The slide of around 10 percent in China's share price has spooked ETF investors. However, some are taking advantage of the lower prices to get in on the action. Getting in remains the motto in ETF trading anyway. US equities are particularly popular.
27 July 2021. FRANKFURT (Börse Frankfurt). The stock markets in the USA and Europe recovered just as quickly after the rapid fall at the beginning of last week. ETF investors were not deterred anyway and remained in a buying mood. "In our case, purchases clearly predominated last week with 53 percent," notes Carsten Schröder of Société Générale. However, according to the trader, things are rather quiet at the moment.
The DAX had slumped to around 15,100 points a good week ago, but is already back at 15,533 points on Tuesday morning. Thus, the all-time high of 15,811 points is no longer far. On the US markets, new records were set again yesterday.
Chinese shares: Just out or ideal buying opportunity?
The excitement this week is China: Due to the recent interventions of the Chinese government, Chinese stocks have recently lost a lot of ground. MSCI China ETFs (IE00B44T3H88) were also sold off in a big way, as Fabian Wörndl of Lang & Schwarz reports. With the slump, all price gains from this year are gone again.
The background to the sell-off is that the Chinese government announced a reform of the private education sector at the weekend. Tutoring is no longer to be a business model in the future. The prices of the previously flourishing education companies literally collapsed. In addition, further interventions are feared.
"However, the price setback is also used for an entry," explains Wörndl. He reports lots of buying for broad-based emerging markets ETFs such as the SPDR MSCI Emerging Markets (IE00B469F816) and the iShares Core MSCI EM (IE00BKM4GZ66). According to Schröder, investors are also taking advantage of lower prices to make additional purchases. "We don't sense anything of panic."
New all-time highs drive investors into US equities
Developed market equities continue to do well, especially from the United States. Schröder observed the largest inflows into S&P 500 (IE00B3YCGJ38), MSCI World (IE00B4L5Y983) and MSCI USA SRI ETFs. In contrast, index funds tracking European (DE0005933956,IE00B14X4N27) and German equities (DE0005933931) saw outflows.
In sector ETF trading, technology, energy and healthcare ETFs are once again in focus, Schröder explains. Wörndl has registered interest in real estate ETFs.
Schröder
High-turnover bond ETFs
Bond ETFs are also attracting a lot of attention, accounting for around one-third of turnover at Société Générale. Investors bet on BBB-rated European corporate bonds and low-investment-grade government bonds (LU1681046774). On the other hand, they divested from euro-denominated high-yield bonds (IE00B66F4759) and government bonds from the currency union.
Amazon rumors drive crypto prices
Business in cryptocurrency ETNs has picked up again, according to Wörndl. "There is a lot of movement in it again," notes the trader with regard to the recent price recovery of Bitcoin & Co. The bitcoin price has risen again to $37,343 after halving in price. The current jump in the price was caused by a job advertisement from Amazon: The online retailer is looking for a blockchain expert. This fueled speculation that Amazon customers will soon be able to pay with cryptocurrencies. In any case, cryptocurrency ETNs are in demand again, as Wörndl explains.
There are currently 14 cryptocurrency ETNs listed on the Frankfurt Stock Exchange. BTCetc - Bitcoin Exchange Traded Crypto (DE000A27Z304), 21Shares Ethereum (CH0454664027) and CoinShares Physical Bitcoin (GB00BLD4ZL17) attracted the most funds.
by Anna-Maria Borse 27 July 2021, © Deutsche Börse AG
Shares | |
China | Buys/Sales |
Emerging Markets | Buys/Sales |
USA | Buys |
Europe | Sales |
Germany | Sales |
Crypto-ETNs | |
Bitcoin, Etherium | Buys |