Etikett: European equities

Inflows into European Equities Despite Greek Crisis

Inflows into European Equities Despite Greek CrisisInflows into European Equities Despite Greek Crisis

Deutsche Bank – Synthetic Equity & Index Strategy – Europe

European Monthly ETF Market Review – Inflows into European Equities Despite Greek Crisis

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Data in this report is as of 30th June 2015

European ETP Highlights

As of the end of June 2015, global ETP assets stood at $2.8 trillion with European ETP assets amounting to $499bn (€448bn). Equity ETFs registered inflows of +€2.8bn which were partly offset by outflows from Fixed Income ETFs (-€1.1bn) during the month of June. Commodity ETPs listed in Europe saw outflows of -€0.2bn.

European equities, particularly German equities favoured over US equities

European equities were, again, preferred over US Equities, both among European and US investors. European equities exposed ETFs gathered over +€3.3bn of inflows compared to +€164mn of inflows into ETFs exposed to US equities. In both listing regions, German equities commanded significant inflows.
Fixed income ETFs experience outflows for the second consecutive month
The selloff in bond markets which had started in late April continued in June resulting in bond yields to rise to its highest level for the year in early June. Correspondingly, European fixed income ETPs saw net outflows for the second consecutive month in 2015 (-€1.1bn). This was driven mainly by sovereign and corporate bonds based ETFs.

Greece crisis triggers significant increase in Greek ETF turnover

Greece focused ETFs listed globally saw an increase in on-exchange activity as the Greek crisis escalated in June ($506mn of turnover in June vs $262mn in May’15). However, total assets remained flat during the month ($563mn). Greek ETFs listed in Europe halted trading on June 26th but an ETF listed in US (GREK US) has continued to trade despite the Greek stock market closure in late June.

China outflows continue as equity markets sell off

Since mid June, the Shanghai Composite Index had lost over 32%. This rout had resulted in China focused ETFs listed globally to experience -$3.3bn of outflows in June (-$18bn so far this year).

New thematic, smart beta and currency hedged product launches

Source launched two thematic ETFs that provide exposure to European and Japanese exporting companies while Lyxor launched two min variance ETFs on the FTSE Developed Europe and FTSE Emerging benchmarks. Several currency hedged ETFs (details on pg 7) were also launched by UBS and Blackrock.

TAARSS says prefer International DM such as Europe and Japan

TAARSS says prefer International DM such as Europe and Japan Deutsche Bank – Synthetic Equity & Index Strategy – Global

The Flow Whisperer – TAARSS says prefer International DM such as Europe and Japan

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Tactical Asset Allocation Relative Strength Signal (TAARSS) Monthly Update
Top recommendations for March: European equities and Germany with currency hedge, Japan, US Aerospace & Defense, and Indian equities.
Market review

Risky assets received a boost in February with Global equities (ACWI) and Commodities (DBC) rising 5.5% and 4.4%, respectively. While US bonds (AGG) lagged behind losing 0.9% on rising rates concerns.
TAARSS rotation strategy monthly performance review

Last month, monthly TAARSS strategies outperformed or were in line with their benchmarks; while quarterly rotation strategies have been mixed QTD.

Tactical positioning for March 2015 based on TAARSS

Within equities we see strong investment demand support in DM Intl, and neutral support for the US, and EM for March. Within regions prefer Europe (with FX hedge) followed in the distance by Asia Pacific, remain neutral North America, and away from Latin America. Within the US, we again prefer Small and Mid Caps over Large Caps for March, or a total market or equal weighting approach. In terms of sectors, flows suggest a rotation into Global Cyclicals (Materials, Energy) away from Domestic Cyclicals, while maintaining some Defensives (Cons. Staples, Health Care) exposures. In International DM countries we see increased investor confidence, prefer Germany (with FX hedge) or Japan. For EM equities we continue to see India with the strongest support. Among other equity themes we see good support for US Aerospace & Defense. In fixed income, signals suggest credit over rates via US Corporate Debt (HY and IG). Lastly for commodities, we continue to see some support to Energy, but remain cautious.