(Reuters) -U.S. equity funds saw a significant drop in net investments in the week through July 9 on caution over President Donald Trump's threats of fresh tariffs on trading partners, even though stocks surged to new records on rising demand in the artificial intelligence sector.

Investors acquired just $2.1 billion worth of U.S. equity funds during the week when compared with a robust $31.6 billion worth of net accumulations in the prior week, data from LSEG Lipper showed.

President Trump this week extended the tariff deadline until August 1 to facilitate trade negotiations, but announced noticeably higher duties for some key trading partners including Japan, South Korea, Canada and Brazil alongside a 50% tariff on copper.

U.S. multi-cap funds saw the first weekly net investment in four weeks to the tune of $1.8 billion. Large-cap, mid-cap and small-cap funds, meanwhile, suffered net outflows of $2.83 billion, $785 million and $472 million, respectively.

Sectoral funds saw net purchases extended into a second successive week, with approximately $1.28 billion flowing into these funds. Tech drew in $1.7 billion but healthcare saw net outflows of $874 million.

U.S. money market funds faced a net $9.78 billion weekly outflow, ending two weeks of buying.

Inflows into U.S. bond funds, meanwhile, cooled to a three-week low of $4.34 billion.

Short-to-intermediate investment-grade funds received $1.76 billion with weekly net investments dropping by 57% over the week. General domestic taxable fixed income funds received just $634 million compared with a net $3.03 billion purchase in the prior week.

Short-to-intermediate government and treasury funds, meanwhile, attracted $982 million, the largest amount in four weeks.