Tradeweb’s Trading Volume Drops 16% MoM in July to $22 Trillion

The total trading volume on Tradeweb Markets,

a NASDAQ-listed operator of electronic marketplaces for rates, credit, equities

and money markets dropped -16% in July.

The volumes slumped from $26.1 trillion recorded in June to $22 trillion last month.

The volumes had climbed 4.4% from $25 trillion in May to reach June’s figure.

These are according to data contained in the July 2022 monthly activity report published by Tradeweb on Wednesday.

The data shows that Tradeweb’s average daily volume (ADV) fell by 12.1% to July’s $1.09 trillion. At the end of June, Tradeweb had recorded an ADV of $1.24 trillion.

However, on a year-over-year basis, Tradeweb's ADV surged by 12% to $1.09 trillion in July. Also, Tradeweb’s average daily trades in July stood at 93,509.

Tradeweb said it recorded the double digit growth “amidst a complex macroeconomic background.”

Moreover, the institutional wholesale and retail marketplace firm noted that the background was “driven by evolving central bank policy, sustained elevated volatility, a strong dollar and rising economic concerns.”

Market Performance

In the rates markets, US government bond’s ADV dropped 5.4% to $117.4 billion from June’s $124.1 billion. However, on a YoY basis, it went up by 1%.

Similarly, the European government bond declined 15% from $36.9 billion in June to $31.4 billion in July. However, on a YoY basis, it shot up 6.5%.

Commenting on this, Tradeweb said: “Client engagement in US government bonds across institutional and wholesale markets remained high.”

It further explained that higher interest rates encouraged strong growth in the retail market.

“European government bond trading continued to remain resilient amidst heightened rates of market volatility,” it added.

In the credit markets, the Tradeweb report noted that fully electronic US Credit ADV increased 16.2% YoY to $3.6 billion. However, on a month-over-month (MoM) basis, this facility dropped 3% from June's $3.7 billion.

On the other hand, the European credit ADV slumped 29.3% YoY to $1.4 billion, the electronic marketplace organizer pointed out. On a MoM basis, this represents a 13% fall from June's $1.6 billion.

Comparing the rates and credit markets, mortgage ADV in the rates market declined 10.7% YoY to $169.2 billion but the municipal bonds ADV on the credit market skyrocketed 93.3% YoY to $333 million.

On top of that, Tradeweb said credit derivatives ADV surged 64.4% YoY to $12.3 billion as “market-wide volatility continued to boost volumes overall.”

Unlike June, the equities market saw a marginal decrease of 2.2% YoY in its ADV on the US exchange-traded fund (ETF). The US ETF ADV came in $6.1 billion. In other words, it slumped 19% from the $7.5 billion record in June 2022.

Similarly, the European ETF ADV climbed 17.8% YoY to $3 billion. However, on a MoM basis, it dropped 7%.

In the money market, Tradeweb’s repurchase agreement ADV rose 15.1% YoY to $397.3 billion. This is a 5.4% drop MoM when compared to June’s $419.9 billion.