The stock price of the Singapore Exchange plunged on Wednesday 27th May after MSCI announced that it had signed a licensing agreement with Hong Kong Futures Exchange, a subsidiary of Hong Kong Exchanges and Clearing, to introduce 37 futures and options contracts. MSCI also announced that it intended to continue to license the MSCI Singapore Index to the Singapore Exchange for a listed futures contract, in addition to allowing HKEX to list a contract on the index. The license to SGX for all other MSCI indexes will expire in early 2021. Singapore Exchange shares fell 7% on 28th May, extending the previous day’s 11.6% slump – the biggest in over 16 years.
Despite this, shares in the world’s largest exchange operating groups rose by 6.7% in May, with all but 5 of the 30 constituents of the FTSE Mondo Visione Exchanges Index being in positive territory, and the index, which aims to reflect market sentiment and is a key indicator of exchanges performance closing at 61,439.17 on 29 May 2020.
The best performer by capital returns in US dollars was Bursa Malaysia with a 27.2 per cent increase in share price from 30 April 2020 to 29 May 2020. The next best performer was Multi Commodity Exchange of India with a 23.5 per cent increase, followed by South Africa’s JSE with a 21 per cent increase over the same period.
The worst performer by capital returns in US dollars was Singapore Exchange with a 14.5 per cent decrease in share price from 30 April 2020 to 29 May 2020. This was followed by Kenya’s Nairobi Securities Exchange with a 14.3 per cent decline and Bulgarian Stock Exchange with a 4.9 per cent decrease over the same period.
Herbie Skeete, Managing Director, Mondo Visione and Co-founder of the Index said: "MSCI decision to shift licensing of many derivatives from SGX to HKEX has the potential for a 10-15 per cent hit on next year’s profit. SGX’s pain is HKEX’s likely gain. HKEX faces many challenges, with investors spooked by a Beijing plan to impose security legislation in the city and with the U.S. warning that Chinese pressure on the city’s autonomy threatens its future as a global financial centre." Click here to download May’s performance report.
Monthly FTSE Mondo Visione Exchanges Index Performance (Capital Return, USD) Monthly FTSE Mondo Visione Exchanges Index Performance (Capital Return, USD) July 2014 3.1% August 2014 2.3% September 2014 […]