>MARKET STRATEGY: Retrospective May 2012 – Murky May

 Retrospective in Summary


• MSCI India underperformed the MSCI EM marginally, by 20bp.


• India’s performance rank improved to 12th position.


• Mid-cap performed in broadly in line with the narrow market; small cap index underperformed.


• INR fell to a record low during the month, down 6% MoM, but was down 0.3% against the EUR.


• Implied volatility rose while inter-day volatility fell MoM.


• Oil prices fell 7% in INR terms while gold prices were flat MoM.


• M&A transactions remained steady.


To read report in detail: MARKET STRATEGY


RISH TRADER

>Equity Flows Monitor: EM Funds Posts US$1.1bn Outflows this week

■ Dedicated EM funds reported outflows of US$1.1bn (0.2% of the AUM) for the week ending May 30, 2012. This is the fourth consecutive week of outflows reported by dedicated EM funds with a cumulative outflows of US$6.1bn. We have reached 8 out of 10 weeks of outflows, this week. Within EM, AxJ regional fund reported the largest outflows of $0.60bn for the current week, followed by LatAm funds (-US$0.22bn). GEMs and EMEA regional funds also reported outflows for the current week. ETF type funds accounted for 41% of the total outflows for the week ending May 30, 2012. Total assets under management for dedicated EM funds are currently at US$617bn, which is 18% below the all time high level of US$749bn in April 27, 2011. 2012 YTD flows for dedicated EM funds have now reached US$18.2bn. GEMs regional fund is now the only fund with inflows YTD (US$22.5bn). (* Fund Flow Database – see slide no. 37 for details)


■ Within EM, at the country level** China (-US$0.38bn) and Brazil (-US$0.20bn) reported the largest outflows for the week ending May 30, 2012. BRICs countries cumulatively accounted for 70% of the total outflows for the current week. YTD, China (+US$3.79bn), Russia (+US$1.66bn), Brazil (+US$1.65bn), and India (+US$1.56bn) have reported the largest inflows, which is 53% of the total flows in EM (YTD-2012). Developed markets reported strong inflows of US$7.2bn for the current week, with the US reporting the largest inflows of US$7.3bn, while developed European countries reported outflows of US$0.59bn. Japan continued to report inflows for the seventh consecutive week with a cumulative inflows of US$3.7bn. YTD developed markets have reported outflows of US$25bn. (** Country Flow Database – see slide no. 37 for details)


■ Within EM sectors, Financials, Energy and Materials reported the largest outflows for the current week, while Healthcare reported marginal inflows. YTD Financials, Energy and IT have reported the largest inflows. Cumulatively, these three sectors accounts for 53% of the total flows in EM (YTD-2012). Within developed markets, Energy, IT and Consumer Discretionary reported the largest inflows for the current week.


To read full report: EQUITY FLOWS MONITOR
RISH TRADER