Positioning for a Rebound
- Global equities recorded net buying of USD10.3b for the week ending 13 June, bringing YTD inflows to USD4.3b. ETF investors accounted for USD10.4b, while non-ETF investors were marginal sellers to the tune of USD75m.
- The data suggests significant short-term positioning ahead of the Greek elections, as it now seems that Greece is unlikely to want to leave Eurozone, encouraged by the bailout package for Spanish banks that entailed no additional conditionality. In addition, some investors are also expecting the Fed to introduce further monetary support measures (upon the expiry of Operation Twist), as US macro data has been disappointing
- Asia ex-Japan saw a modest inflow of USD81m after four consecutive weeks of outflow. Healthcare and Utilities were the only sectors that recorded inflows, whilst IT and consumer staples were flat. On a country basis, markets which had lagged recently, like India and Indonesia, had better inflows. We believe that investors are covering short positions, in line with a global strategy of positioning ahead of an expected market rebound in the near term. Weekly sector flows
below: Weekly Money Flow by country (click to enlarge)
by Maybank IB