EWU (iShares MSCI United Kingdom, Expense Ratio 0.52%)saw a tremendous amount of activity yesterday, resulting in more than $400 million entering the fund via creations.
More than 15 million shares traded yesterday versus average daily volume of 1.72 million shares, and much like the recent flows we have seen in EWG (iShares MSCI Germany, Expense Ratio 0.51%) this week, as that fund has pulled in north of $650 million in new assets as well.
EWU is weighted towards companies like HSBC Holdings PLC (7.62%), Vodafone Group PLC (5.77%), BP PLC (5.18%), GlaxoSmithKline PLC (4..95%), and Royal Dutch Shell PLC Class A (4.81%), with the heaviest representations in the Financial Services (19.20%) and Consumer Staples (17.93%) sectors.
While Developed European markets continue to outpace struggling Emerging Market countries such as China, Brazil, and South Korea for example in terms of 2013 performance, it seems like investors are stepping in here amid broad equity weakness thus far in June to snap up select European equity ETFs, namely EWU and EWG. EWU is trading just below its 50 day moving average for the first time since late April, where it vaulted from the high $17s to as high as $19.58 on an intraday basis before settling back to current levels ($18.62).
From a turnover perspective, we have not seen trading volume this high in this particular fund since late summer of 2011, so this is certainly worth keeping an eye on today, and throughout next week.