14 Mar 2014
Flash: Portfolio outflows from emerging markets moderate - ANZ
FXStreet (Bali) - Richard Yetsenga, Head of Global Markets Research at ANZ, takes a look at portfolio outflows from Emerging Asia.
Key Quotes
"According to EPFR funds flow data, portfolio outflows from Emerging Asia moderated to USD1,647m (from USD2,943m) in the week ending 12 March."
"On equities, while net foreign selling as a whole eased to USD1,761m, outflows from China accelerated to USD1,252m, the biggest outflow since June 2013, reflecting market concerns over the spate of weak economic data from China."
"What is also notable is that in the bond space, foreigners turned into small net buyers of Asian bonds (USD114m), the first time in nine weeks. Bond buying was led by Indonesia, Korea and Malaysia. The same was seen in the EM bond space, where inflows (USD578m) were seen for the first time in 14 weeks, led by foreign buying of local currency bonds. This lends support to our view that yield plays have returned to selective EMs."
"On the global front, US stocks (USD5.3bn) and European equities (USD1.2bn) continued to see inflows, though having moderated from recent weeks, reflecting less bullish market sentiment amid concerns over the Chinese economy."
Key Quotes
"According to EPFR funds flow data, portfolio outflows from Emerging Asia moderated to USD1,647m (from USD2,943m) in the week ending 12 March."
"On equities, while net foreign selling as a whole eased to USD1,761m, outflows from China accelerated to USD1,252m, the biggest outflow since June 2013, reflecting market concerns over the spate of weak economic data from China."
"What is also notable is that in the bond space, foreigners turned into small net buyers of Asian bonds (USD114m), the first time in nine weeks. Bond buying was led by Indonesia, Korea and Malaysia. The same was seen in the EM bond space, where inflows (USD578m) were seen for the first time in 14 weeks, led by foreign buying of local currency bonds. This lends support to our view that yield plays have returned to selective EMs."
"On the global front, US stocks (USD5.3bn) and European equities (USD1.2bn) continued to see inflows, though having moderated from recent weeks, reflecting less bullish market sentiment amid concerns over the Chinese economy."