IOB Newsletter - July 2014

June 2014 highlights: Greater China Forum

On 9th June, the inaugural LSEG Greater China Forum was held in Hong Kong. The forum focussed on LSE Capital Markets and FTSE offerings, in addition to topics in which Greater China clients have great interest in:

 

  1. IPOs in London
  2. Trading UK and European equities
  3. The growing story of ETFs
  4. RMB internationalisation
  5. Implications of China A-Shares Inclusion in Global Equity Benchmarks

 

226 delegates from 149 companies across 6 countries participated in the conference. Find out more about the Greater China Forum

IOB equity trading

  • Average daily turnover in May was $726.4, down 14% from May volumes as we head into holiday season.
  • Indian names have kept the relatively higher liquidity on IOB in June. $264m were transacted onbook and $577m offbook. For onbook turnover, Axis Bank (more than doubled comparing to May), Gail, Larsen & toubro, Reliance Infrastructure, Suzlon Energy and Tata Steel have seen uptick in June vs May

IOB derivative trading

IOB Derivatives are part of the London Stock Exchange Derivatives Markets, which include IOB, UK, and Norwegian products.

  • June 2014 saw continued growth of IOB DR futures (+1,385% on S1 13) with 182,249 contracts traded. Open interest at historical high again, with 269,495 contracts.
  • Sharp drop in was IOB DR options volume, with 281,738 contracts traded as opposed to over 1m monthly average; notional traded down 38% on S1 13; lowest volume historically
  • In contrast, market quality has improved according to multiple metrics; the share of on-screen trading has jumped to a historical high of 16% (latest record: 10%) and the yield has almost doubled to ~$0.10 per contract; share of listed (post trade transparent) series traded reached a historical high of 80%.

New members

  • At the end of June 2014, LSE has 363 member firms; 92 members have trading access to IOB (CCP)
  • Forte Securities Limited became an LSE member in June
  • BCS Prime Brokerage Limited commenced trading on IOB in June

International News

  • 11th June: TBC Bank joined the Main Market following its listing of Global Depositary receipts (GDRs). The company, the latgest bank in Georgia by retail deposits, raised $239m during the IPO, giving it a market value of $640m. Read more
  • 17th June: London Stock Exchange Group signed MOUs with Bank of China and Agricultural Bank of China, which outlined areas for closer collaboration including RMB internationalisation and capital markets opoprtunities. The signing coincided with UK visit of Chinese Premier, Li Keqiang. Read more
  • June 30th: London Stock Exchange welcomed the listing of the UK Government's first Islamic bond. The listing was teh first for a country outside the Islamic world and raised £200m on orders totalling more than £2billion. Read more
  • London Stock Exchange Group (LSEG) and Casablanca Stock Exchange (CSE) signed a strategic agreement to expand CSE's activity in the North Western and Central African regions. Following the agreement, LSEG will share its expertise on the full exchange business chain, from listing to trading, and from clearing to settlement and custody with a commitment to working with the Moroccan authorities to position Casablanca's capital markets and financial infrastructure as a regional hub. In addition, Millenium IT, part of London Stock Exchange Group, will provide trading and market surveillance technology to CSE. Read more
  • Millennium IT, London Stock exchange Group's technology solutions provider, was selected by Canadian-based Aequitas Innovations Inc., to provide a suite of capital markets technology products. Millenium Exchange, Millenium SOR and Millenium Market Data are among the products chosen by Aequitas for its new marketplace in Canada. Read more

July Events

  • London Stock Exchange Equities & Derivatives Summer Drinks: The Equities & Derivatives Team is organising a drinks reception at the Merchant Taylor's Hall on 15th July. The event will provide an opportunity to meet with our Team and network with other industry professionals. Please contact us at summerdrinks@lseg.com to receive your personal invitation.