Weekly Market Monitor – Week Ending 17 February 2023

  • Cryptocurrency ETFs (EETH, EBTC, CRYP) were top performers last week as traders looked past recent crypto crackdowns and Bitcoin rebounded above $25,000 USD for the first time since August 2022. European ETFs (VEQ, ESTX, IEU) also performed, extending their January rally as Q4 earnings showed surprising resilience despite worrying macro conditions.
  • Australian financial ETFs (MVB, QFN, OZF) were prevalent across the poorest performers last week. The big four banks – and the Commonwealth Bank of Australia (CBA) in particular – were to blame for the sector’s weakness as traders priced in lower profit margins despite a steeper yield curve helping banks borrow short and lend long.
  • There were $563.4 million in reported inflows last week. An important driver of these inflows was iShares SMAs rebalancing, as BlackRock expressed a strong view on Australian equities with ASX 200 ETF (IOZ) and AUD Hedged S&P 500 Fund (IHVV). The remaining inflows were largely dominated by AUD income ETFs (IHCB, AESG, BILL, SUBD, FLOT, QPON), a sign that investors are both confident in the Aussie dollar and feeling bullish on global yields.
  • There were $446.0 million in reported outflows last week, again dominated by iShares SMA rebalancing.
  • The top traded funds for the week were large vanilla index trackers (IOZ, VAS) as usual.

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