A huge group of the world’s largest Forex brokers already published information about the results achieved by them in July. So I summarized all the most important information from the public reports. Let’s look at EBS, CME Trading, Intercontinental Exchange, Thomson Reuters and FXall.
In contrast to June, July was a extremely poor month for a large group of brokers. Volumes were coming down by several tens of percent! Of course, this does not include all the major FX investors – some finished the month with record-breaking results. If you are curious who heals the financial wounds after July and who is constantly counting profits, then you have to acquaint with our summary!
EBS volumes decline 30%
EBS, one of the most liquid currency markets partner is certainly not satisfied with the July results. Company reported a sharp decline in volumes in comparison with the previous month. Average daily volume for July was 89.3 billion – this represents a reduction of exactly 30.6% compared to the same averages moth earlier, when they were at 128.8 billion.
Total volumes, taking into account all asset classes, FX and fixed income were around 681.9 billion. Comparing this to June we get 20% lower result – month earlier EBS could boast of 851.9 billion dollars in revenue.
Exceeding the $100 billion ADV level is extremely important, psychological barrier when assessing the trading volumes. July results were a solid punch for EBS, which lost its second position in the market last year for another broker – Fxall (October 2012).
2013 so far has been really impressive for the FX market, and the EBS was able to maintain a ADV of $ 120 billion over the first six months. In the history of the enterprise, a drop below $ 100 billion level took place just a few times – three times last year and once in 2011.
CME Trading Volumes Decline 35%
Having its headquarters in Chicago, CME company (Chicago Mercantile Exchange) connected with futures exchange, published its July financial results as one of the first brokers. The numerical values show a strong decline compared to June – but comparing to the same month year earlier, we see a noticeable increase in the volumes (4%).
ADV indicator was 10.9 million, compared with 16.9 million contracts in June means a 35% decline. In the FX market company reported a similar decline in volumes – the average number of daily contracts amounted to 807 million or about 1% more than in July 2012, which represents last year $96 billion daily reference value. A month earlier, the company had 146 billion daily average, so the difference is really huge. Such big changes in just several days are connected with strong decline in sales and a decrease in yen transactions by 47.1%.
Despite the poorer results in trading volumes, CME still has reason to be optimistic – derivatives quarterly results are really satisfying. Group recorded a 27% increase, and net income jumped to $311.2 million (93 cents per share). In the same quarter a year ago, when profit was $244.9 million, the share cost 74 cents.
Intercontinental Exchange achieves record Q2 results
Intercontinental is certainly not in the group of brokers, that have reasons to complain – derivatives exchange company posted its results achieved in July and in the second quarter of 2013. In the period from April to June, revenues increased by 6% year over year, giving the amount of $372 million. Consolidated transactions also went up by 4%, giving 319 million dollars in revenue. Revenues from transactions were higher as a result of ADV in Q2 – the indicator has reached 3.5 million contracts, that is 3% more than in 2012.
Consolidated net profit recorded by ICE reached $153 million – 7% higher than in the last year, with EPS at $2.09. Excluding the transaction costs related to the acquisition of NYSE Euronext, adjusted net income rose to $161 million (12% higher). According to Intercontinental Exchange, this is quarterly record – in Q2 company has never reached such satisfactory income.
The company also announced launch of ICE, a special trading platform that allows the clearing of swaps, which will be registered under the wings of CFTC and SEC as well as the Multilateral Trading Facility (MTF) in the European Union. Commenting on ICE revenues and profits, company’s CEO, Jeffrey C. Sprecher, stated:
“We delivered on our commitment to growth, achieving a record quarter while making continued progress on our acquisition of NYSE Euronext and seamlessly completing a significant clearing transition. We received approvals from shareholders of both companies and the European Commission and are working with regulators to finalize the transaction. Meanwhile, we remain focused on extending our risk management services and delivering on the needs of our customers around the globe.”
Thomson Reuters and FXall volumes decline
At the moment, Thomson Reuters is one of the most important Forex market participants, like in the world’s most liquid asset class. However, the July financial results clearly shows, that the average daily volumes dropped by 22% compared to the previous month. June brought $147 billion, in July it was only $114 billion. In year over year comparison, results also remain worse – July 2012 was ended at $130 billion level.
Thomson Reuters is constantly increasing its share in the exchange markets by large acquisitions, which included purchase of FXall and part of Tradeweb. The company has also published the results achieved by FXall, which did not avoid the decline in trading activity. Forex electronic platform, purchased last year, got $102 billion ADV indicator – in June it amounted to $123 billion. Year over year volumes, however, were 12% higher (July 2012 gave $91 billion level).
Last month, Thomson Reuters published its revenues for the Q2 2013. The fell by 3% comparing to the previous period. Operating profits shrank by 54% to the $597 million.
