(Reuters) – Global equity funds led investment inflows in the week to Feb. 17, as fund investors favoured riskier assets on optimism over the coronavirus vaccine roll-outs and expectations of a massive U.S. stimulus package.
Investors purchased $26.5 billion in equity funds last week, marking a tenth straight month of net buying in equity funds, Refinitiv Lipper data showed.
(Graphic: Fund flows into global equities, bonds and money markets, https://fingfx.thomsonreuters.com/gfx/mkt/ygdpzekebvw/Fund%20flows%20into%20global%20equities%20bonds%20and%20money%20markets.jpg)
Global bond funds also attracted about $19.5 billion, helped by heavy inflows into shorter-dated bonds and inflation-linked debt.
Investors poured some $5.7 billion into funds that invest in U.S. short-term and medium-term bonds, or bonds maturing between 1-5 years, the data showed. Funds investing in inflation-linked bonds, which are structured to provide protection against rising inflation, lured about $1.1 billion.
(Graphic: Global bond inflows in the week ended Feb 17, https://fingfx.thomsonreuters.com/gfx/mkt/qzjpqgnzkpx/Global%20bond%20inflows%20in%20the%20week%20ended%20Feb%2017.jpg)
Meanwhile, some investors stuck to their holdings in energy funds due to a recent rise in oil prices, driven by a historic freeze in the south of the United States which has hit production.Energy funds saw their lowest investment outflow in 8 weeks in the week ending Feb. 17, but precious metal funds had their second consecutive week of outflows.
Funds investing in the technology and healthcare sectors led equity inflows. Investors poured $6.98 billion into tech funds, followed by $1.12 billion into healthcare funds during the week, data for 1,170 tech funds and 861 healthcare funds, based on Lipper’s sector classification, showed.
(Graphic: Global fund flows into equity sectors, https://fingfx.thomsonreuters.com/gfx/mkt/gjnpwzjzkvw/Global%20fund%20flows%20into%20equity%20sectors.jpg)
Emerging market equity funds also attracted heavy inflows in the week. Refinitiv data covering 13,812 emerging market equity funds showed inflows worth $2.52 billion.
But emerging market bond funds faced outflows worth $696 million, Refinitiv data for 8,981 emerging market bond funds showed.
(Graphic: Fund flows into EM equities and bonds, https://fingfx.thomsonreuters.com/gfx/mkt/azgvoeaelvd/Fund%20flows%20into%20EM%20equities%20and%20bonds.jpg)
(Reporting by Gaurav Dogra and Patturaja Murugaboopathy in Bengaluru; Editing by Ana Nicolaci da Costa)