Inflows into global equity funds picked up again in the week through July 23 as optimism over U.S. trade deals, stronger than expected U.S. economic reports and an encouraging start to the corporate earnings season boosted risk sentiment.
Global investors snapped up a net US$8.71 billion worth of equity funds during the week, reversing a US$4.4 billion net withdrawal in the prior week, data from LSEG Lipper showed.
The United States and Japan agreed a deal earlier this week which cut existing import tariffs on Japanese goods to a lower-than-threatened 15 per cent. Investors were also hopeful about the prospects of the U.S. and the European Union settling on U.S. import tariffs of around 15 per cent.
Investors took comfort from encouraging initial earnings reports as advanced AI chip maker TSMC posted a record profit and Gatorade owner PepsiCo upgraded its earnings forecasts.
Net European equity fund inflows reached an 11-week high of US$8.79 billion, while Asian funds drew a net US$1.17 billion. U.S. equity funds lagged, although net outflows eased to US$2.68 billion from about US$11.67 billion the prior week.
The technology sector gained US$1.61 billion, reversing the previous week’s US$576 million net outflow. The financial and industrial sectors also saw US$1.13 billion and US$1.61 billion net additions, respectively.
Net purchases of global bond funds extended into a 14th week as they added US$17.94 billion.
Investors pumped US$4.14 billion into short-term bond funds, the largest amount in 13 weeks. Euro-denominated bond funds and high-yield funds attracted a net US$3.89 billion and US$2.51 billion, respectively.
Gold and precious metals commodity funds recorded a net US$1.9 billion worth of purchases, the largest weekly figure since June 18.
Global money market funds drew a net US$2.09 billion after about US$21.78 billion of net sales a week ago.
Emerging markets saw a revival in buying interest with investors adding bond funds of US$2.19 billion and equity funds of US$250 million after net disposals of US$1.14 billion and US$155 million in the prior week, data for a combined 29,669 funds showed.
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Reporting by Gaurav Dogra in Bengaluru; Editing by Kirsten Donovan
