(Reuters) – U.S. equity funds attracted inflows for the week ending March 12 as some investors were buoyed by a weaker CPI reading, while worries persisted over the economic impact of President Donald Trump’s trade policies.
U.S. equity funds saw net purchases of $4.67 billion during the week, although the strong inflows from February, which totaled about $9 billion, have tapered off with a combined outflow of $4.81 billion in the first two weeks of March.
“We recommend investors embrace diversification and stay invested despite ongoing volatility … see continued positive potential returns in the United States, AI, as well as power-and-resources-linked equities into year-end,” said Mark Haefele, chief investment officer at UBS Global Wealth Management.
“Investors looking to navigate a tense geopolitical environment should ensure their portfolios are well diversified with quality bonds, gold and alternative investments.”
U.S. large-cap funds received $8.78 billion, the fifth consecutive weekly net inflow.
Multi-cap funds also witnessed $479 million worth of additions, though investors ditched small-cap and mid-cap funds to the tune of $1.32 billion and $1.22 billion, respectively.
Sectoral funds, meanwhile, witnessed the second straight week of outflows, with net sales worth $3.25 billion. Investors divested tech, communication services and consumer staples sector funds to the tune of $1.59 billion, $423 million and $340 million, respectively.
U.S. bond funds were in demand for the tenth successive week, grossing in a net $8.44 billion during the week.
Short-to-intermediate government and treasury funds drew a robust $5.39 billion, the largest weekly net inflow since March 2023. Meanwhile, loan participation funds witnessed a notable $1.13 billion worth of net withdrawals following 10 weekly inflows in a row.
U.S. money market funds, meanwhile, saw $14.62 billion worth of net sales, the second weekly outflow in six weeks.
(Reporting by Gaurav Dogra and Patturaja Murugaboopathy in Bengaluru; Editing by Shounak Dasgupta)
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