Big Month For Capital Raises & Dairy

NZX has released its key market metrics for May 2022, with much stronger trading across wholesale and retail markets.

Total value traded across the NZX was $3.87 billion, an increase of 22% from April. The increase was particularly felt in wholesale trading, which lifted 24%, while retail trading was also strong, rising 10%.

Wholesale market total trades increased 20% from April to May, and retail trades remained flat.These increases are on the back of a MSCI Standard Index rebalance on 31 May which saw Ryman Healthcare move out of the index.

The S&P/NZX 50 remains impacted by ongoing uncertainty and volatility caused by inflation, rising interest rates and geopolitical events.

At the same time, NZX continues to deliver for firms seeking to access capital to expand their businesses. Ampol listed on the NZX following the completion of its merger with Z Energy, and May has seen strong capital raising activity, with equity capital raises from Air New Zealand and Vital Healthcare. Debt capital raises were completed by Mercury and Channel Infrastructure and announcements of an infrastructure bond, green capital bond and senior bond issuance were made by Infratil, Genesis and BNZ.

“Despite challenging times and volatility in global markets, NZX continues to provide businesses with pathways to raise capital to support their next steps for growth,” said Sarah Minhinnick, General Manager Capital Markets Origination.

“We are also seeing ready income streams for investors as bond yields rise.”

NZX notes further strong activity on its dairy platforms. On 20 May the SGX-NZX Global Dairy Futures Market saw multiple records broken. The record for overall daily futures volume traded was topped with 5,685 lots traded.

“This was largely driven by a big trading day for Skim Milk Powder Futures and Butter Futures. The daily volume record for Skim Milk Powder Futures was broken with 3,600 lots traded, breaking the prior record by 43%,” said Nick Morris, Acting General Manager Strategic Delivery.

“The daily volume record for Butter Futures was also broken with 2,025 lots traded, up 32%.”

Overall, across the suite of eight dairy contracts, 37,156 lots were traded in May, an increase of 89% on May last year, and a new Open Interest record was broken at 99,678 lots.

“This result clearly demonstrates the value of the strategic partnership between NZX and SGX with the increasing growth of liquidity in the trading of dairy derivatives benefitting the wider industry,” Mr Morris said.

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