by Pat Keon, CFA.
Lipper’s fund asset groups (including both mutual funds and exchange-traded funds) recorded net inflows of $23.4 billion for the fund-flows trading week ended Wednesday, November 13. This was the eleventh straight weekly net positive flows for funds, during which time they’ve grown their coffers by $219.5 billion for an average weekly net inflow just shy of $20.0 billion. All four asset groups contributed to this week’s total net inflows, led by money market funds (+$18.4 billion), while taxable bond funds (+$1.9 billion), equity funds (+$1.8 billion), and municipal bond funds (+$1.3 billion) all posted net inflows north of $1.0 billion.
The major equity indices recorded gains for the third straight fund-flows trading week. The Dow Jones Industrial Average, the NASDAQ Composite Index, and the S&P 500 Index were up 1.06%, 0.85%, and 0.56%, respectively, this week. These gains extended the indices fourth quarter returns to 6.03% for the NASDAQ, 3.94% for the S&P 500, and 3.22% for the Dow. This week’s market news was dominated once again by the U.S./China trade war. The market took strength from the announcement at the start of the trading week that both sides had agreed to repeal the existing tariffs on each other’s goods as phase one of the trade deal. This news lost some of its luster the next day as President Trump stated that he hadn’t agreed to anything as of yet and he would not sign off on a complete rollback of the existing tariffs, but a partial one was possible.
ETFs had net positive flows of $4.3 billion thanks to the equity ETF asset group (+$5.6 billion). The largest individual net inflows among equity ETFs belonged to iShares Core MSCI EAFE ETF (IEFA, +$1.6 billion) and Invesco QQQ Trust 1 (QQQ, +$1.3 billion). Muni bond ETFs also contributed to the total net inflows as they took $176 million in net new money for the week for the group’s sixth consecutive weekly increase. Taxable bond ETFs saw $1.5 billion leave last week as iShares 20+ Years Treasury Bond ETF (TLT, -$656 million) and iShares iBoxx $ High Yield Corporate Bond ETF (HYG, -$461 million) suffered the largest single net outflows.
Equity Mutual Funds
Equity mutual funds (-$3.8 billion) experienced net outflows for the thirty-ninth consecutive week. All of this week’s net negative flows came at the hands of domestic equity funds (-$4.0 billion), while nondomestic equity funds took in $130 million of net new money. Among the peer groups, Large-Cap Growth Funds (-$736 million) had the largest net outflow in the domestic equity universe while International Large-Cap Growth Funds (+$285 million) took in the most net new money on the nondomestic equity fund side of the ledger.
Fixed Income Mutual Funds
Municipal debt funds (+$1.1 billion) grew their streak of net inflows to 45 weeks, while taxable bond funds (+$3.4 billion) extended their own streak to six weeks. The General Muni Debt Funds (+$348 million) and High Yield Muni Debt Funds (+$244 million) peer groups led the tax-exempt net inflows, while the Ultra-Short Obligation Funds (+$741 million) and Core Plus Bond Funds (+$734 million) peer groups paced taxable bond funds.
Money Market Mutual Funds
Money market funds (+$18.4 billion) took in net new money for the fourth straight week. All of the money market fund peer groups recorded net inflows for the week, with the Institutional U.S. Treasury Money Market Funds (+$6.7 billion) and Institutional U.S. Government Money Market Funds (+$5.2 billion) peer groups leading the way.