European equity products weather second-highest month of outflows ever
European equity products weathered their second-highest month of outflows on record in August as investors continued to flee markets in the face of continued volatility.
European equity exchange traded products (ETPs) continued to be sold for the sixth straight month as the region registered $7.7bn of outflows – the second-highest on record after $8.9bn of outflows after the Brexit vote in July 2016, according to data from the world’s biggest asset manager BlackRock.
Investors globally have been pulling cash from markets this year as they look to shield their cash from extreme volatility sparked by war in Ukraine and soaring inflation.
Investors on the other side of the Atlantic bucked the gloom in August however, as bolshy US investors began to scoop up equities once again as markets showed signs of steadying.
Inflows into equity products in the US more than doubled month on month from $12.6bn in July to $30.2bn.
Analysts at BlackRock said that financial stocks had proved a tempting bet for investors as they returned to positive flows.
“Financials notched up a first inflow month since January, with $2.4bn added, all towards the end of the month,” analysts said.
“As highlighted above, this came amid a broad reduction in sector ETP flows in August, meaning that
financials constituted the largest sector allocation over the course of the month.”
Defensive sector flows persisted over August at lower levels, BlackRock said, with $0.7bn into healthcare and $0.7bn into tech, while utilities flows picked up for a fourth consecutive month to $0.8bn.