Equities rebound in April – EFAMA

European investors increased their risk appetite over April, with equity funds finding buyers to the tune of €8bn, in a rapid rebound from the previous month when €11bn of equities were withdrawn from their allocations.

That contributed to an overall improvement in Ucits fund sales, which enjoyed inflows of €21bn in April against redemptions of €9bn in March.

The European Fund and Asset Management’s data spells a similar picture to that released by Lipper for April. Equity funds sold for €12.9bn across Europe, analysts at the fund market research outfit said, describing the shift from month to month as “the latest twist in the changing attitudes to the stock market”.

Over the past year investors have fallen in and out of love with equities, EFAMA data shows. Between October 2010 and February 2011, equity funds sold in Europe but at widely varying levels. In March 2011, lack of appetite for equities reflected the drop in confidence seen during the eurozone crisis in May last year when redemptions were €11bn.

Balanced funds have sold consistently since April 2010 however, when sales peaked at €15bn. A year on, balanced fund sales reached their second highest level since that time, monthly data showed.

Money market funds recovered from the redemptions of €6bn in the previous month, but only to breakeven point in April, said EFAMA. Over the longer term since April 2010, European investors have retreated from buying money market instruments.

During April, bond fund redemptions continued and even increased. Net redemptions were €1bn, as the sovereign debt crisis and inflationary pressures caused caution among investors in the bond fund market, said EFAMA. Investors’ hunger for bonds has jumped up and down over the past year, in line with the volatility of stock markets.

 

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