Key insights
- US equity funds saw significant inflows ($9.76B) driven by optimism surrounding a potential Middle East ceasefire and the reopening of the Strait of Hormuz. Tech, industrial, and utility sectors led the inflows. Bond funds also rebounded with inflows, while money market funds continued to attract capital. The shift suggests a risk-on sentiment, potentially bullish for US equities in the short term.
April 10 (Reuters) - U.S. investors ramped up purchases of equity funds in the week to April 8, as hopes for a two-week Middle East ceasefire boosted expectations for a reopening of the Strait of Hormuz to oil and gas flows.
Investors acquired U.S. equity funds worth a net $9.76 billion, roughly 80% more than the prior week's $5.42 billion purchases, LSEG Lipper data showed.
Israel sought talks with Lebanon on Thursday, ahead of anticipated peace negotiations between Washington and Tehran on Saturday, raising hopes of a de-escalation and reopening of the vital waterway.
Investors bought sectoral funds totaling $2.84 billion, booking the first weekly net inflow in three weeks. They added tech, industrial and utility sector funds of $2.43 billion, $994 million and $494 million, respectively, on a net basis.
Bond funds drew $9.6 billion in inflows, broadly reversing $10.14 billion outflows the week before.
Short-to-intermediate government and Treasury funds gained a hefty $7.28 billion, compared with $366 million net purchases a week ago. Investors also bought municipal debt funds and inflation-protected funds of $866 million and $709 million, respectively.
Money market funds, meanwhile, received a gross $9.7 billion, with inflows extending into a second successive week.
(Reporting by Gaurav Dogra; Editing by David Holmes)