Investors React to Tariff Threats: A Shift in Global Fund Flows
In response to tariff threats and rising U.S. inflation, investors withdrew $5.3 billion from global equity funds. U.S. equity funds saw significant outflows, contrasted by investments in European and Asian funds. Bond funds continued attracting investments, while money market funds experienced their first net sales in weeks.
Global investors reacted sharply to recent U.S. tariff threats and rising inflation, pulling $5.3 billion from equity funds during the week ending July 16. This marked the first net outflow since the week of June 25, according to LSEG Lipper data.
U.S. equity funds faced significant divestment with $11.75 billion in net outflows, following consecutive weeks of net purchases. In contrast, European and Asian funds received net inflows of $4.66 billion and $718 million, respectively. Sectoral funds saw varied activity, with healthcare and technology facing outflows while industrial and financial funds experienced gains.
Global bond funds enjoyed continuous investor interest, extending their buying streak to 13 weeks with net investments reaching $12.85 billion. Meanwhile, money market funds faced their first net sales in three weeks, losing $21.3 billion. Gold and precious metal funds maintained popularity with $741 million in net weekly investments.
(With inputs from agencies.)
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