Introduction
U.S. equity funds are experiencing outflows for the third consecutive week as investors grapple with uncertainties regarding U.S. trade policies, all while withholding decisions ahead of an important jobs report. Conversely, European equity funds continue to attract solid investment for the eighth week in a row, buoyed by market expectations surrounding a potential policy rate cut by the European Central Bank.Context
As of June 4, LSEG Lipper data highlighted that investors withdrew a net $7.42 billion from U.S. equity funds for the week. Conversely, European regional funds attracted approximately $2.72 billion, alongside a net purchase of $1.84 billion in Asian funds during the same period.Developments
In sector-specific investments, investors acquired $667 million worth of sectoral funds, indicating a continued positive trend into a second week. The technology and industrial sectors particularly benefited, receiving inflows of $909 million and $878 million respectively. However, the financials and healthcare sectors faced significant outflows, each losing nearly $800 million.On a broader scale, global bond funds accumulated a net $16.17 billion for the seventh consecutive week. Investors contributed a combined $4.66 billion into dollar-denominated short- and medium-term bond funds, marking their largest weekly purchase since April 2024. Additionally, high-yield bond funds experienced inflows totaling $2.93 billion.
Money market funds also saw a noticeable uptick, with weekly inflows reaching a five-month high of $108.5 billion. Furthermore, interest in gold and precious metals funds surged, attracting $1.69 billion – the highest inflow observed in seven weeks.
Among emerging markets, bond funds recorded a sixth consecutive week of net purchases totaling $1.99 billion, while equity funds experienced net additions of approximately $191 million, based on data from 29,720 funds.