BENGALURU: Investments into money market funds surged to the highest this year in the week ended March 31, as investors favored safety amid a fall in bond prices and fresh lockdowns in Europe, with the region grappling to contain a rising number of coronavirus infections.
Global money market funds received inflows of $44.7 billion in the week, the biggest since the week ended Dec. 30, data from Refinitiv Lipper showed.
On the other hand, equity funds obtained inflows of $17.6 billion, the lowest in three weeks, pressured by a surge in US bond yields.
Overall, equity funds received net buying of $289.6 billion in the first quarter, the biggest since at least 2013, though the inflows slowed by the end of the quarter.
In the last week, equity inflows were led by the financial sector which saw a net buying of 2.37 billion, while industrial sector received $1.1. billion, the biggest in four weeks.
Higher oil prices bolstered inflows into energy sector funds. However, precious metal funds continued to witness outflows due to a fall in gold prices.
Gold fell 11 percent in the first quarter of this year, marking its worst start to the year since 1982.
Investments into China-focused equity funds dropped to $148 million in the last week, the lowest in three weeks, on concerns over sanctions imposed by the US and its allies on officials in China’s Xinjiang region over allegations of human rights abuses, prompting retaliatory sanctions from Beijing.
Meanwhile, investors net bought $8.4 billion worth of global bond funds, which was about 19 percent higher than the previous week. boosted by inflows into US medium-term bonds and high-yield bonds.
An analysis of 23,671 emerging-market funds showed equity funds attracted $2.06 billion in inflows, a two-fold increase from the preceding week, while bond funds saw $981 million in outflows.
US money market funds attract $21.4 billionCMA’s Smart Investor program participates in Global Money Week
Global money market funds obtain highest inflows in 14 weeks