 7.11 UK Equity A1 £ 7.58 - 0.08 0.00
Bond Global € 1394.59 - -3.33 0.00 Schwab USD Liquid Assets Fd $ 1.00 - 0.00 0.01 US Dollar Liquidity A F $ 13.03 - 0.00 0.00
Franklin Emg Mkts Debt Opp GBP £ 9.95 - -0.23 7.13
Invesco Emerging Mkt Quant.Eq. A $ 8.03 - 0.09 0.00 US Conc.Growth A1 $ 14.42 - 0.13 0.00
Eurocroissance € 833.81 - 23.41 0.00 US Growth A F $ 61.12 - -1.44 0.00
Franklin Emg Mkts Debt Opp SGD S$ 21.85 - -0.58 6.33
Thursday 28 January 2016 FINANCIAL TIMES 25

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

US Growth AH F € 42.31 - -1.00 0.00 Oasis Crescent Gbl Property Eqty $ 8.97 - 0.09 2.07 Pictet-Eastern Europe-I EUR F € 235.85 - 1.94 0.00 Socially Resp.Emerg.Mkts Bd Fd Inst Acc F $ 12.19 - 0.03 0.00 Renminbi Bond Fund GBP Cls B £ 112.34 - 0.46 3.53 Yuki Japan Value Select ¥ 11296.00 - 256.00 0.00

US Growth AX F £ 42.78 - -1.06 0.00 Pictet-Em Lcl Ccy Dbt-I USD F $ 147.43 - -0.60 0.00 StocksPLUS{TM} - Inst Acc $ 21.37 - 0.29 0.00 Renminbi Bond Fund SGD Cls B S$ 111.94 - 0.47 3.48 Unicapital Investments (LUX) YMR Umbrella Fund
Regulated
YMR N Growth ¥ 16497.00 - -1.00 0.00
US Property A F $ 66.03 - -0.55 0.00 Pictet-Emerging Markets-I USD F $ 408.25 - 4.88 0.00 Total Return Bond - Inst Acc $ 27.12 - 0.04 0.00 Renminbi Bond Fund USD Cls B $ 112.12 - 0.48 3.29
Investments III € 5.03 - -22.38 -
Yuki Asia Umbrella Fund
Pictet-Emerging Markets Index-I USD F $ 184.10 - -0.60 0.00 UK Corporate Bond - Inst Acc £ 17.13 - -0.01 0.00 Renminbi Bond Fund YEN Cls B ¥ 12722.71 - 57.63 0.00
Investments IV - European Private Eq. € 247.75 260.13 -44.58 - Yuki Japan Rebounding Growth Fund JPY Class ¥ 21329.00 - 428.00 0.00
Morgens Waterfall Vintiadis.co Inc Pictet-Emerging Corporate Bonds I USD $ 104.05 - -0.05 0.00 UK Long Term Corp. Bnd Inst-Inst Acc £ 19.01 - -0.02 0.00 Renminbi Bond Fund USD Cls A $ 154.32 - 0.67 3.53
Investments IV - Global Private Eq. € 366.42 384.74 -49.81 - Yuki Japan Rebounding Growth Fund USD Hedged Class $ 843.44 - 16.89 -
Other International Funds
Pictet-Emerging Markets High Dividend I USD $ 80.47 - 0.82 0.00 UK Low Duration - Inst Acc £ 14.02 - 0.00 0.00 S W Mitchell Capital LLP (CYM) Renminbi Bond Fund GBP Cls A £ 149.48 - 0.62 3.78
Phaeton Intl (BVI) Ltd (Est) $ 376.84 - 7.44 0.00 Regulated
Odey Asset Management LLP (CYM) Pictet-Emerging Markets Sust Eq I USD $ 74.71 - -0.55 0.00 UK Real Return - Inst Acc £ 22.94 - -0.04 0.00 Renminbi Bond Fund SGD Cls A S$ 148.02 - 0.63 3.73
S W Mitchell European Fund Class A EUR € 328.95 - -9.46 - Value Partners Hong Kong Limited (IRL) Zadig Gestion (Memnon Fund) (LUX)
Regulated
Pictet-Environmental Megatrend Sel I EUR € 149.83 - 1.27 0.00 UK Sterling Long Average Duration - Inst Acc £ 22.08 - 0.03 0.00 Renminbi Bond Fund YEN Cls A ¥ 18841.20 - 84.98 0.00 www.valuepartners.net, fis@vp.com.hk FCA Recognised
OEI Mac Inc GBP A £ 409.98 - 51.79 0.00 S W Mitchell Small Cap European Fund Class A EUR € 231.38 - 0.21 - Regulated
Pictet-EUR Bonds-I F € 557.71 - 0.94 0.00 Unconstrained Bond - Inst Acc $ 11.66 - 0.00 0.00 Renminbi Bond Fund EUR Cls A € 101.40 - 0.44 4.00 Memnon European Fund I GBP £ 110.98 - 0.60 0.00
OEI Mac Inc GBP B £ 236.17 - 34.38 0.00 The Charlemagne Fund EUR € 315.89 - -12.01 - Value Partners Asia ex-Japan Equity Fund $ 7.74 - 0.05 -
Pictet-EUR Corporate Bonds Ex Fin i EUR € 142.06 - 0.51 0.00 US High Yield Bond Fund Inst Acc $ 26.42 - 0.04 0.00
OEI MAC Inc USD $ 2188.18 - 273.75 0.00 Value Partners Classic Equity Fund USD Z Unhedged $ 9.44 - 0.01 0.00
Zebedee Capital Partners LLP (CYM)
Pictet-EUR Corporate Bonds-I F € 198.89 - 0.60 0.00
Odey European Inc EUR € 943.66 - 106.51 0.00 S W Mitchell Capital LLP (IRL) Value Partners Classic Equity Fund CHF HedgedSFr 9.85 - 0.01 0.00 Regulated
Pictet-EUR Government Bonds I EUR € 159.68 - 0.45 0.00 Regulated
Value Partners Classic Equity Fund EUR Hedged € 9.97 - 0.01 0.00 Zebedee Focus Fund Limited Class A EURO Shares € 169.78 - -0.96 0.00
Natixis International Funds (Lux) I SICAV (LUX) Odey European Inc GBP A £ 363.95 - 41.44 0.00
SWMC European Fund B EUR € 13950.63 - 69.52 0.00
Cannon Bridge House, 25 Dowgate Hill, London, EC4R 2YA 0044 20 3216 9000 Pictet-EUR High Yield-I F € 236.25 - -0.35 0.00 Zebedee Focus Fund Limited Class B USD Shares $ 197.30 - -1.19 0.00
Odey European Inc GBP B £ 206.55 - 23.52 0.00 Value Partners Classic Equity Fund GBP Hedged £ 10.19 - 0.01 0.00
FCA Recognised SWMC UK Fund B £ 10976.77 - -94.34 0.00
Pictet-EUR Short Mid-Term Bonds-I F € 137.06 - 0.02 0.00 Zebedee Focus Fund Limited Class A USD $ 170.38 - -0.82 0.00
Harris Global Equity R/A (USD) $ 224.61 224.61 1.71 0.00 Odey European Inc USD $ 436.39 - 49.24 0.00 Value Partners Classic Equity Fund GBP Unhedged £ 11.53 - 0.15 0.00
SWMC Small Cap European Fund B EUR € 12608.96 - 44.95 0.00
Pictet-EUR Short Term HY I EUR € 118.28 - -0.02 0.00 E.I. Sturdza Strategic Management Limited (GSY) Value Partners Classic Equity USD Hedged $ 11.60 - 0.01 0.00
Harris US Equity Fund R/A (USD) $ 184.01 184.01 2.69 0.00 Giano Capital EUR Inc € 4652.16 - 195.57 0.00 Regulated
SWMC Emerging European Fund B EUR € 8192.57 - 47.17 0.00
Pictet-EUR Sov.Sht.Mon.Mkt EUR I € 102.93 - 0.00 0.00 Platinum Capital Management Ltd Value Partners Greater China Equity Fund $ 7.36 - 0.08 -
Harris Concentrated US Equity R/A (USD) $ 139.36 139.36 2.42 0.00 Nippon Growth Fund Limited ¥ 83804.00 - 0.00 0.00
Other International Funds
Odey Asset Management LLP (IRL)
Pictet-Euroland Index IS EUR € 122.67 - 1.41 0.00
Strat Evarich Japan Fd Ltd JPY ¥ 82538.00 - -704.00 0.00 Value Partners Health Care Fund RMB Class Z UnhedgedCNH 8.75 - -0.20 -
Data Provided by
Loomis Sayles Strategic Alpha R/A (USD) $ 108.05 108.05 0.07 - Platinum All Star Fund - A $ 116.86 - - -
FCA Recognised Pictet-Europe Index-I EUR F € 157.59 - 1.38 0.00
Strat Evarich Japan Fd Ltd USD $ 815.91 - -7.01 0.00 Value Partners Health Care Fund HKD Class A UnhedgedHK$ 8.21 - -0.18 -
Odey Pan European EUR R € 320.58 - -0.46 0.00 Platinum Global Dividend Fund - A $ 54.29 - - -
Pictet-European Equity Selection-I EUR F € 582.38 - 4.42 0.00
Natixis International Funds (Dublin) I plc (IRL) Value Partners Health Care Fund USD Class A Unhedged $ 8.19 - -0.18 -
Odey Absolute Return Focus Fund $ 100.00 - - - Platinum Maverick Enhanced Fund Limited $ 93.55 - - 0.00
Cannon Bridge House, 25 Dowgate Hill, London, EC4R 2YA +44 (0)20 3216 9000 Pictet-European Sust Eq-I EUR F € 232.41 - 1.49 0.00
Regulated E.I. Sturdza Funds PLC (IRL)
Odey Allegra European EUR O € 253.17 - 0.94 0.00 Regulated
Pictet-Global Bds Fundamental I USD $ 115.74 - 0.35 0.00 Veritas Asset Management LLP (IRL)
Loomis Sayles Global Opportunistic Bond R/D (USD) $ 12.18 12.18 0.01 1.22
Odey Allegra International EUR O € 167.27 - -0.44 0.00 RobecoSAM (LUX) Nippon Growth (UCITS Fund Euro Hedged Class EUR) € 937.46 - -25.48 0.00 HSSI Ltd, 1 Grand Canal Sq, Grand Canal Harbour, Dublin 2, Ireland
Pictet-Global Bonds-I EUR € 166.99 - 0.21 0.00 Tel. +41 44 653 10 10 http://www.robecosam.com/
Loomis Sayles High Income R/D (USD) $ 7.07 7.07 0.03 15.55
Odey Allegra Developed Markets USD I $ 114.43 - 0.77 0.00
Pictet-Global Emerging Currencies-I USD F $ 93.85 - 0.01 0.00
Regulated Nippon Growth (UCITS Fund Euro Hedged Institutional Class EUR) € 1104.81 - -30.01 0.00
Veritas Funds Plc
www.veritas-asset.com www.morningstar.co.uk
Loomis Sayles Multisector Income R/D (GBP) $ 11.14 11.14 0.04 5.93
Odey European Focus Fund € 17.17 - 0.15 0.50 RobecoSAM Sm.Energy/A £ 10.99 - 0.05 1.61 Nippon Growth (UCITS) Fund JPY Class A shares ¥ 86824.00 - -2359.00 0.00 +353 1 635 6799 Data as shown is for information purposes only. No
Pictet-Global Emerging Debt-I USD F $ 350.07 - 1.78 0.00 FCA Recognised offer is made by Morningstar or this publication.
Odey Atlas Fund GBP I S £ 1.12 - 0.00 0.00 RobecoSAM Sm.Energy/N € 11.00 - 0.08 0.00 Nippon Growth (UCITS) Fund JPY Class B Acc shares ¥ 72804.00 - -1978.00 0.00 Institutional
Pictet-Global Megatrend Selection-I USD F $ 202.48 - 2.35 0.00
Odey Giano European Fund EUR R € 121.36 - -0.83 0.00 Polar Capital Funds Plc (IRL) RobecoSAM Sm.Materials/A £ 113.46 - -0.07 1.43 Nippon Growth (UCITS) Fund JPY Class C Dis shares ¥ 82212.00 - 968.00 0.00 Veritas Asian Fund A USD H $ 291.41 - 1.39 0.42

