Global Equity Funds See Third Straight Inflow as Investors Buy Technology Stocks
Overview of Recent Global Fund Flows and Market Trends
Equity Fund Inflows Driven by Technology Stocks
June 12 (Reuters) - Global equity funds drew inflows for a third straight week, as investors used a market selloff to add exposure to technology stocks on expectations the AI-driven rally will continue.
Investors bought a net $3.32 billion of global equity funds in the week through June 10, compared with $21.12 billion of net investments the prior week, according to LSEG Lipper data.
Investor Sentiment and AI Demand
"For investors who may have under-allocated to the AI supply chain, we think select additions on weakness may make sense," Mark Haefele, chief investment officer at UBS Global Wealth Management, said in a note earlier this week. "Underlying measures of AI demand remain firmer."
Market Performance and Recovery
The MSCI World Index fell as much as 4.8% from last week's record high of 1,138.3, but has since recovered roughly 2.3% on renewed hopes of a peace deal between Iran and the U.S.
Regional Fund Flows
European and Asian Fund Inflows
European and Asian funds witnessed $6.74 billion and $6.37 billion of weekly net inflows, respectively. U.S. funds, however, recorded $12.57 billion of outflows, the first weekly net sales in three weeks.
Sector-Specific Fund Trends
Technology, Financials, and Industrials
Tech funds drew $7.05 billion in their tenth straight week of inflows. Financials and industrials attracted $624 million and $545 million, respectively.
Bond and Money Market Fund Activity
Bond Fund Inflows
Global bond funds saw a net $18.27 billion of weekly inflows, as investors extended their buying streak to 10 weeks.
Short-Term and Medium-Term Bonds
Investors poured $6.7 billion into short-term bond funds, the biggest weekly inflow in three weeks, alongside $3.21 billion into dollar medium-term bond funds and $2.26 billion into euro bond funds.
Money Market Fund Outflows
Money market funds had $18.21 billion of net outflows, reversing course after drawing a hefty $154.64 billion in inflows the previous week.
Commodity and Emerging Market Fund Flows
Precious Metals and Gold Funds
Investors also shed a net $1.86 billion of gold and other precious metal funds, marking a fourth successive weekly outflow.
Emerging Market Pressures
Emerging markets were under pressure as investors offloaded a net $944 million of bond funds and a net $3.4 billion of equity funds for a seventh successive weekly outflow, data covering a combined 28,937 funds showed.
(Reporting by Gaurav Dogra; Editing by Shilpi Majumdar)
