- Derivatives volume rises as global investors turn to our marketplaces to manage risk amid heightened volatility
- SDAV growth and STI outpace peers across Southeast Asia
Singapore Exchange (SGX Group) today released its market statistics for July 2024. Activity in SGX Group’s marketplaces increased across asset classes as global investors managed portfolio risks in response to manifold economic and political developments during a volatile month. Derivatives traded volume gained 15% year-on-year (y-o-y) to 23.5 million contracts.
Towards the end of July, SGX Group’s Japan-access derivatives suite enabled market participants to manage risk around Japan’s monetary policy decisions. As the Bank of Japan (BOJ) raised its benchmark interest rate and announced plans to slow its monthly bond purchases, the volume of SGX three-month Tokyo Overnight Average (TONA) Futures topped 532 lots following the contract’s debut on 29 July, while month-end open interest (OI) in SGX Mini Japanese Government Bond (JGB) Futures rose 21% month-on-month (m-o-m). In addition, the pioneering SGX Nikkei 225 Index Futures saw 52,504 lots (US$6.8 billion notional) traded on 31 July – up 36% over the daily average for the month.
Key highlights:
- Record FX futures volume: total futures traded volume on SGX FX climbed 44% y-o-y in July to 4.8 million contracts, an all-time high. Gains were led by SGX USD/CNH FX Futures – the world’s most widely traded international renminbi futures – with volume up 40% y-o-y at a record 2.9 million contracts, while SGX INR/USD FX Futures volume increased 48% y-o-y to 1.6 million contracts. Anticipation of rate decisions by the BOJ and the Federal Reserve, as well as uncertainties over the U.S. presidential elections, fuelled volatility and bolstered portfolio hedging.
- New interest-rate hedging tools with focus on central banks: SGX Fixed Income launched three-month TONA and Singapore Overnight Rate Average (SORA) Futures on 29 July, as investors seek more accessible and cost-effective tools to hedge and trade fluctuations in interest rates. The contracts build upon SGX’s offering of long-term interest rate futures comprising 10-year Full-Sized and Mini JGB futures.
- Broad-based commodities gains, with record dairy OI: Commodity derivatives traded volume rose 20% y-o-y in July to 5.1 million contracts, with bellwether iron ore derivatives volume up 22% y-o-y on elevated risk management amid diverse views on China’s growth outlook. Over the first seven months of 2024, 13.3 million metric tonnes (MT) of petrochemicals derivatives have traded on SGX Commodities, close to the 13.4 million MT cleared in all of 2023. Dairy derivatives OI set a single-day record of 171,335 lots on 16 July, rounding off the month with a record average of 106,386 lots.
- Highest SIMSCI OI notional value in more than four years: OI in SGX MSCI Singapore Index Futures rose 42% y-o-y in July to 221,551 lots, with notional value surpassing US$5 billion for the first time since January 2020 amid strong buyside interest in safe-haven markets. SGX FTSE Taiwan Index Futures volume gained 15% y-o-y, as overnight volumes climbed to a peak of 53,029 lots (US$4.1 billion notional) on 18 July following the release of chipmaker TSMC’s earnings. On SGX Equity Derivatives, total equity index futures volume increased 5% y-o-y to 13.1 million contracts.
- SDAV growth leads region: Securities daily average value (SDAV) rose 13% y-o-y and 4% m-o-m in July to S$1.2 billion against declines across Southeast Asia, with higher retail activity across stock segments. The benchmark Straits Times Index (STI) advanced 3.7% m-o-m to 3,455.94, also outpacing peers across ASEAN and Developed Asia, with year-to-date returns of 6.7%. During the month, Singapore’s stock market remained the second most-actively traded in Southeast Asia. Total securities market turnover value increased 23% y-o-y and 26% m-o-m to S$26.5 billion.
- Record REIT ETF turnover: The market turnover value of exchange-traded funds (ETF) jumped 48% m-o-m in July to S$404 million. For real-estate investment trust (REIT) ETFs, active participation from retail and robo-advisors lifted trading to a record S$131 million. Turnover of daily leverage certificates (DLC) surged 36% m-o-m to S$219 million, with Singapore-underlying DLCs showing the most increases.
- Mainboard listing: SGX Securities welcomed the secondary listing of Helens International Holdings Company Limited on Mainboard on 19 July. The company runs one of the largest bar chain networks in the PRC.
The full market statistics report can be found here.
