ETF Securities Weekly Flows Analysis Precious metal ETP flows strengthen as trade tensions continue

Transcription

1 Aneeka Gupta Associate Director, Equity & Commodity Research 23 April 218 ETF Securities Weekly Flows Analysis Precious metal ETP flows strengthen as trade tensions continue Bargain hunters continued to drive strong inflows into gold ETPs - worth US$16.1mn - supported by ongoing trade tensions and geopolitical risks. Crude oil ETPs faced redemptions worth US$32.7mn, the highest level in five weeks, on the back of profit taking as oil prices rose for the second week in a row. Outflows from nickel ETPs widened the most in 3 weeks as prices rose over concerns of further US sanctions on Russia. Weekly Flows by Sector (US$mn) TOTAL Diversified Energy Industrial Metals Precious Metals Agriculture Livestock Equities FX Top 5 Inflows/Outflows (US$mn) Top 5 / Bottom 5 Performers -15% -5% 5% 15% So urce: ETF Securities No te: s ee next page (*) -5 Gold Silver Precious metals Coffee Industrial metals Copper -4.6 Aluminium -5.3 Europe Equity -5.7 Nickel Crude oil Aluminium Nickel Cocoa Palladium Zinc Soybeans Wheat Sugar China Equity Carbon % -2.4% -2.7 % -3.% -6.8% 8.4% 6.4% 6.% 4.6% 3.8% Bargain hunters drove US$16.1mn of inflows in gold ETPs, marking two consecutive weeks of inflows. Gold prices came under pressure as bond yields rose sharply. The yield on the 1-year Treasury, rose to 2.96% the highest it s been since January 214 following supportive comments by the Fed governor Lael Brainard, for continued gradual increases in the Federal Funds rate. Added to that, the Federal Reserve Beige book showed a solid outlook for the US economy, while noting concerns over a potential trade war. Silver ETPs received US$12.8mn, marking the fifth consecutive week of inflows. Silver prices were lifted higher by industrial metals strong performance last week and managed to outperform gold by a strong margin of 3.5%. The gold/silver ratio for a time reached 78, its lowest level since early January. Crude oil ETPs faced redemptions worth US$32.7mn, the highest level in five weeks, on the back of profit taking. Brent crude oil price reached US$74 per barrel last week, a level last seen in November 214. The price appreciation has been supported by a trifecta of reasons the decline of US crude oil inventory by 1mn barrels reported by the American Petroleum Institute (API), OPEC s commitment to production cuts and ongoing geopolitical tensions. According to the Joint Technical Committee (JTC) of those OPEC and non-opec countries participating in the cuts, the oversupply in the oil market is nearly over. OECD stocks are likely to dip below the five year average over the coming quarter. Prices eased a little on Friday as President Trump accused OPEC of driving up oil prices artificially. This accusation comes at a critical time for Saudi Arabia. The country needs a high oil price ahead of an IPO of its state oil company, Saudi Aramco which is seen as an important step to spearhead the restructuring of its economy. Industrial metal basket ETPs received inflows worth US$3.9mn, in stark contrast to outflows from copper, nickel and aluminium ETPs of US$4.6mn, US$14.1mn and US$5.3mn respectively. Outflows from nickel ETPs widened the most by US$14.1mn over the last three weeks on the back of profit taking. Nickel prices rose 7.5% on Thursday marking their highest daily increase in 6½ years and putting prices at their highest level since December 214 owing to concerns of further sanctions being imposed by the US on Russia. European equity ETPs faced outflows worth US$5.7mn extending the prior week s trend of outflows as investors took profits ahead of the European Central Bank meeting this Thursday. Given the raft of mixed macro-economic data in Europe, investors will be looking out for further guidance on its asset purchase program. Note: All flow and data in this report are based on ETF Securities ETP numbers to 2 April 218 and are denominated in USD unless otherwise indicated. Investments may go up or down in value and you may lose some or all of the amount invested.

