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US equity funds see outflows as rate cut hopes fade
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US equity funds see outflows as rate cut hopes fade
Apr 12, 2024 7:05 AM

(Reuters) - U.S. equity funds witnessed outflows for a second successive week in the seven days to April 10 as investors weighed the possibility of the Federal Reserve keeping rates higher for longer following recent robust readings on inflation and U.S. payrolls.

According to LSEG data, investors shed a net $2.73 billion worth of U.S. equity funds during the week after about $3.24 billion worth of net disposals in the week before.

By segment, U.S. large-cap funds faced $5.28 billion worth of net selling, the sharpest since January 10. U.S. mid-cap funds also had $506 million in outflows but small-, and multi-cap funds received $1.92 billion and $1.43 billion, respectively in inflows.

The technology sector lost $750 million in its first weekly outflow since February 21. Healthcare and consumer staples sectors, meanwhile, witnessed $1.07 billion and $464 million worth of net withdrawals.

By contrast, U.S. bond funds garnered about $6.25 billion in net purchases during the week, extending inflows into a third successive week.

U.S. short/intermediate investment-grade funds remained in demand for the 17th consecutive week, gaining about $3.4 billion worth of inflows on a net basis.

U.S. short/intermediate government & treasury, and loan participation funds also witnessed $1.54 billion and $663 million worth of net purchases, respectively.

Money market funds, meanwhile, saw $34.98 billion worth of net selling during the week, a third weekly outflow in four weeks.

(Reporting by Gaurav Dogra and Patturaja Murugaboopathy in Bengaluru)

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