Friday, August 12, 2011

Money mkts take in $50bln, stocks, bonds lose-banks cite EPFR

LONDON: The world financial markets sell-off led to a cash exodus out of almost every asset class over the past week but money market funds took in $50 billion, banks said on Friday, Aug 12, quoting data from fund tracker EPFR Global.

That is in contrast to last week when money market funds, a traditional safe haven for investor cash, saw a record outflow of $69.9 billion. Money funds suffered outflows in weeks prior to that as well amid fears about exposure to banks, especially in Europe.

Data released to clients late on Thursday by Boston-based EPFR showed $19 billion flee developed market stocks, the second biggest loss in recent history, banks said. Emerging equity funds posted outflows of $7.7 billion, the largest weekly outflow since January 2008 and the third largest in history.

Global stock markets have sold off heavily this month, with the benchmark MSCI index down almost 11 percent in August.

Banks said in their research notes that funds had pulled $2.18 billion from global fixed income, suggesting big redemption pressures in high-yield bonds. Emerging debt funds, in high favour with investors in recent months, saw their first outflows since March, shedding $607 billion, the data showed. - Reuters

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