2 2 ETF Securities ETF Securities Commodity ETP Flow Trends ETP FLOWS (in US$m) ASSETS TOTAL , ,78 Diversified Precious Metals ,66 Basket % -.2% 1.1% -.3% Gold , % -.8% 3.% 3.9% Silver ,17 3.7% 3.5% 1.3% -5.3% Platinum % -2.2%.5% -5.2% Palladium % 4.5% -2.5% 27.8% Energy ,443 Basket % 4.3% 5.8% 17.2% Crude oil ,25 2.% 5.8% 12.% 41.% Natural Gas % 3.3% -7.6% -28.4% Heating Oil % 5.2% 4.6% 34.9% Gasoline % 3.% 4.6% 25.7% Carbon % 2.7% 62.2% 22.5% Industrial Metals ,28 Basket % 1.% 2.2% 27.3% Aluminium % 21.7% 9.3% 25.4% Copper % 4.8% -5.4% 2.1% Nickel % 14.5% 15.8% 55.4% Zinc %.5% -2.4% 25.6% Tin % 4.8% 9.2% 12.2% Lead % 1.% -4.8% 8.9% Agriculture Basket % -.5% 1.6% -5.9% Wheat %.3% 5.4% -6.3% Corn %.1% 5.5% -7.5% Soybeans %.2% 6.1% 3.% Cotton % 4.1% 6.9% 1.% Coffee % -1.2% -9.7% -2.% Sugar % -6.% -21.6% -31.7% Soybean Oil % -.4% -6.4% -5.7% Cocoa % 2.8% 4.1% 42.3% Livestock Basket % -.2% -9.6% -6.2% Lean Hogs % 4.6% -9.8% 6.8% Live Cattle % -2.3% -9.6% -11.7% Equities US.....5% 3.3%.4% 15.9% Europe % 4.8% -3.2%.7% Asia % -2.4% -5.7% 9.1% Australia %.7% -2.1% 5.7% FX PERFORMANCE (US$) G USD % 1.% -2.% -9.7% CAD % 2.2% -1.2% 5.5% EUR %.4% 1.3% 1.1% GBP %.6% 3.2% 1.9% CHF % -2.3% -2.3% -8.5% NOK %.2% 3.4%.7% SEK % -1.6% -5.2% -3.7% JPY % -2.4% 3.4% -4.% CNY % 1.2% 2.2% 5.2% INR % -.5% -4.2% -7.4% AUD % 1.3% -3.3% -1.7% NZD %.3%.5% -1.9% Commodity FX (*) All data as at 2 Apr 18, based on ETF Securities global commodity ETP flows and assets. In FX due to being pair trades there is double counting. Price performance is based on NAV data for commodities, indices for Bonds & Equities, Trade weighted indices for FX, Bloomberg

3 3 ETF Securities Net Cumulative Flows by Asset Classes over the past year Com modities , -1,2 Apr 17 Jul 17 Oct 17 Jan 18 Apr 18 Equities Apr 17 Jul 17 Oct 17 Jan 18 Apr 18 Currencies Apr 17 Jul 17 Oct 17 Jan 18 Apr 18 All Commodity ETPs Flows Analysis DIVERSIFIED FLOWS Diversified All Commodities Ex-Energy Ex-Ags and Liv Past Month Flows in Diversified ETPs DIVERSIFIED -$22.8 All Commodities -$17.4 Ex-Energy Ex-Agriculture and Livestock -$5.2 1, Net Cumulative Flows into Diversified Commodities % -8% -6% -4% -2% % Ex-Agriculture and Livestock

4 4 ETF Securities Energy ETPs Flows Analysis ENERGY FLOWS Energy ,443 Energy Basket Crude oil ,25 Natural Gas Heating Oil Gasoline Carbon ENERGY Energy Basket Crude oil Natural Gas Heating Oil Gasoline Past Month Flows Trends in Energy ETPs Carbon 5, Net Cumulative Flows into Energy 4-1% -5% % 5% 1% 4,5 2 4, 3,5 3, -2-4 Crude oil 2,5-6 2, -8 1, , Precious Metals ETPs Flows Analysis PRECIOUS METALS FLOWS Precious Metals ,66 PM Basket Gold ,235 Silver ,17 Platinum Palladium Past Month Flows in Precious Metals ETPs PRECIOUS METALS $125.8 $.5 PM Basket -$4. Gold -$.9 $77.9 Silver $53.4 $1.7 Platinum -$.2 $5.7 Palladium -$7.3 Net Cumulative Flows into Precious Metals 12, 11,5 11, 1,5 1, 9,5 9, 8,5 8, % -5% % 5% 1% Silver 1 5-5

