SGX

SGX: Company release January volumes, seeing strong growth across Securities, Derivatives and Commodities. Securities daily average value grew 42% y/y at $1.8b and 55% m/m. Total value traded grew 65% y/y and 70% m/m to $39.6b due to the lesser number of trading days in 2012 (22 vs 19 days). On Derivatives, daily average volume grew 75% y/y and 15% m/m to a second consecutive record 1-month high of 463,561 contracts. Equity index futures volume grew 89% y/y and 19% m/m to 8.6m contracts, led by China A50 futures volume that more than quadrupled y/y to 1.7m contracts. Volume of Commodity swaps cleared grew 59% y/y and 75% m/m to 38,644 contracts, with iron ore swap volumes quadrupled y/y to 33,851 contracts, increasing 78% m/m. SGX is reported to be in talks with LCH.Clearnet about acquiring stake on its own, or taking part in deal in which London Stock Exchange would take controlling stake. Back in 24 Dec 2012, LSE provisionally agreed to pay Eur15/ share for LCH.Clearnet. LCH.Clearnet is Europe's biggest clearing house, with revenues totalling Eur387m (S$648m) and Eur21m (S$35m) in profits in FY11. SGX previously bidded for ASX for US$8.3b in Oct 2010, and has reportedly secured long-term funding worth US$3.7b. Company has $477m cash on hand as at 31 Dec 2012. Would like to point out that technicals look positive, ascending triangle formation has fully formed with counter trading at 52-week high recently. Potential advancement target of $8.00. RSI looks overbought however, but ADX of suggests the beginning of a trend. SGX is trading at 29x P/E.