- Commodity Derivatives achieves new record volume, SGX FX sets new daily average volume record
- REITs mark most active daily turnover since March 2023
Singapore Exchange (SGX Group) today released its market statistics for November 2023. Record commodity derivatives volume and higher FX futures volume drove the Group’s overall derivatives volume, while expectations of a rate cut by US Federal Reserve drove investors’ reallocation into REITs.
Total derivatives traded volume rose 8% month-on-month (m-o-m) to 22.4 million contracts. SGX FX, Asia’s most liquid FX futures exchange that also boasts a robust over-the-counter (OTC) FX marketplace, saw FX futures traded volume in November up 25% m-o-m to over 4 million contracts.
SGX USD/CNH Futures, the most widely traded international RMB futures contract globally, saw volume rise 33% year-on-year (y-o-y) to 2.7 million contracts on the appreciation of the RMB, as exporters typically execute FX conversions towards the end of the year. SGX INR/USD Futures, also one of the top 10 traded listed FX futures globally, saw traded volume grow 13% m-o-m to 1.1 million contracts.
During the month, SGX FX’s average daily volume from its listed futures and OTC offerings achieved a new record of US$160 billion on 30 November, a significant increase from the preceding months.
Record volume for commodity derivatives
Commodity derivatives volume jumped 48% y-o-y in November to 5.4 million contracts, a new record high, with increasing participation in commodity products that provide exposure to Asia and global trade.
SGX Commodities’ flagship iron ore derivatives suite recorded its second highest monthly volume ever, driven by higher risk management activity amid rising iron ore prices from China’s robust demand, as well as growing financial participation as iron ore continues to gain importance and recognition as a proxy to China’s economic growth.
Heightened volatility from a surge in capesize and panamax vessel freight rates prompted active hedging, with SGX Commodities' FFA derivatives volume achieving a new single-day record during the month and a new monthly record of 294,074 contracts, an 89% y-o-y jump.
Increased uncertainty from supply tightness due to bad weather and subsequent demand disappointment saw huge swings in rubber prices during the month. The volume of SGX SICOM rubber futures, the world’s pricing bellwether for natural rubber, increased 34% y-o-y to 295,561 contracts, a new record.
In November, with record net inflow into Taiwanese equities on the back of strong demand for tech exposure, SGX FTSE Taiwan Index Futures open interest rose 63% m-o-m to US$8.1 billion, traded volume climbed 4% y-o-y to 1.6 million contracts -- its highest in twelve months with elevated buy-side interest.
SGX FTSE China A50 Index futures rose 4% m-o-m to 7.3 million contracts with higher institutional demand for hedging Chinese equities. This contract remains the world’s most liquid international futures contract for Chinese equities, with average daily value of US$4 billion and month-end open interest of US$10 billion.
Shifting rate expectations support increased activity and positive price performance for REITs
Securities market turnover value rose 1% m-o-m in November to S$20 billion, while securities daily average value (SDAV) climbed 6% m-o-m to S$952 million.
During the month, Winking Studios Limited listed on Catalist. Operating primarily in Taiwan and China, the company provides art outsourcing and game development services for the video game industry across platforms such as console, PC, online and hand-held content.
Driven by expectations of interest rate cuts, a weaker US dollar and geopolitical tensions, SPDR® Gold Shares ETF was the most heavily traded ETF. Equities ETFs recorded the highest net inflows among the major asset classes with China Equities ETFs leading the pack, as the Xi-Biden meeting at APEC summit sparked optimism.
SGX Securities welcomed the listing of CGS Fullgoal CSI 1000 ETF, launched under the Shenzhen Stock Exchange-SGX ETF product link. This is the third China A-Share ETF listing on SGX, adding to the expanding suite of China growth and tech-focused ETFs.
Singapore was the second most actively traded securities market in Southeast Asia, with higher trading activity coming from both institutional and retail investors across index constituent stocks, REITs and small-mid caps. REITs marked their most active daily turnover since March 2023, with all S-REITs and property trusts that traded in November ending the month in positive territory.
November saw a 28% m-o-m surge in retail activity across Daily Leverage Certificates (DLCs) and structured warrants. Retail average daily turnover for DLCs increased 58% m-o-m, hitting its highest point since February 2023. During the month, SGX Securities listed its first Discount Certificate, offering investors a new payoff type for the Structured Certificates that were first introduced in Asia by SGX Securities in August.
On SGX Fixed Income, Asia’s leading international bond marketplace, the amount issued from 57 new bond listings stood at S$27.3 billion in November. Notable bond listings in the month include: a US$2 billion two-part Sukuk offering by the Republic of Indonesia; a US$900 million senior notes offering by Minerva, one of the leading Brazilian producers of beef and industrialised protein products; a US$800 million two-part senior notes offering by Korea National Oil Corporation, and a US$500 million step-up callable perpetual subordinated bonds offering by Fukoku Mutual Life Insurance Company.
The full market statistics report can be found here.
