Global Equity Funds Experience Outflows Amid Growth Concerns; Jobs Data Anticipated

Global equity funds faced their first weekly outflow in four weeks as of September 4, amid growing concerns over global economic growth and anticipation of a data-heavy week concluding with the U.S. jobs report.

Data revealed that investors withdrew a net $4.93 billion from global equity funds during this period, the largest weekly sales since June 12.

Concerns arose regarding the U.S. economy following a report from the Institute for Supply Management, which indicated that U.S. manufacturing had contracted for the fifth consecutive month in August. Investors were also bracing for the upcoming non-farm payrolls report, wary that a disappointing result could signal a more pronounced economic downturn.

In a notable trend, investors sold off $11.73 billion in U.S. equity funds, marking the fourth outflow in five weeks. Conversely, European and Asian equity funds witnessed inflows of approximately $5.25 billion and $1.88 billion, respectively.

The technology sector saw a considerable outflow of $995 million after three consecutive weeks of inflows. Additionally, real estate and consumer discretionary funds were offloaded by $388 million and $304 million, respectively.

Amidst the uncertainty, global investors turned to the security of money market funds, investing a substantial $67.92 billion into these funds for the fifth consecutive week of net purchases.

Alongside this, global bond funds attracted a net $10.85 billion, marking the 37th consecutive week of net inflows. Corporate bond funds saw robust inflows of $3.26 billion, the largest since July 17. Dollar-denominated medium-term bond funds and government bond funds also recorded net investments of $2.8 billion and $1.46 billion, respectively.

Precious metals, particularly gold, continued to attract attention, with funds in this category gaining a net $792 million in inflows for the fourth week running. Additionally, energy funds experienced a net influx of $189 million.

In the realm of emerging markets, data covering 29,588 funds revealed that equity funds experienced a 13th consecutive week of outflows totaling $419 million. In contrast, bond funds attracted $1.45 billion, representing the largest weekly inflow since July 10.