June 19, 2024

US Equity Fund Withdrawals Ebb to Four-Week Low Amid Tech-Led Wall Street Rally

(Reuters) – U.S. investors continued to reduce their holdings in equity funds for the fourth consecutive week up to Jan. 24, exhibiting caution ahead of a major inflation report and a Federal Reserve meeting set for the following week.

U.S. equity funds saw net withdrawals of $3.04 billion in the week, the smallest in four weeks, as a Wall Street rally, led by strong tech sector gains from upbeat forecasts by TSMC and Super Micro Computer, tempered the outflows.

U.S. value funds saw $2.76 billion worth of net disposals, the largest outflow in five weeks. Conversely, growth funds attracted $1.42 billion worth of new capital, marking their first weekly inflow in four weeks.

The technology sector, in particular, witnessed substantial investor interest, with a net inflow of $1.27 billion — the highest in six weeks. Meanwhile, the healthcare and industrial sectors experienced net outflows.

U.S. bond funds remained in demand for a fifth consecutive week, witnessing purchases worth a net $3.4 billion.

U.S. short/intermediate government & treasury, and short/intermediate investment-grade funds received about $3.02 billion and $1.12 billion worth of inflows, respectively. On the contrary, inflation-protected funds had $375 million worth of outflows.

Investors meanwhile, withdrew a net $9.06 billion from U.S. money market funds, extending net selling to a second straight week.

(Reporting by Gaurav Dogra and Patturaja Murugaboopathy in Bengaluru; Editing by Shweta Agarwal)

Copyright 2024 Thomson Reuters.

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