Global equity funds draw third weekly inflow as investors buy the dip
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June 12 : Global equity funds drew inflows for a third straight week, as investors used a market selloff to add exposure to technology stocks on expectations the AI-driven rally will continue.
Investors bought a net $3.32 billion of global equity funds in the week through June 10, compared with $21.12 billion of net investments the prior week, according to LSEG Lipper data.
"For investors who may have under-allocated to the AI supply chain, we think select additions on weakness may make sense," Mark Haefele, chief investment officer at UBS Global Wealth Management, said in a note earlier this week. "Underlying measures of AI demand remain firmer."
The MSCI World Index fell as much as 4.8 per cent from last week's record high of 1,138.3, but has since recovered roughly 2.3 per cent on renewed hopes of a peace deal between Iran and the U.S.
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European and Asian funds witnessed $6.74 billion and $6.37 billion of weekly net inflows, respectively. U.S. funds, however, recorded $12.57 billion of outflows, the first weekly net sales in three weeks.
Tech funds drew $7.05 billion in their tenth straight week of inflows. Financials and industrials attracted $624 million and $545 million, respectively.
Global bond funds saw a net $18.27 billion of weekly inflows, as investors extended their buying streak to 10 weeks.
Investors poured $6.7 billion into short-term bond funds, the biggest weekly inflow in three weeks, alongside $3.21 billion into dollar medium-term bond funds and $2.26 billion into euro bond funds.
Money market funds had $18.21 billion of net outflows, reversing course after drawing a hefty $154.64 billion in inflows the previous week.
Investors also shed a net $1.86 billion of gold and other precious metal funds, marking a fourth successive weekly outflow.
Emerging markets were under pressure as investors offloaded a net $944 million of bond funds and a net $3.4 billion of equity funds for a seventh successive weekly outflow, data covering a combined 28,937 funds showed.
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