Global equity funds see outflows for an eighth straight week

GLOBAL equity funds posted net outflows for an eighth straight week in the seven days to Dec 28 as a stronger than expected US GDP reading raised worries that US interest rates could stay higher for longer.

However, outflows were capped by a Commerce Department report that showed US consumer spending barely rose in November, while inflation cooled further.

According to Refinitiv Lipper data, investors withdrew a net US$529 million from global equity funds, although that was down from US$39.1 billion the previous week.

US equity funds recorded a net US$5.41 billion worth of outflows but Asian and European funds attracted a net US$1.66 billion and US$460 million respectively.

Among equity sector funds, tech, financials and industrials saw net selling of US$835 million, US$468 million and US$192 million respectively.

Meanwhile, a net US$3.35 billion was withdrawn from bond funds, markedly lower than the US$15.06 billion of outflows in the previous week.

Short- and mid-term bond funds experienced their 19th straight week of outflows, at US$1.59 billion, while high yield bond funds lost a net US$179 million.

Investors purchased lower risk money market funds worth a net US$14.18 billion and parked US$814 million in government bond funds in a eighth straight week of net buying.

Data for commodity funds showed precious metal funds attracting a second straight week of inflows at a net US$330 million, while energy funds recorded a net outflow of US$247 million as selling continued from the previous week.

According to data available for 24,668 emerging market (EM) funds, both equity and bond funds saw net weekly outflows, amounting US$344 million and US$97 million, respectively. REUTERS