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Equity, bond funds see inflows as markets hit rough patch

by Mike Robinson

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© Reuters. FILE PHOTO – Traders are seen working on the New York Stock Exchange’s floor in New York City (U.S.A.), September 29, 2021. REUTERS/Brendan McDermid

By Saikat Chatterjee

LONDON (Reuters] – While global equity and bond funds experienced modest inflows, they were outpaced by cash and gold funds. This week was dominated in part by fears about the U.S. debt ceiling as well as energy insecurity in Europe or China.

Investors invested $9.2 Billion in stocks, $8 Billion into bonds and $0.6 billion in gold. Cash withdrawals were $6.6 billion and $0.6 billion respectively.

If you dig deeper, we find that bigger investment flows are into small caps, energy and financials while large outflows were seen in emerging market debt funds due to rising yields.

Analysts led by Michael Hartnett of Bank, Chief Investment Strategist, stated in a note that “if the 2010s were inflationary, driven primarily by excessive debt and ageing populations, the 2020s would be deflationary,” citing Hartnett.

It was noted that since January 2020 the U.S. has expended $14.2 trillion per hour and spent $1.2 BILLION every hour in 2021. The government is struggling to approve additional fiscal stimulus measures.

The U.S. House of Representatives’ Democratic Leaders postponed a vote scheduled for Thursday on a bipartisan $1 trillion infrastructure bill.

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