(Reuters) – Global equity funds attracted their first inflow in six weeks in the week ended Dec. 14, with investors optimistic that easing inflation levels would prompt central banks to scale back the pace of interest rate hikes.
Still, the Federal Reserve raised its benchmark rate by half a percentage point on Wednesday and said it would deliver more rate hikes next year.
According to Refinitiv Lipper data, investors poured a net $1.01 billion into global equity funds in their first weekly net buying since Nov. 2.
Graphic: Fund flows: Global equities, bonds and money market, https://fingfx.thomsonreuters.com/gfx/mkt/klvyggqqbvg/Fund%20flows-%20Global%20equities%20bonds%20and%20money%20market.jpg U.S. and Asian equity funds drew a net $3.4 billion and $500 million, respectively, in inflows, but investors exited European funds to the tune of about $2.14 billion.
Among equity sector funds, financials, consumer staples, and materials saw net purchases of $559 million, $292 million and $212 million, respectively, but tech witnessed a net outflow of $839 million.
Graphic: Fund flows: Global equity sector funds, https://fingfx.thomsonreuters.com/gfx/mkt/dwpkddkkqvm/Fund%20flows-%20Global%20equity%20sector%20funds.jpg Investors withdrew about $1.53 billion net from global bond funds after a net purchase of $4.96 billion last week.
Short- and mid-term bond funds recorded a 17th straight week of net selling, worth $1.54 billion, but high-yield and government bond funds received net inflows amounting to $4.24 billion and $1.92 billion, respectively. Graphic: Global bond fund flows in the week ended Dec. 14, https://fingfx.thomsonreuters.com/gfx/mkt/xmvjkkbbxpr/Global%20bond%20fund%20flows%20in%20the%20week%20ended%20Dec%2014.jpg Money market funds saw a net $12.95 billion outflow after three straight weeks of net purchases.
Data for commodity funds showed energy funds gained about $190 million in an eighth week of net buying but precious metal funds posted a ninth consecutive week of net selling, with outflows of $201 million.
According to data available for 24,687 emerging market (EM) funds, bond funds were in demand for the third week in a row, accumulating $636 million in net buying. Equity funds also received inflows worth $215 million after a weekly outflow. Graphic: Fund flows: EM equities and bonds, https://fingfx.thomsonreuters.com/gfx/mkt/zjvqjjnnmpx/Fund%20flows-%20EM%20equities%20and%20bonds.jpg
(Reporting by Gaurav Dogra and Patturaja Murugaboopathy in Bengaluru; Editing by Kirsten Donovan)