Asset Management
Pictet-Greater China-I USD F $ 383.40 - 2.48 0.00 Regulated

Asset Management
Odey Naver Fund EUR I € 127.75 - -0.42 0.00 RobecoSAM Sm.Materials/N € 129.16 - 0.26 0.00 Nippon Growth (UCITS Fund Class D Institutional JPY) ¥ 47186.00 - -1282.00 0.00 Veritas Asian Fund A GBP H £ 374.05 - -0.11 0.24
Pictet-Health-I USD $ 250.82 - 0.42 0.00 Asian Financials I USD $ 248.85 248.85 1.45 0.00
Odey Odyssey USD I $ 132.52 - 0.09 0.00 RobecoSAM Sm.Materials/Na € 89.14 - 0.18 - Strategic China Panda Fund USD $ 1937.90 - -29.23 0.00 Veritas Asian Fund A EUR H € 304.46 - 0.00 0.21
Pictet-High Dividend Sel I EUR F € 148.25 - 2.00 0.00 Biotechnology I USD $ 15.64 15.64 -0.14 0.00

New Capital Fund Management Ltd (IRL)

Odey Orion Fund EUR I € 117.04 - 0.16 0.00
Pictet-India Index I USD $ 87.96 - 0.05 0.00 European Income Acc EUR € 10.81 10.81 0.07 0.00
RobecoSAM Gl.Small Cap Eq/A £ 73.43 - 0.35 1.28 Strategic China Panda Fund Hedged EURO € 1891.15 - -26.65 0.00 Veritas China Fund A USD $ 128.55 - 0.08 0.35
Guide to Data
Odey Swan Fund EUR I € 103.73 - -2.66 0.00 RobecoSAM Gl.Small Cap Eq/N € 144.74 - 1.05 0.00 Strategic China Panda Fund Hedged Sterling £ 1916.74 - -27.35 0.00 Veritas China Fund A GBP £ 133.04 - 0.10 0.36
Leconfield House, Curzon Street, London, W1J 5JB Pictet-Indian Equities-I USD F $ 404.35 - 0.72 0.00 European Ex UK Inc EUR Acc € 9.29 9.29 0.07 -
FCA Recognised RobecoSAM Sustainable Gl.Eq/B € 168.25 - 1.34 0.00 The fund prices quoted on these pages are supplied by
Odey European Absolute Return GBP S £ 100.66 - -1.58 0.00 Financial Opps I USD $ 10.65 - 0.09 2.17 Strategic Euro Bond Accumulating Class CHFSFr 980.75 - -0.01 0.00 Veritas China Fund A EUR € 127.07 - 0.07 0.36
New Capital UCITS Funds Pictet-Japan Index-I JPY F ¥ 14762.02 - 426.16 0.00 the operator of the relevant fund. Details of funds
RobecoSAM Sustainable Gl.Eq/N € 145.32 - 1.16 0.00 Strategic Euro Bond Institutional Class EUR € 1009.31 - 0.03 0.00 Veritas Global Equity Income Fund D USD $ 104.37 - 0.52 4.25 published on these pages, including prices, are for the
Asia Pac Bd USD Inst Inc $ 90.23 - -0.02 3.27 Pictet-Japanese Equities Opp-I JPY F ¥ 8790.82 - 249.51 0.00 GEM Growth I USD $ 7.40 - -0.04 0.00
purpose of information only and should only be used
Odey Wealth Management (CI) Ltd (IRL)
GEM Income I USD $ 8.20 - -0.06 0.00
RobecoSAM S.HealthyLiv/B € 171.24 - 1.67 0.00 Strategic Euro Bond Fund Accumulating Class Shares € 1131.24 - 0.03 0.00 Veritas Global Equity Income Fund D EUR € 185.95 - 0.03 4.17 as a guide. The Financial Times Limited makes no
Asia Pac Bd USD Ord Inc $ 92.20 - -0.02 2.53 www.odey.com/prices Pictet-Japanese Equity Selection-I JPY F ¥ 12995.23 - 339.74 0.00 representation as to their accuracy or completeness
FCA Recognised RobecoSAM S.HealthyLiv/N € 159.71 - 1.56 0.00 Strategic Euro Bond Fund Distributing Class Shares € 1021.18 - 0.03 1.33 Veritas Global Equity Income Fund D GBP £ 141.69 - -0.02 4.17 and they should not be relied upon when making an
Asia Pac Eq EUR Ord Inc € 74.63 - -1.06 3.42 Pictet-LATAM Index I USD $ 41.77 - 0.00 0.00 Global Alpha I USD $ 11.62 11.62 0.11 0.00
investment decision.
Odey Opportunity EUR I € 211.55 - 1.07 0.00 RobecoSAM S.HealthyLiv/Na £ 105.51 - 0.76 - Strategic European Smaller Companies Fund EUR Class € 916.93 - 7.85 - Veritas Global Focus Fund D USD $ 23.99 - 0.06 0.65
Asia Pac Eq GBP Ord Inc £ 77.11 - -1.11 3.86 Pictet-LATAM Lc Ccy Dbt-I USD F $ 101.20 - 0.41 0.00 Global Convertible I USD $ 10.81 10.81 0.02 0.00
The sale of interests in the funds listed on these pages
RobecoSAM S.Water/A £ 162.20 - 0.56 1.22 Strategic Global Bond RMB Acc $ 1049.21 - -0.17 0.00 Veritas Global Focus Fund D EUR € 22.21 - -0.05 0.64 may, in certain jurisdictions, be restricted by law and
Asia Pac Eq USD Ord Inc $ 78.01 - -1.09 3.24 Pictet-Pacific Ex Japan Index-I USD F $ 295.84 - 2.79 0.00 Global Insurance I GBP £ 4.02 - 0.02 0.00
Omnia Fund Ltd the funds will not necessarily be available to persons
RobecoSAM S.Water/N € 154.28 - 0.93 0.00 Strategic Global Bond USD Acc $ 1049.21 - 0.06 0.00 Veritas Global Focus Fund D GBP £ 28.45 - -0.08 0.63
Asia Pac Eq USD Inst Acc $ 83.98 - -1.16 0.00 Pictet-Premium Brands-I EUR F € 143.12 - 1.51 0.00 Global Technology I USD $ 21.12 - 0.02 0.00 in all jurisdictions in which the publication circulates.
Other International Funds Persons in any doubt should take appropriate
Healthcare Blue Chip Fund I USD Acc $ 10.15 10.15 0.06 0.00 Strategic US Momentum and Value Fund $ 705.97 - 6.70 0.00 Veritas Global Focus Fund A GBP £ 27.47 - -0.07 0.36 professional advice. Data collated by Morningstar. For
Asia Pac Eq USD Inst Inc $ 86.96 - -1.23 3.97 Estimated NAV $ 833.84 - -21.78 0.00 Pictet-Quality Global Equities I USD $ 127.06 - 1.66 0.00
other queries contact reader.enquiries@ft.com +44
Healthcare Opps I USD $ 35.49 - 0.10 0.00 Strategic US Momentum & Value Fund USD I Class $ 469.10 - 4.47 0.00 Veritas Global Focus Fund A EUR € 12.94 - -0.03 0.36
Dyn Europ Eq EUR Ord Inc € 164.86 - 0.45 1.33 Pictet-Russia Index I USD $ 40.72 - 0.03 0.00 (0)207 873 4211.

