Singapore Exchange (SGX) S68 posted record commodity derivatives and higher FX futures traded volumes for the month of November, while expectations of a rate cut by the US Federal Reserve drove investors’ reallocation to REITs.
In its monthly market statistics report, SGX recorded a total derivatives traded volume increase of 8% m-o-m to 22.4 million contracts. SGX FX also saw its 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
volumes rise 33% y-o-y to 2.7 million contracts on the appreciation of the RMB, in line with exporters’ seasonal execution of 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 over the counter (OTC) offerings achieved a new record of US$160 billion ($215 billIon) on Nov 30, a significant increase from the preceding months.
Record volume for commodity derivatives
In November, commodity derivatives volume jumped 48% y-o-y to 5.4 million contracts, a new record high, with increasing participation in commodity products that provide exposure to Asia and global trade.
This included SGX Commodities’ flagship iron ore derivatives suite recording 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.
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Increased uncertainty from supply tightness due to bad weather and subsequent demand disappointment also saw huge swings in rubber prices in November 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.
During the month, a record net inflow into Taiwanese equities on the back of strong demand for tech exposure saw SGX FTSE Taiwan Index Futures open interest increase 63% m-o-m to US$8.1 billion, with traded volumes climbing 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 recorded an increase of 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 an average daily value of US$4 billion and month-end open interest of US$10 billion.
Shifting rate expectations offering support for REITs
Securities market turnover value rose 1% m-o-m in November to $20 billion, while securities daily average value (SDAV) climbed 6% m-o-m to $952 million.
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 also 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.
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In Southeast Asia, Singapore was the second most actively traded securities market, 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, with all S-REITs and property trusts that traded in November ending the month in positive territory.
November also 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 $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, a leading Brazilian producer 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.
Shares in SGX closed 7 cents lower or 0.73% down at $9.53 on Dec 11.
