MarketAxess beats quarterly profit estimates on robust bond trading

MarketAxess Holdings

06/11/2024 13:18

Nov 6 (Reuters) - Bond trading platform MarketAxess
Holdings  MKTX.O  beat third-quarter profit estimates on
Wednesday, helped by strong activity in the bond market.
    The company also said its founder and executive chairman,
Rick McVey, will retire at the end of the year.

WHY IT'S IMPORTANT
    Demand for investment-grade corporate debt typically
increases amid anticipation of declining interest rates as
investors rush to lock in current yields.
    Geopolitical tensions and concerns about the economy also
boost investor appetite for safe-haven assets such as Treasuries
and other government bonds.
    
CONTEXT
    Growing expectations of a soft landing for the U.S. economy
have led to a rally in the bond market in recent months,
boosting trading volumes on platforms such as MarketAxess.
      
    BY THE NUMBERS
    The company's third-quarter profit of $1.90 per share came
in above analysts' average estimate of $1.85, according to data
compiled by LSEG.
    Its quarterly revenue rose 20% to $206.7 million from a year
earlier, driven by increased commissions that constitute a major
part of its total revenues.
    The average daily trading volumes for U.S. government bonds
on MarketAxess' platform was up 43% at $25.30 billion during the
third quarter from a year ago.
    Total credit average daily volumes, which is a measure of
the average daily number of bond transactions on MarketAxess'
platform, rose 27% to $14.12 billion.
        The average daily trading volume for high-grade credit
climbed 36% to $7.03 billion in the third quarter.

 (Reporting by Vedant Vinayak Vichare; Editing by Shreya Biswas)
 ((Vedant.VinayakVichare@thomsonreuters.com;))