U.S. equity funds recorded their first weekly inflow in three weeks as investors positioned ahead of the Federal Reserve’s expected policy rate cut.
In the week through December 10, investors added a net $3.3 billion to U.S. equity funds, nearly reversing the prior week’s $3.52 billion outflow, according to LSEG Lipper data.
🔹 Sector Rotation Continues
Despite lingering concerns over AI profitability, following weaker-than-expected guidance from Oracle, sectoral equity funds attracted strong demand:
- $2.81B in net inflows — the highest since late October
- Metals & mining: $672M
- Industrials: $548M
- Healthcare: $527M
🔹 Fixed Income & Liquidity Trends
- U.S. bond funds saw $3.49B in weekly inflows, sharply higher than the prior week.
- Short-to-intermediate investment-grade funds attracted $2.61B, the strongest inflow in seven weeks.
- Investors withdrew $902M from general domestic taxable bond funds.
- Money market funds recorded $4.58B in outflows after last week’s massive inflows.
🔹 The Big Picture
While rate-cut expectations are supporting risk assets, investors remain selective — rotating toward defensive and cyclical sectors while balancing equity exposure with high-quality fixed income.