Net outflows from US equity ETFs exceeded $20bn in January – sending into reverse the strong pattern of inflows seen last year – with a large chunk of that coming from investors selling positions in the SPDR S&P 500 ETF, which has $151.9bn in assets tracking the US benchmark stock index. Outflows from emerging market equity ETFs were almost $9bn, according to calculations by UBS, as investors withdrew from products such as the iShares MSCI Emerging Market Index ETF and the Vanguard FTSE Emerging Markets ETF.
European equities, however, saw significant inflows in the first month of this year, following better than expected economic data – especially for crisis-hit countries on the eurozone periphery such as Spain – and increasing confidence in the eurozone’s stability. Many investors were also strategically underweight Europe as a result of the continent’s economic traumas of the past few years. The inflows have added to the upward pressure on the euro currency.