Fund Flows in October

Currencies of the world

Image by Images_of_Money via Flickr

Global trading slowed marginally in October under normal seasonality, but remained elevated across many asset classes given the ongoing sovereign debt concerns in Europe, according to capital markets information firmIPREO. What sectors did money flow in and out of in October and why? Here’s a snapshot fromIPREO of sectors the street put money into last month and those it avoided. An in-depth view of types of investors selling and buying particular sectors is available at NYSEconnect.

Energy: trading activity in Energy was notably strong during the month, as OPEC was expected to adjust its crude production amid increased output from Libya.

Healthcare traded around 5% higher over September but lagged the other major sectors as investors rotated capital into their riskier oversold positions.

Industrials: As stock prices rose in a market wide rebound from third quarter lows, oversold stocks in the Industrials sector attracted a variety of investors seeking upside from debt issues across the eurozone as well as a hotly anticipated earnings season.

The Financials sector continued to see extreme volatility as investors questioned the eurozone’s plan to solve the sovereign debt crisis.

Utilities closed higher in October (UTY +3.2%), but underperformed the broader market (SPX +10.8%) by a wide margin as investors rotated into riskier assets. Utilities remained the best performing sector YTD as of month end.

Institutional investors were net sellers of Technology stocks in October as managers looking to recover from September losses took profits.

Institutional activity across the Basic Materials sector was mixed as market volatility and ambiguity surrounding risk vs. safe haven status persisted throughout October.


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