Cash Market Trades Set A Record
Sydney Morning Herald
Friday June 6, 2008
VOLATILITY in the volume of share trading is showing few signs of abating, with the biggest online broking firm, CommSec, disclosing a huge spike in business in the first week of this month after a slowdown earlier in the year.
In a reflection of the unsteady peaks and troughs of the ASX 200 and All Ordinaries indexes, CommSec, the broking arm of Commonwealth Bank, revealed yesterday that the number of trades that had gone through its books on a daily basis in early June was 50 per cent more than this time last year.Last month was also a top performer, giving a degree of comfort to market players after the general drop-off in volume in February, March and April.ASX figures this week showed cash market trades set a record of 9.2million last month even though their actual total value fell by 12 per cent."Surprisingly, or reassuringly, May is actually very close to the best month we've ever had," said CommSec's managing director, Matt Comyn.That carried through to June, with daily trading this week so far averaging 70,000 trades. "There was definitely a blip and a small slowdown but if anything there's been renewed activity coming back to the market in the last four to six weeks." Mr Comyn's comments came as CommSec, which dominates the nation's online broking with a 48 per cent share, renewed the assault on its rivals with a new trading account that will give customers more access to their deposits.In turn, by persuading day traders to pull together their funds from other accounts, particularly those with competing banks and institutions, the Commonwealth hopes to increase its access to a larger pool of deposits. That would give it increased options for cheaper funding as it seeks to offset the higher cost of borrowing caused by the global credit crunch.Only about one in five of Commsec's 1.5million customers have their savings with the bank, a reflection of its total share of the deposit-taking market.The new system will allow customers to trade stocks, manage their money and pay bills through the one account, although the interest rates will not be as high as for some of the better-paying investment accounts.
© 2008 Sydney Morning Herald