[SINGAPORE] Brokerages recorded a surge in trading activity amid heightened market volatility after US President Donald Trump announced sweeping tariffs on Apr 2.
Trading volume for Tiger Brokers’ Singapore platform shot up 124 per cent from Apr 1 to Apr 4, as trading value jumped 313 per cent, said James Ooi, market strategist at Tiger Brokers.
Its trading orders on Apr 4 also more than doubled when compared to the daily average in the last week of March, as investors appear to be “actively repositioning amid rising geopolitical and macroeconomic uncertainty”, he said.
Similarly, OCBC Securities experienced a significant uptick in trade. Its daily trading volumes on Apr 3 and Apr 4 – days after the tariff announcement – hiked 75 per cent above the March daily average.
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Wilson He, managing director at OCBC Securities, expects trading volumes to trend upwards as investors adjust to tariff developments, especially in the Singapore market.
“All this comes on top of an already volatile market, where trading volume in the first quarter of this year is up 30 per cent from the same period in 2024,” he added.
Signs of “nervous selling” and “tactical buying” have both been observed, with the rise in trading activity “especially pronounced” with buy orders, said Tiger Brokers’ Ooi.
Tiger Brokers’ trading volume for “buy” orders more than doubled from Apr 1 to Apr 4, as trading value surged 320 per cent, he noted. “Sell” orders also rose, with trading volumes up 113 per cent; trading value climbed 306 per cent for the period.
OCBC Securities noticed a similar uptick in both “buy” and “sell” orders alongside higher trading activity among its retail and institutional clients.
Buying the dip: Investors scoop up blue chips, banks
Retail investors have been buying the dip and scooping up blue-chip stocks whose prices have sunk to attractive levels, said OCBC Securities’ He.
“Bargain hunters are entering to capture opportunities amid this market meltdown,” he said.
Trading volumes of the trio of local banks were also up 200 to 300 per cent from their three-month averages, added He.
Well-established, dividend-paying local equities were sought after, said Phillip Securities’ Singh. He noted that net purchases were seen in the three local banks and benchmark Straits Times Index constituents such as Singtel, Keppel, Sembcorp Industries and Singapore Exchange.
The signs point to Singapore retail investors taking a “long-term approach” amid the uncertainty, he said.
“(They) are… focusing on the fundamental strength and value of the companies they invest in, (and) evaluating companies based on valuation metrics like price-to-book, price-to-earnings ratio, dividend yield and plans for returning surplus capital to shareholders.”
Institutional investors, on the other hand, made massive sell-offs on Apr 4, OCBC Securities’ He said.
“Despite the extremely volatile market, to-date losses by clients have remained relatively stable and are under control,” he added.
US tech stocks hotly traded, including Magnificent Seven
Tech stocks, including those of the Magnificent Seven, have been hotly traded on the US market front, noted brokers that The Business Times spoke to. Among these, Nvidia, Tesla, Microsoft, Meta and Amazon were listed as heavily traded counters.
Daily trading volumes for tech counters such as Google, Microsoft, Amazon and Meta doubled or tripled from their three-month averages as “buy” orders outnumbered “sell” ones, said OCBC Securities’ He.
The trend was echoed on Tiger Brokers’ platform, which experienced a sharp spike in trading volumes for tech counters such as Nvidia, Tesla and Palantir.
Trade orders for Nvidia alone skyrocketed more than 249 per cent post-tariff announcement, said Tiger Brokers’ Ooi.
Conversely, OCBC Securities observed a drop in trading volumes for Nvidia and Tesla on Apr 3 and Apr 4, after the tariffs were announced, although both counters remained top-traded names.
Singapore investors have been selling off pricey tech stocks amid profit taking, said Phillip Securities’ Singh. Tesla is one such stock; Palantir is another.
These stocks of US growth companies with high price-to-earnings ratios have appreciated substantially in the past few years before the recent pullback in the US equities market, and the sell-offs come as investors are realising gains, Singh said.
Meanwhile, Tiger Brokers’ Ooi and OCBC Securities’ He think the sell-offs might be a sign of investors adopting a cautious stance.
Ooi said the sell-offs point to investors taking a risk-off strategy amid tariff-related uncertainty. He added that investors engaging in selling are doing so primarily to limit their losses.
ETFs favoured as haven for navigating volatility
Investors have flocked to exchange-traded funds (ETFs) as they seek diversification strategies to navigate heightened volatility, and a good part of the increased trading activity has been concentrated in such assets, said Tiger Brokers’ Ooi.
Broad-based ETFs have garnered interest and some of the most traded ETFs on Tiger Brokers’ Singapore platform included SPY, QQQ and TQQQ. SPY’s trading volume climbed 72 per cent from Apr 1 to Apr 4.
Gold ETFs also faced a demand surge, with “buy” volumes for such assets outstripping “sell” volumes by 94 per cent for the month to date, and 123 per cent for the year to date as at Apr 8, Ooi said.
A rush to gold was observed after Trump’s announcement of the tariffs. Inflows into gold ETFs have hit records. The safe-haven precious metal has rallied this year amid volatility from geopolitical trade tensions.
Higher trading activity was observed for money market funds, another relatively low-risk instrument that invests in short-term bonds, added Ooi.
Margin calls up, market down
Margin calls rose due to the market’s downturn after the tariffs were announced, said OCBC Securities’ He. The broker offers share margin financing predominantly secured by share collateral.
The increase in margin calls aligned with overall margin correction, he added.
Conversely, Singh said Phillip Securities did not experience a notable rise in margin calls or forced selling among its clients.
