UN Climate Ambition Summit 2023
Climate change has become an escalating concern, particularly this year where we are on track to break the record for being the hottest year in history. With numerous floods and bushfires occurring globally, addressing climate-related challenges appears to be at the forefront of the global agenda.
On September 20th, the United Nations (UN) hosted the Climate Ambition Summit at its headquarters in New York. The aim of the summit was to accelerate action by governments, businesses, finance sectors, local authorities, and civil society toward their commitments for decarbonization.
The Summit coincided with New York Climate Week and holds significance as a lead-up event to COP28 (Conference of the Parties to the United Nations Framework Convention on Climate Change) in Dubai. The goal of COP28 is to limit global warming to 1.5 degrees Celsius and address the various impacts of climate change.
US and China Excluded at Climate Summit
According to Reuters, the United Nations General Assembly criticized major polluters for not doing more to combat global warming. UN Secretary-General António Guterres invited 34 countries to speak at the summit in recognition of their strong actions on climate change. These countries include Brazil, Canada, Pakistan, and more. However, it is important to note that three of the world's largest polluters—China, the United States, and India—were not invited to speak due to their perceived lack of commitment to decarbonization.
UN Calls for More Proactive Measures to Combat Climate Issues
AP News reported that UN Secretary-General António Guterres emphasized that despite the global goal established in 2015 to limit global warming to 1.5 degrees Celsius above pre-industrial levels, the world is currently on a trajectory toward warming of 2.8 degrees Celsius, a level considered "dangerous and unstable."
To address this urgent issue, Guterres called on world leaders to take proactive measures.
He urged major emitters, particularly those who have benefited the most from fossil fuels, to implement additional measures to reduce emissions. Additionally, Guterres stressed the importance of wealthy countries supporting emerging economies in their efforts to reduce emissions.
How Will UN Climate Summit Impact SGX MSCI Climate Futures?
Climate change and climate change policies can exert significant influence on the performance and composition of SGX MSCI Climate Action Indexes. These indexes comprise companies committed to climate action and sustainability. Here's how climate change and associated policies affect these indexes.
Performance of Component Stocks
Climate change can affect component stock performance. Companies tied to fossil fuels may face challenges due to emission regulations, impacting their stock prices. Conversely, those engaged in renewable energy or sustainability can benefit from climate policies, potentially boosting index performance. With the nations promising to engage in more efforts to reduce emissions, there might be significant impact on the companies.
Investor Sentiment & Regulatory Changes
Investor sentiment is influenced by climate policies and *ESG criteria. Positive policies attract investments to index companies aligned with climate goals, potentially enhancing stock prices. With the potential regulatory changes after the summit, such as carbon pricing and emissions targets, this can have a direct impact on companies within the index. Firms adhering to these policies may have reduced regulatory risk and greater investor appeal.
*ESG Meaning: Environmental, Social, and Governance. It represents a framework used by investors and businesses to assess and measure the sustainability and ethical impact of an investment in a company or organization.
SGX MSCI Climate Action Index Futures
The MSCI Climate Action Indexes are designed to help investors decarbonize their portfolios through the emission reduction efforts taken by companies in every sector. The SGX MSCI Climate Action Index consists of different futures contracts that provide traders with exposure to a diverse range of sectors and regions. These futures contracts track the performance of companies that have demonstrated leadership in addressing climate-related challenges and transitioning towards a more sustainable future.
Below are the five Futures Contracts under the SGX MSCI Climate Action Index Futures:
- SFX MSCI Europe Climate Action NTR (USD) Index Futures
- SGX MSCI World Climate Action NTR (USD) Index Futures
- SGX MSCI AC Asia ex Japan Climate Action NTR (USD) Index Futures
- SGX MSCI USA Climate Action NTR (USD) Index Futures
- SGX MSCI Japan Climate Action NTR (USD) Index Futures
SGX MSCI Climate Action Index Futures Trading Hours
The index futures contracts are available for trading during Asian, European, and US trading hours, providing extended trading opportunities for investors. With extended hours for trading, traders can efficiently execute trades globally.
The Trading Hours for the SGX MSCI Climate Action Index Futures are as follows:
Last Trading Day: Third Friday of the Contract Month
Listed Contract Months: Mar, Jun, Sep and Dec months on a 3-year cycle and 2 nearest serial months
Trading hours: T-session: 7.25am-6.30pm Singapore Time (SGT)
T+1 Session: 7.00pm-5.15am (next day) Singapore Time (SGT)
How to Trade SGX MSCI Climate Action Index Futures?
Traders can trade the Climate Action Index Futures through Orient Futures Singapore. Orient Futures Singapore currently holds membership at the Singapore Exchange (SGX), which makes the trading process smoother for traders.
As a Singapore exchange, SGX is regulated by the Monetary Authority of Singapore (MAS) in the performance of its role as a front-line regulator and operator of the securities and derivatives markets. Their duty includes a list of rules, regulations, and roles that are strictly adhered to, increasing the safety of funds.
Apart from the Climate Action Index Futures, traders also can trade other futures contracts on SGX futures market through Orient Futures Singapore. These contracts include Mysteel Steel Rebar Futures, SGX Nifty 50 Index Futures, USD Nikkei 225 Index Futures and more.
SGX MSCI Climate Action Index Futures Price
According to SGX Website, the SGX MSCI World Climate Action NTR (USD) Index Futures stands at 1,553.0000 as of 2nd October 2023.
Start Trading With Orient Futures Singapore
Being an Overseas Intermediary of Shanghai International Energy Exchange (INE), Dalian Commodity Exchange (DCE), and Zhengzhou Commodity Exchange (ZCE), when foreign clients participate in internationalised futures contracts in these Chinese markets with us, they have direct access to trading, clearing, and settlement. Our parent company, Shanghai Orient Futures, is the largest broker in terms of aggregated volume across the five regulated exchanges in China.
Orient Futures Singapore also currently holds memberships at the Singapore Exchange (SGX), Asia Pacific Exchange (APEX), and ICE Futures Singapore (ICE SG). Starting August 2023, corporate clients can also gain access to the B3 Exchange through us.
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