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Amid wild swings, Australian stock market trade volume doubles in March: ASX

[SINGAPORE] The volume and value of trades on the Australian Securities Exchange doubled during last month's wild market swings, the exchange operator said on Monday.

Australia's stock market posted its worst month since 1987 in March, plunging 21.5 per cent amid a worldwide equities rout as the coronavirus pandemic worsened.

The volume of trades more than doubled to 67.5 million compared with March 2019, and the average daily trade rose 96 per cent to 3 million, according to monthly statistics released by exchange operator ASX.

The total value of cash market trades rose 110 per cent to A$264.2 billion (S$229.3 billion) compared with A$125.5 billion a year earlier. There was also a 51 per cent surge in index options, as fund managers used them to offset big swings in their portfolios.

"The market volatility was sky high," said Mathan Somasundaram, strategist at brokerage Blue Ocean Equities in Sydney. "Thematics were changing on a weekly basis."

"It's too hard to move big portfolios, but easier to do that with index options. The big volumes in index options forced the option providers to then have to trade big on equities to counter the risk. Hence we had elevated equities volume driven by elevated index options," he said.

The benchmark index posted both its second-largest daily drop and its biggest daily rise in the month, and on the All-Ordinaries index, average daily movement was 4.1 per cent compared with 0.3 per cent in March 2019.


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