U.S. Equity Funds See Inflows as Rate Cut Hopes Boost Sentiment
U.S. equity funds attracted $5.58 billion in net inflows during the week ending January 29, reversing a three-week outflow trend. The inflows were driven by expectations of lower interest rates following President Trump's comments and a rebound in tech stocks.
Technology sector funds received the largest inflows at $2.12 billion, marking the highest weekly inflow since November 2023. Financials and industrials funds also saw inflows of $1.5 billion and $717 million, respectively.
Large-cap and small-cap equity funds attracted $1.13 billion and $1.51 billion in net inflows, while mid-cap and multi-cap funds experienced outflows of $1.1 billion and $947 million, respectively.
In the debt market, investors allocated $8.38 billion to U.S. bond funds, marking the fourth consecutive week of inflows. General domestic taxable fixed income funds saw inflows of $3.46 billion, extending their net purchases for a fourth week. Loan participation and short-to-intermediate investment-grade funds also attracted sizable inflows of $1.5 billion and $1.17 billion, respectively.
However, money market funds experienced net sales of $35.05 billion, marking the second weekly outflow in six weeks.