Overview
Morgan Stanley highlighted that Singapore Exchange Ltd (SGX) experienced a sharp rise in turnover velocity, reaching 56% in May, up from 48% in April and matching the level seen in March. This velocity remains well above the 12‑month run rate, while the fiscal‑2026 year‑to‑date velocity stands at 44%.
Market Activity
Institutions were net buyers of small‑ and mid‑cap stocks for the fifth consecutive month. Momentum in these segments, excluding REITs, accelerated, with average daily value rising 24% month‑over‑month and more than four times year‑over‑year.
Derivatives Segment
Derivatives volumes in May increased 1% month‑over‑month and 21% year‑over‑year. Growth was broad‑based across equity, fixed‑income, currency and commodity derivatives. Equity derivatives volumes expanded across the board, led by A50 and other Singapore‑related contracts. Fixed‑income, currency, and commodity (FICC) derivatives saw strong growth, particularly in CNH, INR and KRW futures, while iron‑ore derivatives fell 6% month‑over‑month.
Open Interest
Open interest declined 5% month‑over‑month but posted a 10% year‑over‑year increase.
Structural Catalysts
Morgan Stanley expects the ongoing "Value Unlock" program, market structural reforms, the upcoming Global Listing Board, and Singapore’s low‑beta market status to continue supporting SGX. The Global Listing Board launch is targeted for end‑June 2026, and the next batch of equity distribution platform managers is expected to be appointed around mid‑2026.