The SPDR S&P 500 ETF (NYSEArca: SPY) and the PowerShares QQQ (NasdaqGM: QQQ), the NASDAQ-100 tracking exchange traded fund, fell 2.2% and 2.8%, respectively, last month but those glum performances did not deter investors from pouring money into equity-based ETFs.
ETFs added $18 billion in net new assets last month with equity funds receiving more than $20 billion in new assets, according to State Street data. Outflows from fixed income and commodity funds pared the June inflows total to $18 billion.
“After starting the year more positively than expected, recent economic data out of Europe has been lackluster. In contrast, U.S. economic news has been on an upswing as evidenced by the recent strength in the housing market, consumer confidence numbers and job reports. All equity categories that we track added new assets in June, but the U.S. was far and away the winner with $9.4 billion of inflows,” said SSgA Head of Research Dave Mazza in a note.
Led by the iShares Russell 2000 ETF (NYSEArca: IWM), which hauled in more than $2.1 billion last month, five of June’s top 10 asset-gathering ETFs were U.S.-focused equity funds. The other five were international equity funds. Five fixed income funds were found among June’s 10 worst outflow offenders. [Despite Broad Market Slowdown, Small-Cap ETFs Are Outperforming]
At the sector level, financial services and healthcare ETFs continued to be prolific asset gatherers, extending a theme that was seen in May.
“At the sector level, investors concentrated their interest toward financials and healthcare with each taking in over $2 billion. Both remain well positioned in today’s market and may continue to see investor interest. Rate-sensitive sectors such as real estate and utilities saw outflows of over $495 million, which is not surprising given how trigger-happy investors have been around the potential for a rate hike in September,” according to Mazza.