June was a good month for inflows into exchange-traded funds (ETFs) with one exception: the influx came entirely from equity funds, according to the latest BlackRock Global ETP Landscape Report.
Global ETFs drew in US$20.8 billion with no thanks to bonds. In all, bond ETFs hit a nine-month low with outflows of US$2.9 billion, as investors fled from investment grade corporate and high-yield fixed income.
It’s not a huge surprise given that a rate hike is imminent but a big turnaround nonetheless from last year’s trend, which saw fixed income ETFs experience record inflows.
Investors also pulled back on other areas:
- Broad emerging market equities saw redemptions of $1.2 billion after months of positive inflows as investors reacted to volatility in China and limited growth expectations.
- China also saw outflows from A-shares funds.
- India surprised with a flat month—the first since October.
- Commodities saw outflows of $1 billion.
The bulk of inflows were to U.S.-listed funds focused on U.S. equities and EAFE exposure. Those along with Japan accounted for the lion’s share of inflows for June.
Closer to home. Canada experienced its 17th straight month of inflows, with the year-to-date total ($6.8 billion) nearly matching the full year of inflows in 2014.