Aberdeen Sees $13.3 Billion in Outflows After Trump Victoryby
Aberdeen Asset Management Plc reported 10.5 billion pounds ($13.3 billion) of net outflows in its fiscal first quarter after Donald Trump’s U.S. presidential election victory dented sentiment toward emerging markets.
A U.K. wealth manager and a sovereign wealth fund accounted for 4.2 billion pounds of outflows in the three months through December as investors pulled money from a range of equity, fixed-income and multi-asset funds, the Scottish firm said Thursday. Assets under management fell 3 percent to 302.7 billion pounds from the previous quarter.
“If the U.S. election had gone the other way, we would have seen inflows of 2 to 3 billion pounds,” Chief Executive Officer Martin Gilbert said on a conference call with journalists. Trump has “certainly put flows into emerging markets on hold. I think sentiment is improving, but people are just waiting to see the effect of what Trump does.”
Aberdeen fell as much as 5.3 percent in London to 244.4 pence, the lowest since June 27, and were at 247.3 pence at 9:25 a.m. The stock is trading ex-dividend, weighing on the share price.
Aberdeen said a further 2.4 billion pounds is scheduled to be withdrawn from low-margin products in the current quarter. The asset manager started to see redemptions ease last year as sentiment toward emerging markets turned positive. However, Trump’s election victory sparked concern the president will pursue inflationary policies that will cause U.S. interest rates to rise more rapidly.
Trump is “business-friendly, or he’s perceived as business-friendly,” said Gilbert. “I think he will improve economic sentiment over in the U.S.”
Gilbert, under pressure after more than three years of outflows at Aberdeen, said that while the firm will continue to focus on costs, it won’t mean job losses. The CEO also said he intends to stay at the company for at least another five years.