Advertisement

ICAP says activity picking up after 'challenging' third quarter

Interdealer broker ICAP saw shares slip into the red on Thursday after revealing that revenues and volumes declined in the third quarter as a result of 'challenging' conditions.

Interdealer broker ICAP saw shares slip into the red on Thursday after revealing that revenues and volumes declined in the third quarter as a result of 'challenging' conditions.

However, with activity picking up in January, the company said it remains on track to deliver a full-year pre-tax profit within current market forecasts of £280-305m.

Advertisement - Article continues below

As highlighted in its first-half report in November, trading during the final three months of 2012 was tough with a "pronounced slowdown" in Global Broking volumes in December.

Group revenues fell 13% year-on-year with total average daily volumes on ICAP's electronic foreign exchange and fixed income platforms, EBS and BrokerTec down 9.0% at $664bn.

The firm said that Global Broking activity levels were affected by the "ongoing economic, monetary and regulatory uncertainty, which further exacerbated the traditional year-end slowdown".

However, activity levels last month improved, with electronic broker volumes up 17% year-on-year. The improvement was sparked by the 'fiscal cliff' resolution in the US, early repayment of loans by banks to the European Central Bank, and an increase in volatility in core currency pairs at EBS, ICAP's electronic FX platform.

"While December was even slower than expected, we've seen a marked improvement in trading volumes since the beginning of January across our entire business, although it is premature to tell if this is the start of a more sustained upturn," said Chief Executive Officer Michael Spencer.

"We remain well positioned for the opportunities that regulatory changes in the market landscape will bring. The push towards more electronic trading and risk mitigation of OTC derivatives plays to our strengths as we have invested in developing the services and technology that our customers will need to meet the new regulatory requirements."

Shares were down 2.13% at 349.3p by 08:30 on Thursday,

Advertisement
Advertisement

Recommended

Broker safety – your questions answered
Investment strategy

Broker safety – your questions answered

Cris Sholto Heaton answers more of your questions about the safety of stockbroker accounts
25 Mar 2020
How demographics affects stock valuations
Investment strategy

How demographics affects stock valuations

New research suggests that stock and bond valuations are driven by the age of the population – at least in the US.
24 Feb 2020
Do you own shares in Sirius Minerals? Here’s what you need to do now
Stocks and shares

Do you own shares in Sirius Minerals? Here’s what you need to do now

Mining giant Anglo American has proposed a cash takeover of Yorkshire-based minnow Sirius Minerals. Unhappy shareholders must decide whether to accept…
20 Feb 2020
Why investors should be “cautiously bullish” for 2020
Stockmarkets

Why investors should be “cautiously bullish” for 2020

Analysts have been out in force making rosy predictions for stockmarkets in 2020, but while there is certainly a case for optimism, investors should r…
17 Jan 2020

Most Popular

An economics lesson from my barber
Inflation

An economics lesson from my barber

On reopening his shop after lockdown, Dominic Frisby’s barber doubled his prices. It’s all part of the post-Covid inflation process – and we’re going …
8 Jul 2020
Can Rishi Sunak save the economy with stamp duty cuts and half-price meal deals?
UK Economy

Can Rishi Sunak save the economy with stamp duty cuts and half-price meal deals?

John Stepek runs his eye over the chancellor's £30bn stimulus package and asks if it's enough to get the economy back on its feet after months of lock…
9 Jul 2020
Have small companies lost their edge?
Sponsored

Have small companies lost their edge?

SPONSORED CONTENT – The tectonic plates beneath the modern investing landscape appear to have started moving in new directions
26 Jun 2020