© Reuters. A screen displays Federal Reserve Chair Jerome Powell speaking as a trader works on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., November 2, 2022. REUTERS/Brendan McDermid
(Reuters) – Global equity funds obtained huge inflows in the week ended Nov. 2 as investors were hoping that the U.S. Federal Reserve would consider decelerating the pace of its interest rate hikes, ahead of its policy decision.
According to Refinitiv Lipper data, investors purchased a net $13.76 billion worth of global equity funds, marking their biggest weekly net buying since March 23.
Graphic: Fund flows: Global equities, bonds and money market – https://fingfx.thomsonreuters.com/gfx/mkt/klvygeoydvg/Fund%20flows-%20Global%20equities%20bonds%20and%20money%20market.jpg
The U.S., European, and Asian equity funds, all received inflows worth $10.19 billion, $2.42 billion and $830 million respectively.
By sector, investors accumulated healthcare, tech and consumer staples funds of $717 million, $522 million and $458 million respectively.
However, the sentiment was slightly soured after the U.S. Federal Reserve hiked interest rates by 75 basis points and said the peak for rates would likely be higher than previously expected.
Graphic: Fund flows: Global equity sector funds – https://fingfx.thomsonreuters.com/gfx/mkt/dwpkdgnbzvm/Fund%20flows-%20Global%20equity%20sector%20funds.jpg
Meanwhile, global bond funds obtained $655 million worth of inflows after witnessing disposals for 10 weeks in a row.
High yield bond funds saw purchases worth $4.35 billion, which marked their biggest weekly inflow in two months, but short- and medium-term bond funds recorded a 11th straight week of net selling.
Investors sold government bonds funds of $1.22 billion after 10 weeks of purchases in a row.
Graphic: Global bond fund flows in the week ended Nov. 2 – https://fingfx.thomsonreuters.com/gfx/mkt/xmvjkgxdjpr/Global%20bond%20fund%20flows%20in%20the%20week%20ended%20Nov.%202.jpg
Money market funds had a fifth successive weekly inflow, amounting $66.82 billion, the data showed.
Emerging market (EM) equities received $1.5 billion after two weeks of outflows, although bonds remained out of favour for the 11th successive week with outflows worth $2.45 billion, data for 24,754 EM funds showed.
Graphic: Fund flows: EM equities and bonds – https://fingfx.thomsonreuters.com/gfx/mkt/zjvqjqgznpx/Fund%20flows-%20EM%20equities%20and%20bonds.jpg
Among commodity funds, precious metal funds witnessed outflows for a third week, amounting $1.01 billion, but energy funds gained a second weekly inflow, worth $73 million.