Slide 1European Trade OrganizationsEquity MarketsThe ClusterCountry’s ClusterCluster MapTrade AgreementsPotential Enlargement of EUMain EconomiesGeographic InvestmentsGlobal PresenceEuropean MarketThe European Stock MarketMajor European MarketsSlide 15European BenchmarksGlobal OutputWorld Equity Benchmark Shares (WEBS)Current Status of EUCurrent Status of EUSourcesQuestionsEuropean MarketsAlmost 90% of the total market capitalization of the world’s equity markets is accounted for by the market capitalization of the developed world.European Trade OrganizationsEquity MarketsPrimary Markets•Shares offered for sale directly from the issuing company.Secondary Markets•Provide market participants with marketability and share valuation.Major Stock ExchangesThe ClusterMichael Porter (1998) defines clusters as:•"geographically proximate groups of interconnected companies and associated institutions in a particular field, linked by commonalities and complementarities“Country’s ClusterCluster MapTrade AgreementsEUEFTACEFTAPotential Enlargement of EUMain EconomiesGeographic InvestmentsA highly concentrated market•5 countries do 84% of the total amount invested•UK attracted 33% of investmentsGlobal PresenceEuropean MarketLargest consumer market in the world (500 million)27 member states following strict acceptance criteriaEU27 contributes one third of the world’s GDP Free movement of people, goods, services and capitalFree market economyThe European economy is lead by Germany, the largest exporter in the worldVideoThe European Stock MarketEASDAQ is a sort of a European NASDAQ that binds together national exchanges.UK, Germany, France, Switzerland, Austria, Italy, Belgium, Denmark, Portugal, Finland, Greece, Luxembourg, and the Netherlands.A lack of common securities regulations, even among the countries of the European Union, is hindering a single European stock market.Major European MarketsAmsterdam Stock Exchange London Stock ExchangeParis Bourse Deutsche Börse (Frankfurt Stock Exchange)European Benchmarks Name Symbol FT-SE 100 UKX CAC 40 CAC Frankfurt DAX Index DAX IBEX Index IBEX Milan MIB30 MIB30 BEL20 Index BEL20Global OutputWorld Equity Benchmark Shares (WEBS)Country-specific baskets of stocks designed to replicate the country indexes of 20 countries and 3 regions.WEBS are subject to U.S. SEC and IRS diversification requirements.Low cost, convenient way for investors to hold diversified investments in several different countries.Current Status of EULosing world market share•Specially to AsiaOffering market access as leverage•Hoping developing countries will require access•Not enticing enoughDeveloping countries are competitive enough to access other global marketsCurrent Status of EUEU needs to set up efforts•Liberalize markets, more market flexibility.•Allow member companies to compete globally.•Develop larger economic presence for Europe.•Develop trade agreementsFacilitate
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