Persistent enthusiasm for artificial intelligence and a cooler-than-expected US inflation report drove $20.6 billion in net inflows into US equity funds during the week ending September 30 (LSEG Lipper data), offsetting concerns over 10-year Treasury yields reaching 24-year highs.
📌 Key Capital Movements & Breakdown:
- Equity Market Allocation:
- Large-Cap Funds: Attracted $19.33 billion—their second-largest weekly inflow of the past quarter.
- Multi-Cap & Small-Cap Funds: Captured $1.01 billion and $223 million, respectively.
- Mid-Cap Funds: Recorded net outflows of $329 million.
- Sector Rebalancing: Sector funds saw net weekly outflows of $4.1 billion, led by profit-taking in technology (-$3.79 billion) and industrials (-$738 million).
- Fixed Income & Money Markets:
- US Bond Funds: Pulled in $6.45 billion in net inflows—a three-week high—led by short-to-intermediate government and Treasury funds (+$4.3 billion).
- Money Market Funds: Suffered net outflows of $41.36 billion, marking their third week of net redemptions in the past four weeks.
🌐 Key Market Drivers: Strong AI chip demand—underscored by Micron Technology’s robust revenue forecast—lifted tech sentiment, while moderating August inflation data reduced expectations of an October Fed rate hike.