Lunch bites dust in Asian exchange war

The Singapore Exchange is to introduce continuous all-day securities trading from 1 March 2011, eliminating the current 90-minute break as part of its ongoing competition for trading volumes with other major Asian exchange groups.
By None

The Singapore Exchange (SGX) is to introduce continuous all-day securities trading from 1 March 2011, eliminating the current 90-minute break as part of its ongoing competition for trading volumes with other major Asian exchange groups.

The move, which is subject to regulatory approval, would mean that the exchange would operate continuously from 09.00 to 17.00, bringing SGX's securities market into line with its derivatives market, which already trades continuously. The move follows positive feedback from market participants in a consultation held by SGX during Q4 2010.

Elsewhere in Asia, Korea the Exchange, India's National Stock Exchange and the Australian Securities Exchange (ASX) have already embraced continuous all-day trading, while Japan's Tokyo Stock Exchange and Hong Kong Exchanges and Clearing have both recently announced plans to reduce their lunch periods.

“Investors are constantly seeking trading opportunities and continuous all-day securities trading will provide more avenues for participants to invest, hedge and arbitrage their investments,” commented Magnus Bocker, CEO of SGX.

SGX also announced an adjusted net profit of S$81.7 million (US$63.7 million) for the second quarter of its financial year 2011, up 14% from S$71.8 million year-on-year, while revenue rose 14% to S$172.2 million, primarily due to increased trading activities in the securities market. Operating profit also increased by 21%, to S$100.5 million.

Securities revenue, which accounts for 47% of SGX's total revenue, rose 20% to S$81.0 million, while daily average trading value increased 30% to S$1.8 billion. Meanwhile derivatives revenue, which represents 20% of SGX revenue, improved 8% to S$33.9 million. Depository services (14%), issuer services (9%), market data and member services (5% each) account for the rest of the exchange's income.

The exchange is also working on a pan-Asian exchange merger with ASX, which Bocker expects to be completed in 2011.

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