ETFs: Demand for Europe
Investors see upside potential for European equities, including UK blue chips and small caps. Value stocks as well as financial and insurance stocks are convincing, regardless of their origin. Fixed income should offer a high return or meet sustainability criteria.
16 March 2021. FRANKFURT (Börse Frankfurt). Under the influence of interest rate worries, the international stock markets are currently volatile. In this mixed situation, ETF investors are leaning more towards European stocks, according to traders. "Investors are still focusing on broad market indices such as MSCI World and S&P 500," reports Florian Lenhart from UniCredit. There are also a noticeable number of positions in products on the Euro Stoxx 50 (DE0005933956), FTSE 100 (IE00B810Q511) and DAXplus Maximum Dividend (DE000ETFL235), he said.
Hubert Heuclin of BNP Paribas paints a similar picture. In another week with a general focus on equities, his clients relied on products based on the Euro Stoxx 50 (LU0380865021) and MSCI Europe Enhanced Value (IE00BQN1K901), among others. Investors also see upside potential in U.K. small caps. Trackers of the FTSE 250 (IE00BKX55Q28) and FTSE UK Dividend+ (IE00B0M63060) are sought after, he said. "The wild swings in the stock markets have little impact on the current bullish bias for European equities," the trader says.
On the Frankfurt Stock Exchange, a Stoxx Europe 600 product (DE0002635307) leads the list of most-traded ETFs.
(Kopie 32)
No fear of higher interest rates
Heuclin does not think it is necessary to worry too much about the consequences of high inflation, at least at the present time. Improved economic prospects combined with an unchanged loose monetary policy provide plausible reasons for rising bond yields. The ECB's decision to significantly increase bond purchases and make them more flexible also signaled the monetary guardians' determination not to accept higher financing costs for governments, companies and private households.
Value trumps growth
All in all, Heuclin still sees an opportunity for value stocks to outperform growth stocks - despite fluctuating U.S. returns. ETF investors seem to hold a similar view. Trackers of MSCI USA Enhanced Value (IE00BD1F4M44) ranked high in BNP Paribas ETF buying statistics. In addition, there were significant buying overhangs for products based on the S&P 500 Equal Weight (IE00BLNMYC90), MSCI USA Minimum Volatility ESG Reduced Carbon Target (IE00BKVL7331) and MSCI USA Momentum (IE00BD1F4N50).
Heuclin
Towards financials
In terms of sectors, Heuclin recognizes a preference for insurance stocks in the Dow Jones Stoxx 600 Optimised Insurance (IE00B5MTXJ97). Financials stocks in the Stoxx Europe 600 Banks (LU1834983477) and MSCI World Financials (LU0533032859) were also among the gainers. Investors said goodbye to iShares Automation & Robotics (IE00BYZK4552) and developed country real estate stocks included in FTSE Epra/Nareit Developed Dividend+ (IE00B1FZS350) in total.
Out of US dollar corporate bonds
In fixed income trading, Heuclin reports inflows to euro corporate bonds and outflows from U.S. dollar corporate bonds. Short-dated sustainable bonds in the Bloomberg Barclays MSCI Euro Corporate 0-3 Sustainable SRI (IE00BYZTVV78) and high-yield stocks in the Markit iBoxx Eur Liquid High Yield (IE00B66F4759) were attracted at a manageable level. Most affected by outflows were trackers in the Markit iBoxx USD Liquid Investment Grade (IE0032895942), which includes high credit quality U.S. corporate bonds. To a lesser extent, high-yield bonds contained in the Markit iBoxx USD Liquid High Yield Capped (IE00B4PY7Y77) went out.
from Iris Merker
16 March 2021, © Deutsche Börse AG
| Equity | |
| Worldwide | Purchases |
| Europe | Strong purchases |
| Germany | Purchases |
| Great Britain | Strong purchases |
| Industries | |
| Financials | Purchases |
| Insurances | Purchases |
| Value | Purchases |
Automation & Robotics | Sales |
| Real Estate Industrialized Countries | Sales |
| Bonds | |
| Euro Corporate Bonds | Purchases |
| US-Dollar Corporate Bonds | Sales |
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