Global Bond, Money Market Funds Attract Inflows 

Global Bond, Money Market Funds Attract Inflows 

In the week ending April 21, investors poured $16.4 billion into global bond funds.  Additionally, $14.9 billion into money market funds, according to data. Worries about a global increase in coronavirus cases prompted moves towards safer assets.

Data also showed the inflows at global bond funds were roughly 2% higher than in the week prior. The massive inflows into money market funds followed an outflow of $50 billion in the last week.

However, global equity funds had inflows of $10.8 billion. Compared to the previous week, that was around 33% less.

Investors began to question lofty stock valuations amid a spike in COVID-19 cases and its impact on the global economic rebound. As this happened, slow money inflows into equity funds came.

However, the majority of equity inflows were at European equity funds which obtained $8.2 billion. That’s in comparison with an inflow of $1.5 billion Asian funds and $0.8 billion at U.S. funds.

This week, European equities reached a record high on anticipations of higher earnings growth in Q1. 

Indian equity funds faced an outflow of $287 million in the week, data showed, hit by growing COVID-19 cases. This was their biggest outflow in three months.

Also on Friday, India reported the world’s highest daily tally of coronavirus cases for the second day.

Commodities

Helped by lower bond yields and a sagging dollar, safer precious metal funds faced their lowest outflow in 10 weeks.

Concerns about economic recovery affected energy funds. Its outflow of $195.5 million was the biggest in six weeks.

In 30 weeks, emerging market equity funds faced their first outflow. The lowest in three weeks were emerging market bond funds with an inflow of $714 million.

Oil Up, Gold Slides on Stronger Dollar

At the end of the week, oil prices were edging higher, boosted by reopening optimism in the US and Europe. However, eyes are still on surging Covid cases in India and new lockdown restrictions in parts of Japan to keep any gains in check.

 

Gold is recovering after falling lower in the previous session. The yellow metal slid -0.5% lower on Thursday on the back of a stronger US dollar. 

 

Boosting the greenback in the previous session were the better-than-forecast US jobless claims. Moreover, reports that the Biden administration is considering raising capital gains tax for wealthy individuals to 40%. Consequently, the US dollar-denominated gold came under pressure.

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