Singapore Exchange (SGX Group) today released its market statistics for August 2022. Increased risk-management activity drove derivatives volume amid ongoing uncertainty. Securities market turnover value gained on month-end rebalancing by institutions.

Derivatives traded volume across multiple asset classes rose 4% year-on-year (y-o-y) in August to 20.4 million contracts, while derivatives daily average volume (DDAV) climbed 2% y-o-y to 921,170 contracts.

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The U.S. Federal Reserve’s unprecedented cycle of interest-rate hikes continued to place Asian currencies under pressure, driving institutional hedging on SGX FX. Total foreign exchange (FX) futures traded volume increased 31% y-o-y to 2.6 million contracts, led by a 45% y-o-y jump in SGX USD/CNH futures to 1.2 million. The SGX contract is the world’s most widely traded international renminbi (RMB) futures. SGX INR/USD futures volume climbed 17% y-o-y to 1.3 million contracts amid volatility in the Indian rupee.

During the month, China’s official manufacturing gauge remained in contraction, fanning uncertainties over the outlook for Asia’s leading economy. The volume of SGX FTSE China A50 Index Futures – the world’s most liquid international contract for Chinese equities – rose 2% month-on-month (m-o-m) to 8 million contracts, bringing total equity index futures volume on SGX Equity Derivatives to 13.8 million contracts. On a y-o-y basis, SGX Nifty 50 Index futures volume gained 14%, SGX Nikkei 225 Index Futures volume increased 17%, while SGX MSCI Singapore Index Futures volume climbed 8%.

More financial participation in commodities

On SGX Commodities, total screen volume rose to a record 1.1 million lots in August as adoption grew from an expanding pool of financial participants. Total commodity derivatives volume gained 29% y-o-y to 3.3 million contracts. Benchmark iron ore derivatives volume surged 35% y-o-y to 2.9 million contracts – demonstrating the SGX contract’s relevance amid demand for hedging tools. SGX SICOM rubber futures, the world’s pricing bellwether for natural rubber, climbed 22% y-o-y to 167,262 contracts. Month-end open interest in the pioneering suite of dairy derivatives surpassed 125,000 lots, the highest since launch in November 2021.

Securities turnover increases

Securities market turnover value on SGX Securities climbed 35% m-o-m to S$24.3 billion in August, while securities daily average value (SDAV) rose 23% m-o-m to S$1.1 billion. The market turnover value of structured warrants and daily leverage certificates (DLC) gained 16% m-o-m to S$608 million.

The broad pickup in securities market turnover came on the back of the corporate earnings season and a strong month-end rebalancing. Institutional portfolio rotation led to an estimated S$750 million in net institutional inflows in August, the highest since January and mainly into the Financials and Consumer sectors.

The benchmark Straits Times Index (STI) advanced 0.3% m-o-m to 3,221.67 in August. It generated a year-to-date price return of 3.1%, outperforming the FTSE All-World Index.

During the month, SGX Securities welcomed Lincotrade & Associates Holdings Limited to Catalist. The Singapore homegrown company provides interior fitting-out, additions and alterations works, as well as other building construction services. SGX-listed companies continued to tap the equity capital markets during the month, with secondary fundraising of S$204.5 million.

On SGX Fixed Income, Asia’s premier international bond marketplace, the amount issued from 37 new bond listings stood at S$5.9 billion in August. Highlights included the Government of Singapore’s S$2.4 billion 50-year inaugural sovereign green bond, KT Corporation’s US$500 million notes due 2025 and Macquarie Group’s SGD500 million senior bonds due 2026.

The full market statistics report can be found here.