US equity funds draw biggest weekly inflow in 1-1/2 months
Feb 16 (Reuters) -A market rally spurred by upbeat fourth-quarter earnings drove heavy inflows into U.S. equity funds in the week to Feb. 14, with investors undeterred by uncertainty over the timing of Federal Reserve rate hikes.
U.S. equity funds accumulated a net $6.78 billion in inflows during the week, the biggest weekly net purchase since Dec. 27, 2023, LSEG data showed.
The surge followed the S&P 500's .SPX climb to a record high of 5,048.39 on Monday. The index later retreated to 4,920.31 after a higher-than-expected U.S. inflation reading, but recovered approximately 1.6% in the following two sessions, suggesting potential for new highs.
Wall Street's fourth-quarter earnings reports have been overwhelmingly positive. According to LSEG data, about 80% of S&P 500 companies have exceeded estimates, contributing to an estimated earnings growth of 9.9%, compared with the 4.7% growth anticipated on Jan. 1.
The most demand was for large-cap equity funds that drew about $5.61 billion in net buying, the biggest weekly inflow in seven.
Small-cap funds also lured about $1.46 billion in inflows, but mid-, and multi-cap funds suffered net selling of $679 million and $229 million, respectively.
Technology sector funds received $1.95 billion, the highest since Nov. 22, 2023. Investors also accumulated $453 million and $260 million in consumer discretionary and industrials sector funds.
U.S. bond funds, in demand for an eighth straight week, drew inflows of about $6.03 billion on a net basis.
U.S. short/intermediate investment-grade funds secured about $2.14 billion as net purchases continued into a ninth successive week.
Investors also poured $2.81 billion and $418 million, respectively into general domestic taxable fixed income, and loan participation funds.
Concurrently, U.S. money market funds experienced net selling of about $17.56 billion, the biggest outflow in a week since Jan. 17.
Fund flows: U.S. domiciled equities, bonds and money market funds https://tmsnrt.rs/3KNM61M
Fund flows: U.S. equity sector funds https://tmsnrt.rs/40SDRqx
Fund flows: U.S. bond funds https://tmsnrt.rs/3KM9fkX
Reporting by Gaurav Dogra and Patturaja Murugaboopathy in Bengaluru; editing by Barbara Lewis
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