After a week of sharp outflows, U.S. equity funds saw renewed investor demand through October 15, signaling a rebound in risk appetite amid Federal Reserve rate-cut optimism and strong Q3 corporate earnings.
💵 Key Flow Highlights:
- Total U.S. Equity Funds: + $1.04 billion, recouping ~25% of prior week’s losses
- Sector Funds: + $4.39 billion (4th consecutive week of inflows)
- Technology: + $1.18 billion
- Financials: + $920 million
- Large-Cap: − $2.42 billion
- Mid-Cap: + $495 million
- Small-Cap: − $114 million
📊 Earnings-Driven Optimism:
Stronger-than-expected results from Morgan Stanley (MS) and Bank of America (BAC) reinforced investor confidence despite trade tariff concerns and political uncertainty over a potential government shutdown.
💼 Fixed Income & Cash Movements:
- Bond Funds: + $6.49 billion (2nd straight weekly inflow)
- Short-Term Investment Grade: + $2.13 billion
- Treasury/Government Funds: + $890 million
- Municipal Debt: + $678 million
- Money Market Funds: − $20.98 billion, ending a 3-week inflow streak
🪙 Market Context:
Investors continue to rotate cautiously between equities and bonds as the Fed signals easing and corporate America beats expectations, suggesting a possible Q4 rally underpinned by improving liquidity and easing inflationary pressures.