A month after March set a five-year high for monthly inflows into overseas equity ETFs—at $22 billion—the April level of flows into overseas equities ETFs broke that record, with $25 billion in net flows into international equity ETFs.
The month-over-month record leapfrogging means the message is not new, but it’s a sign that instead of leveling off, the trend among investors bailing on U.S. equities for more international exposure has accelerated.
The $16 billion fear signal
Investors pulled a net $16 billion from U.S. equity ETFs in April, according to monthly data from FactSet. The list of the biggest ETF losers in April flows runs the gamut of U.S. equity buckets: small-cap, large-cap, financials, technology, real estate, health care, utilities. But the biggest flow loser of all was the proxy for the U.S. market—the SPDR S&P 500 ETF (SPY)—which saw negative $13 billion in flows.
Read MoreThe latest idea in the ETF market channels Carl Icahn
The only bright spots in April for U.S. stocks were mid-cap and energy, which were No. 5 and No. 6 in April flows among ETF asset classes—energy being no surprise with the big crude-oil price rally.
Stacey Brorup, of FactSet’s ETF research team, said the most notable positive turn for the U.S. was in the fixed-income market. March had seen net outflows of $900 million, while April saw inflows of around $3.56 billion. “That’s a big reversal in investor sentiment,” she said.
Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at email@example.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.