Introduction
U.S. equity funds have seen a revival as they attracted net inflows for the first time in five weeks, driven by optimism surrounding tariff negotiations and declining concerns about rising consumer prices.Context
For the week ending May 14, LSEG Lipper data revealed that investors purchased a total of $12.86 billion in U.S. equity funds, marking their first net buying activity since April 9. The positive sentiment follows a recent 90-day U.S.-China tariff truce reached on Monday, which has led to expectations of a possible rollback of steep tariffs by Washington. Additionally, softer-than-expected U.S. consumer data for April has alleviated worries about price pressures linked to tariffs.Developments
Large-cap U.S. equity funds attracted $5.06 billion in net inflows, helping to offset $13.6 billion in outflows from the previous week. Small-cap funds experienced a net purchase of $1.05 billion, while mid-cap funds faced net redemptions of approximately $650 million.U.S. sector equity funds enjoyed a substantial $2.77 billion in inflows, the strongest weekly performance since January 29. The financial, industrial, and healthcare sectors led this growth, with respective inflows of $596 million, $559 million, and $475 million.
In addition, U.S. bond funds reported impressive net inflows of $10.14 billion, the highest weekly amount since July 17, 2024. General domestic taxable fixed income funds accounted for $3.09 billion of this figure, representing their largest intake since February 5. Meanwhile, short-to-intermediate investment-grade and mortgage bond funds saw inflows of $1.76 billion and $1.43 billion, though short-to-intermediate government and Treasury funds faced net outflows of $2.15 billion.
Conversely, U.S. money market funds incurred $9.43 billion in net outflows, reversing the previous week’s $28.8 billion in inflows.