Investor appetite for European equities continued to grow in May, with Amundi’s ETF data as at June 30 showing that Europe and globally focused equity strategies together accounted for over 70% of total equity flows.
European-domiciled Ucits ETFs attracted €27 billion during the month, of which €18.7 billion went into equities and €8.3 billion into fixed income.
Globally, investors added €120.8 billion to ETFs in May, with equities drawing €70.2 billion and fixed income €40 billion. US investors split their allocation almost evenly—€43.5 billion into equities and €35 billion into bonds—while those in Europe, the Middle East and Africa showed a stronger tilt towards equities, allocating €21.9 billion versus €3.7 billion to debt.
Large blend strategies, particularly global equity indices, remained the most popular, attracting €14.3 billion in inflows, while US large-cap strategies gained €5.9 billion. Ultrashort bond strategies also proved attractive, bringing in €10.6 billion globally.
Within European equity ETFs, developed market strategies gained €4.8 billion in May, leading the way. All-country indices followed with €4.5 billion, ahead of developed world strategies at €4.3 billion. According to Amundi, the popularity of all-country strategies suggested a “renewed appetite for diversification and a waning sense of concern around emerging markets”. US equity ETFs reversed their recent outflows with €2.3 billion in inflows, and emerging markets gained €1.9 billion. According to Amundi, both benefitted from post-Liberation Day tariff realignments.
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Investor flows into European industrials rose by €1.2 billion in May, as defence spending and infrastructure plans boosted confidence in the sector. “Investors appear to be playing the defence and reconstruction themes more broadly through the industrial sector rather than concentrating solely on defence stocks,” shared Amundi. Technology sector ETFs added €0.5 billion as lower valuations made the sector more attractive. Smart beta flows were mixed: €0.9 billion went into income strategies, while €1 billion was withdrawn from equal-weighted strategies.
ESG equity Ucits ETFs recorded €1.9 billion in inflows, about 10% of the total equity allocation. Within fixed income, ESG strategies attracted €2.4 billion, with €1.5 billion flowing into investment-grade corporate debt and €0.7 billion into high-yield. ESG emerging market debt gained €1 billion, with investors also adding to developed world (€0.8 billion) and all-country ESG indices (€0.7 billion), though US ESG strategies saw €0.4 billion in outflows.
Fixed income flows into European Ucits ETFs jumped to €8.3 billion in May—four times April’s figure. Government bonds led the way with €3.9 billion, while investment-grade corporate debt saw a strong rebound, gaining €2.4 billion after last month’s outflows. Investors showed a clear preference for euro-denominated credit, adding €3 billion and pulling €0.7 billion from multi-currency bonds.
Investors favoured multi-currency government bond strategies in May, adding €2.4 billion, while euro bonds gained €0.9 billion and US-dollar bonds €0.5 billion. Interest in short-dated bonds faded, with €2.8 billion flowing into all-maturity indices. In Europe, investors put €0.5 billion into long-dated bonds and €0.3 billion into short-duration debt, while €0.7 billion was pulled from long-dated US bonds, signalling a shift away from US duration exposure.
Commodity ETF flows were flat in May, with no significant movement in gold exchange traded products.
