US equity funds pulled in $11.72 billion during the week ended August 21 while bond funds recorded their largest weekly inflow since mid-July, a divergence that shows investors chasing earnings momentum even as fixed income regains favor.
Earnings breadth drives equity demand
Anthropic’s upbeat revenue forecast added to a backdrop where roughly 85 percent of the 468 S&P 500 members that have reported so far exceeded analyst estimates, according to LSEG data cited by Reuters. That beat rate has kept risk appetite intact despite Thursday’s selloff triggered by climbing Treasury yields and a crude oil rally.
Large caps lead, small caps lag
Large-cap equity funds absorbed $9.58 billion of the weekly total, with multi-cap products taking another $1.36 billion. Mid-cap and small-cap funds saw redemptions of $809 million and $70 million respectively, a pattern that suggests investors are clustering in the biggest names rather than broadening out.
Sector rotation punishes financials
Sector funds posted $3.1 billion of net outflows. Financial funds shed $1.87 billion, consumer staples lost $623 million and industrials gave back $444 million. Technology was the sole gainer, adding $287 million as the market waits for Nvidia’s results next week to gauge AI infrastructure demand.
Bonds reclaim the spotlight
Bond funds attracted $9.92 billion, the strongest week since July 15. The inflow arrived even as yields rose earlier in the week, a reminder that income seekers are willing to buy the backup when the carry looks adequate.
Indexes rebound into the weekend
Major averages recovered on Friday. The Dow Jones Industrial Average rose 0.81 percent, the S&P 500 added 0.41 percent and the Nasdaq Composite edged up 0.35 percent, erasing most of the prior session’s decline.