Income Opportunities B2 I GBP Acc £ 1.65 1.65 0.00 0.00 Strategic US Momentum and Value EUR Hedged Class EUR € 492.09 - 4.62 0.00 Veritas Global Focus Fund A USD $ 23.15 - 0.06 0.38
Dyn Europ Eq GBP Ord Inc £ 174.72 - 0.50 1.69 Pictet-Russian Equities-I USD F $ 36.06 - 0.18 0.00 The fund prices published in this edition along with
Strategic US Momentum and Value CHF Hedged Class CHFSFr 488.91 - 4.61 0.00 additional information are also available on the
Japan Alpha I JPY ¥ 188.89 188.89 5.84 0.00 Veritas Global Focus Fund C GBP £ 29.83 - -0.08 0.00
Dyn Europ Eq USD Ord Inc $ 164.60 - 0.44 1.25 Pictet-Security-I USD F $ 187.91 - 2.25 0.00 Financial Times website, www.ft.com/funds. The
Veritas Global Focus Fund C EUR € 23.39 - -0.06 0.00 funds published on these pages are grouped together
China Equity EUR Ord Acc € 109.23 - -4.01 0.00 Pictet-Select-Callisto I EUR € 104.09 - 0.35 0.00 Japan I JPY ¥ 1857.41 - 60.26 0.00 by fund management company.
North American I USD $ 16.39 16.39 0.20 0.00
Schroder Property Managers (Jersey) Ltd The Hartford International Funds (IRL) Veritas Global Focus Fund C USD $ 25.20 - 0.06 0.00
China Equity GBP Ord Acc £ 113.51 - -4.58 0.00 Pictet-Small Cap Europe-I EUR F € 1059.15 - 1.75 0.00 Regulated Prices are in pence unless otherwise indicated. The
Other International Funds
Veritas Global Equity Income Fund A GBP £ 135.75 - -0.02 4.18 change, if shown, is the change on the previously
China Equity USD Ord Acc $ 111.20 - -4.03 0.00 Optima Fund Management Pictet-ST.MoneyMkt-I € 140.44 - 0.00 0.00 UK Absolute Equity I GBP £ 12.67 12.67 -0.02 0.00 Gbl Govt Bond (Ex Japan) Index (GBP) £ 1681.14 - -1.48 0.00
Indirect Real Estate SIRE £ 134.51 140.66 1.17 2.78 quoted figure (not all funds update prices daily). Those
Other International Funds Veritas Global Equity Income Fund A EUR € 180.60 - 0.04 4.17 designated $ with no prefix refer to US dollars. Yield
China Equity USD Inst Acc $ 114.47 - -4.13 0.00 Pictet-ST.MoneyMkt JPY I USD ¥ 101497.63 - -1.31 0.00 UK Corporate Bond £ 1565.50 - -3.34 0.00 percentage figures (in Tuesday to Saturday papers)
Cuttyhunk Fund II Limited $ 1350.67 - 22.88 0.00 allow for buying expenses. Prices of certain older
Europ. Equity Fd EUR € 98.27 - 0.27 - Pictet-ST.MoneyMkt-ICHF SFr 124.11 - -0.01 0.00
Polar Capital LLP (CYM)
SIA (SIA Funds AG) (LUX) Gilt £ 1609.68 - -0.39 0.00
Veritas Global Equity Income Fund A USD $ 100.41 - 0.50 4.25
Regulated insurance linked plans might be subject to capital
JENOP Global Healthcare Fund Ltd $ 14.76 - -0.27 0.00 Regulated Veritas Global Equity Income Fund C GBP £ 163.20 - -0.02 - gains tax on sales.
Europ. Equity Fd GBP £ 96.83 - 0.28 - Pictet-ST.MoneyMkt-IUSD $ 135.37 - 0.00 0.00 ALVA Convertible A USD $ 128.02 - -0.62 0.00 Global Eq (Ex Japan) Index Fund ¥ 1.28 - 0.01 0.00
OPTIKA Fund Limited - Cl A $ 94.86 - -2.67 - LTIF Classic € 302.60 - 1.60 0.00
Veritas Global Equity Income Fund C EUR € 217.01 - 0.05 - Guide to pricing of Authorised Investment Funds:
Europ. Equity Fd USD $ 97.10 - 0.27 - Pictet-Timber-I USD F $ 126.71 - 1.88 0.00 European Conviction A EUR € 144.65 - 3.79 0.00 Global Eq (ex Japan) Class HJ4 ¥ 1.33 - 0.01 0.00
LTIF Natural Resources € 63.46 - 0.94 0.00 (compiled with the assistance of the IMA. The
Optima Fd NAV $ 85.46 - -2.91 0.00 Veritas Global Equity Income Fund C USD $ 119.94 - 0.59 - Investment Management Association, 65 Kingsway,
Global Val.Cr.Fd GBP Ord Inc £ 106.62 - -0.04 3.63 Pictet Total Ret-Agora I EUR € 116.68 - -0.19 0.00 European Forager A EUR € 178.02 - 3.04 0.00 Global Eq (ex Japan) Class JP5 ¥ 1.40 - 0.02 0.00
LTIF Stability A ACCU € 155.54 - -0.75 0.00 London WC2B 6TD.
Optima Discretionary Macro Fund Limited $ 87.21 - -1.06 0.00 Veritas Global Real Return Fund A USD $ 20.59 - -0.03 0.29
Global Val.Cr.Fd USD Inst Acc $ 120.11 - -0.03 0.00 Global Eq Ex Japan Index Fund (Hedge) ¥ 1.28 - 0.02 0.00 Tel: +44 (0)20 7831 0898.)
Pictet Total Ret-Corto Europe I EUR € 134.64 - -0.32 0.00
The Dorset Energy Fd Ltd NAV $ 20.39 - 1.97 0.00 Veritas Global Real Return Fund A GBP £ 11.54 - -0.01 0.32
Global Val.Cr.Fd GBP Ord Acc £ 172.98 - -0.04 0.00 Gbl Govt Bond (Ex Japan) Index ¥ 1.31 - 0.00 0.00 OEIC: Open-Ended Investment Company. Similar to a
Pictet Total Ret-Divers Alpha I EUR € 105.12 - -0.10 0.00 Polunin Capital Partners Ltd SIA (SIA Funds AG) (CH) unit trust but using a company rather than a trust
Platinum Fd Ltd $ 78.42 - -3.04 0.00 Veritas Global Real Return Fund A EUR € 12.14 - -0.02 0.12
Other International Funds structure.
Global Val.Cr.Fd USD Ord Acc $ 162.43 - -0.04 0.00 Pictet Total Ret-Kosmos I EUR € 108.72 - 0.05 0.00 Other International Fds Gbl Govt Bond (ex Japan) Class JP4 ¥ 1.28 - 0.00 0.00
Platinum Fd Ltd EUR € 15.20 - -0.59 0.00 Emerging Markets Active $ 40.75 - 0.67 - Retail
Global Val.Cr.Fd EUR Ord Acc € 151.00 - -0.04 0.00 Pictet Total Ret-Mandarin I USD $ 111.15 - -0.55 0.00 LTIF Stability Growth SFr 185.70 - 3.40 - Japan Equity Index Fund ¥ 0.97 - 0.03 0.00 Different share classes are issued to reflect a different
Platinum Japan Fd Ltd $ 50.95 - -1.11 0.00 Luxcellence Em Mkts Tech $ 851.68 - 16.03 0.00 Veritas Asian Fund B USD $ 202.98 - 0.97 0.00 currency, charging structure or type of holder.
Swiss Select Equity Inst Acc SFr 111.59 - 1.11 0.00 Pictet-US Equity Selection-I USD $ 175.43 - 1.83 0.00 LTIF Stability Inc Plus SFr 159.40 - 2.90 0.55 Japan Equity Class JP3 ¥ 1.17 - 0.03 0.00
Optima Partners Global Fd $ 13.48 - -0.39 0.00 Polunin Developing Countries $ 641.29 646.74 -6.05 0.00 Veritas Asian Fund B GBP £ 275.62 - -0.09 0.00 Selling price: Also called bid price. The price at which
Swiss Select Equity Ord Acc SFr 110.24 - 1.09 0.00 Pictet-US High Yield-I USD F $ 141.50 - 0.23 0.00 units in a unit trust are sold by investors.
Optima Partners Focus Fund A $ 15.38 - -0.26 0.00 Polunin Discovery - Frontier Markets $ 1275.98 - -15.71 0.00 Veritas Asian Fund B EUR € 224.21 - 0.00 0.00
US Growth USD Ord Acc $ 186.33 - 1.93 0.00 Pictet-USA Index-I USD F $ 168.35 - 2.34 0.00
Standard Life Wealth (JER) The National Investor (TNI) Buying price: Also called offer price. The price at
PO Box 189, St Helier, Jersey, JE4 9RU 01534 709130 www.tni.ae Veritas China Fund B GBP £ 128.96 - 0.09 0.00 which units in a unit trust are bought by investors.
Polunin Small Cap $ 1266.92 1282.76 24.45 0.00
US Growth EUR Ord Acc € 177.95 - 1.87 0.00 Pictet-USD Government Bonds-I F $ 644.63 - 1.48 0.00 FCA Recognised Includes manager’s initial charge.
Other International Funds
Oryx International Growth Fund Ltd Standard Life Offshore Strategy Fund Limited Veritas China Fund B EUR € 163.91 - 1.09 0.00
US Growth GBP Ord Acc £ 186.91 - 2.00 0.00 Other International Funds Pictet-USD Short Mid-Term Bonds-I F $ 129.94 - 0.05 0.00 TNI Blue Chip UAE Fund * AED 8.34 - -0.05 0.00 Single price: Based on a mid-market valuation of the
Private Fund Mgrs (Guernsey) Ltd (GSY) Bridge Fund £ 1.5569 - 0.0079 1.92 Veritas Global Focus Fund B USD $ 16.71 - 0.04 0.00 underlying investments. The buying and selling price
US Growth USD Inst Acc $ 172.27 - 1.78 0.00 NAV (Fully Diluted) £ 7.21 - 0.28 0.00 Pictet-USD Sov.ST.Mon.Mkt-I $ 102.69 - 0.00 0.00 Regulated TNI Funds Ltd (BMU) for shares of an OEIC and units of a single priced unit
Diversified Assets Fund £ 1.1463 - 0.0022 3.04 Veritas Global Focus Fund B GBP £ 20.98 - -0.06 0.00 trust are the same.
Wealthy Nat Bd EUR Inst Inc € 103.88 - 0.02 3.83 Monument Growth 19/01/2016 £ 459.42 464.53 -18.20 1.22 MENA Hedge Fund $ 938.96 - 33.96 0.00
Pictet-Water-I EUR F € 266.68 - 2.75 0.00
Global Equity Fund £ 1.8215 - 0.0124 0.64 Veritas Global Focus Fund B EUR € 15.41 - -0.04 0.00
TNI Funds Plc (Ireland) Treatment of manager’s periodic capital charge:
Wealthy Nat Bd GBP Inst Inc £ 107.96 - 0.02 3.66 OTP Asset Management Romania SAI SA ((ROM))
The letter C denotes that the trust deducts all or part
www.otpfonduri.ro Global Balanced Fund - Income Units £ 1.3184 - 0.0038 2.09 MENA UCITS Fund * $ 932.86 - 22.55 0.00 Veritas Global Equity Income Fund B GBP £ 124.78 - -0.02 4.20
Prusik Investment Management LLP (IRL) of the manager’s/operator’s periodic charge from
Wealthy Nat Bd EUR Ord Inc € 103.22 - 0.02 3.59 Other International Funds Pimco Fds: Global Investors Series Plc (IRL)
capital, contact the manager/operator for full details
PIMCO Europe Ltd,11 Baker Street,London W1U 3AH Enquiries - 0207 493 1331 Global Balanced Fund - Accumulations Units £ 1.5426 - 0.0045 2.06 Veritas Global Equity Income Fund B EUR € 165.60 - 0.03 4.19
OTP Comodisro RON 16.89 - 0.00 - of the effect of this course of action.
Wealthy Nat Bd GBP Ord Inc £ 108.59 - 0.02 3.39 http://gisnav.pimco-funds.com/ Regulated
Global Fixed Interest Fund £ 0.9486 - 0.0013 5.50 Veritas Global Equity Income Fund B USD $ 99.47 - 0.50 4.27
OTP Obligatiuni RON 14.30 - 0.00 - Dealing: +44 20 3640 1000 Prusik Asian Equity Income B Dist $ 142.46 - 0.88 3.84 Exit Charges: The letter E denotes that an exit charge
Wealthy Nat Bd USD Ord Inc $ 105.85 - 0.03 3.37
PIMCO Funds: +44 (0)20 3640 1407 Sterling Fixed Interest Fund £ 0.8293 - -0.0011 4.30 Veritas Global Real Return Fund B USD $ 19.96 - -0.04 0.00 may be made when you sell units, contact the
New Capital Alternative Strategies OTP Avantisro RON 7.88 - 0.01 - FCA Recognised Prusik Asia A $ 175.84 - 1.60 0.00 manager/operator for full details.
UK Equity Fund £ 1.7872 - 0.0047 2.94 Veritas Global Real Return Fund B GBP £ 11.32 - -0.01 0.00
All Weather Fd USD Cls $ 117.83 - -0.64 0.00 OTP Euro Bond € 12.42 - 0.00 - Capital Securities Inst Acc $ 14.58 - -0.02 0.00 Prusik Asian Smaller Cos A $ 128.19 - -0.07 0.00 Time: Some funds give information about the timing of
