Chart - US stock funds see net inflows for the second consecutive week

Reuters, October 23 - In the seven days to October 21, U.S. equity funds attracted inflows for the second consecutive week, mainly due to falling Treasury yields and strong corporate earnings to date boosting investor confidence, though caution towards AI-related trades limited the scale of net purchases during the week.

According to LSEG Lipper data, net inflows into U.S. equity funds were $5.07 billion that week, down about 62% from $13.37 billion the previous week.

https://www.reuters.com/graphics/USA-FLOWS/USA-FLOWS/zgvozlawzpd/chart.png

The decline in U.S. Treasury yields partly eased market concerns about high borrowing costs. The benchmark 10-year Treasury yield has fallen nearly 38 basis points from its early October high of 5.3645%—the highest in 24 and a half years.

The strong start to U.S. earnings season also bolstered investor confidence. According to LSEG data, nearly 24% of S&P 500 companies have reported results so far, with around 82% beating analysts’ average expectations.

However, the tech-heavy Nasdaq Composite Index .IXIC fell 2.6% on Thursday, after Meta META.O reported strong earnings on Wednesday but also announced (link) plans to issue non-voting shares, reigniting concerns over growing capital investment in the tech sector.

This week, investors made net purchases of $8.63 billion in U.S. large-cap funds and $1.92 billion in mid-cap funds, while redeeming a net $4.24 billion from small-cap funds.

After two straight weeks of outflows, sector funds attracted $1.8 billion in inflows this week, mainly thanks to metals and mining funds taking in $1.18 billion. Technology and industrial funds also recorded net inflows of $429 million and $269 million, respectively.

https://www.reuters.com/graphics/USA-FUNDS/USA-FUNDS/egvbqejnxpq/chart.png

U.S. bond funds saw $969 million in outflows that week, ending a 26-week streak of net purchases.

After three consecutive weeks of inflows, investors redeemed $3.3 billion from long-term government bond and Treasury fixed income funds, but allocated $1.76 billion to short- and medium-term government bond and Treasury funds. In addition, investors increased holdings in municipal bond funds by $1.56 billion.

https://www.reuters.com/graphics/USA-FUNDS/USA-FUNDS/gkvlakbgwpb/chart.png

Meanwhile, money market funds attracted $14.82 billion in inflows during the week, while the previous week saw outflows of about $45.93 billion from such funds.

(To assist non-native English speakers, Reuters has automated the translation of its reports into several other languages. As automated translation may contain errors or lack the necessary context, Reuters does not guarantee the accuracy of translated texts, which are provided solely for the reader’s convenience. Reuters accepts no responsibility for any damages or losses incurred from the use of automated translation.)