Global equity funds record third week of inflows on Fed rate cut hopes – TradingView News

Global equity funds saw large inflows in the week ended October 16, driven by investor optimism over Federal Reserve interest rate cuts, a rally in technology stocks and positive earnings expectations.

According to LSEG data, investors purchased a net worth of $30.22 billion in equity funds, significantly higher than net purchases worth about $8.03 billion the previous week.

The MSCI World Index EURONEXT:IACWI The U.S. dollar hit a new record high of 858.13 on Tuesday, supported by last week's U.S. producer price report that showed a continued slowdown in inflation in September, potentially giving the Fed flexibility to cut interest rates next month .

Mark Haefele, chief investment officer of UBS Global Wealth Management, said healthy earnings growth should lead to further gains in U.S. stocks.

“We believe third-quarter results should confirm that large-cap earnings growth is solid against a robust macroeconomic backdrop.”

US equity funds secured a solid $20.08 billion during the week, following net purchases of around $3.98 billion the previous week. Investors also added European and Asian funds with a net worth of $8.78 billion and $540 million, respectively.

The financial sector recorded notable inflows worth $1.02 billion, the highest weekly net buying since July 17. The industrial and technology sectors also recorded net purchases worth $347 million and $241 million, respectively.

Global bond funds attracted around $19.95 billion, marking their largest weekly net buying since April 2021.

Investors bought a whopping $5.16 billion worth of government bond funds, the largest amount since at least November 2023. They also bought a whopping $2.97 billion and $1.08 billion worth of high-yield and credit equity funds, respectively .

At the same time, money market funds recorded $19.95 billion in net sales after three consecutive weeks of net buying.

In the commodities segment, gold and other precious metals funds saw inflows of $1.11 billion as investors extended their net purchases for the 10th straight week. However, energy funds recorded a second weekly outflow worth a net $56 million.

Data on 29,651 emerging market funds showed bond funds remained in demand for the 17th week in a row, attracting a net total of $298 million. Investors also bought $100 million in equity funds.