Equities exchange traded product (ETP) flows climbed to $98.6bn in March, according to BlackRock’s latest Global ETP Flows report.
The inflow was largely driven by cyclical buying. Industrials led sector flows, with $1.4bn added, followed by materials at $1.3bn, energy at $0.6bn and financials with a $0.2bn inflow.
Notably, this was the first month since October in which Technology did not come top. Instead it recorded a net outflow of $0.6bn. Healthcare flows also fell into negative territory at -$0.7bn.
In geographic terms, European equities ETPs stood out, adding $3.3bn in March, with $2.8bn going into EMEA-listed ETPs. Of this, $0.6bn went into small caps in March, the highest monthly inflow on record.
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Notably, commodity flows saw their first inflow month since May 2023, with $1bn of buying driven by silver ETPs with investors positioning in the precious metal as a catchup trade to gold and to seek portfolio diversification.”
Elsewhere in the asset class mix, commodities saw the most notable shift, according to BlackRock. It notched up the first inflow month since May 2023 with $1bn of net buying, driven by silver ETPs.
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Silver flows rose to their highest level since January 2021, with $1bn added in March. In contrast, investors continued to sell gold following its strong run-up, with $0.4bn of outflows recorded globally.
BlackRock noted the contrast in conviction between gold and silver has been ‘stark.’ Gold ETP flows have been negative for 10 consecutive months, and for 19 out of the past 23 months.
Global investment grade credit flows rose to $4.6b in March, with high yield flows also turning positive at $0.7bn. Overall fixed income flows were steady at $20.1bn.
Laura Cooper, senior macro investment strategist for iShares EMEA at BlackRock, said: “March was the highest inflow month of the year so far for global ETPs, with $126.5bn added, up from $109.7bn in February.
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“Equity flows climbed to $98.6bn driven by cyclical buying, while a risk-on rotation was evident in fixed income as despite flows remaining steady at $20.1bn, investors tilted towards high yield.
“Notably, commodity flows saw their first inflow month since May 2023, with $1bn of buying driven by silver ETPs with investors positioning in the precious metal as a catchup trade to gold and to seek portfolio diversification.”
