Global equity funds draw inflows for fourth week as Treasury yields ease

By Reuters News

Oct 16 (Reuters) - Global equity funds drew inflows for a fourth straight week through October 14 as a pullback in Treasury yields from near 2½-decade highs and hopes for strong earnings lifted sentiment, though investors pulled money from technology funds amid concerns over rising debt in the sector.

They bought a net $20.01 billion of global equity funds, significantly more than the $1.59 billion in net purchases recorded the previous week, LSEG Lipper data showed.

https://www.reuters.com/graphics/GLOBAL-FLOWS/GLOBAL-FLOWS/xmvjeynzgpr/chart.png

The US 10-year Treasury yield , which hit a 24½-year high of 5.3645% last week, has since eased by roughly 26 basis points amid expectations that the Federal Reserve may hold rates steady at its upcoming meeting.

Fund investors also pinned their hopes on the early stages of the earnings season. Global large- and mid-cap companies are expected to report year-on-year earnings growth of 25.14% for the latest quarter, compared with 38% in the previous quarter, according to LSEG data covering analyst estimates for 4,495 companies. The technology sector is expected to post earnings growth of 46.9%.

By region, investors bought about $13 billion in US equity funds, reversing net sales of $5.1 billion in the previous week. Asian and European equity funds recorded weekly inflows of $2.93 billion and $1.5 billion, respectively.

Sectoral equity funds, meanwhile, saw net outflows of $6.14 billion, led by net sales of $4.75 billion in technology funds, $1.86 billion in industrials and $1.43 billion in financials.

https://www.reuters.com/graphics/GLOBAL-FLOWS/GLOBAL-FLOWS/jnvwbraqlpw/chart.png

Global bond funds extended their inflow streak to a fourth straight week, drawing $7.79 billion from investors.

Short-term bond funds, government bond funds and corporate bond funds attracted significant inflows of $2.87 billion, $2.33 billion and $976 million, respectively, although overall demand was weaker than in the previous week.

https://www.reuters.com/graphics/GLOBAL-MARKETS/zjpqomyxxpx/chart.png

Money market funds recorded weekly outflows of $46.73 billion, as investors partly reversed net purchases of $153.98 billion in the previous week.

Among commodity funds, investors ended a four-week buying streak in gold and other precious-metals funds, recording net sales of $1.14 billion. They also sold $216 million worth of energy-sector funds, following net purchases of $269 million in the previous week.

In emerging markets, equity funds recorded inflows of $717 million, their first weekly net purchases in six weeks. Bond funds, however, saw outflows of $304 million, compared with inflows of $1.43 billion a week earlier, according to data covering a combined 29,093 funds.

https://www.reuters.com/graphics/GLOBAL-FLOWS/GLOBAL-FLOWS/lgvdagorbpo/chart.png

Capital.com is an execution-only brokerage platform and the content provided on the Capital.com website is intended for informational purposes only and should not be regarded as an offer to sell or a solicitation of an offer to buy the products or securities to which it applies. No representation or warranty is given as to the accuracy or completeness of the information provided.
The information provided does not constitute investment advice nor take into account the individual financial circumstances or objectives of any investor. Any information that may be provided relating to past performance is not a reliable indicator of future results or performance.
To the extent permitted by law, in no event shall Capital.com (or any affiliate or employee) have any liability for any loss arising from the use of the information provided. Any person acting on the information does so entirely at their own risk.
 

Cryptocurrency-related content is intended solely as news and market commentary. Crypto Derivatives are not available to Retail clients registered with Capital Com (UK) Ltd.