US money market funds see large inflows ahead of Fed decision

US investors poured large sums into money market funds while pulling back from riskier equity funds in the week to December 3, taking a cautious stance ahead of the Federal Reserve's policy decision on Wednesday, reports Reuters.

They accumulated approximately $104.75 billion worth of US money market funds, registering their largest weekly net purchase since November 5, LSEG Lipper data showed.

Despite expectations, opens new tab of a rate cut, investors remained wary, with stretched valuations in mega-cap technology stocks reinforcing the shift toward safer assets.

They ditched US equity funds amounting to a net $3.52 billion, in a second successive week of net selling.

Mid-cap funds witnessed a seventh straight weekly net outflow, valued at $494.92 million. Small- and large-cap funds also experienced net disposals of $1.18 billion and $476 million, respectively.

Sectoral equity funds, however, stayed popular for a second week as these funds drew approximately $510 million worth of net inflows.

Industrials, and gold and precious metals equity funds saw inflows of $510 million and $293 million, respectively.

US bond funds, meanwhile, attracted just $314 million, the smallest amount for a week since October 1.

Short-to-intermediate investment-grade funds and municipal debt funds secured inflows of $1.45 billion and $737 million, respectively, while short-to-intermediate government and treasury funds had a weekly outflow of $1.58 billion.