$72.5 billion wiped off US ETP assets as market fell

US exchange-traded products (ETPs) lost US$72.5 billion of assets under management (AUM) after the S&P 500 had its largest drop since November 2008, says Deutsche Bank ETF Market Weekly Review.

Outflows from US ETPs totalled $5.5 billion in the first week of August and $1.9 billion the week before; weekly turnover increased by 93.5% last week.

US ETP AUM is still up year-to-date, however, ending the week at $1.02 trillion, a 2.4% increase.

Long-only equity ETPs had the largest outflows ($7.7 billion), with US-focused products experiencing the worst hit. Long-only fixed Income ETPs were the beneficiaries of the volatile markets with inflows of $470 million last week.

Asia-Pacific ETPs also lost assets, although on a much modest scale at $5 billion. Deutsche reports that turnover activity increased by 73% on the previous week with emerging and Asia-Pacific developed country ETPs seeing the biggest leap, up 100% from the last week of July; activity in gold ETPs increased by 45.4%, totalling $230 million.

Despite withdrawals from ETPs, assets are up 7.3% year-to-date compared to the end of last year, ending the week at $90.3 billion.

In Europe LaBranche reports increases of up to 300% in on exchange volumes as the Eurostoxx 50 dropped 10%. Over-the-counter volumes were also strong.

There were large block trades in the major equity index ETFs in Europe as investors pulled out of the market. Inverse ETFs saw large buy orders - LaBranche saw some of its largest ever block trades in some of these funds.

At a sector level, the Stoxx Europe 600 sector ETFs experienced outflows of more than US$160 million last week, BlackRock reports. The largest of these were in telecommunications ($97.6 million), followed by banks ($41.9 million).