SGX: Equity markets (30% of revenue) for May average daily turnover was down 2% YoY to $1.3bn, and down 9% on Apr. Derivatives markets (35% of revenue) on the other hand, volumes were up 89% YoY in May 2015, and down 4% MoM and 53% above the 2014 level (China A50 futures product flat MoM).
Depository services (15% of revenue): These fees are based more on equity volumes than value, with volumes in May flat YoY. Listing (10% of revenue): no equity listings in the month.
Credit Suisse believes that recent structural changes to equities (reduction in board lots, changes to penny stocks and rebates to improve liquidity in certain stocks) could lead to an improvement in volumes near to medium term. Also, derivatives, the stand-out area for SGX in the last few years, are starting to build critical mass in many products and SGX could become a regional trading hub for such contracts, as well as expanding into other product lines outside index futures.
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