H1 2018 Market Highlights

Published by: The WFE Research Team Aug 2018

The first half of 2018 has been eventful for stock markets worldwide. While the year started on a high note with domestic market capitalisation and benchmark indices scaling record high levels in markets across the globe, February 2018 was marked by a global stock market correction and a return of volatility after a remarkably calm period over 2017. Overall market valuation declined in the months that followed, market capitalisation at end H1 2018 was 1.6% down on end 2017. Trading activity (value and volumes of trades in equity shares) was up on H1 2017, however primary market activity was mixed, with IPO listings down and investment flows slightly up on H1 2017. 

  • Overall domestic market capitalisation at the end of H1 2018 was 9.1% higher than at end H1 2017, due to increases across all three regions – the Americas up 14.9%, the Asia-Pacific region up 5.3% and the EMEA region up 4.3%. However, the trend of a positive month-on-month growth rate in market capitalisation observed since November 2016 came to an end in February 2018 when a stock market correction was observed in markets across the globe.

Domestic Market Capitalisation

  • The number of companies listed at end H1 2018 was up 1.3% on H1 2017, due to slight increases across all three regions, the Americas up 0.3%, the Asia-Pacific region up 1.3% and the EMEA region up 2.1%. However, overall listings were barely up on end 2017 (0.3%) and infact marginally down in the Asia-Pacific region (-0.03%).
  • Value and volume of trades in equity shares in H1 2018 were up 24.6% and 14.1% on H1 2017. This was due to increases across all three regions. 

Value of share trading (EOB)

  • In the presence of risks and uncertainties, new listings and investment flows through IPOs in H1 2018 got off to a slow start. New listings were down 9.9% largely due to declines in the Asia-Pacific and EMEA regions. Investment flows were up 4.1% on H1 2017, driven by increases in the Americas and EMEA regions.
  • Non-IPO listings, which accounted for about 36.8% of the total new listings, were up 29.1% on H1 2017, with only the Americas experiencing a decline (down 8.5%). Asia-Pacific and EMEA listings were up 25.5% and 53.4% respectively. Investment flows through already listed companies however, down 19.4% on H1 2017, due to declines across all regions - the Americas down 7%, the Asia-Pacific region down 8.7% and the EMEA region which experienced a sharp fall of 43.8%.
  • Exchange traded derivatives volumes in H1 2018 were up 17.4% on H1 2017. This was due to increases in volumes traded across all asset classes except commodity futures which saw a slight decline in volumes on H1 2017 (-0.3%).
    • Stock options volumes were up 18.1% due to increases in volumes traded across all three regions.
    • Single stock futures volumes were up 74.3%. 
    • Index options volumes were up 25.9% on H1 2017.
    • Index futures volumes traded were up 32.6%.
    • Currency options volumes traded were up 35.5%.
    • Currency futures volumes were up 21.5%.
    • Commodity options volumes were up 5.2%.
  • ETFs (Exchange traded funds) listed grew by 9.1% in H1 2018, driven by increases across all three regions. ETFs value traded increased by 28.4%, almost entirely driven by the 28.3% increase in the Americas region which accounts for nearly 90% of the value traded. However, value traded was down 44.3% on H1 2017.