Trends in the Global Capital Markets Industry: Financial Intermediary Firms

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Key emerging trends across financial intermediary firms and their implications on the global capital markets industry

Global capital markets continued their recovery in 2010, with the global financial stock of debt and equity surpassing 2007 levels and improved investor confidence leading to increased trading volumes. However, recovery was not uniform across all asset classes as bond trading grew by 19.8% by value, whereas equities trading grew by only 1.8% by value. The discrepancy highlights the skepticism of investors towards relatively riskier asset classes. On the backdrop of the increase in trading activities during 2010, financial intermediaries’ top and bottom line improved significantly in 2010. This paper explores the key drivers for growth in the financial intermediary industry and discusses emerging markets like Asia-Pacific, merger and acquisition activities, and higher spending on IT systems and communication to support the adoption of new technologies.