LatAm Equity Strategy: Flows to know

Research evidence excerpt

LatAm Equity Strategy: Flows to know

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LatAm Equity Strategy

Flows to know

Investment Strategy

LatAm lags as flows leave EM 12 June 2026

LatAm underperformed global markets in May as US rates repriced higher, the dollar Investment Strategy

appreciated, and EM sentiment worsened (see Quilt of Returns in Exhibit 5). Global flows Latin America

to EM ex-China turned negative in the last month for the first time since Aug-25 (Exhibit

8), with GEM funds as the epicenter of outflows but the LatAm region also registered

outflows. In Brazil, outflows from local equity funds have slowed down, but now

corporate credit funds are posting significant outflows. Paula Andrea Soto, CFA >>

LatAm Equity Strategist

Merrill Lynch (Brazil)

+55 11 2188 42261st monthly outflow from EM ex-China since Aug-25 paula.soto@bofa.com

EM ex-China funds had -US$6bn in outflows in May, down from +US$8bn in April. This is

David Beker >>

the first monthly outflow after eight months of inflows. Stepping back and looking at Bz Econ/FI & LatAm EQ Strategy

the different EM regions, in the last month flows rotated out of LatAm & India and into Merrill Lynch (Brazil) +55 11 2188 4371

South Korea & Taiwan (Exhibit 11). This signals reduced interest in broader EM, while david.beker@bofa.com

the AI/tech narrative remains resilient. YTD flows into EM ex-China remain positive at Carlos Peyrelongue >>

+US$85bn, after +US$48bn in 2025 (Exhibit 8). MexMerrillEqLynchStrat/Research(Mexico) Analyst

+52 55 5201 3276

BZ May flow: foreigners bought only Energy carlos.peyrelongue@bofa.com

The Brazilian local exchange (B3) recorded -R$12bn in outflows from foreigners in May MateusLatAm EquityConceicaoStrategist>>

(see Exhibit 22).