(Reuters) – Online trading firm CMC Markets Plc <CMCX.L> said on Thursday it would report annual net operating income and pretax profit that is marginally above the upper end of the current range of analysts’ forecasts.
The upbeat forecast comes days after CMC’s first-quarter net operating income bounced back from a year earlier, boosted by higher revenue per active client as traders adjusted to regulatory curbs that plagued the sector over the last year.
Shares in CMC jumped 6.3% to 93.5 pence at 1106 GMT.
CMC and its rivals, Plus500 Ltd <PLUSP.L> and IG Group <IGG.L>, have had to weather a drop in clients over the past year as regulators in Europe and Britain tightened rules.
However, the companies in their recent updates have signalled that the situation was steadying, with Plus500 saying that its revenue picked up in the second quarter as it added new customers, while IG forecast a return to revenue growth in the second half of the year.
CMC said on Thursday the Australian Securities and Investments Commission (ASIC) had proposed regulatory changes for products that allow anyone with a bank card to make highly-leveraged bets on financial markets.
It has proposed changes in binary options and leverage ratio limits among other, similar to rules drawn up by the European Securities and Markets Authority.
The company said it was prepared to respond quickly and manage any regulatory changes. The Australian business as a whole represented 31% of the group’s net operating income in the year ended March.
Meanwhile, IG, which flagged the possibility of stricter rules in Australia in July, said on Thursday it expects to return to revenue growth in fiscal 2020, sending share up 1% by 1128 GMT.
“The group’s focus on serving sophisticated and knowledgeable clients means that IG’s business is well placed to adapt and thrive in a stricter regulatory environment,” the company said.
The company said the new rules could come into effect in the second half of its financial year and that the ASIC consultation on banning binary options to retail clients was set to close on Oct.1.
(Reporting by Noor Zainab Hussain and Muvija M in Bengaluru; Editing by Arun Koyyur)