Global equity funds face weekly outflows on growth worries

Global equity funds saw outflows in the week ended Nov. 23 on worries over a recession due to higher interest rates and fresh lockdowns as COVID cases rise in China.

According to Refinitiv Lipper data, investors withdrew $8.6 billion and $840 million respectively from U.S. and European equity funds but invested $470 million in Asian equity funds.

(Graphic: Fund flows: Global equities bonds and money market - https://fingfx.thomsonreuters.com/gfx/mkt/lbpggnzxjpq/Fund%20flows-%20Global%20equities%20bonds%20and%20money%20market.jpg)

Among equity sector funds, financials, tech, and real estate funds had outflows of $751 million, $429 million, and $390 million, respectively, although consumer staples received $600 million worth of inflows.

Meanwhile, global bond funds posted outflows for a third straight week, amounting to $2.52 billion.

Global short- and mid-term bond funds saw withdrawals of $4.84 billion, the biggest weekly outflow in five weeks, but high-yield bond funds lured inflows for a second successive week, to the value of $2.35 billion.

Meanwhile, global government bond funds received inflows worth $809 million in a third straight week of net buying.

Global money market funds saw much bigger inflows, with investors bracing for the release of the Federal Reserve's meeting minutes.

(Grphic: Fund flows: Global equity sector funds - https://fingfx.thomsonreuters.com/gfx/mkt/lgpdkwabxvo/Fund%20flows-%20Global%20equity%20sector%20funds.jpg)

The data showed investors accumulated global money market funds worth $26.4 billion, compared with an outflow of $9.4 billion in the previous week.

Energy funds remained in demand for the fifth consecutive week as they received net investment of $149 million. Investors also purchased about $18 million of precious metal funds after five weeks of net selling in a row.

(Graphic: Global bond fund flows in the week ended Nov 23 - https://fingfx.thomsonreuters.com/gfx/mkt/dwpkdrlmyvm/Global%20bond%20fund%20flows%20in%20the%20week%20ended%20Nov%2023.jpg)

According to data available for 24,768 emerging market (EM) funds, EM equity funds received $1.11 billion but EM bond funds had outflows of $201 million after $233 million worth of net purchases the previous week.

(Graphic: Fund flows: EM equities and bonds - https://fingfx.thomsonreuters.com/gfx/mkt/klvygkbrjvg/Fund%20flows-%20EM%20equities%20and%20bonds.jpg)