European investors offload everything bar bonds in August

investmentweek.co.uk:

Fixed income funds had their tenth positive month in terms of flows bringing in €1.7bn, although August's figures are down sharply compared to previous period.

Equity funds experienced net outflows totalling €1.3bn last month, the second-worst monthly result since October 2022, according to data from Morningstar. Year-to-date, equity strategies have enjoyed inflows of €19.9bn.

Active funds saw the majority of the outflows, shedding €11.8bn in the period, while passive equity funds attracted €10.5bn.

However, fixed income funds had their tenth positive month in terms of flows, bringing in €1.7bn, although August's figures are down sharply compared to previous period.

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Global stocks fell amid worries over renewed weakness in the Chinese real estate sector, Morningstar analysts said, while at the same time, government bond yields rose, which resulted in prices falling.

Economic data from China also continued to be worse than expected, with emerging markets underperforming their developed peers. China equity and China equity A-shares funds suffered particularly, with both categories shedding €1.1bn each.

On the other hand, US large-cap blend funds attracted €6.4bn in the month, and global large-cap blend equity was again the top seller in August.

Allocation strategies were the biggest detractor of the month, with €2.7bn of net outflows. These funds had only three positive months in terms of flows since May 2022. In August, cautious and flexible allocation in euros that invest globally were the ones hit hardest. 

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Alternative funds had their sixteenth consecutive