5 5 ETF Securities Industrial Metals ETPs Flows Analysis INDUSTRIAL META FLOWS Industrial Metals ,28 IM Basket Aluminium Copper Nickel Zinc Tin Lead Past Month Flows in Industrial Metals ETPs INDUSTRIAL METALS IM Basket$. Aluminium -$52.1 -$25. -$11.6 $4.2 $1.1 Copper -$.2 $6.8 Nickel Zinc -$18.9 -$2.8 $3. $.2 Tin -$.2 $. 1,5 1,4 1,3 1,2 1,1 1, Net Cumulative Flows into Industrial Metals % -5% % 5% 1% 25 2 Aluminium Agriculture ETPs Flows Analysis AGRICULTURE FLOWS Agriculture Agri Basket Wheat Corn Soybeans Cotton Coffee Sugar Soybean Oil Cocoa ,5 1,3 1,1 9 Net Cumulative Flows into Agriculture Past Month Flows in Agricultural ETPs AGRICULTURE -$27.1 $1.1 Agri Basket$. -$19.2 Wheat -$1.5 $.4 Corn $2.7 Soybeans $1.2 Cotton $. $.9 Coffee $5.7 $.5 Sugar -$3.6 $.5 Soybean Oil -$.1 -$.2 Cocoa -$13.1 $.2-1% -5% % 5% 1% Sugar

6 6 ETF Securities Livestock ETPs Flows Analysis LIVESTOCK FLOWS Livestock Livestock Basket Lean Hogs Live Cattle Past Month Flows in Livestock ETPs LIVESTOCK -$.1 $. Livestock Basket $. Lean Hogs -$.1 $.2 Live Cattle -$.3 Net Cumulative Flows into Livestock % -5% % 5% 1% Live Cattle -.8 Equity ETPs Flows Analysis EQUITIES FLOWS Region EQUITIES Past Month Flows in Equity ETPs -$3.7 $5.2 US.... Europe Asia Australia.... US Europe -$4.4 $. $5. Asia Australia $. -5% % 5% 1% Net Cumulative Flows into Equities Italy

7 7 ETF Securities Currency ETPs Flows Analysis CURRENCIES FLOWS FX G USD CAD EUR GBP CHF NOK SEK JPY CNY INR AUD NZD Commodity FX n.b. Due to each currency being a pair, there is double counting in the flow data Net Cumulative Flows into Currencies G1 USD CAD EUR GBP CHF NOK SEK JPY CNY INR AUD NZD Commodity FX Past Month Flows in Currency ETPs % -5% % 5% 1% GBP -15.

8 8 ETF Securities Important Information General This communication has been issued and approved for the purpose of section 21 of the Financial Services and Markets Act 2 by ETF Securities (UK) Limited ( ETFS UK ) which is authorised and regulated by the United Kingdom Financial Conduct Authority (the FCA ). The information contained in this communication is for your general information only and is neither an offer for sale nor a solicitation of an offer to buy securities. This communication should not be used as the basis for any investment decision. Historical performance is not an indication of future performance and any investments may go down in value. This document is not, and under no circumstances is to be construed as, an advertisement or any other step in furtherance of a public offering of shares or securities in the United States or any province or territory thereof. Neither this document nor any copy hereof should be taken, transmitted or distributed (directly or indirectly) into the United States. This communication may contain independent market commentary prepared by ETFS UK based on publicly available information. Although ETFS UK endeavours to ensure the accuracy of the content in this communication, ETFS UK does not warrant or guarantee its accuracy or correctness. Any third party data providers used to source the information in this communication make no warranties or representation of any kind relating to such data. Where ETFS UK has expressed its own opinions related to product or market activity, these views may change. Neither ETFS UK, nor any affiliate, nor any of their respective officers, directors, partners, or employees accepts any liability whatsoever for any direct or consequential loss arising from any use of this publication or its contents. ETFS UK is required by the FCA to clarify that it is not acting for you in any way in relation to the investment or investment activity to which this communication relates. In particular, ETFS UK will not provide any investment services to you and or advise you on the merits of, or make any recommendation to you in relation to, the terms of any transaction. No representative of ETFS UK is authorised to behave in any way which would lead you to believe otherwise. ETFS UK is not, therefore, responsible for providing you with the protections afforded to its clients and you should seek your own independent legal, investment and tax or other advice as you see fit. Telephone calls may be recorded for training and monitoring purposes. M-142 ETF Securities (UK) Limited 3 Lombard Street London EC3V 9AA United Kingdom t +44 () f +44 () e info@etfsecurities.com w etfsecurities.com