What happened with NDAQ today?
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Uses news and trading volume to explain the day’s move and how it relates to the market.
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Nasdaq is more than the exchange where companies list their shares: data, listing services, index licensing and financial technology together form the larger part of its business. Listed companies pay annual fees, while investors and financial firms subscribe to market information drawn from Nasdaq’s exchanges. Investment-product providers pay to use its indices, including the Nasdaq-100, with fees often linked to the assets or trading activity of those products. Most assets tracking Nasdaq indices follow its Nasdaq-100 core indices.
Banks and other financial institutions also pay for software subscriptions. Nasdaq Verafin helps them detect fraud and money laundering; AxiomSL manages risk data and regulatory reporting; and Calypso handles trading, treasury, risk and collateral. Nasdaq also sells the systems that other exchanges and clearing organizations use to run their markets. Demand depends partly on clients’ budgets and changing regulatory requirements.
Its own exchanges in the United States, Nordics and Baltics earn fees from trading, clearing and market access. This business depends on trading activity and on a relatively small group of financial-industry customers, including members that supply market liquidity. Nasdaq cannot freely change its U.S. securities-market rules, operations or pricing: changes require SEC review and, in many cases, explicit approval.
The risk section is the longest, dullest part of the filing. This keeps only what can really hurt you: where it hits, how hard, when it plays out.
Every company claims an edge. Each one is checked against hard numbers like margins and returns: which hold, and which line gives way first.
Intercontinental Exchange competes with Nasdaq for trading fees, financial-data customers and companies choosing where to list, through NYSE. Watch NYSE’s wins in larger-company listings, where it is Nasdaq’s primary U.S. rival.
Cboe Global Markets competes with Nasdaq for U.S. stock and equity-options trades, exchange-traded product listings and the market-data revenue those activities generate. Its revenue from consolidated U.S. quote and trade data is worth watching: Nasdaq’s share of that revenue depends on trading and quoting activity.
MSCI competes with Nasdaq for asset managers’ and institutional investors’ spending on index licenses and investment analytics. Watch its Index and Analytics businesses, rather than company-wide results, for competition facing Nasdaq’s index products and eVestment investment tools.
S&P Global competes with Nasdaq for benchmark licenses and institutional customers’ data budgets, selling indices, investment information and analytics. Its Indices and Market Intelligence businesses are the parts to watch for pressure on Nasdaq’s index and investment-information offerings.
CME Group and Nasdaq both earn fees from institutions trading derivatives, settling those trades through clearing and buying market data to manage financial-market exposures. CME’s interest-rate and equity-index trading activity offers a window into demand for services that Nasdaq also provides through its Nordic derivatives markets.
FIS competes with Nasdaq for financial institutions’ spending on software and services that run trading, risk management and day-to-day operations. Its Capital Markets recurring revenue is the line to watch alongside Nasdaq’s Calypso trading platform and AxiomSL risk and reporting tools.
SS&C Technologies Inc competes with Nasdaq to supply financial institutions with software covering trading through back-office operations, risk analysis and regulatory reporting. Its hosted subscriptions and outsourced services show how it sells these capabilities, alongside Nasdaq’s Calypso and AxiomSL platforms.
Broadridge competes with Nasdaq for broker-dealers’ and asset managers’ spending on technology that handles trading-related operations, analysis and reporting. Watch its Global Technology and Operations business, where shared platforms and outsourced processes overlap with Nasdaq’s financial-technology offerings.
FactSet competes with Nasdaq for institutional investment professionals’ spending on data, portfolio analysis and workflow tools. Its subscriptions for portfolio analytics and data solutions are more relevant to Nasdaq’s investment-information business than its geographic revenue mix.
Moody’s Analytics competes with Nasdaq for banks’ spending on risk, compliance and tools for identifying financial crime. Watch its banking and customer-verification cloud subscriptions, rather than Moody’s credit ratings, for the overlap with Nasdaq’s Verafin and AxiomSL businesses.
Morningstar competes with Nasdaq for investment professionals’ and product sponsors’ spending on investment data, institutional analytics and indices. Its research and data subscriptions and Morningstar Indexes are the relevant offerings to follow alongside Nasdaq’s eVestment and index licenses.
