LONDON — Global investors are fleeing Europe in droves, according to Barclays.
Analyst Magesh Kumar Chandrasekaran and the European Equity Strategy team at the investment bank said in a note sent to clients on Thursday that billions have been pulled from European stock markets and funds in 2018.
Europe has seen the highest equity outflows so far this year of any major market. Investors have pulled $35 billion from European equities so far in 2018, the bank said
Barclays added: „European funds have seen redemptions for twenty-one consecutive weeks, worth $51 billn since the start of March this year. These redemptions have completely wiped out the inflows Europe receivedsince 2017.”
UK funds have suffered particularly badly. The bank writes: „Within Europe, outflows from the UK have been more severe compared to the rest of Europe. UK funds have seen outflows of more than 6% of AUM since the Brexit referendum.”
UK funds have seen six weeks of fund outflows and $3.8 billion was pulled in the last week alone, according to Barclays data.
Globally, flows into equities have been flat over the last month and bonds saw $17 billion of inflows. $104 billion has been invested into equities so far this year, compared to $65 billion for bonds.
„Among regions, the US was the only major market to have received meaningful equity inflows over the last four weeks,” the team said. „As trade war-related uncertainties increased in May, EM [emerging markets] funds saw $17bn worth of outflows. However, last week, EM funds received inflows for the first time in eleven weeks.”
Investors are also shifting money from active funds to passive funds, with $82 billion shifting between the two strategies.