Inflows into EMs accelerated to $2.6bn over the week to 24 October, from $1.5bn. As in the previous week, more than 90% of these inflows were attracted by ETFs.
Asia ex. Japan inflows grew the most on the regional level, to $1.2bn from $310mn. Inflows to Chinese funds more than doubled to $910mn. Non-region specific funds recorded strong inflows of $1.1bn, although BRIC funds reported marginal outflows. Inflows into Latin American funds decelerated to $390mn where inflows of $430mn to Brazilian funds were offset by outflows of $110mn from Latin American regional funds. For the second week in a row, EMEA was the only region reporting outflows, of $110mn. Outflows from Russian funds decelerated to $30mn, from $50mn the week before while outflows from SA funds stayed flat at around $20mn. Turkish funds reported marginal outflows of $2mn.
Q Equity-only funds inflows tripled to $140mn. Russian equity-only fund flows turned marginally positive to $9mn. SA equity-only funds inflows grew to $60mn over the week to 24 October. Turkey equity-only funds marked inflows of $22mn. Nigerian and Kenyan equity-only fund inflows shrank to $0.8mn and $0.3mn, respectively.
Inflows into gold funds decelerated to $25mn in the week to 24 October, but remained positive. Over the same period, the gold price fell 2.8%, to $1,702/oz.
Renewed concerns over global growth and a relatively poor reporting season bore down on equities in the week to 24 October. The biggest laggards were the MSCI Poland (-5.1%), the MSCI Hungary (-4.6%) and the MSCI Russia (-3.5%).
Risk appetite grew further during the period as allocation to cash went down below 2%. Investors moved even more overweight in Russia relative to its MSCI EM weight. Following a strong market performance in India, its fund allocation increased, but relative to its weight in the MSCI, investors reduced exposure to this market. Investors also moved more underweight in China and South Africa.