Fixed income ETPs top $32.5bn inflows in July

ETPs_downFixed income dominated inflows for global ETPs in July, seeing $32.5 billion in inflows after only $3.2 billion in June.

According to BlackRock’s latest global ETP flow report, the recovery was due to a pickup in credit buying, which accounted for just under half of fixed income inflows ($13.8 billion).

Investment grade ETPs recorded $9.9 billion in inflows, while high yield ETPs recorded $3.9 billion in inflows.

Overall, total global ETP inflows reached $44.2 billion.

Meanwhile, commodity ETPs recorded the largest outflows on record with $11.2 billion sold over the month.

July is the third consecutive month of selling for commodity ETPs and surpasses the combined outflows of both May and June ($9.7 billion).

Equity ETPs recorded a drop in inflows to $17 billion, which BlackRock attributed to a slowdown in equity buying in the US which was down from June’s figure of $25.9 billion to $12.4 billion.

Emerging market equity ETP flows were flat, while European equity ETPs saw outflows of $3.9 billion.

BlackRock said sector selectivity pointed to a “defensive tilt” in equity allocations. Technology and healthcare are the two most popular sectors this year, and monthly inflows for July reached $1.2 billion and $2.6 billion, respectively.

Energy, industrials, and materials, on the other hand, all recorded outflows for the month at $2.7 billion, $400 million, and $1.4 billion, respectively.

Sustainable ETPs, meanwhile, saw a significant increase in inflows during the month, with $9.6 billion being added in total compared to June’s inflows of $2.3 billion.

EMEA-listed ETPS accounted for the majority of these inflows ($9.2 billion), while the US share accounted for only $300 million.

July accounted for one-third of inflows year-to-date to sustainable ETPs, in great part due to the last ten days of the month, which saw a series of large trades amounting to almost $6 billion.

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