Global Equity Funds Attract Inflows for 11th Week

(Reuters) – Global equity funds attracted inflows for an 11th consecutive week through Dec. 11, buoyed by indications that a cooling U.S. labor market and stable consumer prices may enable a third consecutive rate cut by the Federal Reserve this month.

Investors purchased global equity funds worth a net $10.18 billion during the week, following net purchases of approximately $21.19 billion in the preceding week, according to LSEG Lipper data.

The recent U.S. employment report highlighted a surge in job growth for November, rebounding from disruptions due to hurricanes and strikes; however, the unemployment rate rose to 4.2%, indicating a loosening labor market that could prompt interest rate cuts by the Federal Reserve this month.

U.S. equity funds experienced net inflows of $6.36 billion for the sixth consecutive week. European funds gained $3.24 billion, while Asian funds faced a net outflow of $278 million.

Sectoral funds encountered their first weekly outflow in five weeks, totaling $1.94 billion. Specifically, the healthcare, technology, and consumer discretionary sectors recorded outflows of $1.08 billion, $654 million, and $616 million, respectively.

Global bond funds noted their 51st consecutive week of net investments, attracting $10.19 billion. Corporate bond funds led the charge with a robust $3.21 billion, the highest weekly inflow since September 18, while loan participation funds achieved their 12th consecutive weekly inflow, amassing $1.32 billion.

Recently, investors withdrew $16.29 billion from money market funds, following significant purchases of $169.16 billion the week before.

In the commodities sector, the energy segment experienced a net outflow of $256 million, marking its third weekly loss in four weeks, while gold and precious metal funds gained net inflows of $190 million.

Data regarding 29,593 emerging market funds revealed that investors withdrew $2.35 billion from equity funds for the fifth consecutive week, while bond funds saw $721 million in net sales.