NEW YORK: Global equity funds recorded their biggest weekly outflow in five weeks in the week to July 20, on investor caution ahead of crucial central bank meetings in which rate hikes are expected to be announced.

According to Refinitiv Lipper, investors offloaded a net $13.79 billion worth of global equity funds, marking the biggest weekly outflow since June 15.

The European Central Bank raised its benchmark deposit rate by 50 basis points, above its own guidance of a 25-basis-point hike, to rein in soaring inflation levels in the region.

The US Federal Reserve is also expected to raise policy rates by another 75 basis points at its meeting next week as it seeks to balance the risks of a stubbornly high inflation and the likelihood of a recession.

US and European equities funds booked withdrawals of $8.45bN and $5.6bn, respectively, although investors poured about $740 million in Asian equity funds.

Sectoral data showed financial, consumer discretionary and metals and mining funds witnessed outflows of $995m, $445m and $416m, respectively, but healthcare gained $511m in inflows.

Selling continued for a second week in global bonds funds as investors unwind $6.9bn worth of holdings.

Government funds saw outflows of $2.49bn after 15 weeks of inflows, while net selling in short- and medium-term bond funds eased to a 15-week low of $1.88bn.

Meanwhile, investors sold money market funds worth $1.34 billion after two weeks of purchases.

In the commodities space, net selling in gold and precious metal funds stood at $1.1bn, a 63 per cent bigger outflow than the previous week, while energy funds posted a fourth weekly outflow, valued at $180m.

An analysis of 24,388 emerging market funds showed investors jettisoned equity fund worth $2.04bn, the biggest outflow in 10 weeks, while bond funds suffered a sixth weekly outflow of $2.13bn.

Published in Dawn, July 24th, 2022

Now you can follow Dawn Business on Twitter, LinkedIn, Instagram and Facebook for insights on business, finance and tech from Pakistan and across the world.

Opinion

Editorial

Election time
Updated 27 Jan, 2023

Election time

There are concerns whether the ECP will be sufficiently able to protect the integrity of elections if they are held under partisan governments.
SCO invite
27 Jan, 2023

SCO invite

THOUGH India’s invitation to Pakistan to attend the Shanghai Cooperation Organisation events in Goa later this ...
Call to arms
27 Jan, 2023

Call to arms

ONE way the state abdicates responsibility in Pakistan is by farming out its functions to the private sector. In ...
Nuclear miscalculations
26 Jan, 2023

Nuclear miscalculations

IF the claim of former US secretary of state Mike Pompeo, that Pakistan and India came close to a nuclear exchange...
Exchange rate cap
26 Jan, 2023

Exchange rate cap

THE ‘management’ of the exchange rate by the State Bank, allegedly at the behest of the government, to ward off...
Fawad’s arrest
Updated 26 Jan, 2023

Fawad’s arrest

Does the state really need to fan public discontent in a period as fraught with uncertainty as this?