Veritas Global Real Return Fund B EUR € 12.97 - -0.02 0.00 price quotes. The time shown alongside the fund
All Weather Fd EUR Cls € 105.67 - -0.67 0.00 OTP Dollar Bond $ 10.58 - 0.00 - Commodity Real Return Fund Inst Acc $ 5.46 - 0.08 0.00 manager’s/operator’s name is the valuation point for
Toscafund Asset Management LLP (UK) their unit trusts/OEICs, unless another time is
All Weather Fd GBP Cls £ 113.91 - -0.67 0.00 OTP Premium Return RON 1052.14 - 0.67 - Credit Absolute Return Fund Inst Acc $ 10.83 - 0.00 0.00 Purisima Investment Fds (CI) Ltd (JER) indicated by the symbol alongside the individual unit
www.toscafund.com
Regulated Veritas Asset Management LLP trust/OEIC name.
Tactical Opps USD Cls $ 115.54 - 3.20 0.00 Diversified Income - Inst Acc $ 18.80 - 0.04 0.00 Authorised Funds
PCG B 151.55 - -0.87 0.00 www.veritas-asset.com
Aptus Global Financials B Acc £ 2.84 - 0.01 4.54 Other International Funds The symbols are as follows: ✠ 0001 to 1100 hours; ♦
Tactical Opps EUR Cls € 96.53 - 2.64 0.00 Diversified Income Durat Hdg Fund Inst Acc $ 10.83 - 0.00 0.00
PCG C 149.41 - -0.86 0.00 1101 to 1400 hours; ▲1401 to 1700 hours; # 1701 to
Aptus Global Financials B Inc £ 2.49 - 0.02 4.55 Real Return Asian Fund USD (Est) € 277.60 - -26.20 0.00 midnight. Daily dealing prices are set on the basis of
Tactical Opps GBP Cls £ 108.13 - 2.90 0.00 Emerging Asia Bond Fund Inst Acc $ 9.24 - 0.02 0.00
the valuation point, a short period of time may elapse
Stenham Asset Management Inc Real Return Asian Fund GBP (Est) £ 296.77 - -7.03 0.00 before prices become available. Historic pricing: The
Emerging Local Bond - Inst Acc $ 10.18 - 0.04 0.00
Putnam Investments (Ireland) Ltd (IRL) www.stenhamassetmanagement.com letter H denotes that the managers/operators will
Regulated
Toscafund Asset Management LLP Real Return Asian Fund EUR (Est) $ 292.91 - -10.89 0.00 normally deal on the price set at the most recent
Emerging Markets Bond - Inst Acc $ 36.23 - 0.08 0.00 Other International Funds
www.toscafund.com valuation. The prices shown are the latest available
Putnam New Flag Euro High Yield Plc - E € 974.88 - -1.73 4.30 Stenham Asia USD $ 128.00 - -1.80 - Other International Funds before publication and may not be the current dealing
Permal Investment Mgmt Svcs Ltd Emerging Markets Corp.Bd Fund Inst Acc F $ 12.21 - 0.00 0.00
levels because of an intervening portfolio revaluation
www.permal.com Stenham Credit Opportunities A Class USD $ 99.47 - -1.45 0.00 Tosca A USD $ 305.04 - -1.61 0.00 Waverton Investment Funds Plc (1600)F (IRL)
or a switch to a forward pricing basis. The
Emerging Markets Short-Term Local Currency Fund $ 11.26 - 0.01 0.00
Other International Funds waverton.investments@citi.com managers/operators must deal at a forward price on
Offshore Fund Class A US $ Shares Stenham Equity UCITS USD $ 127.64 - -2.31 0.00 Tosca Mid Cap GBP £ 245.63 - -7.49 0.00 FCA Recognised
Euro Bond - Inst Acc € 22.72 - 0.03 0.00 request, and may move to forward pricing at any time.
Waverton Asia Pacific A USD $ 15.37 - 0.08 5.23 Forward pricing: The letter F denotes that that
Northwest Investment Management (HK) Ltd Investment Holdings N.V. $ 5417.00 - -70.68 0.00 Stenham Growth USD $ 214.36 - -1.09 - Tosca Opportunity B USD $ 334.27 - -12.71 0.00
Euro Credit - Inst Acc € 14.69 - 0.01 0.00 managers/operators deal at the price to be set at the
11th Floor, Kinwick Centre, 32, Hollywood Road, Central Hong Kong +852 9084 4373 Waverton Global Bond Fund Cls A $ 8.59 - -0.01 5.42 next valuation.
Macro Holdings Ltd $ 4176.78 - -15.24 0.00 Stenham Healthcare USD $ 184.07 - 0.80 0.00 Pegasus Fund Ltd A-1 GBP £ 55.26 - -0.15 0.00
Other International Funds Euro Income Bond - Inst Acc F € 12.74 - -0.01 0.00
Waverton Global Equity Fund A GBP £ 13.02 - 0.14 0.58 Investors can be given no definite price in advance of
Northwest $ class $ 2329.36 - -28.58 0.00 Fixed Income Holdings N.V. $ 349.32 - -14.81 - Euro Long Average Duration - Inst Acc € 22.08 - 0.12 0.00 Stenham Managed Fund USD $ 113.54 - -0.62 -
the purchase or sale being carried out. The prices
Northwest Warrant $ class $ 1969.35 - -444.40 0.00 Permal Absolute Return Fund $ 163.19 - -0.40 0.00 Robeco Asset Management (LUX) Stenham Macro UCITS USD $ 101.19 - -0.24 - Waverton UK Fund A GBP £ 12.36 - 0.02 1.85 appearing in the newspaper are the most recent
Euro Low Duration Fund Inst Acc € 11.23 - 0.01 0.00 provided by the managers/operators. Scheme
Coolsingel 120, 3011 AG Rotterdam, The Netherlands.
www.robeco.com/contact Stenham Multi Strategy USD $ 115.54 - -0.74 - Waverton Equity Fund A GBP £ 13.77 - -0.07 0.19 particulars, prospectus, key features and reports: The
Euro Real Return - Inst Acc € 13.34 - 0.02 0.00 most recent particulars and documents may be
FCA Recognised Waverton Sterling Bond Fund A GBP £ 9.37 - -0.01 5.31
Stenham Quadrant USD A $ 398.60 - -2.93 - obtained free of charge from fund
Euro Short-Term Inst Acc € 12.23 - 0.00 0.00 managers/operators. * Indicates funds which do not
Asia-Pacific Equities (EUR) € 118.97 - -2.02 0.00
Stenham Trading Inc USD $ 115.43 - -0.76 - price on Fridays.
Euro Ultra Long Duration - Inst Acc € 29.34 - 0.18 0.00
Chinese Equities (EUR) € 63.09 - -0.96 0.00
Stenham Universal USD $ 430.13 - -1.32 -
WA Fixed Income Fund Plc (IRL) Charges for this advertising service are based on the
Global Advantage - Inst Acc $ 11.82 - 0.02 0.00 Regulated
Em Stars Equities (EUR) € 152.08 - 0.17 0.00 number of lines published and the classification of the
Stenham Universal II USD $ 159.28 - -0.56 0.00 European Multi-Sector € 115.80 - 0.26 0.00 fund. Please contact data@ft.com or
Global Advantage Real Return Fund Inst Acc $ 8.12 - 0.02 0.00
Emerging Markets Equities (EUR) € 124.64 - -0.95 0.00 call +44 (0)20 7873 3132 for further information.
Oasis Crescent Management Company Ltd Pictet Asset Management (Europe) SA (LUX)
Global Bond - Inst Acc $ 27.90 - 0.04 0.00 TreeTop Asset Management S.A. (LUX)
15, Avenue J.F. Kennedy L-1855 Luxembourg Flex-o-Rente (EUR) € 110.49 - 0.15 0.00
Other International Funds Regulated
Tel: 0041 58 323 3000 Global Bond Ex-US - Inst Acc $ 19.59 - 0.02 0.00
Stratton Street Capital (CI) Limited (GSY)
Glob.Consumer Trends Equities (EUR) € 144.77 - 0.41 0.00 Regulated TreeTop Convertible Sicav
Oasis Crescent Equity Fund R 9.13 - 0.04 0.00 FCA Recognised
Global High Yield Bond - Inst Acc $ 19.29 - 0.02 0.00 Japan Synthetic Warrant Yen Class ¥ 1362.59 - -419.81 0.00 International A € 279.63 - 1.26 0.00
Pictet-Absl Rtn Fix Inc-HI EUR € 106.04 - -0.05 0.00 High Yield Bonds (EUR) € 119.12 - 0.06 0.00
Global Investment Grade Credit - Inst Income $ 11.96 - 0.01 3.84 Japan Synthetic Warrant GBP Hedged Class £ 197.20 - -2.68 0.00 International B $ 359.01 - 1.61 0.00
Oasis Global Mgmt Co (Ireland) Ltd (IRL) Pictet-Absl Rtn Glo Div-I EUR F € 121.87 - 0.14 0.00 Lux -O- Rente (EUR) € 143.90 - 0.51 0.00
Regulated Global Investment Grade Credit Fund Inst Acc € € 11.68 - 0.00 0.00 International C £ 121.34 - 0.50 0.00
Pictet-Agriculture-I EUR F € 169.05 - 2.60 0.00 New World Financials (EUR) € 46.77 - 0.39 0.00 Japan Synthetic Warrant USD Class $ 15.08 - -4.14 0.00
Oasis Global Investment (Ireland) Plc
Global Investment Grade Credit Fund Inst Acc $ $ 16.52 - 0.02 0.00 Japan Synthetic Warrant USD Hedged Class $ 196.54 - -2.43 0.00 International D € 259.56 - 1.16 3.04 Yuki International Limited (IRL)
Oasis Crescent Global Short Term Income Fund $ 0.98 - 0.00 0.86 Pictet-Asian Equities Ex Japan-I USD F $ 181.76 - 1.47 0.00 US Premium Equities (EUR) € 164.02 - 3.06 0.00
Tel +44-20-7269-0207 www.yukifunds.com
Global Multi-Asset - Inst Acc $ 13.40 - 0.09 0.00 TreeTop Global Sicav Regulated
Pictet-Asian Local Currency Debt-I USD F $ 150.63 - 0.10 0.00 US Premium Equities (USD) $ 183.43 - 3.43 0.00 Renminbi Bond Fund AUD Cls A A$ 112.13 - 0.50 3.93
Oasis Global Equity $ 25.36 - 0.26 0.23
Global Opp.A € 128.12 - 1.86 0.00 Yuki Mizuho Umbrella Fund
Global Real Return - Inst Acc $ 17.87 - 0.03 0.00 Renminbi Bond Fund AUD Cls B A$ 113.99 - 0.50 3.67
Oasis Crescent Global Investment Fund (Ireland) plc Pictet-Biotech-I USD F $ 700.51 - -8.13 0.00
Global Opp.B $ 125.60 - 1.95 0.00 Yuki Mizuho Japan Dynamic Growth ¥ 6161.00 - 102.00 0.00
Oasis Crescent Global Equity Fund $ 25.81 - 0.26 0.00 Income Fund Inst Acc $ 12.23 - 0.02 0.00 Renminbi Bond Fund CHF Cls A SFr 108.64 - 0.47 4.01
Pictet-Brazil Index I USD $ 28.96 - -0.06 0.00
Global Opp.C £ 167.53 - 1.98 0.00 Yuki Mizuho Japan Large Cap ¥ 777.62 - -0.38 0.00
Oasis Crescent Variable Balanced Fund £ 10.16 - 0.00 0.59 Inflation Strategy Fund Inst Acc $ 8.36 - 0.06 0.00 Renminbi Bond Fund CHF Cls B SFr 108.63 - 0.47 3.76
Pictet-CHF Bonds I CHF SFr 509.42 - 1.80 0.00
Sequoia Equity A € 130.39 - 0.36 0.00 Yuki Japan Low Price ¥ 23742.00 - 341.00 0.00
OasisCresGl Income Class A $ 10.64 - 0.00 2.42 Low Average Duration - Inst Acc $ 14.76 - 0.01 0.00 Renminbi Bond Fund CNH Cls A CNH 120.52 - 0.55 3.36
Pictet-China Index I USD $ 88.11 - -2.46 0.00
Sequoia Equity B $ 132.13 - 0.51 0.00
OasisCresGl LowBal D ($) Dist $ 11.12 - 0.06 0.00 PIMCO RAE Fundam.PLUS Em.Mkts Inst Acc $ 6.91 - -0.05 0.00 Renminbi Bond Fund CNH Cls B CNH 120.46 - 0.56 3.13
Pictet-Clean Energy-I USD F $ 70.06 - 1.24 0.00
Sequoia Equity C £ 158.12 - -0.03 0.00
OasisCresGl Med Eq Bal A ($) Dist $ 11.25 - 0.08 0.33 PIMCO RAE Fundam.PLUS Gl.Dev.Inst Acc $ 9.67 - 0.13 0.00 Renminbi Bond Fund Euro Cls B € 110.45 - 0.48 3.76
Pictet-Digital Communication-I USD F $ 239.80 - 1.51 0.00
PIMCO RAE Fundam.PLUS US Inst Acc $ 11.16 - 0.19 0.00
26 ★ FINANCIAL TIMES Thursday 28 January 2016

