US equity funds see third straight weekly outflow

U.S. dollar banknotes are shown in this illustration taken February 14, 2022. REUTERS/Dado Ruvic/Illustration

July 15 (Reuters) – U.S. equity funds posted outflows for the third consecutive week in the week ended July 13 on pessimism about economic growth and earnings prospects as companies were hit by higher borrowing costs and lower margins.

According to data from Refinitiv Lipper, U.S. equity funds faced outflows of $1.41 billion, compared to $5.45 billion in net sales the previous week.

Data released this week showed US consumer prices accelerating faster than economists had expected, with the CPI jumping 9.1% in the 12 months to June , strengthening the case for further Fed rate hikes. Read more

On Thursday, JPMorgan Chase & Co and Morgan Stanley (MS.N) reported falling second-quarter profits and warned of an impending economic slowdown. Read more

US small-cap and mid-cap funds saw outflows worth $2.38 billion and $81 million, respectively, but large-cap funds saw inflows of $1.98 billion.

Among sector funds, consumer discretionary, technology and industrials lost $715 million, $403 million and $307 million, respectively, in outflows, while utilities made purchases worth net of $298 million.

Meanwhile, safer money market funds gained about $10 billion in the second consecutive week of net buying.

The data showed investors withdrew $705 million from U.S. bond funds after net purchases of $2.72 billion the previous week.

Investors sold $3.32 billion of short/middle-range US investment-grade funds, while loan equity funds suffered outflows of $1.29 billion in a sixth straight week net sales.

Meanwhile, short/intermediate US government and treasury funds secured $1.65 billion in net purchases, after posting small outflows the previous week.

Reporting by Gaurav Dogra and Patturaja Murugaboopathy in Bengaluru; Editing by Shinjini Ganguli

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