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SP500-CK surged 260.7% as S&P 500 futures rebounded

The Malaysia warrants market picked up more trading momentum last week with a RM407.6mil turnover, 23.4% higher than the previous week. While markets remained volatile amid the Covid-19 pandemic, global equities erased some of the earlier losses following more monetary easing by central banks plus the additional stimulus measures proposed by local governments to dampen the economic impact of the contagious virus.

As usual, warrants over the Hang Seng Index (HSI) dominated the warrants space with RM290.5mil. traded. The HSI futures plummeted 1,561.0 points last Monday but rebounded very strongly in the next two days to close above the 23,600 level. However, the bullish momentum did not sustain as the HSI futures finished 1.9% lower on Thursday before reversing most of the losses to close marginally above the 23,500 level on Friday, while recording an 1.9% gain week-on-week (w-o-w). Put warrant HSI-H8M emerged as the most active warrant last week with RM137.9mil. turnover. Since last Tuesday, bearish investors have accumulated a total of 12.2mil units of put warrant as the HSI futures were trading above the 23,000 level. On the other hand, call warrant HSI-C9J was second on the chart as it was popular among investors who were bullish on the Hong Kong market. By the end of last week, investors net bought more than 15.0mil. units of this call warrant.

Meanwhile, the S&P 500 (SP500) warrants stole the limelight last week as the the second most traded index warrant on Bursa Malaysia after the HSI warrants with RM41.4mil turnover. The most notable one was call warrant SP500-CK which saw RM23.7mil traded and made it to the top 5 most active warrant list. 

Bargain hunters accumulated more than 13.0mil units of this call warrant last Monday as the SP500 futures dipped below 2,200 points during the morning session. Since then, the SP500 futures rallied more than 380 points to trade above the 2,600 level on Thursday as the U.S. Senate on Wednesday unanimously pass a USD2 trillion bill on Wednesday aimed at helping unemployed workers and industries hurt by the coronavirus pandemic (The Star, 26 Mar). The bid price of the call warrant tracked the SP500 futures price performance closely to record a large 260.7% gain in just 4 trading days.

Top warrants by value traded:

Warrant name Value
Issuer Exercise level Expiry date
HSI-H8M 137.9 Macquarie 23,000.0 28 Apr 2020
HSI-C9J 72.5 Macquarie 27,400.0 29 Jun 2020
HSI-C9T 29.1 Macquarie 26,200.0 28 Aug 2020
SP500-CK 23.7 Macquarie 3,300.0 21 Sep 2020
HSI-C9S 23.6 Macquarie 27,600.0 28 Aug 2020

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Provided for Malaysian residents information only. It is not an offer or recommendation to trade and is not research material. Past performance is not indicative of future performance. You should make your own assessment and seek professional advice.