(Reuters) – Outflows from U.S. equity funds cooled to the lowest in three weeks in the week to Jan. 22, buoyed by shifting expectations for a pause in rate cuts after a benign U.S. core inflation report bolstered equities.
Weekly net selling in U.S. equity funds fell off to $3.2 billion during the week from about $8.26 billion worth of net outflows in the prior week, data from LSEG Lipper showed.
Outflows from large- and mid-cap funds cooled to $2.68 billion and $972 million from $4.35 billion and $1.57 billion, respectively, in the previous week.
Multi-cap and small-cap funds, meanwhile, had a net $1.53 billion and $290 million worth of sales, respectively.
U.S. sectoral funds, however, obtained a significant $2.74 million, the largest amount for a week since Nov. 27, 2024. Investors snapped up financials, industrials and tech sector funds worth a notable $998 million, $816 million and $657 million, respectively during the week.
Bond funds were popular for a third successive week with U.S. investors pumping a net $8.83 billion into these funds following $6.19 billion worth of net purchases a week ago.
General domestic taxable fixed income funds and municipal debt funds received a sharp $2.33 billion and $2.03 billion, respectively, in inflows. Investors also acquired loan participation funds totaling a net $1.62 billion in a fourth consecutive week of purchases.
At the same time, money market funds saw a net $32.86 billion worth of investments, the fourth weekly inflow in five weeks.
(Reporting by Gaurav Dogra and Patturaja Murugaboopathy in Bengaluru; editing by Mark Heinrich)
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