BlackRock Global ETP Flows : Flows into rates ETPs rose to the highest level since October, with 10.1B added in April.
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BlackRock Global ETP Flows April 2024
Laura Cooper, senior macro investment strategist for iShares EMEA at BlackRock
Rates rise: fixed income (FI) flows rose to $27.4B in April, as rates flows picked up and emerging market debt (EMD) turned positive for the first time this year.
Muted flows: $68.5B was added to global ETPs in April, amid a broader slowdown in equity buying to $40.7B from $106.3B in March. Commodity flows flipped back into negative territory (-$1.9B) due to persistent selling of gold.
Europe and Japan in favour: European equity ($8.2B) saw a third consecutive month of net buying, while Japanese equity ($6.9B) recorded the largest monthly inflows since June 2023.
Rates pick back up
Flows into rates ETPs rose to the highest level since October, with 10.1B added in April. The pickup in buying came across listing regions. Among EMEA-listed rates ETPs, buying was relatively evenly split between European and US exposures: $1.1B went into US rates, while just over $1.2B was added to eurozone rates. Gilts ETPs also notched up a second consecutive month of inflows, with $0.3B added. Eurozone rates flows largely went towards intermediate-term rates ($0.7B). Although EMEA-listed US rates flows showed a similar bias towards intermediate-term exposures ($0.5B), short-term flows were also positive ($0.4B).
The entirety of US-listed rates flows went into US rates exposures ($5.3B), with flows into short-term exposures ($2.4B) turning positive for the first time since October and intermediate-term rates ($1.7B) making up the bulk of the remaining flows.
Elsewhere in FI, EMD flows ($2.7B) turned positive for the first time this year. This was driven by an increase in US-listed EMD buying ($1.2B), while EMEA-listed EMD notched up a third outflow month (-$0.3B).
A spring cycle
Sector flows continued to show a cyclical bias in April: while tech flows picked up to $2.4B and represented the single largest sector flow, financials flows rose to $1.8B – the highest level since December – and industrials ($1.0B) and energy flows ($0.5B) also stayed positive. At the same time, health care flows stayed negative (-$2.3B) for the second consecutive month, while materials flows flipped to negative with $0.5B out.
Factor flows continued to show a quality bias, with a further $3.3B added to quality ETPs in April. Value flows also remained persistent, with $1.1B added in April, slightly down from $1.3B in March – with US-listed value inflows leading the way.
Home bias – except in Japan
The global trend of declining US equity flows held true for EMEA-listed flows in April, with EMEA-listed US equity flows falling progressively MoM from $7.8B in January to $1.3B in April. At the same time, European equity flows have stabilised globally, with three consecutive months of inflows (with a cumulative $8.2B added from February to April). EMEA-listed flows into US equities continued to favour large caps.
European equity inflows spanned EMEA and US listing regions, but with more domestic buying: $2.2B went into EMEA-listed European equity in April, versus $0.8B into US-listed exposures. US-listed flows into European equities have tilted towards large caps, while domestic investors have favoured cyclical exposures – the pickup in small caps seen in March continued into April ($0.4B), while European financials also saw inflows of $0.6B.
Japanese equity flows also picked up in April, with $6.9B added – the highest level since June 2023 – off the back of a rise in US- ($0.7B) and EMEA-listed flows ($1.3B). This takes non-APAC buying of Japanese equities to $7.1B YTD
Source: ETFWorld.co.uk
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