NO 239 – JANUARY 2013
2012 WFE market highlights

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WFE Focus January 2013
2012 GLOBAL MARKET HIGHLIGHTS
Peter Clifford
Chief Operating Officer,
WFE

Market Capitalization Growth Rate Up, Volume of Exchange-Traded Products Down

The WFE’s annual survey of global markets found that while the global market capitalization increased 15.1% in 2012, the volume of all products traded on WFE member exchanges fell significantly. According to our statistics, the value of Electronic Order Book (EOB) share trading was down 22.5%, and the number of derivative contracts traded on-exchange worldwide decreased by 20%. The number of listed companies remained stable in 2012, while both ETFs and securities derivatives increased their listings. Specific 2012 highlights WFE are as follows:

Equity Markets

In 2012, the WFE global market capitalization increased by 15% reaching US$ 54 trillion, getting back to its end-of 2010 level. The best performance was observed in the Americas (+17.2%) followed by Asia - Pacific (+15.4%) and Europe - Africa - Middle East (EAME) (+11.6%). In the Americas, the growth was primarily driven by the U.S. exchanges that increased 19%. Despite the good performance of market capitalization in 2012, all regions were affected by a drop in EOB turnover value: EAME (-24.1%), Americas (-23.3%) and Asia Pacific (-20%). The number of EOB trades totaled 9.7 billion, down 14.3% from the previous year, while the average transaction size increased slightly from $US 8,100 to $US 8,300.

Derivatives

For the first time since 2004, the number of on-exchange equity derivatives contracts traded in 2012 decreased by 20.4% to 14.9 billion. The drop in equity derivatives (-21%) mirrors the decline in the value of cash equities and is probably explained by the significant decrease in volatility observed in 2012. The volume of Interest Rate options and futures traded also decreased significantly (-17%). Factors generically seen as unfavorable for interest rates derivatives (low interest rates environments, no economic growth and credit expansion) continue to prevail in certain regions and could explain that trend.

The full 2012 market highlights can be found in 2012 WFE Market Highlights.

Also in this issue, we have interviewed the 3 newest members from Asia: China Financial Futures Exchange, Dalian Commodity Exchange, and Zhengzhou Commodity Exchange. The 3 CEOs told us about their markets.