We believe its earnings are protected from the ravages of declining equity markets and weakening economic environment. Given that the volatility is driven by structural debt and competitiveness problems, we do not see either an easy or quick solution, so believe Icap will continue to benefit.
SARAH ING | SINGER CAPITAL
It is interesting to note there was a shift back to voice broking in July and August due to very significant volatility in European financial markets. Icap is not surprised at this temporary reversion given the nascent stage of the electronic market. Voice volumes have markedly picked up since August.
NESE GUNER | CITI
Icap expects recent high levels of volatility to continue for the rest of the year, driven by macro volume. Given the extraordinary market conditions, volatility and lack of maturity of electronic broking, we think the temporary shift in its interest rate swap trading from iSwap to voice is understandable.