Monthly Securities Finance Market Review:
September 2024

September saw 2,732,788 trades executed versus $3.01T (-4% m/m, +10% y/y) and closed out what was a record quarter for EquiLend’s NGT platform. Q3 sets a new benchmark with 8.4m trades against $8.59T, representing a 6% increase over Q2 and an 11% gain from Q3 2023. Within the equity space, Canada and the US were the bright spots as EMEA and APAC saw softening demand with trade counts down 8% and 9% respectively. Fixed income saw strong demand across the board with US, EMEA, APAC, and South America, all seeing double digit percentage growth. 

Central bank activity was the key theme of September with the US Federal Reserve boosting markets with a 50bps rate cut and both the European Central Bank and Swiss National Bank both reducing by 25bps. This drove global indices broadly higher while benefitting bond funds as yields dropped. Volatility as indicated by the CBOE Volatility Index (VIX) and the EURO STOXX 50 (VSTOXX) started and ended the month at peaks but remained relatively suppressed through the middle. The volatility was triggered by the erosion of recessionary fears on the back of strong US economic data and the rate drop, before the markets began digesting escalating geopolitical conflict in the middle east. 

Looking more broadly at Q3 data, fixed income demand drove the increased volumes as all regions saw increased trade counts compared to the same period in 2023. The US (+35%) and APAC (+27%) were the two standouts. Equity demand cooled despite the strong August with only the US (+10%) and Canada (+17%) seeing growth. EMEA was relatively flat versus 2023 while APAC saw –17%. 

Given it is an election year in the US, it’s likely that volatility could increase going into November, so conditions look promising for continued elevated demand driving trade count increases.