– Global equity funds drew massive inflows in the seven days to Feb. 9 as investors cheered strong earnings results from U.S. and European companies, shrugging off concerns over a rise in bond yields and inflation. Global equity funds lured $24.24 billion in their biggest weekly purchase since Dec. 29, Refinitiv Lipper data showed.
Fund flows: Global equities bonds and money market – https://fingfx.thomsonreuters.com/gfx/mkt/lgvdwxgdnpo/Fund%20flows-%20Global%20equities%20bonds%20and%20money%20market.jpg
A fresh batch of global companies including Amazon.com Inc, oil giant BP and Britain’s GSK reported strong earnings, although Facebook owner Meta Platforms missed its profit forecasts. Investors bought U.S., European and Asian equity funds of $14.19 billion, $6.07 billion and $2.03 billion respectively. Financial sector funds obtained $1.63 billion in net buying, the biggest in three weeks, while energy and utilities sector funds received $0.76 billion each.
However, consumer discretionary, health care and tech funds saw outflows of $0.8 billion, $0.73 billion and $152 million respectively.
Meanwhile, global bond funds posted outflows for a fifth straight week, worth $9.05 billion.
Fund flows: Global equity sector funds – https://fingfx.thomsonreuters.com/gfx/mkt/egpbklerovq/Fund%20flows-%20Global%20equity%20sector%20%20funds.jpg
Global high yield, and short- and medium-term bond funds faced net selling of $4.01 billion and $2.08 billion respectively, in a fifth straight week of outflows, while inflation protected funds saw outflows for a third successive week, worth $1.55 billion.
“We believe the selloff in high yield is largely technical in nature and we are constructive on high yield as we are still seeing very robust fundamentals, strong balance sheets,” said Paul Benson, head of Efficient Beta at Insight Investment.
However, government bond funds obtained $3.15 billion, marking their biggest inflow in seven weeks.
Global bond fund flows in the week ended Feb 9 – https://fingfx.thomsonreuters.com/gfx/mkt/dwvkrjyxjpm/Global%20bond%20fund%20flows%20in%20the%20week%20ended%20Feb%209.jpg
Global money market funds saw outflows of $35.42 billion, a 68% surge in net selling over the previous week. Among commodity funds, precious metals lured inflows for a fourth successive week, worth $289 million, although the lowest since Jan 12. Energy funds also attracted marginal inflows of $25 million after four consecutive weeks of outflows. An analysis of 24,010 emerging market funds showed equity funds pulled in $4.05 billion in net buying, the biggest in nearly a year, while investors sold bond funds of $98 million after having purchased $306 million in the previous week.
Fund flows: EM equities and bonds – https://fingfx.thomsonreuters.com/gfx/mkt/klpykmlaqpg/Fund%20flows-%20EM%20equities%20and%20bonds.jpg
(Reporting by Gaurav Dogra and Patturaja Murugaboopathy in Bengaluru; Editing by Chizu Nomiyama)