The Russell US Indexes are designed to reflect the ever-changing US equity market, and the annual reconstitution process is critical to maintaining accurate representation.

During this highly-anticipated market event, the breakpoints between large, mid and small cap are redefined to ensure market changes that have occurred in the preceding year are captured. Companies are also revaluated to determine where they lie along the investment styles spectrum. 

During three hours of unscripted and dynamic debate, CNBC's flagship show leads you into and delivers the open of the European markets. Anchors Geoff Cutmore, Steve Sedgwick and Karen Tso are joined by leading business executives, policymakers, financial strategists, fund managers and other newsmakers to provide original points of view and instant analysis of the latest business news and key market themes.

By Philip Lawlor, managing director, head of Global Markets Research

US stocks regained their dominance with the global risk rally of the past two months, and US small caps have led the way. The Russell 2000 is up almost 40% from its March 23 low, outstripping the gains of 38% the Russell 1000 and 31.2% for the FTSE All-World.

Global equity market moves from March 23 Covid-19 correction lows (LC, TR)

Source: FTSE Russell. Data from March 23, 2020 through May 31, 2020. Past performance is no guarantee to future results. Please see the end for important disclosures.

Part of the Russell 2000’s newfound power comes from its bigger tilt to financials, producer durables and materials than the Russell 1000. These economically sensitive sectors were pummeled in the March pandemic panic but have staged strong rebounds in May amid signs of a faster-than-expected resumption in post-lockdown economic activity in the US and elsewhere, as well as progress...

By Philip Lawlor, head of Global Markets Research

The risk-on rally since late March gained traction in May, extending what has been a remarkably swift rebound from a historically sharp collapse in global equity markets this year.

It took just 24 trading days for the FTSE All-World Index to hit bottom, a blink of an eye compared to the length of time for it to do so during the last two major market crashes. It took only another 49 trading days to recoup nearly three-fourths of its pandemic loss of 32% at the height of the sell-off in March. The roaring April/May risk rally has trimmed the world index year-to-date declines to 7.9%.

Covid -19 market moves resemble a correction, not a sustained bear market (LC, TR %)

Source: FTSE Russell. Data through of May 31, 2020. Past performance is no guarantee to future results. Please see the end for important disclosures.

US winning streak continued in May

The strong May showing has put US...

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FTSE Russell, the global index provider, confirms today that Avast, GVC Holdings, Homeserve and Kingfisher will be joining the FTSE 100 Index as a result of the June 2020 quarterly review. In the rebalance, Carnival, Centrica, Easyjet and Meggitt will leave the FTSE 100 index and enter the FTSE 250 index.

The rules-driven, impartial quarterly reviews ensure the indexes continue to portray an accurate reflection of the market they represent and form an essential component to the management of the indexes.

The FTSE 250 Index will see the following changes (in alphabetical order), in addition to the amendments described above.

Entering FTSE 250 Index (Additions) 

Join Philip Lawlor, managing director, Global Markets Research, to gain critical insights into the ongoing impact COVID-19 is having on global equity and bond markets.

Register for a webinar in your region.

Join Philip Lawlor, managing director, Global Markets Research, to gain critical insights into the ongoing impact COVID-19 is having on global equity and bond markets.

Register for a webinar in your region.

New FTSE Canada research shows that over the past 15 years Canadian mortgage-backed securities have had higher returns with lower volatility than other government bond segments in Canada. Based on 15 years of historical market data for the recently introduced FTSE Canada NHA MBS 975 Index—the first dedicated index for this asset class—NHA MBS 975 securities have achieved higher average returns with less risk.

In addition, interest in this market, which currently has nearly $500 billion in principle outstanding, has the potential to increase going forward and the index, as well as the ETF access product, are part of the evolution to bring transparency to the mortgage market in Canada.

Marina Mets – head of Americas, fixed income product management, FTSE Russell:

“Developing the first dedicated index for the Canada NHA MBS 975 Index has given us a unique insight into the market dynamics of this very important and growing asset class for Canadian fixed...

In this FTSE Russell Product Insight, we profile a new index series—the FTSE Canada NHA MBS 975 Index—which is designed to measure the performance of Canada’s mortgage-backed securities (MBS) market, an important sector of the investment opportunity set in Canada. We summarize the key characteristics of mortgage-backed securities and describe the core structural features of the Canadian MBS market. Through the lens of the newly launched index, we look at market dynamics, including issuance levels, interest rate spreads, prepayment rates and duration.

