Asset manager Ashmore's share fall on worse than expected outflows

(Reuters) -British fund manager Ashmore's shares slid by 2.4% on Monday after it reported a drop in assets under management owing to choppy risk appetite and mixed results from emerging markets.

The company reported outflows of $2 billion in its financial third quarter to March 31, reducing assets under management to $51.9 billion from $54 billion on Dec. 30. Jefferies and JP Morgan analysts had expected outflows of $1.2 billion.

That decline was driven by institutional clients looking to curb risk, primarily in local currency, blended debt and corporate debt, Ashmore said. Equities investment, meanwhile, registered a small net inflow and hard currency markets fared well.

"Emerging markets delivered a mixed performance over the quarter as stronger than expected economic data pushed back expectations of rate cuts by the US Fed," Ashmore CEO Mark Coombs said in a statement.

In the longer term, the emerging markets-focused company is betting on central banks in emerging economies to cut rates as inflation declines. It also expects a weaker U.S. dollar to boost local currency bonds and equities investment.

Shares in the company dropped by as much as 4% to 180.4 pence in early trade, with JP Morgan analysts warning that the higher for longer US interest rates and geopolitical tensions will be a drag on flows. By 0807 GMT the shares recovered some losses to 182.8 pence.

($1 = 0.8024 pounds)

(Reporting by Eva Mathews in BengaluruEditing by Subhranshu Sahu and David Goodman)