STOCK MARKET DESK

The volatility in stock markets has forced investors across the world to pull out over US$700 million from funds focused on Asian market last week, while there was an outflow of as much as two billion dollars from the emerging market equity funds, says a report.

According to the emerging market fund tracking firm, Emerging Portfolio Fund Research (EPFR), global investors have pulled out from most of the emerging markets during the second week of March, as investors fretted about the loss of export competitiveness in the face of a slumping dollar and showed little confidence in the view that growth in key emerging markets is decoupled from the US economic cycle.

Investors pulled out US$ 2.01 billion of the diversified Global Emerging Markets (GEM) Funds, US$ 714 million out of Asia (ex-Japan) Funds and modest amounts -- around 0.1 per cent of assets under management -- from EMEA and Latin America Equity Funds for the week ended March 12 , the EPFR report said.

Among BRIC (Brazil, Russia, India and China) country funds, Russia was the only one to post an inflow during the reviewed period, while the funds focused on the BRIC region recorded outflows for the third time in four weeks.

However, strong commodities story provided some protection and flows out of Brazil and Latin America regional funds were a minimal 0.01 per cent and 0.02 per cent of assets under management, reflecting the regions close correlation with commodity prices, the report added.