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CME Group (CME) Q1 Volumes Drop Y/Y in All Product Lines
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CME Group Inc. (CME - Free Report) reported soft average daily volume (ADV) for the first quarter and March 2021. ADV of 21.8 million contracts per day was down 19% year over year in the first quarter due to lower volumes in all six product lines. There were 61 trading days in the first quarter of this year.
Interest rate volume of 10.3 million contracts per day fell 25%. Energy volume of 2.4 million contracts declined 27% year over year, while Foreign exchange volumes dropped 21% to about 0.9 million contracts per day. Metals volume of 0.8 million contracts per day declined 24%. Moreover, Equity index volume of 6.1 million contracts per day fell 6% and Agricultural volume of 1.5 million contracts per day dropped 2%.
Despite the fall in March volumes, we expect the company’s operating leverage and compelling suite of products to help it record higher volumes going forward. CME Group maintains a solid market share of about 90% in global futures trading and clearing services.
Concurrently, it reported ADV 21.7 million contracts for March. ADV dropped 32%, attributable to lower volumes across all six product lines.
Expansion of futures products in the emerging markets plus an increase in non-transaction related opportunities as well as OTC offerings should continue to contribute modestly to the top line in the years ahead.
Increasing electronic trading volume adds scalability and hence leverage to CME Group’s operating model. Efforts to expand and cross-sell through strategic alliances, acquisitions, new product initiatives and a strong global presence will likely drive growth.
Shares of CME Group, carrying a Zacks Rank #3 (Hold), have outperformed the industry in the year-to-date period. The stock has gained 13.9% compared with the industry’s increase of 5.9%. Its solid fundamentals will likely help the stock retain its growth momentum.
Recently, MarketAxess Holdings (MKTX - Free Report) reported March volumes of $689.6 billion consisting of $292.6 billion in credit volume and $397.0 billion in rates volume.
Stocks to Consider
Some better-ranked stocks from the same industry are OTC Markets Group (OTCM - Free Report) and Intercontinental Exchange (ICE - Free Report) .
Intercontinental Exchange came up with a four-quarter average surprise of 3.67%. It carries a Zacks Rank #2 (Buy).
Zacks Top 10 Stocks for 2021
In addition to the stocks discussed above, would you like to know about our 10 best buy-and-hold tickers for the entirety of 2021?
Last year's 2020 Zacks Top 10 Stocks portfolio returned gains as high as +386.8%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
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CME Group (CME) Q1 Volumes Drop Y/Y in All Product Lines
CME Group Inc. (CME - Free Report) reported soft average daily volume (ADV) for the first quarter and March 2021. ADV of 21.8 million contracts per day was down 19% year over year in the first quarter due to lower volumes in all six product lines. There were 61 trading days in the first quarter of this year.
Interest rate volume of 10.3 million contracts per day fell 25%. Energy volume of 2.4 million contracts declined 27% year over year, while Foreign exchange volumes dropped 21% to about 0.9 million contracts per day. Metals volume of 0.8 million contracts per day declined 24%. Moreover, Equity index volume of 6.1 million contracts per day fell 6% and Agricultural volume of 1.5 million contracts per day dropped 2%.
Despite the fall in March volumes, we expect the company’s operating leverage and compelling suite of products to help it record higher volumes going forward. CME Group maintains a solid market share of about 90% in global futures trading and clearing services.
Concurrently, it reported ADV 21.7 million contracts for March. ADV dropped 32%, attributable to lower volumes across all six product lines.
Expansion of futures products in the emerging markets plus an increase in non-transaction related opportunities as well as OTC offerings should continue to contribute modestly to the top line in the years ahead.
Increasing electronic trading volume adds scalability and hence leverage to CME Group’s operating model. Efforts to expand and cross-sell through strategic alliances, acquisitions, new product initiatives and a strong global presence will likely drive growth.
Shares of CME Group, carrying a Zacks Rank #3 (Hold), have outperformed the industry in the year-to-date period. The stock has gained 13.9% compared with the industry’s increase of 5.9%. Its solid fundamentals will likely help the stock retain its growth momentum.
Recently, MarketAxess Holdings (MKTX - Free Report) reported March volumes of $689.6 billion consisting of $292.6 billion in credit volume and $397.0 billion in rates volume.
Stocks to Consider
Some better-ranked stocks from the same industry are OTC Markets Group (OTCM - Free Report) and Intercontinental Exchange (ICE - Free Report) .
OTC Markets Group came up with a four-quarter average surprise of 22.71%. It sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Intercontinental Exchange came up with a four-quarter average surprise of 3.67%. It carries a Zacks Rank #2 (Buy).
Zacks Top 10 Stocks for 2021
In addition to the stocks discussed above, would you like to know about our 10 best buy-and-hold tickers for the entirety of 2021?
Last year's 2020 Zacks Top 10 Stocks portfolio returned gains as high as +386.8%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Access Zacks Top 10 Stocks for 2021 today >>