Bloomberg News

Emerging Energy Stocks Led 2011 DR Trade on Oil, BNY Mellon Says

January 30, 2012

Jan. 30 (Bloomberg) -- Shares of emerging-market energy and mining companies were the most traded among depositary receipts last year as gains in oil and metals prices outweighed concern that the global economy is slowing, according to Bank of New York Mellon Corp.

Trading in gas, oil and mining stock rose 23 percent to $1.5 trillion in 2011, and companies in the sector raised $4.3 billion last year, more than any other industry, BNY Mellon said in an e-mailed report. Depositary receipts, or DRs, are receipts representing foreign shares of stock held on deposit at a bank and denominated in dollars.

Crude oil rose 8.2 percent last year, the third annual advance, as the collapse in Libyan exports cut supply and U.S. stimulus measures kept the world’s largest economy afloat. Commodities also gained for the third year, according to the Standard & Poor’s GSCI Spot Index. The International Monetary Fund cut its forecast for global growth last week, warning that the European debt crisis could derail the world economy.

“In a year of uncertainty, investors found opportunities to diversify their portfolio and access global growth via DRs, with activity in the energy and mining sectors particularly brisk,” Michael Cole-Fontayn, chief executive officer of BNY Mellon’s Depositary Receipts business, said in the report.

DRs of Moscow, Russia-based OAO Gazprom, the world’s biggest producer of natural gas, Brazil’s state-controlled oil company Petroleo Brasileiro SA, as well as Rio De Janeiro-based Vale SA, the world’s biggest iron-ore producer, were among the most traded, according to the report.

Total DR volume jumped 19 percent to 175 billion receipts in 2011, BNY Mellon data show.

--Editors: Marie-France Han, Emma O’Brien

To contact the reporter on this story: Tal Barak Harif in New York at tbarak@bloomberg.net

To contact the editor responsible for this story: Emma O’Brien at eobrien6@bloomberg.net


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