Europe and Asia Lead Equity Fund Inflows as U.S. Funds See Outflows
European and Asian equity funds recorded strong inflows in the week ended February 11, as investors reduced exposure to U.S. mega-cap stocks amid concerns about high valuations and rising spending linked to artificial intelligence.
According to LSEG Lipper data, global equity funds posted a fifth consecutive week of net inflows, totaling $25.54 billion. European equity funds attracted $17.53 billion, marking their largest weekly inflow since at least 2022. Asian equity funds followed with approximately $6.28 billion in net inflows.
In contrast, U.S. equity funds experienced $1.42 billion in net outflows, the first weekly withdrawal in three weeks.
Nasdaq Declines on AI-Related Concerns
The U.S. technology-focused Nasdaq Composite fell 2.03% on Thursday. The decline reflected renewed concerns about how artificial intelligence could disrupt sectors such as software, legal services, and wealth management. Investors also remained cautious about the sustainability of elevated spending in AI-related projects.
Global Bond Funds Extend Winning Streak
Global bond funds remained in demand for a sixth straight week, attracting roughly $21.09 billion in net inflows.
Short-term bond funds saw $4.87 billion in weekly inflows, the strongest since mid-December. Corporate bond funds and euro-denominated bond funds also drew significant investor interest, with inflows of $2.63 billion and $2.06 billion, respectively.
Meanwhile, money market fund inflows slowed to $1.15 billion, marking a three-week low.
Gold and Emerging Markets Stay Attractive
Gold and precious metal funds recorded their 13th weekly inflow in 14 weeks, although the $1.25 billion net inflow was the smallest in five weeks.
Emerging market equity funds extended their positive momentum, attracting $8.52 billion and marking an eighth consecutive week of inflows. Emerging market bond funds also saw steady demand, with $1.29 billion in new investments across a combined 28,723 tracked funds.
The latest data signals a rotation in global capital flows, with investors favoring Europe, Asia, bonds, and emerging markets while trimming exposure to U.S. equities.
