>Investors Continue to Favor Developed Market Equities (CITI)

■ US$4b of new money taken in by Global/International funds in past three weeks — In particular, inflows last week were up 69% WoW to US$2.2b. This has been the second largest in history after some US$2.8b received in the first week of February 2006. Year-to-date, Global funds have taken in US$5.5b of fresh money, the biggest of all equity fund groups and compares to US$2b for Japan funds in 2nd place. That said, the latter is the category that has seen the most sustainable inflows YTD.

■ Inflows to global emerging market equities lagging — Dragged by the redemption from GEM funds, net inflows to all dedicated emerging market equity funds fell 74% WoW to US$239m in the week ended last Wednesday. Nevertheless, flows to regional dedicated Asian funds, Latin American as well as EMEA funds remained positive. Relative to AUM, inflows to EMEA funds were three times of Asian and LatAm fund inflows individually.

■ Asian fund inflows at US$170m last week, the biggest since February — The resumption of inflows was skewed towards 3 out of 13 fund types with investment in the Asia ex Japan region, namely Greater China regional funds, India and Korea country funds (see Figure 1). Indeed, foreign net purchases of equities in these two countries rose to US$2.1b in the past three weeks vs. net sell of US$3.3b in the three weeks prior to Chinese New Year.

To read the full report: FUN WITH FLOWS