Global Equity Funds Draw Inflows for Ninth Consecutive Week on Earnings Optimism
Investor Sentiment and Fund Flows Overview
Global Equity Fund Inflows Continue
July 24 (Reuters) – Global equity funds attracted inflows for a ninth straight week through July 22 as investors remained optimistic about a robust earnings season despite an escalation in Middle East tensions and the recent weakness in semiconductor stocks.
They bought a net $10.51 billion in global equity funds during the week, slightly below the previous week’s $12.48 billion in purchases, according to LSEG Lipper data.
Regional and Sector-Specific Trends
European and Asian Equity Fund Performance
Optimism over the ongoing earnings season boosted demand for European equity funds, as quarterly profits at European blue-chip companies are estimated to grow at their fastest pace in more than three years, according to LSEG I/B/E/S data. Recruiter Randstad, along with energy firms TotalEnergies and Repsol, have all reported strong results.
Investors bought a net $10.29 billion in European equity funds, following roughly $8.87 billion in net purchases the previous week. Asian funds attracted $4.5 billion in inflows, while U.S. funds saw net outflows of $7.34 billion.
Sector-Specific Fund Inflows
Among sector-specific funds, technology-sector funds attracted a net $2.12 billion, a fourth consecutive weekly inflow. Financials and healthcare funds drew inflows of $1.7 billion and $1.36 billion, respectively.
Bond and Money Market Fund Movements
Bond Fund Outflows and Inflows
Meanwhile, net investments in global bond funds fell to a 16-week low of $3.34 billion, as renewed gains in crude oil prices heightened inflation concerns.
Global short-term bond funds recorded outflows of $5.75 billion after 13 consecutive weeks of inflows. However, investors bought a net $1.74 billion in government bond funds, $856 million in loan participation funds, and $806 million in euro-denominated bond funds.
Money Market Fund Trends
Money market funds remained out of favour for a second consecutive week, posting net outflows of $40.97 billion.
Commodities and Emerging Markets
Commodities Fund Inflows
In commodities, investors poured a net $166 million into energy funds and $1.46 billion into gold and other precious metals funds, a second consecutive week of net purchases.
Emerging Market Fund Activity
Data covering 28,874 emerging-market funds showed that equity funds attracted $3.96 billion in inflows for a second straight week, while bond funds recorded modest weekly outflows of $43.58 million.
Reporting
(Reporting by Gaurav Dogra)