Emerging market funds attract US$ 1.8 b worth fresh capital

Tuesday, 3 May 2011 00:00 - - {{hitsCtrl.values.hits}}

New Delhi (PTI): Extending their inflows for the fifth straight week, emerging market equity funds attracted US$ 1.8 billion worth of fresh capital last week, says a report.

According to data compiled by international fund tracking firm EPFR, emerging market equity funds took in US$ 1.8 billion during the week ended April 27.

Besides, flows into Asia ex-Japan equity funds are being supported by renewed faith in the resilience of the region’s economic growth, with both India and China expected to maintain a rate of over nine per cent this year.

Russia remains the stand out among the four BRIC – Brazil, Russia, China and India – markets, with year-to-date flows into Russia Equity Funds now north of US$ 4.5 billion.

Further, China equity funds have recorded inflows in four of the past five weeks, their best showing since mid-November. The latest infusion came despite aggressive administrative efforts in the country to limit lending and cool its real estate sector.

Brazil equity funds posted an outflow for the 14th time in the 17 weeks.

However, EPFR did not disclose specific inflow figures for India-focused funds. According to information available with Sebi, Foreign Institutional Investors (FIIs) infused US$ 388 million into the Indian market during the period.

Overall, global market equity funds drew US$ 7.9 billion in the past week, despite concerns of the slowing economic growth in the US. It seemed that investors put more emphasis on stronger corporate earnings.

In terms of sectors, commodity funds were the biggest money magnets among the nine tracked sectors in the week under review. Investors poured money into gold and precious metals funds in a bid to counter the effects of a declining US dollar and rising inflation in some parts of the globe.

Besides, consumer goods, real estate, energy and technology sector funds absorbed over US$ 250 million each.