Exchange traded funds tracking Spanish and Italian equities have suffered significant falls over the past week as a result of events that threaten the political stability in both countries, and in the case of Italy raise fresh concerns over the rise of populism in Europe as a whole.
European large cap stock ETFs suffered outflows throughout March, according to TrackInsight data, as investors continued to fret about the political situation in Italy, the potential for a global trade war, and the possibility that the European Central Bank might be implementing tighter monetary policy.
European ETFs have suffered outflows since the beginning of March, as investors have been spooked by a double whammy of a potential trade war between the US and EU and the rise in support for populist parties in Italy. Investors have been taking money out of European equity products on the back of these fears, with €906.2 million leaving the asset class since the start of the month, TrackInsight data shows.
Italian government bond ETFs are seeing inflows for the first time this year as investors dismiss worries about the outcome of Italy’s election on 4 March, but the country’s stock market is suffering, reflecting investors’ concerns about potentially the most divisive vote for the country in a long time.