MARKETS & INVESTING

INSIGHT Equities

Sharmin
Mossavar- Fears fanned as US industrials decline
Rahmani Groups feel downdraft mechanism between the energy sector exposure industrial companies have,” “Much of it has to do with oil, but it is a
and the rest of the economy,” said said Peter Stournaras at BlackRock. 8% little too broad and severe to say it is all
from lower investment Nicholas Colas, chief market strategist “People were originally looking at rev- Fall so far this oil,” said Jonathan Golub, chief US mar-
year in shares
Biggest threat from by energy companies at Convergex.
A slowing global growth outlook, led
by emerging market economies, and a
enues directly at oil companies, and
now [they are] looking at tangential
exposure . . . For example, it is not an
of industrial
companies in
the S&P 500
ket strategist at RBC.
“There is a fair amount of global
capacity coming out of emerging mar-
China slowdown is NICOLE BULLOCK
The collapse in oil prices and capital
strengthening dollar also pose a signifi-
cant challenge to industrials. Many
oil company but it might make a prod-
uct that is supplied to an oil company.” $7.22
kets, and that says you probably have a
larger problem in terms of demand for

a US overreaction spending by the energy sector is weigh-

ing heavily on US industrial companies,
fanning fears of a broader slide for the
world’s largest economy.
Shares of industrial companies have
groups are feeling the downdraft from
lower investment by energy companies,
whose capital expenditure fell about
30 per cent in the third quarter, accord-
ing to S&P Dow Jones Indices.
Many industrials have yet to report
quarterly results. For the sector as a
whole, analysts expect earnings per
Expected earnings
per share for sector
in fourth quarter, a
heavy equipment.”
Another factor is the rising dollar.
While falling prices for commodities,
share of $7.22 for the quarter, for a year- 1.88% fall in growth including oil, reduce demand, a higher
on-year decline in growth of 1.88 per year on year dollar makes products sold by industri-

C
oncern about the slowdown in China’s econ-
omy and Beijing’s tenuous policy responses
have been the primary driver of the past two
big slides in global equities. Throw in the
uncertainty about what Saudi Arabia might or
might not do to stabilise oil prices, and investors should
brace for extreme volatility in markets.
This volatility reflects an overreaction to the slowdown
in China, but the absence of a clear strategy for the devalu-
ation of the renminbi has not helped. What was billed as a
one-off currency change last August has morphed into a
series of depreciation measures against the US dollar.
China is undergoing significant transition. It is attempt-
ing a shift away from an export-driven and investment-led
economy to a more balanced, consumption-oriented one.
To achieve its goals and double gross domestic product and
GDP per capita by 2020 from 2010 levels, the leadership
has set out an extensive reform agenda. This includes fur-
ther financial market liberalisation and state-owned
enterprise, fiscal and rural land reform. Such widespread
transition brings risks and significant uncertainties. A
complex and interconnected reform agenda has never
been achieved on this scale or at this speed.
China is walled in. If reforms are implemented too
quickly, it risks a sharp slowdown. If they are implemented
too slowly or not at all, it risks an unsustainable increase in
debt-to-GDP ratio, which could push the country past the
tipping point into economic and, in all likelihood, political
instability. Beijing is also constrained by deep structural
faultlines, including weak demographics and low rankings
on human capital factors such as tertiary education,
labour productivity and business environment indicators.
These challenges are being faced against a backdrop of
modest projected global growth of about 3 per cent in 2016.
At first glance, investors may think such a backdrop
warrants the recent market
downdrafts. US markets,
however, are overreacting to
GDP growth is
the slowdown. driven by
Yes, China is the second-
largest economy, generating
consumption-
12.7 per cent of global exports oriented sectors
and 10.4 per cent of imports.
And its demand accounts for
such as retail
50 to 60 per cent of the pro-
duction of iron ore, nickel, thermal coal and aluminium,
and a significant share of copper, tin, zinc, steel, cotton
and soyabeans.
But China is not the “next subprime crisis”. Why? First,
while confidence in the latest published GDP growth of
6.9 per cent is limited, more widely accepted indicators do
not portend a collapsing economy. The Goldman Sachs
China Current Activity Indicator and Emerging Advisors
Group China Activity index show growth of 5.2 per cent
and 6.1 per cent respectively.
This growth is driven by consumption-oriented sectors
such as retail and travel.
Second, given President Xi Jinping’s remarks that the
GDP growth rate “should be no less than 6.5 per cent in
the next five years”, policymakers will use all available
tools to try to reach such targets.
Third, the US does not have significant direct and indi-
rect economic and financial exposure to China. The US
exports 0.7 per cent of its GDP to China. US banking sector
exposure is 0.8 per cent of bank assets, compared with
39 per cent exposure to US mortgages in 2007.
According to US national income accounts, only 0.7 per
cent of US profits are sourced in China. Goldman’s global
investment research division estimates a 1 per cent drop in
China’s GDP growth will have a 0.1 per cent impact on US
GDP, including indirect exposure.
The greater impact will come from financial contagion.
If markets overreact, the drop in US GDP growth could
increase to 0.47 per cent. Similarly, the International Mon-
etary Fund’s 2012 Spillover Report estimated that a 1 per
cent slowdown in China’s GDP would lead to a 0.05 per cent
slowdown in global growth — compared with 0.3 per cent
from a 1 per cent US slowdown.
More consistent and transparent policy with respect to
the near-term strategy for the renminbi is critical to stabil-
ising markets and ultimately to China’s reform agenda,
given the continuing reliance on exports to boost the econ-
omy and foreign currency reserves. But China’s impact on
markets is overstated.
Sharmin Mossavar-Rahmani is chief investment officer of Gold-
man Sachs Private Wealth Management Group
declined nearly 8 per cent this year,
making them the fourth worst-perform-
ing group in the S&P 500. With earnings
season under way, weakness in indus-
trial companies and downbeat outlooks
from chief executives could intensify
fears of a US recession at a time when
equity market psychology is fragile.
“[Industrials] are the transmission
India’s Sensex gives up gains since Modi’s win
Points added to the index
since election have vanished
but bright spots remain
DAVID KEOHANE AND JAMES CRABTREE
MUMBAI
Narendra Modi swept to election vic-
tory on a pro-business economic plat-
form on May 16 2014, pushing India’s
benchmark Sensex share index to a
record high of more than 24,000 points.
The Modi effect did not stop there:
India’s bull market kept climbing, rac-
ing up a further 23 per cent to an all-
time peak last January.
But with world markets in free fall,
last week the Sensex finally gave up all
those gains, closing beneath 24,000 for
the first time since Mr Modi’s triumph.
Stocks have since recovered some-
what, with the market opening up
slightly at about 24,550 yesterday
morning.
But hopes that India’s robust growth
and reform-minded prime minister
could offer protection against a worsen-
ing global sell-off have evaporated, with
local media headlines warning of a
bear market.
India’s position still looks healthier
than its developing-market peers.
Headline growth hit 7.4 per cent during
the most recent quarter, making it the
fastest-growing large nation. And falling
oil prices have provided a big boost to its
energy-import-dependent economy.
Even so, worries about vulnerability
to a global slowdown, combined with
diminished expectations over the pace
and reach of Mr Modi’s reforms, have
taken their toll.
Last year “disappointed hugely”, ana-
lysts at Nomura in India wrote last
week, arguing that investors had been
spooked by weaker monsoon rains than
expected and the effect of plunging
commodity prices on local energy, met-
als and resources groups. “The market
was caught in a perfect storm,” the ana-
lysts concluded.
Global factors have weighed more
heavily of late but weak corporate earn-
ings have also played a part, according
to Herald van der Linde, HSBC’s head
equity strategist for Asia. For him there
are no signs of a rebound so far in the
third-quarter reporting season.
“In 2015 it looks like earnings growth
came in at about 7 per cent,” he says.
“For 2016 expectations are for 19 per
cent earnings growth, which is very
high. We need to find a very good reason
for earnings to accelerate like that.”
General Electric, the largest US indus- cent, according to S&P Capital IQ. als more expensive globally.
trial group, last week warned of intensi- Lower oil benefits airlines, but the Companies in the services sector con-
fying pressure from falling crude prices, outlook for most of the group — particu- stitute a larger part of the US economy
which hit its division serving the oil and larly machinery-oriented companies — than manufacturing, and “they look
gas industry. The effects have also been is much more negative. unaffected”, according to Mr Golub.
felt by smaller operators such as Faste- Fourth-quarter earnings per share “There is an equipment recession and
nal, a distributor of fasteners. for Caterpillar, reporting today, are a commodities recession,” he added.
“What is evolving over time is our expected to fall about 50 per cent, “There is no reason to believe that it will
understanding of how much energy excluding restructuring costs. spread further.”
Analysis. Equities
Indian equities
Sensex index, ’000
30
29
28
27
26
25
24
Jan 2015 Jan
2016
Indian rupee
Against the $ (rupee per $)
60
62
64
66
68
Jan 2015 Jan
2016
Source: Thomson Reuters Datastream
Narendra Modi: Investors have shifted their opinions ufacture of generic pharmaceuticals. average of 15, according to Nomura.
hopes that on India from a dominant consensus Having held steady for much of last Many investors are likely to remain
robust growth overweight position last year to a more year, the currency hit its weakest level in cautious. Structural economic reforms,
and a reform- neutral stance, according to a survey more than two years last week. Some notably the introduction of a long-
minded prime by Bank of America Merrill Lynch. For- analysts say global worries will weaken delayed nationwide goods and services
minister would eign fund managers have pulled some the rupee beyond the record Rs68.85 tax, could inspire confidence — but only
offer protection $1.6bn out of Indian equities so far this required to buy a single dollar during if Mr Modi can push them through a
against a year, reversing much of last year’s the currency crisis of August 2013. gridlocked parliament.
worsening $3.75bn in inflows. More generally, the Reserve Bank of Here the prime minister’s record is
global sell-off Not everything is gloomy. Many ana- India and its governor, Raghuram mixed. With important regional elec-
have evaporated lysts say the Sensex will bounce back, Rajan, are likely to offer limited assist- tions looming this year, his willingness
Jonathan Brad/Reuters
possibly even moving back above ance, with a further 25 basis points in to push through unpopular measures is
30,000 by the end of 2016, according to rate cuts expected early this year. open to question.
Morgan Stanley. Domestic inflows into mutual funds India’s best hope of a return to more
Optimists hope India’s growth will hit record levels during 2015, a trend bullish conditions may rest on the cur-
finally trickle down to the corporate sec- that could also offset further outflows rent global sell-off being short, and
tor, potentially helped by Mr Modi’s by foreign fund managers this year. China’s economic situation in particular
annual budget in March, in which his Meanwhile, for investors pondering proving less severe than many fear.
government could loosen its fiscal tar- whether India’s correction offers a buy- If so, India remains one of the few
get, providing a short-term boost to ing opportunity, the market no longer bright spots in Asia. As Morgan Stanley’s
public spending. looks expensive. India team put it: “It is still the best
Meanwhile, the recent weakening of The Sensex’s 12-month forward price/ house in a bad neighbourhood.”
the rupee is set to help exporters, aiding earnings ratio dropped to 14.8 in mid- New Delhi and the markets will want
sectors such as IT services and the man- January, falling below its long-term it to stay that way.