Read this paper for 

By Philip Lawlor, managing director, head of Global Markets Research

Stock buybacks have been a major driver of shareholder returns in the US for the past several years. The pandemic threatens to pull the plug on that.

As the chart below shows, US gross buybacks have grown more than six-fold since the depths of the 2008 financial crisis. This bit of financial engineering really took off after the massive US corporate tax cut in late 2017, peaking at $248 billion in Q4 2018, as companies took advantage of newfound cash windfalls and ultra-low borrowing costs to repurchase their own shares. (By reducing share count, buybacks boost EPS and, in turn, price/EPS multiples, all else being equal.)

US non-financial corporate debt vs gross share buybacks (USD, billions)

Source: FTSE Russell / Refinitiv. Data as of May 20, 2020. Past performance is no guarantee to future results. Please see the end for important disclosures.

The chart below,...

By Philip Lawlor, managing director, head of Global Markets Research

Forward PE multiples have fully recovered from their March lows, with most now at or approaching their highest levels of the past five years. The bounce has been particularly striking for the US large-cap Russell 1000, which has climbed more than 600 basis points to around 20× (a 15-year high), and for the FTSE Europe, up more than 500 basis points. The Russell 1000 multiple retains its sizable premium to those of its developed peers, which have converged around 14-15×. 

Regional 12-month forward price/earnings ratios (×)

Source: FTSE Russell / Refinitiv. Data as of May 15, 2020. Past performance is no guarantee to future results. Please see the end for important disclosures.

But, as the chart below illustrates, the global re-rating since the March nadir reflects the perverse combination of rising “Ps” and sharply falling forecasts for “E”.

Price/earnings...

Toronto – FTSE Russell today announced the introduction of the FTSE Canada NHA MBS 975 Index. This innovative new index is the first transparent measure of the performance of the Canada mortgage-backed securities (NHA MBS) market, an important investment opportunity set for Canadian investors.

As outlined in a recent FTSE Russell Product Insight, the Canadian National Housing Act mortgage-backed securities (NHA MBS) market currently represents a sizeable and growing portion of the Canada investment landscape at almost C$500 billion in amount outstanding. Fully insured by the Canada Mortgage Housing Corporation (CMHC) and assigned a AAA rating, these securities provide investors with a steady stream of monthly interest and principal payments and offer a yield advantage over other government securities.

 FTSE Russell has applied its decades of experience in measuring the Canada fixed income markets and its leading position in Canada fixed income indexes to...

By David Harris, head of sustainable business, LSEG

It was Rahm Emanuel, President Barack Obama’s chief of staff, who argued in the aftermath of the last great period of market turmoil in 2008 that “you never want a serious crisis to go to waste.”

As policy makers and financial institutions around the world make dramatic and costly moves to address the current crisis, many are also taking aim at the crises of the future. 

As the market turmoil caused by the COVID-19 pandemic necessitates institutional investors to review their asset allocations and mandates over the coming months, we expect them to embrace invention, in the form of climate and sustainability-tilted smart beta strategies, or what we refer to as Smart Sustainability. This is set to accelerate the already explosive growth of sustainable investing. 

Smart beta strategies offer investors a low-cost means of taking a view on factors they believe will generate outperformance over...

In this FTSE Russell Product Insight, we profile a new index series—the FTSE Canada NHA MBS 975 Index—which is designed to measure the performance of Canada’s mortgage-backed securities (MBS) market, an important sector of the investment opportunity set in Canada. We summarize the key characteristics of mortgage-backed securities and describe the core structural features of the Canadian MBS market. Through the lens of the newly launched index, we look at market dynamics, including issuance levels, interest rate spreads, prepayment rates and duration.

Read this paper for 

Toronto – FTSE Russell today announced the introduction of the FTSE Canada NHA MBS 975 Index. This innovative new index is the first transparent measure of the performance of the Canada mortgage-backed securities (NHA MBS) market, an important investment opportunity set for Canadian investors.

As outlined in a recent FTSE Russell Product Insight, the Canadian National Housing Act mortgage-backed securities (NHA MBS) market currently represents a sizeable and growing portion of the Canada investment landscape at almost C$500 billion in amount outstanding. Fully insured by the Canada Mortgage Housing Corporation (CMHC) and assigned a AAA rating, these securities provide investors with a steady stream of monthly interest and principal payments and offer a yield advantage over other government securities.

 FTSE Russell has applied its decades of experience in measuring the Canada fixed income markets and its leading position in Canada fixed income indexes to...