SGX Sees Investor Demand Increase Due to ‘Uneven’ Economic Recovery

On Friday, Singapore Exchange (SGX) reported its market statistics for August, stating that an uneven economic recovery in Asia had increased the demand to invest and trade multiple asset classes. 

The exchange saw FX volumes jump, with INR/USD Futures climbing 9% year-on-year to 1.1 million contracts. SGX’s USD/CNH futures rose 12% year-on-year to 812,929 contracts. However, the USD/CNH futures, which according to SGX, is the most generally traded international RMB futures contract, saw an open interest of US$11.3bn at the end of the month, reaching a record high. In total, foreign exchange futures volume on the exchange jumped to 2 million contracts, or 12% year-over-year.

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Elsewhere, SGX said its commodity derivatives were the standout performer due to price swings and supply chain issues continuing to impact physical markets. The entire commodity derivative volume, including iron ore (which SGX says is a macroeconomic proxy for China), climbed 10% year-over-year to 2.6 million contracts. In addition, forward Freight agreements (FFA) volume surged 131% to 160,678 contracts compared to the same period in 2020, while petrochemicals volume on the exchange increased 48% to 3,407 in August.

SGX stated:

Steady growth elsewhere in Emerging Asia provided more opportunities. A broad-based economic rebound in India sustained investor optimism, while inflationary pressure fueled hedging demand.

Benchmark Indian stock market index Nifty 50 futures volume gained 2% compared to August 2020, to approximately 2 million contracts. 

In its home country of Singapore, SGX’s total securities market turnover climbed 5% month-on-month to S$26.3bn, with the daily average value rising 5% month-on-month to around S$1.3bn. In addition, daily leverage certificates turnover structured warrants rose to the highest levels since November last year, showing an 8% month-on-month increase to S$622m. SGX put the rise down to more stocks being made available.

SGX continued:

SGX-listed companies continued to tap the equity capital markets with secondary funds raised of S$377 million in August. The amount issued from 42 new bond listings on SGX, Asia’s leading international bond marketplace, stood at S$20.9 billion.

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