China, India the key drivers of global trading activity

MUMBAI: The total value of share trading rose 41% in 2015 and the number of trades 55% from 2014, according to World Federation of Exchanges ( WFE’s) full-year statistics. The increases were driven predominantly by trading activity in the Asia--Pacific region, particularly mainland China.

Despite the significant volatility witnessed through the year, Asia-Pacific markets still managed to end the year up 10% in terms of market capitalization compared to the end of 2014, WFE said.

The value of share trading rose 41% worldwide to $114 trillion in 2015 compared with $81 trillion in 2014. Most of the increase is attributable to the rise in trading activity in the Asia-Pacific region where the value of share trading rose 127% from that seen in 2014. The total value of Asia-Pacific share trading in 2015 approached $54 trillion, putting it ahead of other regions in terms of the total value of share trading.

Total number of trades in 2015 increased 55% from 2014, ending the year at 23.7 billion (up from 15.3 billion in 2014). Again, Asia-Pacific was responsible for most of the increase. The region saw a 94% rise in the number of trades from 2014, from just over 8 billion to 15.5 billion trades in 2015

Global market capitalization decreased 1.3% in 2015 compared with the end of 2014, to reach $67 trillion compared with $68 trillion at the end of 2014. The Americas led this fall (down nearly 8% by the end of 2015), followed by EMEA, which fell just over 3%. Asia-Pacific market capitalization ended the year at 23 trillion USD, up from $21 trillion at the end of 2015

WFE’s H1 2015 Market Highlights report already pointed out that China’s markets accounted for a large proportion of the rise in 2015 trading activity. The value of share trading in China increased 218% from USD13.5 trillion to $43.0 trillion and the number of trades rose 186% on 2014 to reach 10.1 billion at the end of 2015

IPOs and investment flows: Total new listings in 2015 (including IPOs) registered a 9.6% increase overall, although investment flows from IPOs alone declined by nearly 17% compared to 2014 ($202 billion in 2015 as compared to 242 billion in 2014). Other investment flows for already listed companies, however, were up by over 41% at $914 billion in 2015 compared with 2014

Exchange Traded Derivatives (ETD) volumes (as represented by number of contracts traded) ended the year 11.6% up in 2015, fueled mainly by increases in the number of commodity and currency derivatives traded. “Last year saw sharp rises in global trading volumes,’’ said Nandini Sukumar, CEO of WFE.

``Strong trading activity in Asia-Pacific drove the increases in the value and volume of global share trading, putting it ahead of every other region in terms of activity,” Sukumar said.

“Market capitalization in Asia-Pacific managed to end the year up 10% thanks to the strength of the region’s markets in H1 2015, although total global market capitalization fell by over 1%.”

“Other notable trends of 2015 included a 12% rise in exchange traded derivatives, led by FX and commodities, and a rise in net new IPO listings,” said Siobhan Cleary, Head of Research and Public Policy at WFE.