Commodities Capital markets

Oil rebound extends as Brent climbs above $33 European bank debt sales slowest since 2008
NEIL HUME, JACK FARCHY
AND GREGORY MEYER
Oil continued its rebound yesterday,
jumping above $33 a barrel as traders
looked beyond the highest US crude oil
stockpiles since the Great Depression
to focus on the possibility of supply
cuts.
After dropping to a 12-year low below
$28 a barrel last week, Brent, the global
oil benchmark, has rebounded almost
22 per cent as hedge funds have started
to take profits on positions designed to
gain from the crash in prices.
Talk of co-ordinated production
cuts has gathered pace this week,
with the head of Opec calling on
the world’s largest producers to help
stem the worst price collapse in decades.
Russia’s state oil pipeline monopoly,
Transneft, said yesterday it would dis-
cuss possible output cuts with the cartel.
While a deal is a remote possibility —
there is little sign the world’s biggest oil
exporter Saudi Arabia will come to the
table — it has been enough to see some
hedge funds cover their record bearish
bets against the oil price.
The rebound follows a punishing start
to a year, with Brent still down 13 per
cent since January 1, while the decline
over the past 18 months has reached 70
per cent.
“The risk of $20 oil is still present, but
much reduced following the latest rally,”
said Ole Hansen, head of commodities
research at Saxo Bank. “A seasonal rise
in US inventories during the first quar-
ter, combined with rising supply from
Iran, is now largely priced in.”
Brent rose almost 4 per cent to $33.17
a barrel, while West Texas Intermedi-
ate, the US oil marker, climbed 3 per
cent to $32.38. Figures released yester-
day showed US commercial crude oil
stocks had risen 8.4m barrels last week
to 494.9m barrels, the highest since
1930. The increase came as the biggest
oil consumer imported 7.6m barrels per
day of crude and refineries slowed oper-
ations for seasonal maintenance.
As a worldwide supply glut persists,
excess oil is being sent to the US, which
has still extra capacity in its storage
tanks, said Michael Tran, director of
energy strategy at RBC Capital Markets.
“We’re just swimming in oil,” Mr Tran
said. “Global inventories are elevated
virtually everywhere.”
The International Energy Agency
reckons the oil market is facing a third
successive year when supply will exceed
demand by 1.0m b/d, an imbalance that
will place enormous strain on the ability
of the oil system to absorb it efficiently.
THOMAS HALE
European banks have sold $42bn of
bonds so far this year, the lowest total
since the financial crisis, as investors
focus on new risks against a backdrop
of market turmoil.
Sales of bank bonds, which financial
institutions use along with deposits to
fund loans to the wider economy, are 18
per cent lower than the same period last
year, according to Dealogic. Issuance,
which excludes covered bonds, is lower
than in any start to the year since 2008.
After sharp declines in global stock
markets and commodity prices, some
areas of capital markets have closed in
what is often one of the busiest months.
“To pause for four to five days in Janu-
ary is unheard of in recent years,” said
Peter Mason, co-head of European
financial institutions group at Barclays.
Many debt bankers expect markets,
especially in peripheral Europe, to
remain closed for some time. But the
low-yield environment may revive
appetite for bank debt sooner, espe-
cially for riskier, higher yielding bonds.
“Investors can afford to stay in cash in
January,” said Mr Mason. “By March it
will no longer be sustainable.”
Banks, which issue bonds much more
frequently than non-financial compa-
nies, have in some cases been forced to
turn to covered bonds — a market that
provides investors with recourse to
assets in the event of default.
In the new regulatory era, bondhold-
ers, rather than taxpayers, are exposed
to losses when banks fail. Portuguese
regulators imposed losses on the
bonds of Novo Banco in late December,
triggering legal threats from investors.
Concerns have spread to the bond
prices of other peripheral institutions.
The share prices of Italian banks col-
lapsed last week, after news of a Euro-
pean Central Bank investigation into
non-performing loans. The primary
market for southern bank bonds is in
effect closed.
“We haven’t seen much action coming
from Spain, Portugal and Italy,” said
Sebastien Domanico at Société Géné-
rale, who also cited lower funding needs
in the region.
Investors and bankers alike have been
unsettled by the difficulty of pricing
bank bonds in a market dominated by
regulators.
“What’s difficult . . . is to assess the
relative value and risk,” said Mr Doman-
ico. “In particular, the discretionary role
of the regulator, as highlighted by Portu-
gal. It’s a concrete case that nobody can
ignore from now on.”
Thursday 28 January 2016 ★ FINANCIAL TIMES 27

MARKETS & INVESTING

Global overview
TRADING POST Markets update
Jamie
Chisholm
Stocks supported by fresh crude S&P 500 index
Change on day 0.68%

