SGX

SGX securities trading volume remained unchanged in Aug from Jul, while derivatives and commodity activities grew, led by China A50 futures and iron ore derivatives. The total value of securities traded was unchanged at $21b, although there was one less trading day in Aug (21 days) as opposed to Jul (22 days). Average daily value traded rose 5% m/m but fell 27% y/y. Derivatives volume traded was at 9.4m contracts, +9% y/y and +5% m/m. China A50 futures was the most active with 3.7m contracts traded (+112% y/y and +18% m/m), and Nikkei 225 futures volume was up 17% m/m but down 21% y/y to 1.7m contracts. A total of 51,721 SGX foreign exchange futures contracts were traded (+21% m/m). Commodities continued to outperform, with Total Asiaclear volume at 189,040 contracts, +10% m/m and more than triple the volume a year earlier, while total volume of iron ore derivatives (futures, options and cleared swaps) was 178,381 contracts, +13% m/m and more than three times during the same period. SGX continues to focus on a series of transformative initiatives in the securities market, which include new product launches, international distribution and moves to strengthen its regulatory and risk management capabilities. Investors could also expect SGX to be on the lookout for further tie-ups and JVs in the commodities and derivatives segment, as it attempts to diversify from its traditional securities business and increase its product offering. At the current price, SGX trades at 22.4x forward P/E, in line with its regional peers. Overall, the street has 5 Buys, 9 Holds and 1 Sell rating with a consensus TP of $7.49.