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ETF Inflows: U.S. Still King; Europe on Mend

In fact, European funds outperformed the S&P 500 in July


State Street Global Advisors’ monthly look at exchange-traded fund inflows shows the continuation of a couple trends for 2013: The well-known bull running rampant in the U.S. … but also an air of optimism across the Atlantic.

The U.S. had more than $42 billion worth of inflows in July, bringing its year-to-date total to $114 billion. Better-than-expected GDP expansion as well as jobs growth helped power American equities forward, with the SPDR S&P 500 ETF (SPY) gaining more than 5% for the month to extend its year-to-date gains to roughly 18.5% through July 31.

However, Europe also saw a nice influx of more than $3 billion in July for a total of $7.1 billion YTD. Funds like the iShares S&P 500 Europe 350 Index (IEV, +7.8% in July) and the Vanguard MSCI Europe ETF (VGK, +7.6%) topped the market, bolstered by the euro zone’s first decline in the unemployment rate since April 2011.

Across the rest of the globe, the Middle East & Africa saw $232 million in inflows, and Latin America also was in the black with $218 million. Asia Pacific was down $194 million, and Canada was the worst-performing area, seeing $750 million in outflows.

Other notes from the SSgA’s Global ETF Snapshot:

  • Global commodity funds saw $2.84 billion in outflows in July. The lion’s share of that came in precious metals funds at $2.77 billion in outflows, even as funds like the SPDR Gold Shares (GLD) and iShares Gold Trust (IAU) saw market-beating gains of more than 7% for the month.
  • Global equity funds experienced $41.3 billion in net inflows for the month, bringing their total to nearly $140 billion for 2013.
  • Materials were the best-performing equity sector as far as flows are concerned, with $1.5 billion coming in during July. Consumer services were the worst, remaining flat.
  • Developed-market investors flocked to financials in July, throwing nearly $1.8 billion in funds toward sector ETFs.
  • State Street (STT) led all ETF providers with $17.8 billion in inflows, and its 18% market share was only second to BlackRock (BLK) at 39.1%. BLK was second in monthly asset flows with $11.2 billion.

Kyle Woodley is the Deputy Managing Editor of InvestorPlace. As of this writing, he was long SPY and VGK. Follow him on Twitter at @IPKyleWoodley.

Article printed from InvestorPlace Media,

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