rally but earnings add to concerns

A busy week for central bank meetings
includes not just the Federal Reserve
and Bank of Japan but decisions from
Ukraine, Egypt and South Africa today.
The last is expected to raise its
main interest rate from 6.25 per cent,
though analysts are divided on
whether there will be a 25 basis point
or 50bp increase.
Uncertainty may add to volatility in
the South African rand.
It can sometimes be hard for forex
traders of emerging market currencies
to gauge which way the market
will jump with regard to monetary
policy moves.
Currently it is quite simple for
developed nation currencies. If
investors perceive the prospect of
tighter policy then the unit tends to
strengthen, and vice versa.
But often EM central banks have to
raise borrowing costs to support an
exchange rate, even though the
underlying economy is struggling.
This, put simply, is the case with
South Africa. Will traders reward the
SARB for biting the bullet and buy the
rand for its more attractive yield?
Or will they see a rate rise as
exacerbating difficulties the country
faces amid tumbling commodity prices
and anxiety over EM assets. This
could cause further selling of the rand,
which at R16.40 per US dollar sits less
than 3 per cent off last week’s record
closing low.
Perhaps it all depends on the oil
price, which has been driving broader
market sentiment. The 20-day rolling
correlation between Brent crude and
the rand is 94 per cent.
jamie.chisholm@ft.com
South Africa rand
Against the dollar (rand per $)
10
12
14
16
18
Jan 2015 Jan
Source: Thomson Reuters Datastream 2016
Apple and Boeing drag
on S&P 500 and
Treasuries weaken ahead
of Fed decision with
US outlook in focus
DAVE SHELLOCK
A fresh bounce for oil prices offered
support to US and European equities
although there remained plenty for
participants to remain concerned
about, not least a poorly received set of
earnings from Apple and uncertainty
about the outlook for US monetary
policy.
Oil see-sawed as the markets digested
data from the Energy Information
Administration that showed a rise in
overall US crude inventories to the high-
est level on record. But the markets
appeared to pay more attention to news
of a drop in stockpiles at Cushing, Okla-
homa, the delivery point for West Texas
Intermediate.
And an hour or so after the release of
the EIA figures, Brent oil was up 3.6 per
cent at $32.95 a barrel — the highest in
more than two weeks — while WTI was
3.8 per cent higher at $32.65. Impor-
tantly, both managed to spend the day
above the $30 mark that many increas-
ingly see as a key support level.
Crude’s rally helped the S&P 500
equity index recover from a weak start
and trade 0.4 per cent higher at 1,911 by
midday in New York, even as Apple
shares fell nearly 5 per cent, in heavy
volume, in response to concerns about
slowing iPhone shipments.
Boeing was another serious drag on
the S&P as its shares fell 7.5 per cent
after it delivered gloomy guidance for
2016.
The better tone on Wall Street helped
fuel a late rally for European stock indi-
ces. The pan-regional Stoxx 600 fin-
ished 0.3 per cent firmer at the day’s
Value in Japan: FT.com/video
With excess cash on company balance sheets, Nicholas Smith,
strategist at CLSA , discusses the case for Japanese equities
high, as the FTSE 100 in London jumped
1.3 per cent and Germany’s Xetra Dax
rose 0.6 per cent.
Those gains came after a generally
positive session for Asian markets. The
Nikkei 225 in Tokyo rose 2.7 per cent
and the Hang Seng in Hong Kong 1 per
cent, although the Shanghai Composite
slipped 0.5 per cent after Tuesday’s 6.4
per cent slide.
The Chinese benchmark ended at a
fresh 13-month low, and remained
firmly embedded in “bear market” ter-
ritory, as official data showed that
industrial profits fell 4.7 per cent year-
on-year in December, the seventh suc-
cessive decline.
“The People’s Bank of China has been
— Toru Yamanaka/AFP/Getty Images
injecting liquidity more through open
market operations than through reserve
ratio requirement cuts,” said analysts at
Barclays.
“We think the absence of system-wide
easing has resulted in markets being dis-
appointed recently. We maintain our
forecast of two RRR cuts in the first half
of this year due to weak domestic
demand and accelerated capital out-
flows.”
The bounce for US equities prompted
a weaker tone in the Treasury market
ahead of the latest policy decision from
the Federal Reserve.
The yield on the 10-year note, which
moves inversely to its price, was up 5
basis points at 2.04 per cent, while the
2100
2000
1900
1800
Dec 2015 2016 Jan
more policy-sensitive two-year yield US equities Wall Street took its cue
was 2bp higher at 0.88 per cent. from a jump in oil prices, although
Steven Ricchiuto, chief economist at caution before the latest Federal
Mizuho Securities USA, said the mar- Reserve policy statement and sharp
kets were probably correct in assuming falls for Apple and Boeing limited gains
US interest rates would be held steady at
this stage. FTSE 100 index
“The financial market dislocations Change on day 1.33%
that have followed on the heels of the 6400
December rate hike have convinced 6200
most consensus forecasters that the lan- 6000
guage used in the post-meeting state- 5800
ment will be more dovish,” Mr Ricchiuto 5600
said. Dec 2015 2016 Jan
“The increase in market volatility, the
decline in the equity markets, the UK equities The London market
steady downward pressure on the Chi- outpaced its continental European
nese currency, and the downward bias peers as mining and energy stocks
in crude oil prices have led to specula- rallied and Sage jumped 7.5 per cent
tion that the Committee will spread out after delivering a solid trading update
the pace of rate hikes from that antici-
pated by the FOMC in the ‘dot plots’ Eurofirst 300 index
released just a month ago.”
Change on day 0.36%
But he added: “My read of the chair’s 1450
December post-meeting press confer- 1400
ence and the public comments made by 1350
a number of policymakers since is that
1300
policymakers are less apt to be swayed
1250
by market movements than the street
Dec 2015 2016 Jan
assumes.”
The more risk-on tone in the markets European equities A late burst of
put the yen under some pressure, with buying left the Eurofirst 300 modestly
the dollar up 0.5 per cent at Y118.94 — higher as crude oil prices rallied,
putting the pair on track for its highest offsetting concerns in the tech sector
close in more than three weeks. about the outlook for Apple
The euro was also up 0.4 per cent
against the Japanese currency at
Y129.96. Nikkei 225 index
Gold retreated from its highest level (’000) Change on day 2.72%
19
since the start of November as it shed $3
to $1,116. 18
Base metals took their cue from oil’s 17
rally. Copper rose 1.2 per cent in London
to $4,590 a tonne, having touched a 16
$4,595 in early trade, its highest since Dec 2015 2016 Jan
January 8. Japanese equities Overnight gains on
The euro was flat versus the dollar Wall Street offered support to the
at €1.0864 as the yield on the 10-year Tokyo market as the Nikkei climbed to
German Bund held steady at 0.45 per its highest in almost two weeks
cent.

VMware “neutral” and cut their price target Trading Directory

Wall Street
VMware falls 9% as
weaker guidance adds
to independence fears
Mamta Badkar
VMware’s woes continued after it issued
a disappointing outlook for both the full
year and the current quarter, and
received an analyst downgrade.
Shares in the software maker, which
EMC controls, fell nearly 9 per cent to
$45.02 after it said it expected total
revenues in a range of $6.785bn to
$6.935bn, shy of the $7.2bn that analysts
on Wall Street had forecast.
The company’s current quarter sales
forecast of $1.55bn-$1.6bn also missed
analysts’ estimates.
“Exclusion of the Virtustream
business probably had a much greater
effect than generally expected,” said
John DiFucci, an analyst at Jefferies.
EMC acquired Virtustream last year
and said it would share ownership with
VMware, but scuppered those plans in
December.
Share price ($) from $80 to $60.
90 Boeing shares fell nearly 7 per cent to
80 $119.30 after 2016 profit and sales
70 guidance missed analysts’ estimates.
60 The largest US aerospace company
50 said it expected revenues of $93bn-
Jan 2015
Source: Thomson Reuters Datastream
Jan
2016
$95bn this year and earnings per share
in the range of $8.15 to $8.35, both of
which missed analysts’ forecasts.
Day's
Indices Close change
A bigger than expected fourth-
quarter loss and disappointing outlook
S & P 500
DJ Industrials
1911.69
16199.80
8.06
32.57
pushed shares in US Steel down more
than 13 per cent to $6.74.
Nasdaq Comp 4553.12 -14.55
The second-largest steelmaker in the
Russell 2000 1204.70 -8.35
US posted a loss of $999m, or $6.83 a
VIX 21.87 -0.63
share, in the fourth quarter, compared
US 10 yr Treas Bd
US 2 yr Treas Bd
2.00
0.85
0.01
0.01
with a profit of $275m, or $1.83, in the
period a year ago. Adjusting for one-off
items, a loss of 23 cents a share was
The weaker guidance accompanied narrower than analysts’ forecasts. Sales
stronger than expected fourth-quarter fell 37 per cent to $2.6bn.
results. US Steel said it faced “significant
VMware, which has faced increasing headwinds and uncertainty in many of
competition from Amazon and the markets we serve”.
Microsoft in cloud computing, said it It added that “at current market
would axe 800 jobs in the first half and conditions, we would expect lower
expected to take a charge of between results in each of our operating
$55m and $65m over the period. segments as compared to 2015”.
The company appointed as chief Apple dropped 6 per cent to $94.09
financial officer Zane Lowe, who after it said iPhone sales would fall for
recently held the same position at EMC. the first time in the current quarter.
VMware shares have declined more Energy was the best performing of the
than 40 per cent since Dell first 10 sectors on the S&P 500, rising 1.4 per
proposed its $67bn acquisition of EMC cent as crude oil rebounded, while
in October. Investors have grown technology was the only one in the red.
anxious about the company’s By midday the S&P 500 had gained
independence and how it would fit into 0.6 per cent to 1,914.09, the Dow Jones
the new company. Industrial Average was up 0.3 per cent to
Analysts at Robert Baird downgraded 16,215.62, and the Nasdaq Composite
the stock from “outperform” to had slid 0.2 per cent to 4,557.32.

Eat’s independent takeaway restaurants world’s second-largest buyer of

London
Just Eat tumbles as
competition heats up
Bryce Elder
Competition gave Just Eat its second-
sharpest fall on record yesterday. The
takeaway website operator tumbled
9.8 per cent to 379.4p after Morgan
Stanley downgraded to “underweight”.
Just Eat’s growth risked being eroded
by competitors that offered restaurants
an outsourced delivery service, the
broker said. “Trends on delivery will
follow trends on the high street, and Just
stand to lose,” it said.
Just Eat has about 70 per cent of UK
dedicated takeaway restaurants signed
up to its system. But Deliveroo, which
branded itself a premium service, was
expanding quickly to overlap Just Eat by
more than 50 per cent in some cities,
said Morgan Stanley. Just Eat was at risk
of “losing the network effect which is its
main barrier to entry”, said the broker.
A rebound for oil steadied the wider
market, lifting the FTSE 100 by 1.3 per
cent, or 78.91 points, to 5,990.37.
Admiral hit a record high, up 2.5 per
cent to £17.40 amid talk that the car
insurer might be vulnerable to a bid
approach from a peer.
Imperial Tobacco also hit a record
high, up 2.2 per cent to £36.67, awaiting
results overnight from US peer Altria.
Imperial has outperformed British
American Tobacco, a putative bidder,
by 20 per cent over the past year.
Software maker Sage jumped 7.5 per
cent to 610p on a reassuring trading
update.
Arm Holdings faded 1.9 per cent to
995.5p after results from Apple, the
semiconductors, showed iPhone and
iPad shipments had been weaker than
expected in the December quarter.
TalkTalk — the recent subject of
speculation that it might be a target for
Iliad — bounced a further 6.4 per cent to
215.9p. RBC said the French telecoms
group’s potential entry into the UK
market could loosen regulatory
restraints on the expansion of
TalkTalk’s mobile business, with growth
potentially worth 50p a share by 2020.
Evraz, the Russian steelmaker
controlled by Roman Abramovich, slid
6.5 per cent to 60.7p after Credit Suisse
and Société Générale advised selling.
“We expect the company to struggle
because of its higher operational and
financial leverage than other Russian
steel producers,” said Credit Suisse.
“Evraz’s valuation does not appear to
compensate for a significantly weaker
debt profile and a higher dependency on
the underperforming Russian
construction sector.”
SocGen set a 40p target price based on
Evraz’s net debt rising to more than four
times ebitda by the end of the year.
28 ★ Thursday 28 January 2016

