SGX

SGX saw renewed market fervour on possible spillover effects from Trumponomics with securities turnover surged to $29.3b (+51%y/y, +49% m/m) in Nov albeit with one additional trading day versus Oct and two more compared to last year. Nonetheless, securities daily average value jumped to $1.3b (+37% y/y, +43% m/m).

During the month, there was one new Catalist listing (HC Surgical Specialists) which raised $8.1m. There were 24 new bond listings which raised $8.5b.

Derivatives trading volume also saw a substantial uptick to 16.6m contracts (+22% y/y, +43% m/m), reflecting the risk-on sentiment across Nifty 50 (+31% y/y, +16% m/m) and Nikkei 225 (+22% y/y, +52% m/m) index futures although performance was more mixed for the China A50 (-2% y/y, +53% m/m) and MSCI India (-72% y/y, +7% m/m) index futures.

Meanwhile, FX futures volume stood at 701,870 contracts (+51% y/y, +41% m/m), testament of the renewed volatility in currency markets following Trump's surprise election.

The Exchange's strongest growth engine continued to come from the commodities derivatives trading which bolted to 2.4m (+147% y/y, +101% m/m), buoyed by iron ore (+145% y/y, +111% m/m), forward freight (+34% y/y, +52% m/m), and rubber (+273% y/y, +42% m/m) derivatives.

While the strong trading flows were reflective of overseas events such as Trump's election win, there is little to indicate that such flows will continue with similar strength in the coming months.

SGX is currently trading at 22.2x forward P/E with indicative yield of 3.8%, seemingly cheaper to its closest peer, HKEx (38.4x, 2.6%). However, the latter's premium valuation is backed by stronger growth prospects arising from its closer proximity and ties to China coupled with two stock connects (Shanghai and Shenzhen).

The street has 8 Buy, 10 Hold ratings on the exchange with a consensus TP of $7.79, indicating little potential upside (>5%) from current prices.