Global equity funds see outflows on growth worries

Global equity funds experienced their first weekly outflow in four weeks in the week to September 4, as cautious investors pulled back on concerns about global economic growth and ahead of a data-heavy week culminating in the US jobs report, reports Reuters.

According to LSEG data, investors sold a net $4.93 billion worth of global equity funds during the week, marking their largest weekly net sales since June 12.

Investors were concerned about the US economy after a report from the Institute for Supply Management (ISM) on Tuesday revealed that US manufacturing had contracted for the fifth consecutive month in August. Additionally, anticipation was building for the non-farm payrolls report, where a weak outcome could heighten fears of a sharp economic downturn.

Investors offloaded a net $11.73 billion worth of US equity funds, marking a fourth weekly outflow in five weeks. On the contrary, European and Asian equity funds still gained about $5.25 billion and $1.88 billion worth of inflows.

The technology sector witnessed a significant $995 million worth of outflow following three weekly inflows in a row. Investors also ditched real estate and consumer discretionary funds of $388 million and $304 million, respectively.

Global investors sought the safety of money market funds as they pumped in a massive $67.92 billion into these funds in a fifth successive week of net purchases.

Simultaneously, investors snapped up global bond funds of a net $10.85 billion, extending net purchases into the 37th consecutive week.