Equity flows in developed markets hit a high

rising graph penFlows into European open-ended equity funds were at their highest level in July for a year.

Morningstar says flows into equity funds were €8.29 billion, the highest level since July 2014, and that long-term funds (excluding money markets) received €25.97 billion of assets as equities and bond markets rallied.

Chinese funds saw €2.12 billion exit across the Morningstar China Equity, Greater China Equity, and China A-Shares Equity categories.

Asia-focused emerging-markets equity funds had a difficult month; diversified global emerging-markets equity funds saw net outflows of more than €2 billion, pushing the category’s year-to-date outflows to €7.84 billion. Alternative funds collected €9.03 billion.

Aberdeen Asset Management and Franklin Templeton saw outflows of €1.27 billion and €1.04 billion, respectively. Aberdeen has not seen a month of positive flows into its long-term funds since August 2014, Morningstar says.

Matias Möttölä, manager research analyst for Morningstar, says the positive effects of Greece not exiting the euro were mostly limited to developed-market funds. Emerging-country funds saw outflows stemming from worries over China’s growth, mounting pressure on emerging currencies from a potential Chinese devaluation, and the US Federal Reserve’s intentions to raise interest rates.

According to Lipper figures, equity funds registered for sale in Europe had the largest market share in the region, at 37% at the end of the second quarter.

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