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Weekly ETF Monitor for week ending 15 June 2018

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Jun 15, 2018

Global equity markets were mixed last week with North Korea talks dominating the news flow, though with limited market reaction. The U.S. announced tariffs on $50bn of Chinese imports late in the week, sending index futures lower after market close on Friday. The S&P/ASX 200 added 0.8%, with Utilities and Telcos being the top performing sectors. The S&P 500 ended marginally higher, while the EURO STOXX 50 added 1.7% as the euro weakened. ETFS Morningstar Global Technology ETF (TECH) and iShares Global Consumer Staples ETF (IXI) were the top sector plays for the week. The Federal Reserve raised its target rate by 25 basis points, in line with market expectation. The Australian dollar fell by 2.1% to US74.42c. The euro declined by 1.4% against the U.S. dollar as the ECB said it would end QE by year-end. Commodities mostly declined last week. WTI Crude was down by 1.0% to US$65.06/bbl as speculation mounted that this week's Opec meeting will see an agreement on increased supply. Precious metals declined across the board following the tariff announcement, with gold down 1.5%. ETFS Physical Silver (ETPMAG), which fixed its NAV before the announcement, was the top performing ETF for the week. The Australian ETF market saw inflows of $64m into and outflows of $25m from domestically domiciled funds last week. The largest inflows were into iShares S&P/ASX 200 ETF (IOZ) and domestic and global sustainability funds (FAIR and ETHI). The largest outflows were from USD and YMAX.

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Weekly ETF Monitor for week ending 8 June 2018

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Jun 12, 2018

Global equity markets returned to risk-on last week. The S&P/ASX 200 gained 0.9%, led higher by energy and mining sectors. Three resources ETFs (QRE, OZR and MVR) were amongst the top performers for the week. The S&P 500 gained 1.6% and the Nasdaq 100 hit a new high. In Asia the Nikkei 225 added 2.4% and FTSE China A50 Index gained 0.8% as China A-shares debuted in the MSCI Emerging Markets Index. In Europe, the EURO STOXX 50 declined by 0.2% as the fall-out from the Italian election continued to impact market confidence. The Australian dollar gained 0.4% against the US dollar last week to end the week just above US76c. The euro regained some lost ground adding 0.9% against the U.S. dollar. U.S. 10-year Treasury yields rose 4 basis points. WTI Crude declined slightly to US$65.74/bbl. Gold added 0.4%, while silver gained 2.3%. ETFS Physical Palladium (ETPMPD) returned 1.9% for the week. The Australian ETF market saw inflows of $126m into and outflows of $17m from domestically domiciled funds last week. The largest inflows were into SPDR S&P/ASX 200 Fund (STW) and other domestic equity funds (QOZ and MVW). The largest outflows were from domestic dividend and strategy ETFs; RDV, HVST and MVOL.

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Weekly ETF Monitor for week ending 18 May 2018

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May 18, 2018

Global equities were mixed last week. The S&P/ASX 200 declined by 0.5% with financials, energy and resources performing strongly in the face of rising interest rates and energy prices, while utilities and telecommunications suffered. The S&P 500 declined 0.5% with energy, industrial and materials sectors also gaining ground at the expense of real estate, utilities and IT. Small caps outperformed in the U.S. with IJR and IRM amongst the top performing ETFs for the week. The EURO STOXX 50 gained 0.2% as Italy moved closer to a populist coalition, while the Nikkei 225 gained 0.8%. BetaShares Global Energy Companies ETF (FUEL) was the top performing ETF for the week. VanEck Vectors Australian Banks ETF (MVB) was the top performing domestic equity fund. The U.S. 10-year Treasury yield jumped 9 basis points to reach a new 7-year high above 3%, while the Australian 10-year Government Bond yield rose 12 basis points. The U.S. dollar gained against the Aussie, euro and yen last week. The Australian dollar ended the week at US75.1c. Crude oil continued to climb, with Brent Crude briefly topping US$80/bbl for the first time since 2014. Precious metals fell on rate-rise concerns, with gold suffering its worst week of 2018, down 2.0%. Platinum continued its downwards trajectory in 2018, falling 3.9% for the week to end 12.7% below its January peak. The Australian ETF market saw inflows of $103m into and outflows of $87m from domestically domiciled funds last week. The largest inflows were into BetaShares Australian High Interest Cash ETF (AAA), while the bulk of outflows were from SPDR S&P/ASX 200 Fund (STW).

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Weekly ETF Monitor for week ending 11 May 2018

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May 11, 2018

Global equities rallied last week across most major markets. The S&P 500 added 2.4% on strong corporate earnings and economic data. Energy stocks were the top performing sector for the week, responding to higher oil prices in the wake of the U.S. withdrawal from the Iran nuclear agreement. Technology stocks also performed strongly, with HACK and NDQ both amongst the top performing funds on a price return basis. The EURO STOXX 50 gained 0.4% as Italy neared an agreement for a coalition government. Elsewhere the Nikkei 225 gained 1.3% while the MSCI Emerging Markets Index added 2.5%. Domestically the S&P/ASX 200 gained 0.9% on strong performance across the resources and energy sectors. The U.S. dollar gained against the euro and yen last week. The Australian dollar ended the week slightly higher at US75.4c. Crude oil continued to rally, reaching it highest levels since late 2014. BetaShares Crude Oil Index ETF (OOO) was amongst the top performing funds for the week. Precious metals also advanced, with gold adding 0.4% to US$1,319/oz and silver adding 0.8%. The Australian ETF market saw inflows of $103m into and outflows of $72m from domestically domiciled funds last week. The largest inflows were into BetaShares Australia 200 ETF (A200) as well as cash and fixed income ETFs (IAF, PLUS and AAA), while the bulk of outflows were from BetaShares S&P/ASX 200 Resources Sector ETF (QRE).

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Weekly ETF Monitor for week ending 4 May 2018

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May 08, 2018

The S&P/ASX 200 gained 1.8% last week, its best weekly performance in over a year. Every sector registered a positive return for the week, with Financials, Materials and Real Estate sectors being the largest contributors. Small cap stocks also performed strongly, with three domestic small cap ETFs (MVS, ISO and SSO) all returning close to 3% for the week. Offshore, the S&P 500 declined modestly, despite a technology-driven recovery towards the end of the week. ETFS Morningstar Global Technology ETF (TECH) was the top performing international fund for the week. The recent U.S. dollar rally continued last week as the Fed expressed confidence in the U.S. inflation outlook. The DXY Dollar Index gained 1.1% and reached new 2018 highs. The Australian dollar dropped below US75c before recovering in late trading on Friday. The euro declined by 1.4% against the U.S. dollar following disappointing eurozone inflation numbers. WTI crude oil continued to rally, adding 2.4% for the week. Precious metals mostly retreated, with gold declining 0.7% to US$1,315/oz. The broad Bloomberg Commodity Index gained 0.7%. The Australian ETF market saw inflows of $283m into and outflows of $60m from domestically domiciled funds last week. Broad-based domestic equity funds saw $82m of inflows across VAS, STW, MVW and EX20, while investors switched from Vanguard MSCI Index International Shares Hedged ETF (VGAD) to its unhedged counterpart (VGS).

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