EM and US lead year’s best sales for ETFs

Emerging markets and US equities helped fuel the best sales of the year so far for exchange-trade funds (ETFs) in July.

Data from BlackRock shows that broad emerging market equity and debt funds saw inflows globally of $8.2 billion (€7.3 billion) and $3.9 billion, respectively, during the month.

The rise in emerging market investment was due to investors favouring assets less impacted by the Brexit vote in the UK, said BlackRock, though the firm added that emerging market debt funds should continue to benefit as investors hunt for yield.

US equity inflows reached $32 billion, the highest since December 2014.

Overall flows into ETFs and other exchange-traded products were $55.2 billion during the month, with higher yielding fixed income categories also gaining flows.

Commenting on emerging markets, Alastair Reynolds, global emerging markets equity portfolio manager at the UK’s Martin Currie, said: “The backdrop for emerging markets investors continues to be a testing one, with macroeconomic and political clouds, but we believe the negativity surrounding the asset class has been excessive.”

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