Stock market investors are on the defensive! / The initial supply decreased – Tejaratnews
According to Tejarat News, according to the latest WFE report, only a few market indices, especially in the United States, had a positive trend. Similarly, trading activity in cash stocks declined across regions, indicating less investor interest in participating in the markets. On the contrary, the volume of derivatives traded on the stock exchange increased, especially in interest rate and commodity contracts, which shows the need for investors to manage risk, the uncertainty caused by the increase in interest rates, the geopolitical perspective and the fear of inflation.
The Asian stock market was left behind
The new report of the World Federation of Stock Exchanges indicates that the value of the global stock market increased by 7.5% in the first half of 2023 compared to the end of the second half of 2022 due to the increase in market value in the Americas and the Europe, Middle East and Africa region, while the Asia- Oceania experienced almost no change. In total, the evidence points to a growth of more than $7.8 trillion in market value in global markets.
The value and volume of transactions fell
Meanwhile, WFE has announced in its new report that according to the first half of 2022, the value and volume of transactions at the global level have decreased by 21% and 14%, respectively.
Also, the number of IPOs and capital raised in this way has decreased significantly compared to the second half of 2022 (about 29% and 24%, respectively).
Derivative contracts grew; Ati decreased
According to this report, in the first half of 2023, the number of derivative contracts traded on the exchange continued its double-digit growth from the second half of 2019 and reached more than 56 billion. This result was driven by options contracts, which increased by more than 38% compared to the second half of 2022. While the number of future contracts decreased by almost 8%. Options trades account for 75% of all traded contracts and the remaining 25% are related to futures trades.
Currency derivatives (including future contracts and trading options) were the only derivative products whose total trading volume decreased by 14.3% in the first half of 2023. While the volume of stock derivatives and interest rates recorded a double-digit increase (31.3% and 23.8%, respectively). According to this report, the volume of commodity derivatives increased by 7.6% and exchange-traded funds (ETF) by more than 6%.
The Indian stock market became the leader in options contracts
Stock index option transactions were by far the most traded derivative contracts (55% share). Also, 96% of the global volume of stock index options is traded on the National Stock Exchange of India, which reached its peak of 29.6 billion contracts in the first half of 2023.
Meanwhile, the number of exchange-traded funds (ETFs) shows a slight increase (more than one percent) compared to the second half of 2022. While the value of this traded instrument has decreased by 7.4%. The reason for this decrease is that 79% of ETFs are traded in the Americas.
According to the new WFE report and quoted by Tehran Stock Exchange, the number and value of accepted investment funds decreased by 4.3% and 2.4% respectively. In the EMEA region, both the number of accepted investment funds and the value of their transactions have decreased.
It should be noted that most of these investment funds (70%) are accepted in the EMEA region, while about 96% of them are traded in the APAC region.
Read more reports on the capital market page.