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Confidence in the derivatives market remains robust despite the tumultuous period in April 2025, largely triggered by US tariff announcements. This is according to the latest Acuiti SGX Global Market Sentiment Index for Q2 2025.
The quarterly Index, which gauges business outlook across various market participants like asset managers, hedge funds, proprietary trading firms, sell-side execution desks, and clearing providers, saw a modest dip in optimism. The headline index fell from a record 78 in Q1 2025 to 74 in Q2, though this figure is still considered historically high.
The data for the Q2 2025 report was collected from 588 senior executives across North America, Europe, Asia Pacific (APAC), and the rest of the world, between January 6 and February 21, 2025.
Key Findings:
* Bullish Sell-Side and Proprietary Trading Firms: Sell-side clearing and proprietary trading firms continue to be the most optimistic. Their bullish sentiment is attributed to surging volumes in early April, coinciding with President Trump’s announcement of the Liberation Day tariffs.
* Strong Optimism Among Brokers: Overall, 81% of sell-side clearing firms were upbeat for the next three months, a slight decrease from 84% last quarter. Notably, brokers and interdealer brokers showed even higher confidence at 95%.
* Volatility Fuels Derivatives Activity: The report highlights that firms involved in derivatives trading often benefit from market volatility, as it leads to increased activity and more trading opportunities.
* Record S&P 500 Swings: The five trading days between April 4th and 10th, 2025, witnessed the top five largest intra-day point swings in the S&P 500 since its inception in 1957. This heightened volatility significantly boosted volumes in equity futures and led to record options trading across multiple exchanges.
* Strong Q1 2025 Performance: The April market turbulence followed a strong first quarter, with volumes on European and North American markets jumping 25%. Exchange volumes by asset class rose 32% year-on-year from Q1 2024, as revealed by the Futures Industry Association’s (FIA) exchange-traded derivative (ETD) tracker data.

Video courtesy of Interactive Brokers.

Video courtesy of Interactive Brokers.