MSCI, Inc. earningsMSCI
MSCI’s Index and Analytics results show whether institutions are spending on benchmarks and investment tools that Nasdaq also sells.
Look at MSCI’s Index and Analytics businesses, not just its company-wide results. Strength in both would show institutions are still spending on index licenses and investment tools, but MSCI is competing for the same budgets as Nasdaq. Weakness would point to softer demand for these offerings, not prove that Nasdaq is winning customers.
CME Group Inc. earningsCME
CME’s interest-rate and equity-index derivatives activity offers a read on demand for trading, clearing and data services that Nasdaq also provides.
Watch trading activity in CME’s interest-rate and equity-index derivatives. Stronger activity would indicate firm demand for services in related derivatives markets and offer a useful industry comparison for Nasdaq’s Nordic derivatives business. Weaker activity would suggest less support from that demand, but would not establish Nasdaq’s own trading volumes.
Moody's Corporation earningsMCO
Moody’s banking and customer-verification cloud subscriptions show demand for tools that compete with Nasdaq’s financial-technology offerings.
Focus on Moody’s banking and customer-verification cloud subscriptions, not its credit ratings. If subscriptions grow, banks are still buying risk and compliance tools, but Moody’s is also competing for budgets Nasdaq’s Verafin and AxiomSL seek. If they weaken, banks may be spending more cautiously; that does not show Nasdaq has won the business.
Nasdaq, Inc. earningsThis company
Nasdaq’s results will show whether software sales to financial institutions are growing, alongside fees from trading and clearing.
Read Financial Technology annual recurring revenue (ARR, the annualized value of subscription contracts) alongside its revenue, then compare Market Services revenue with trading activity. If ARR and revenue rise together, Nasdaq’s software subscriptions to financial institutions are expanding. If subscription growth slows while Market Services revenue moves with trading activity, growth is relying more on market volumes that can fluctuate.
SS&C Technologies Inc earningsSSNC
SS&C’s hosted subscriptions and outsourced services show how institutions are buying capabilities that compete with Nasdaq’s financial-technology platforms.
Watch SS&C’s hosted subscriptions and outsourced services, especially its trading, risk and regulatory-reporting software. Strength would show institutions are still buying or outsourcing these capabilities, while SS&C competes for customers Nasdaq’s Calypso and AxiomSL also serve. Weakness could mean customer spending is under pressure, not that Nasdaq has won market share.
Fed Interest Rate Decision
The Fed’s policy-rate decision tracks the benchmark rate that shapes borrowing costs; for Nasdaq, it can change interest expense on repricing or new debt and affect trading and clearing activity that generates fees.
Expected4.0%Last release4.0%
If it comes in above expectations
Higher-than-expected rates can raise the cost of Nasdaq’s repricing or new borrowing, weighing on earnings; any resulting shift in trading and clearing activity may also change fee revenue.
If it comes in below expectations
Lower-than-expected rates can reduce the cost of Nasdaq’s repricing or new borrowing, easing pressure on earnings; any resulting shift in trading and clearing activity may also change fee revenue.
Intercontinental Exchange Inc. earningsICE
ICE’s report can show whether NYSE is winning larger-company listings from issuers that Nasdaq also seeks to attract.
Watch NYSE’s wins among larger-company listings. More additions would show issuers continuing to choose Nasdaq’s main U.S. rival, raising competitive pressure on Nasdaq’s listing business. Fewer would soften that signal, but would not mean those companies chose Nasdaq instead.
Cboe Global Markets, Inc. earningsCBOE
Cboe’s consolidated U.S. quote and trade-data revenue shows whether market activity supports data sales in a business Nasdaq also serves.
Read Cboe’s consolidated quote and trade-data revenue alongside its stock and options activity. If both strengthen, market activity is supporting data sales; if they weaken, that support may be fading. Nasdaq’s share of U.S. consolidated-tape revenue depends on quoting and trading activity, so Cboe offers an industry read, not proof of Nasdaq’s share.