SMART MONEY Analysis. Commodities

John
Authers
Oil price collapse sends mixed signals
Using crude as a proxy for Singapore naphtha v Brent crude oil futures spread Oil and world equities correlation
200 Rebased
global economy discounts
Depressed Japanese benefits of cheaper energy
150
100
Brent crude
S&P 500
FTSE Eurofirst 300
Nikkei 225

stocks suggest a way DAVID SHEPPARD AND NEIL HUME

50
0
Shanghai Composite
100

out of the value trap Since the end of the second world war,
almost every recession has been pre-
-50
-100
90

ceded by a run-up in oil prices. 80

-150
From the stagflationary Arab oil
-200 70

I
s there value in Japan? International investors have embargoes of the 1970s, to the sharp rise
asked this question for a quarter of a century, and are to almost $150 a barrel on the eve of the 2008 09 10 11 12 13 14 15 16 1 4 5 6 7 8 11 12 13 14 15 18 19 20 21 22 25 26
tired of getting the same answer. After flirting with financial crisis, few investors doubt that Jan 2016
recovery for a brief period, Japan reconfirms itself as oil can steer the economy.
the world’s biggest value trap. So it has been hard for many to square
GDP growth forecasts Share of global GDP
IMF January 2016 update 2015
That may just have happened again. After a sharp the dismal performance of global equi- China
rebound at the end of last week, the Topix and Nikkei 225 ties in 2016 with oil’s collapse. Falling oil 2016 2017
indices remain about 20 per cent below the highs of last prices have been treated as the global 0 2 4 6 8 17.24
Others
summer. They are also, of course, some 55 per cent below economy’s lodestone, signalling every- 29.45
their peak amid one of history’s most insane bubbles at thing from a slowdown in China to sub- India
15.88 US
the end of 1989. prime-esque debt energy defaults.
So they again look cheap. According to Research Affili- Equities and oil are moving in lock- China
ates, Japan’s cyclically adjusted price/earnings multiple, step. But using the oil price as a proxy Opec 9.12
adjusting for the business cycle by taking an average of the for the health of the global economy US
16.95 7.09 India
past 10 years’ earnings, stands at 25. This is below its appears misguided. It risks crystallising
median since 1969 (which should not be affected by the an overly pessimistic view of the world Japan
ridiculous valuations in the late 1980s) of 38. that discounts the benefits lower energy EU 4.28 Japan
Most Topix sectors are trading lower than their average costs normally bring. FT graphic Sources: Thomson Reuters Datastream; IMF
for the years since 2000. Steel, wholesale trade, marine “The logic of blaming oil for every-
transport and mining have been cheaper than this only thing is perplexing,” says Amrita Sen of slowdown in China. People are seeing York. Apple, the world’s most valuable the global economy, a large fall means
5 per cent or less of the time since then. Energy Aspects, a London-based energy ‘A small fall the impact of a massive oversupply of oil company by market capitalisation, significant balance sheet stress for
At least in part the renewed sell-off is caused by a sense consultancy. “If $100 oil can hurt global might act like in the price and perceiving it as coming cited lower commodity prices as one energy producers,” says Sebastian Rae-
that Abenomics, the premier’s plan for growth, is coming growth . . . it is really hard to fathom a tax cut from the demand side.” reason for its first sales decline. dler, equity strategist at Deutsche Bank.
off the tracks. The slide took shape as it became clear that how $20 oil can also be blamed for dam- Last year Prof Mohaddes co-authored Equity investors are also worried He estimates that “significantly
the government intended to go through with raising the aging the world economy and weighing [but] a large an International Monetary Fund paper about the systemic risk from the oil stressed” US energy companies account
consumption tax next year, despite the disastrous recep- on global stock markets.” fall means that said a halving in oil prices would price rout via industrial companies and for 20 per cent of the high-yield bond
tion for the last such rise three years ago. Exports have suf- Those who fear that oil is heralding a significant add 0.2 to 0.4 percentage points to glo- the banking system. Several of the larg- market. This is important because the
fered as neighbouring China has decelerated. rapid slowdown in global growth should bal growth in the first year. In large est banks in the US, including Bank of risk premium in the equity market has
Yet there is a decent case for take note of the fact that prices have balance sheet importing countries the impact was pre- America, JPMorgan Chase, Citigroup closely tracked high-yield spreads over
value investing in Japan.
Topix’s steel and been falling for some time, say analysts. stress for dicted to be closer to 1 per cent. and Wells Fargo, have in recent weeks the past decade.
It starts with the surprising The main driver of the 70 per cent drop producers’ In Asia prices for naphtha — a type of cautioned about writedowns and provi- Opec, which controls about 40 per
fact that while the country as a mining sectors in price over 18 months has been a boom refined oil that is an indicator of manu- sions on their oil company loans. cent of production, is broadly expected
whole has been a value trap, in supply, not a slowdown in demand. facturing activity — are strong relative Their exposure is no way near the to cut output this year. But that impact
the value style of investing has
have rarely been “In oil what we’ve seen has primarily to crude, unlike during the financial cri- scale of the subprime crisis — energy-re- is vastly overshadowed by the benefit of
worked well when it comes to cheaper than been a supply-side shock,” says eco- sis when they collapsed with demand. lated loans make up about 3 per cent of lower prices for the four largest net
choosing between Japanese nomics Kamiar Mohaddes of the Uni- There is, of course, some linkage BofA’s portfolio — but banks could have importers — China, US, Japan and India
stocks, and has done so
this since 2000 versity of Cambridge. “While we are between falling oil prices and weak to set aside more cash to soak up losses. — which make up more than 50 per cent
throughout most of the post- also starting to see some signs of slowing stock markets. Oil companies have And bad energy loans have an impact on of the world’s $77tn GDP.
bubble malaise. Nicholas Smith, strategist for CLSA in demand . . . the close correlation fallen an average of about 20 per cent financial markets in other ways. “The boost in spending for consumers
Tokyo, notes that small-cap value stocks have outper- between the two markets is something this year, making the sector one of the “The problem is that while a small fall should eventually win out,” says Prof
formed the Topix 300 per cent since 1985. Even megacap of an overreaction to fears of a bigger worst performers in London and New in the oil price might act like a tax cut for Mohaddes.
value stocks did 150 per cent better, though that outper-
formance has petered out badly over the past few years.
The reason for this is that Japan is highly cyclical.
According to Mr Smith, this tends to mean that cyclical Capital markets
sectors get badly battered in down cycles. Once they
become too cheap, they deliver great returns for value
investors when the cycle turns positive, and mean that
Japan has delivered returns for value more reliably than
Investors fleeing EM
any other market.
Second, there is the issue of cash. Japanese companies
bonds at record pace
have a lot of it — Y110tn — sitting unused on balance
sheets. Jesper Koll, head of WisdomTree in Japan, says the
money will have to move somewhere, and that dividends JONATHAN WHEATLEY lar is gaining in value against
and share repurchases have begun to rise from low levels. EM currencies.
Dividends rose to Y11.6tn last year, but this is not much Investors are deserting Foreign-currency bonds,
higher than the pre-crisis level of Y8.4tn in 2007. Share emerging market bonds at mostly in US dollars, are
repurchases have risen post-crisis to Y6tn, but again this is the fastest rate on record, attractive to EM borrowers
not far ahead of pre-crisis levels of Y4.7tn. Given that their withdrawing more money because interest rates are
total cash doubled over the same period, companies have than they did at the height lower than they would pay
ample room to distribute more to shareholders. of the global financial crisis, on local financial markets.
Third, Japan offers at least a partial refuge from the according to data on net But they can go wrong when
greatest macroeconomic concerns of the moment. It has investment flows seen by EM currencies devalue,
no big energy companies. It has no capital expenditure the Financial Times. making it much harder for
dependent on oil, and so has everything to gain from The figures are the latest to issuers to repay their debts,
cheaper crude. Its markets’ correlations with the level of highlight EM financial mar- especially if their earnings
the Chinese currency are negligible. ket stress as investors worry have been hit by the precipi-
Finally, corporate Japan has found ways to be more prof- about slowing global growth tous fall in commodity prices
itable. Profits are 3.5 per cent of GDP, their highest for the led by China and other over the past 18 months.
entire malaise era and double their level 20 years ago. If emerging economies. According to Mr Spegel’s
the hoped-for wave of mergers and acquisitions happens, Data compiled since 2007 data, EM foreign-currency
allowing companies to reduce capacity and limit competi- by David Spegel, head of glo- corporate bonds received net
tion at home, it would be great news for investors — if not bal EM strategy at ICBC new investment of $639bn in
for consumers. Standard Bank, show that the three years from 2012 to
Value investing needs a catalyst; otherwise stocks stay net new investment into EM 2014, compared with $100bn
cheap. There could be one in the improved corporate gov- foreign-currency bonds was for EM foreign-currency sov-
ernance that the government has fomented. Japanese negative by $79.6bn in the ereign bonds.
companies have spent 20 years repairing their balance second half of last year, The build-up in EM bond
sheets, and are overweight in cash. Any that come to regret eclipsing the $57.2bn of out- issuance went into sharp
paying out can turn to deep debt capital markets. flows he recorded in the sec- reverse in the second half of
The case for a long-term position in Japan, centred on ond half of 2008 during the last year, when net invest-
the cheaper stocks that offer value, is a strong one. The global crisis. ment in EM corporate for-
sell-off of the past few months has strengthened that case. The exodus has continued eign-currency bonds was
during January, with $7.8bn negative by $89.4bn, accord-
john.authers@ft.com of outflows so far, according ing to Mr Spegel. Yet net
to Mr Spegel. investment to EM sovereign
His data — derived from bonds remained positive at
the value of bonds issued $9.9bn — perhaps, he says,
minus interest payments, because dedicated EM bond
amortisations and proceeds investors were switching into
More comment and data on ft.com from debt restructurings sovereigns from corporates
recycled into the bond mar- in the face of rising corporate
ket by investors — underline default rates.
Y Fast FT Our global economies, headed the rapid pace at which EM This month Mr Spegel has
team gives you market- by Brazil, Russia, India companies, especially com- recorded outflows of $13.8bn
moving news and views, and China. modity exporters, took on from EM corporates, accom-
24 hours a day, five days ft.com/beyondbrics foreign currency debt after panied by inflows of $6bn to
a week. ft.com/fastft the crisis. sovereigns.
Y Podcast The Hard
Y Alphaville Our Currency podcast takes a Bond issuance surged dur- Because of the rapid rise in
irreverent financial blog. look at what is driving ing the ultra-loose monetary the stock of outstanding EM
Join Paul Murphy and the global currency policy era introduced by the bonds, last year’s outflows
Bryce Elder for the daily market. ft.com/podcasts US Federal Reserve and were smaller as a percentage
Markets Live session at other central banks. of total bonds in the market
Y Lex Video Analysis Analysts have said this than in 2008. Outflows in the
11am. ft.com/alphaville
and opinion from the rapid rise in debt presents second half of 2015 were
Y beyondbrics News and team on the hot issues one of the greatest threats to equal to 3.1 per cent of the
comment from more affecting companies and stability of EM financial mar- outstanding stock, com-
than 40 emerging markets. ft.com/lexvideo kets, now that the Fed is rais- pared with 5.9 per cent in the
ing interest rates and the dol- second half of 2008.