Research Quarterly: Equities, Third Quarter 2019

The U.S. equity markets are the largest in the world and continue to be among the deepest, most liquid and most efficient, representing 40.8% of the $75 trillion global equity market cap, or $30 trillion (as of FY18). This is 3.8x the next largest market, the EU (excluding the U.K.). U.S. market share has averaged 36.0% over the last 10 years, troughing at 31.4% in 2010 and peaking at 40.8% in 2018. YTD (as of Sept.) U.S. equities markets are on track to surpass last year’s dollar total, currently at $35 trillion, but remain in line from a market share perspective, at 40.8%.

Markets continue to expand, with (as of September) the S&P 500 index at 2,976.74, +18.7% YTD (monthly average 2,871.80, peak 2,980.38, trough 2,704.10); the DJIA at 26,916.83, +15.4% YTD (monthly average 26,115.18, peak 26,916.83, trough 24,815.04); and the Nasdaq at 7,999.34 (monthly average 7,804.00, peak 8,175.42, trough 7,281.74).  The VIX was at 16.24 in September, -36.1% YTD (peak 18.98, trough 13.12) after the December 2018 pop of 25.42. Looking at VIX YTD, excluding the December high, 2019 monthly average was 15.92 versus 15.40 LY, +3.4%.

ADVs were up for all three segments covered in this report. Equity ADV was 6.9B for the quarter, +9.1% Y/Y (quarterly average 7.1B, peak 7.5B, trough 6.9B). Options ADV was 19.8M for the quarter, +6.6% Y/Y (quarterly average 19.5M, peak 19.8M, trough 19.3M). ETF ADV was 1.41B for the quarter, +22.5% Y/Y (quarterly average 1.43B, peak 1.51B, trough 1.36B).

Capital formation did not fare as well as secondary markets, with total equity issuance of $57.8B for the quarter down 4.4% Y/Y and IPOs of $10.4B down 16.3% Y/Y (on a dollar basis). YTD, total equity issuance is running 6.4% below last year, but IPOs are up slightly (+0.5%).

Download the full report for all data, tables and the chart book.

About the Report

A quarterly report containing brief commentary and statistics on the U.S. cash equities, multi-listed options, ETFs and capital formation.

Authors

SIFMA Research

  • Katie Kolchin, CFA, Director of Research
  • Justyna Podziemska
  • Ali Mostafa