This article was originally published on Tuesday, 10 September 2019 at 8:48 A.M. SGT; it has since been updated to include more details.
Trading volume of commodity derivatives, including freight, petrochemicals and SICOM rubber contracts, surged 91 percent on-year in August to 2.74 million contracts as markets remained jittery, Singapore Exchange said in a statement Tuesday.
“Market participants continued to use SGX’s suite of risk-management tools to manage their positions across multiple asset classes as concerns over the outlook for both developed and emerging economies intensified,” SGX said.
“With ongoing U.S.-China trade tensions, a yield-curve inversion in the U.S. bond market – interpreted by some participants as a recession signal – as well as fresh uncertainties over Brexit, global growth concerns dominated the markets throughout August,” it added.
SGX iron ore derivative trading volume jumped 111 percent on-year in August to a record 2.48 million contracts after a slowdown in steel demand spurred the metal’s biggest one-month price drop since 2011, SGX said.
“Financialisation in iron ore through the use of futures contracts is gaining pace as more international market participants adopt the commodity as a macro barometer for Asia’s growth,” the statement said.
Foreign exchange derivatives were also active during the month, with total FX futures volume rising 59 percent on-year to 2.62 million contracts, SGX said.
With India’s rupee facing headwinds, SGX INR/USD futures trading volumes climbed 61 percent on-year to a record 1.6 million contracts for August, the statement said.
After the yuan weakened on stalled U.S.-China trade talks, with the U.S. dollar fetching more than 7 yuan, SGX USD/CNH futures volumes rose 50 percent on-year during the month to 965,241 contracts, SGX said.
Equity derivatives also saw increased interest, with equity-index derivatives volume rising 14 percent on-year to 16.7 million contracts, SGX said.
SGX added that in the cash equities market, the securities daily average value (SDAV) rose 12 percent on-month and increased 6 percent on-year in August to S$1.2 billion even as the benchmark Straits Times Index declined 5.9 percent on-month.
The securities daily average volume fell 27 percent on-year to 1.19 billion shares in August, the filing said.
Total market turnover by volume fell 30 percent on-year to 23.80 billion shares, while the value rose 1 percent on-year in August to S$23.75 billion, SGX said.
While you’re here, we’re hoping you can help us out.
Shenton Wire has been providing you with quick news and market analysis. But we need your support to continue to bring you the news you’ve come to expect and to expand our reach beyond Singapore.
Your monthly contribution will directly fund our journalism.
Contact us about other contribution levels or for corporate subscriptions and article syndication.
Or you can contribute via PayPal: