Money returns to emerging markets

Emerging markets signEmerging market equity funds gained their biggest weekly net inflow since the start of 2013 in the final week of July.

The data on funds tracked by data firm EPFR Global also revealed a weekly net inflow of $900 million (€670 million) into emerging market bond funds.

“These fund groups may be benefiting from the roughly $13 billion redeemed from US money market and high yield bond funds that was looking for a new home this past week,” says Cameron Brandt, EPFR’s director of research.

Chinese equity funds tracked by EPFR were particularly popular, gaining a net $1.4 billion in the week ending July 30 – the largest weekly inflow since 2008.

EPFR says its data shows that Chinese equity fund managers are investing roughly 40% of any new money into the country's financial sector.

European equity funds were one of the fund types to have a net outflow during the week, which EFPR linked to sanctions placed on the continent's main energy supplier, Russia, as a result of the Ukraine civil war.

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