Global equity funds see biggest inflow in three weeks

(Reuters) – Global equity funds lured big inflows in the seven days to Feb. 2 on optimism over strong earnings from U.S. technology companies and on hopes that inflation would ease later this year.

Investors secured global equity funds of $14.34 billion in their biggest weekly purchase since Jan. 12, Refinitiv Lipper data showed.

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Strong earnings from tech firms including Apple Inc, Alphabet and chipmaker Advanced Micro Devices, boosted investor appetite during the week. Investors purchased European and Asian equity funds of $15.44 billion and $3.16 billion respectively, while selling U.S. equity funds of $7.9 billion. Tech and consumer discretionary sector equity funds posted outflows of over $1.1 billion each, while financials obtained inflows worth $0.64 billion.

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Global bond funds witnessed net selling for a fourth successive week amounting to $4.85 billion.

Global high yield bond funds led with outflows of $5.98 billion, the biggest since March 2020.

“We expect 2022 to be a volatile year for all risk assets, including high yield bonds,” said Ryan O’Malley, portfolio manager at Sage Advisory Services.

Investors sold $2 billion worth of short- and medium-term bonds finds. Government bond funds drew inflows of $1.19 billion. Meanwhile, inflation protected bond funds posted outflows worth $1.95 billion, their largest in 22 months.

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Global money market funds witnessed outflows worth $21.72 billion after seeing some small purchases in the previous week.

Among commodities, precious metal funds attracted inflows of $426 million in a third straight week of net buying, although energy faced a fourth straight weekly outflow, amounting to $308 million.

An analysis of 24,000 emerging market funds showed bond funds received $360 million in net buying after three consecutive weeks of outflows, while equity funds pulled in $2.31 billion worth of inflows.

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(Reporting by Gaurav Dogra and Patturaja Murugaboopathy in Bengaluru; Editing by William Maclean)