Global exchange traded funds (ETF) are on course to notch a new record high this year, after inflows rose to USD 129.7 bn in August, despite a summer slowdown and volatility in the market, the Financial Times reports, citing data from BlackRock. While this figure sits below July's record USD 198 bn, it edges YTD inflows to USD 969 bn, well ahead of the USD 848 bn logged by the same point in 2021, the peak year for ETF investments.

Investors favored defensive sectors and fixed income: While technology remained the most popular equity sector, “we have continued to see buying in defensive sectors, in financials and utilities,” head of investment strategy for BlackRock’s iShares arm in the Emea region Karim Chedid said. In fixed income, government bond ETFs — one of the safest among the asset class — attracted USD 18.7 bn, investment-grade corporate bonds took in USD 7.9 bn, and high-yield bonds saw just USD 0.8 bn. ETF demand for gold, another traditional safe haven, has rebounded after a period of outflows, even with gold prices at record highs.

The overall trend for ETF investments this year is an upwards trajectory, possibly encouraged by expectations of rate cuts, Chedid added.

ALSO WORTH KNOWING-

  • Oman’s sovereign wealth fund Oman Investment Authority will initiate IPOs in key sectors, including energy, services, and logistics, between 2024 and 2028, as part of its wider divestment strategy, which has already generated over OMR 1 bn. (Statement)
  • The Bank of England has scaled back its capital rule changes for UK banks and pushed back the new regime to 2026, easing requirements on small business lending, mortgages, trade finance, and infrastructure loans, with key thresholds rising less than 1% instead of the previously estimated 3%, following industry lobbying and similar moves by US and EU regulators. (FT)

MARKETS THIS MORNING-

Asian markets are mixed this morning, dragged down by a six-year low for China’s CSI 300. The Nikkei also fell 0.46%, while Hong Kong’s Hang Seng index gained 0.87%. Wall Street futures are up marginally, after the S&P 500 notched its fourth consecutive gain this week

ADX

9,308

-0.2% (YTD: -2.8%)

DFM

4,365

+0.4% (YTD: +7.5%)

Nasdaq Dubai UAE20

3764

+0.2% (YTD: -2.0%)

USD : AED CBUAE

Buy 3.67

Sell 3.67

EIBOR

5.0% o/n

4.2% 1 yr

TASI

11,843

+0.7% (YTD: -1.0%)

EGX30

30,498

0.0% (YTD: +22.5%)

S&P 500

5,596

+0.8% (YTD: +17.3%)

FTSE 100

8,241

+0.6% (YTD: +6.6%)

Euro Stoxx 50

4,814

+1.1% (YTD: +6.5%)

Brent crude

USD 71.97

+1.9%

Natural gas (Nymex)

USD 2.35

-0.1%

Gold

USD 2,586.20

+0.2%

BTC

USD 58,089.3

+1.2% (YTD: +37.5%)

THE CLOSING BELL-

The ADX fell 0.2% yesterday on turnover of AED 1 bn. The index is down 2.8% YTD.

In the green: Apex Investment (+4.7%), Sharjah Islamic Bank (+3.9%) and Abu Dhabi Ship Building Co. (+3.7%).

In the red: NMDC Group (-6.0%), EasyLease Motorcycle Rental (-3.7%) and Bildco (-2.8%).

Over on the DFM, the index is up 0.4% on turnover of AED 320 mn. Meanwhile, Nasdaq Dubai closed up 0.2%.

CORPORATE ACTIONS-

Agthia’s board of directors approved AED 85.7 mn in interim dividends for 1H 2024, marking a 25% y-o-y increase, according to an ADX disclosure (pdf).

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