US bond funds see biggest weekly outflows in four weeks

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US one dollar banknotes are seen in this illustration taken February 8, 2021. REUTERS/Dado Ruvic/Illustration

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June 10 (Reuters) – U.S. bond funds saw massive outflows in the week to June 8 after a weekly inflow as a better-than-expected payrolls report argued for a faster pace rising interest rates.

According to data from Refinitiv Lipper, investors withdrew $7.61 billion from U.S. bond funds after buying $7.09 billion the previous week, which was the only weekly inflow since Jan. 5.

Fund flows: US stocks, bonds and money market funds

The benchmark US 10-year yield jumped more than 10 basis points in the reported week amid strong US job creation. It hit a more than 3.5-year high at 2.862% on Friday ahead of a consumer price report.

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Investors expect the Federal Reserve to raise interest rates by 50 basis points next week as inflation data, due later today, is expected to show a sharp 0.7 rise. % in May. Read more

U.S. investors unloaded taxable bond funds worth $5.21 billion and municipal funds worth $2.4 billion, the largest weekly outflow in three weeks.

US short/mid high quality funds and short/mid government and treasury funds saw outflows of $3.63 billion and $2.77 billion, respectively, but investors bought funds at high yield worth $1.17 billion.

Fund flows: US bond funds

Meanwhile, money market funds saw net purchases of $24.79 billion, following outflows of $9.3 billion a week ago, underscoring risk sentiments.

U.S. equity funds saw net sales worth $1.82 billion after two consecutive weeks of inflows.

US growth and value funds saw outflows totaling $728 million and $869 million, respectively.

Fund Flows US Growth and Value Funds

In equities, investors disposed of technology and consumer staples funds worth $827 million and $558 million, respectively, while acquiring financials and utilities worth $558 million, respectively. $394 million and $332 million.

Fund flow: U.S. equity sector funds
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Reporting by Gaurav Dogra and Patturaja Murugaboopathy in Bengaluru; Editing by Anil D’Silva

Our standards: The Thomson Reuters Trust Principles.

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