A thumping election victory looks set to put Romania’s ruling coalition back in power with a strong mandate, according the exit polls following Sunday’s vote.
The predicted landslide for the Social Liberal Union (USL) led by Prime Minister Victor Ponta is also a resounding defeat for his rival, President Traian Basescu. But while the result looks clear-cut, exactly what happens next is still not clear, as the wily Basescu may still have a few cards to play. Read more
Egyptian equities jumped 4.4 per cent on Sunday after president Mohamed Morsi rescinded the controversial decree in which he extended his powers and plunged the country into a new wave of protests.
Investors clearly hope that Morsi has done sufficient to restore enough stability for the International Monetary Fund to implement its crucial planned $4.8bn loan. But has he? The opposition doesn’t think so – it is still demanding a delay on the planned December 15 constitutional referendum. Watch out for more seesawing in the markets, as the Islamists and the opposition fight it out. Read more
If investors were asked to give a chunk of money directly to emerging market governments, most would refuse. But in the stampede towards low-cost, index linked investment in emerging markets, many will effectively end up doing just that, according to a report in Monday’s FTfm.
Arjun Divecha, chairman of GMO’s board and manager of three of its emerging markets funds, says GMO research shows that about 35 per cent of the constituents of the widely benchmarked MSCI emerging market index are companies that are owned or controlled governments and that these companies actually account for about 70 per cent of the earnings generated by that index. Read more
This week Russia’s president delivers his ‘state of the nation’ address in parliament, Tajikistan joins the World Trade Organisation and the African National Congress holds its electoral conference in Manguang.
Sources: Reuters; Roubini; Fens Read more