NEW YORK ¨C Investors are fleeing an exchange-traded fund tracking Japanese stocks on concern that the new coronavirus will further dampen economic growth if it gains a foothold in the country.
JPMorgan BetaBuilders Japan ETF lost $315 million (?34.59 billion) on Wednesday, the biggest one-day outflow since its inception in June 2018, according to data compiled by Bloomberg. JPMorgan Chase & Co. holds about 90 percent of the $4 billion fund, known by the ticker BBJP, so it was likely the culprit behind the withdrawal.
Japan¡¯s economy is teetering toward a recession now, with economists estimating gross domestic product shrank an annualized 4 percent in the more recent quarter. In addition, Japan reported its first death from the coronavirus Thursday, sparking worries the illness could spread. One of Prime Minister Shinzo Abe¡¯s advisers said earlier this week that the coronavirus ¡°could be a significant drag for Japan¡¯s economy.¡±
¡°Japan is certainly dependent ¡ª especially the automobile sectors ¡ª on growth in China, on Chinese demand, and that¡¯s a sector that¡¯s been hit hard,¡± said Chris Gaffney, president of world markets at TIAA. ¡°That would justify some of those outflows.¡±
JPMorgan¡¯s press office declined to comment on whether it was behind this week¡¯s withdrawal from BBJP.
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