The acceptance by Qantas’s board of an A$11.1 billion (US$8.7 billion) bid for the Australian airline cements private equity’s place in the country’s mainstream, despite a growing sense of unease among the public and some thorny remarks from senior bankers.

Sterling market opened in the Middle East and CIS.

Car parks that rival Monaco for the quality of the marques, apartment prices that rival those in New York, but a stock exchange capitalization of only $50 billion. That’s Almaty. Kazakhstan’s government hopes to develop its capital markets and create a financial centre there for all central Asia. The buildings are going up. Will there be enough tenants to fill them? Chloe Hayward reports from Almaty.

After some considerable time in development, Eurex plans to launch the world’s first exchange traded credit derivatives contract on March 27. The contract will be based on the iTraxx Europe five year series and – dependent on market demand and sufficient market maker support – Eurex might also list futures contracts on the HiVol and Crossover indices on the same date. The contracts will be cash settled.

Mizuho Securities is building its structured credit and debt capital markets business.

Hundreds pushed out at Dresdner just ahead of bonus round.

The securities prove to be among the hottest assets of 2006 – some of the best trades across the globe.

Major errors of concept and execution in the Iraq war have weakened the US: a sharp lesson in the limits of what seemed like limitless power. Its allies have been discredited, its enemies strengthened. Its real or wannabe rivals, China and Russia, are new global power centres. Its sway in Latin America and Africa has been compromised. The new Asian regional powers must steer a careful course in a complex world.By Charles Dumas, Diana Choyleva and Gabriel Stein.

The UK private banking market is in rude health. However, although London still dominates, banks are throwing resources into regional growth. The biggest obstacle to organic growth is the lack of suitable talent to drive this expansion. Banks have to decide on the best business development strategy – acquisition, organic growth or servicing from the City? Julian Marshall reports.

The influence of investors in credit default swaps has conspicuously failed to match the growth of the market itself. But a recent restructuring could be the watershed moment that changes the credit markets for ever. Has the ground shifted beneath corporate issuers’ feet without them even noticing? Louise Bowman reports.

Moody’s threw a potential spanner in the works of the European hybrid market by announcing a consultation on possibly increasing the notching on securities with non-cumulative deferral features and cumulative deferral with stock settlement. Feedback was due at the end of December.

Corporates need to recognize that they need to care about their CDS investors and that the old attitude of concentrating on the requirements of bondholders alone will no longer wash.

Chesapeake is first US energy issuer to target euro investors this decade.

Rising intra-regional trade and investment are helping to underpin the economic fortunes of the states that formerly constituted Yugoslavia. Guy Norton takes a look at three examples of a stock exchange, a fund manager and private equity.

UK-based bond dealers breath sigh of relief as regulator turns back from proposals set out eight months ago.

“Hedge funds have trailed equities on a relative basis in 2006 because of the unusually consistent strength in the equity markets”

18,000,000,000 the dollar volume of ECM deals that was expected to be executed in December 2006 in the EMEA region, according to Dealogic. $244 billion was raised in the first 11 months of the year, up 9% on full-year 2005, making the amount of money raised in ECM deals in 2006 the highest on record.

Investment bankers in Japan are confident that a hybrid securities market will be established this year, despite fears that the lack of a sizeable standout deal thus far is contributing to investor and issuer caution about the structure. The sector was extremely active in the US as 2006 came to a close, with overwhelming levels of investor demand for deals from Axa and Washington Mutual, and bankers in Japan say that treasurers and CFOs there are looking closely at how their counterparts in the US use the instruments to fund acquisitions and improve capital structure.

Just over one-third of people in the region believe that their economic situation has improved.

Two major state companies will be partly privatized and up to 10 private companies are expected to undertake initial public offerings in Colombia next year.

The SEC has proposed increasing the minimum net worth for an investor in hedge funds to $2.5 million from $1 million in 2007. The $2.5 million net worth minimum is to include only liquid assets. Analysts doubt that the move will have much effect.

Wealth managers are muscling in on the fund of hedge funds business.

Charles Dumas warns of a ‘reverse Robin Hood’ scenario.

Abuse of information prompts worries about integrity in credit markets.

Germany’s deputy finance minister, Thomas Mirow, has promised that industrial nations will “coordinate efforts to reduce risks posed from hedge funds”, in a briefing dealing with Germany’s upcoming presidency of the G8 in 2007. He did, however, add that regulation might not be the way to reduce risk, suggesting that more transparency might rather do the job.

Asia’s nascent market in structured growth capital is hard to define and even harder to resist. Fat margins and tied clients are bringing more entrants and might engender greater risks.

Lombard Odier Darier Hentsch’s US dollar, low-risk portfolio caters to high-net-worth clients who want to preserve their money over the long term but are also looking for performance.

Western investment banks are competing to acquire Russian investment houses, while the chief executive of VTB, the country’s second-largest bank, is prioritizing either the acquisition of a local investment bank or the establishment of a partnership with an international player. But can domestic banks successfully compete with their international rivals in the longer term? Kathryn Wells reports.

In spite of all the takeover talk among major global exchanges, and the heavy consolidation in eastern Europe’s banking sector, not everyone believes that acquisitions are the only way to expand business in the region. Florian Neuhof talks to Heinrich Schaller, joint CEO of the Wiener Börse, who outlines his vision of cooperation with the developing regional exchanges.

Volume and profits in the FX market have grown more consistently than in any other part of the financial markets. New entrants and existing users still cannot resist the promise of diversification and excess return.