Global equity funds witnessed weekly outflows for a fifth straight week in the week to July 27 on caution ahead of the US Federal Reserve’s policy meeting and on lingering fears over a global recession.
According to Refinitiv Lipper, global equity funds booked net selling of $2.73 billion, although weekly outflows eased to the lowest in five weeks.
The Fed raised US interest rates by 75 basis points on Wednesday, in a quest to cool the sharpest inflation since the 1980s and signalled “ongoing increases” in borrowing costs were still ahead despite evidence of a slowing economy.
Also a cut in Russian gas flows to Europe and European Union leaders’ agreement on an emergency plan to curb demand, raised concerns.
European and Asian equity funds posted outflows of $2.58 billion and $0.55 billion respectively, while the US equity funds drew a net $0.63 million in inflows.
Investors broadly withdrew out of sectoral funds with real estate, industrials, financials and tech recording outflows of $672 million, $593 million, $538 million and $267 million, respectively.
Meanwhile, safer money market funds obtained $3.52 billion in net buying after $3.05 billion worth of outflows in the week before.
Global bond funds suffered withdrawals worth $2.28 billion, in a third subsequent week of net selling.
Selling in short term funds surged to a three-week high of $4.43 billion, while government bond funds recorded outflows of $567 million after five weeks of net buying in a row.
