KUALA LUMPUR, Nov 8 (Bernama) -- Bursa Malaysia Derivatives (BMD) Bhd recorded an all-time high monthly trading volume for all its products combined with a total of 2.34 million contracts traded in October 2024.
It said the achievement, which surpassed the previous record of 2.13 million contracts traded in March 2020 by 10 per cent, is a testament to the effectiveness of the exchange’s continuous efforts to improve its market depth and liquidity.
For the first time in the history of the exchange, the monthly average daily contracts (ADC), also hit a record high, breaching the 100,000 contracts threshold, with 106,385 contracts traded in October 2024. This was a rise of eight per cent from the previous record of 98,421 contracts, traded in September 2024, it said.
The exchange highlighted that the increase in trading volume was primarily fuelled by the exceptional performance of the Bursa Malaysia Crude Palm Oil Futures (FCPO), with a historic monthly trading volume of 2.03 million contracts in October, surpassing the previous record of 1.71 million contracts established in June 2021 by 19 per cent.
"The surge in FCPO trading volume was mainly driven by the rally in the FCPO third month contract price, which rose to a two-year high at RM4,879 in October 2024, a substantial increase from a low of RM3,194 in May 2023.
"Among the factors driving prices upward include declining CPO production, strong exports, exchange rate movements, the European Commission’s proposal to postpone the end-2024 deadline to implement the European Union Deforestation Regulation (EUDR) and the announced allocation of RM100 million on replanting incentives for small-scale oil palm farmers under Budget 2025," it said in a statement.
According to the BMD, the FTSE Bursa Malaysia KLCI Futures (FKLI), which tracks the performance of the underlying KLCI Index, also has been experiencing significant movements reflecting broader economic conditions and market sentiment.
As of Nov 1, 2024, the FKLI traded at 1603.98 points, with notable fluctuations driven by global market trends and local economic policies, it noted.
BMD director Mohd Saleem Kader Bakas said one of the pivotal strategies adopted by the exchange to improve its market depth and liquidity in recent years has been the introduction of after-hours (T+1) trading sessions.
"Since its implementation in 2021, after-hours trading volume has seen considerable growth with year-to-date October 2024 volume reaching 1,961,723 contracts traded, surpassing 1,250,427 contracts traded during the same period in 2023, representing an increase of 57 per cent.
"The extension of trading hours has proven effective in encouraging greater participation in our markets from international traders, as it enables swift reactions to market-moving news during the United States and European Union market hours," he added.
-- BERNAMA
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