Emerging markets get $2.1 bn inflow in a week: report

Emerging markets attracted fresh capital worth $2.1 billion during the week ended November 9, given their superior growth prospects in the wake of debt crises in Italy and Greece, global fund-tracking agency EPFR has said.

"The turmoil surrounding Italy and Greece did, however, highlight the better fundamentals and superior growth prospects of many emerging markets, with China front and center," EPFR said in its weekly report.

During the week ended November 9, emerging market equity funds attracted in $2.1 billion, marking the fourth straight week of inflows. However, this was lower than $3.5 billion inflows during the previous week.

The report said that funds focussed on Brazil and India both experienced modest net redemptions during the week under review, without specifying the weekly amounts for these funds.

The year-to date outflows of funds dedicated to Brazil and India reached to $1.78 billion and $3.67 billion respectively.

"Brazil and India equity funds both experienced modest net redemptions that took year-to-date outflows to $1.78 billion and $3.67 billion respectively," EPFR said.

During the same period last year, Brazil funds had attracted $1.47 billion and India funds $685 million," it noted.

Most of such funds invest in India as FIIs (Foreign Institutional Investors) and the capital flows through this route are a key factor in the stock market trends here.

As per the data available with capital market regulator Sebi, FIIs made a net investment of $208 million in Indian equities during the week ended November 9.

EPFR noted that equity funds dedicated to Bric countries (Brazil, Russia, India and China) collectively snapped an outflow streak since mid-April. Besides, flows into Asia excluding Japan equity funds hit a 20 week high.

In its report, EPFR said that overall, equity funds dedicated to global markets saw net inflows of $9.59 billion during the week ended November 9, which is much higher than $4.9 billion net inflows witnessed in the previous week.

In developed equity markets, the US had inflows of $7.3 billion, an eight-week high.

In the major sectors, commodity funds pulled in a net $2.16 billion and energy had inflows of $873 million.