SGX Group (Singapore Exchange) today reported strong volume growth in August as global institutions tapped its China-access derivatives offering to manage risk across multiple asset classes, while the Singapore stock market continued its positive trajectory.
Derivatives traded volume rose 11% y-o-y in August to 27.4 million contracts, with derivatives daily average volume (DAV) climbing 17% y-o-y to 1.3 million contracts. Securities market turnover gained 17% year-on-year (y-o-y) to S$33.6 billion, while securities daily average value (SDAV) also increased 17% y-o-y to S$1.6 billion.
Key highlights:
- Robust activity across China-access derivatives: A rally in China’s equities market drove demand for China equity derivatives, with DAV of SGX FTSE China A50 Index Futures rising 66% y-o-y in August to 496,023 lots (US$7.2 billion notional), the highest in six months. Open interest (OI) in the contract – the world’s most liquid international futures for Chinese equities – climbed to a record 1.31 million lots on 25 August. Complementing the A50 contract, activity in SGX FTSE China H50 Index Futures also sustained its recent momentum with record DAV of 7,454 lots (US$259 million notional), as more institutional investors sought to capture opportunities from a rally in H-shares. With lower implied volatility in dollar/yuan, OI in SGX USD/CNH FX options surged to a record 20,055 lots (US$2 billion notional).
- More INR risk management: Concerns over the impact of additional U.S. trade tariffs on India’s economy fanned portfolio hedging demand in August. SGX INR/USD FX Futures traded volume gained 24% y-o-y to 2.12 million contracts, with month-end OI up 31% y-o-y at US$3.06 billion notional
- Record commodities open interest: Monthly average OI in benchmark iron ore derivatives rose 28% y-o-y to 3.71 million lots amid expectations of accelerated infrastructure spending in China and broader macroeconomic uncertainty. OI in dairy derivatives also climbed to new highs, with a monthly average of 192,749 lots and a single-day peak of 200,510 lots on 19 August, driven by increased hedging on the back of expanded dairy production in New Zealand.
- STI marches higher, while small- and mid-caps shine: Following several single-day records in July, the bellwether Straits Times Index (STI) advanced further in August, rising 2.3% month-on-month (m-o-m) to 4,269.7. This brought year-to-date gains to 12.7%, outpacing most ASEAN markets. On a Singapore dollar basis, the STI topped Asia-Pacific benchmark indices across a five-year horizon for total returns, returning 111% as of end-August. Even so, small- and mid-cap stocks outperformed the STI, lifting cash SDAV by 8% m-o-m and small-mid cap SDAV by 11% m-o-m. The FTSE ST Small Cap Index climbed 2.4% m-o-m, while the FTSE ST
- ETF AUM rises to new peaks: Combined assets under management (AUM) of exchange-traded funds (ETF) surpassed S$15 billion for the first time in August, up 38% y-o-y. Quality Singapore dollar assets continued to dominate fund flows, with combined net inflows of S$200 million. AUM in the iShares MSCI Asia ex Japan Climate Action ETF climbed to an all-time high of S$1.9 billion, while real-estate investment trust (REIT) ETFs ended the month with AUM at a record S$1.3 billion, driven by growth in the Singapore REIT sector.
- Growth in capital raising: SGX-listed companies continued to tap the equity capital markets in August, with secondary fundraising totalling S$610.1 million, the most since November last year. On 15 August, Dezign Format Group Limited, a Singapore company that provides end-to-end design and fabrication for events, exhibitions and festive decorations, joined Catalist.
Mid Cap Index gained 3.9% m-o-m. Institutions net-purchased S$82 million of small- and mid-caps during the month, extending a trajectory since February.
The full market statistics report can be found here.
