In the seven days up to May 15, US equity funds attracted a large inflow of capital, driven by weak US employment data and rising expectations of the Federal Reserve's interest rate cut after falling short of expectations. According to LSEG data, investors made a net injection of 5.78 billion US dollars into US equity funds, the largest weekly capital inflow since March 20. The report released on Wednesday showed that the US CPI slowed in April, which strengthened the market's expectations that interest rates would be cut twice before the end of the year.

US large equity funds absorbed about US$5.38 billion, the largest weekly net inflow since March 27. Large-cap funds attracted about $1.05 billion, but net outflows of small and medium capitalization funds were $817 million and $191 million, respectively.

After six consecutive weeks of net outflows, industry equity funds received only $22 million in capital inflows. The industrial, financial and utilities sectors attracted net inflows of $515 million, $385 million, and $359 million, respectively. The net sell-off in tech stocks was around $757 million.

US bond funds attracted capital inflows for the fourth week in a row, with a net increase of about US$2.39 billion. Investors allocated a net allocation of US$815 million to US loan participation funds, US$812 million to general US domestic taxable fixed income funds, and US$698 million to short/medium term government and treasury bond funds. However, US shorter/mid-tier investment-grade bond funds experienced a sharp correction, with a net outflow of US$1.18 billion, the largest since November 8, 2023.

The net inflow of money market funds was US$2.56 billion, the lowest last month.

Editor/Jeffrey