The Zacks Analyst Blog Highlights: CME Group, Morgan Stanley, JP Morgan Chase, Goldman Sachs Group & Royal Dutch Shell plc - ..
February 23 2012 - 3:30AM
Zacks
For Immediate Release
Chicago, IL – February 23, 2012 – Zacks.com announces the list
of stocks featured in the Analyst Blog. Every day the Zacks Equity
Research analysts discuss the latest news and events impacting
stocks and the financial markets. Stocks recently featured in the
blog include CME Group
Inc. (CME), Morgan
Stanley (MS), JP Morgan Chase &
Co. (JPM), Goldman Sachs Group
Inc. (GS) and Royal Dutch Shell
plc (RDS.A).
Get the most recent insight from Zacks Equity Research with the
free Profit from the Pros newsletter:
http://at.zacks.com/?id=5513
Here are highlights from Wednesday’s Analyst
Blog:
CME Hikes Stake in Dubai
Mercantile
In an attempt to strengthen its oil futures market,
yesterday, CME Group Inc. (CME)
announced the acquisition of another 25% stake in the Dubai
Mercantile Exchange (DME), thereby owning 50% of this Dubai’s
commodities exchange in total.
The DME was established as a joint venture (JV) between the
Dubai and Omani governments and the New York Mercantile Exchange
(NYMEX) in 2007. However, following the acquisition of NYMEX by
CME, the latter got a one-fourth stake in the DME.
While CME doubled its stake in DME, the Oman Investment Fund had
raised its ownership to 29%, leaving Dubai Holdings with a 9%
stake. The remaining 12% of DME is owned in tidbits by firms such
as Morgan Stanley (MS), JP
Morgan Chase & Co. (JPM), Goldman
Sachs Group Inc. (GS), Royal Dutch Shell
plc (RDS.A), Concord Energy and Vitol. The shift of
interest was part of the recapitalization process initiated by DME
to restructure its debt.
Hiking its stake in DME appears to be a strategy growth step for
CME, which has been firming its global footprint in the energy
sphere for long now. Additionally, as CME has already been
launching its crude oil futures and options contracts on the
globally leading Brent and light sweet crude oil (WTI) benchmarks,
initiating crude oil futures through DME would further enhance its
reach in the rapidly developing markets of Middle East and
Asia.
Moreover, DME being out of the Organization of the Petroleum
Exporting Countries (OPEC) enjoys liberty of price discovery and is
open to testing new risk management products. These factors pave
scope for DME to stay ahead and quickly acclimatize to the
consistent changes in global industry dynamics. DME also aims to
grow as a benchmark for new crude oil futures contracts in Middle
East and Asia, and price these contracts within the region as most
of the crude oil is generated in the Middle East.
Hence, being a part of such an attractively positioned
mercantile exchange could further prove to be a feather in CME’s
cap in the long run. Meanwhile, the company is head on heels to
expand its market share by leaps and bounds. CME is also eyeing
London Metal Exchange (LME) to enhance its metals exchange, Comex,
and strengthen its competitive position in Europe. The company had
participated in the preliminary bid to acquire LME, which closed
last week.
Overall, we believe that CME’s efforts to promote, expand and
cross-sell its core exchange-traded business through strategic
alliances, meaningful acquisitions, newer product initiatives along
with its global presence will generate a decent growth in the long
term.
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CME GROUP INC (CME): Free Stock Analysis Report
GOLDMAN SACHS (GS): Free Stock Analysis Report
JPMORGAN CHASE (JPM): Free Stock Analysis Report
MORGAN STANLEY (MS): Free Stock Analysis Report
ROYAL DTCH SH-A (RDS.A): Free Stock Analysis Report
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