by Jack Fischer.
During Refinitiv Lipper’s fund-flows week that ended March 22, 2023, investors were overall net purchasers of fund assets (including both conventional funds and ETFs) for the fourth week in a row, adding a net of $133.3 billion.
Money market funds (+$115.6 billion), equity funds (+$11.9 billion), taxable bond funds (+$5.3 billion), and tax-exempt bond funds (+$427 million) all reported inflows. Money market funds surpassed last week’s inflow total and set a new fifth-largest weekly intake of all time.
At the close of Refinitiv Lipper’s fund-flows week, U.S. broad-based equity indices reported mostly positive returns. The DJIA (+0.49%), Nasdaq (+2.06%), and S&P 500 (+1.16%) all reported gains while the Russell 2000 (-1.06%) realized a weekly loss.
The Bloomberg Municipal Bond Total Return Index (+0.03%) and the Bloomberg U.S. Aggregate Bond Total Return Index (+0.56%) logged their third straight weekly gain.
Overseas indices traded in the black—Shanghai Composite (+0.21%), Dax 30 TR (+5.79%), FTSE 100 (+4.74%), and Nikkei 225 (+0.98%).
The 10-two Treasury yield spread remained negative (-0.48), marking the one hundred and eighty-seventh straight trading session with an inverted yield curve.
According to Freddie Mac, the 30-year fixed-rate average (FRM) decreased for the second consecutive week—currently at 6.42%. Both the United States Dollar Index (DXY, -2.20%) and the VIX (-16.94%) fell over the course of the week.
Exchange-traded equity funds recorded $14.6 billion in weekly net inflows, marking the second weekly inflow in the last five weeks. The macro-group posted a gain of 1.13% on the week.
Growth/value-large cap ETFs (+$15.5 billion), sector-other ETFs (+933 million), and sector-financial/banking ETFs (+$569 million) were the largest outflows under the macro-group. Growth/value-large cap ETFs realized positive weekly performance (+1.28%) for the second week in three. This past weekly inflow was the largest for growth/value-large cap ETFs since December 2021.
Growth/value-small cap ETFs (-$1.4 billion), sector-energy ETFs (-$598 million), and convertible & preferreds ETFs (-$571 million) were the top subgroups to log outflows. The weekly outflow for growth/value-small cap ETFs was the first in the past four weeks while the subgroup has suffered three straight weeks of negative returns.
Over the past fund-flows week, the top two equity ETF flow attractors were SPDR S&P 500 ETF (SPY, +$13.1 billion) and iShares: MSCI USA Quality Factor (QUAL, +$6.5 billion).
Meanwhile, the bottom two equity ETFs in terms of weekly outflows were iShares: ESG Aware MSCI USA ETF (ESGU, -$5.1 billion) and iShares: MSCI USA Momentum Factor ETF (MTUM, -$1.3 billion).
Exchange-traded fixed income funds observed a net $9.2 billion weekly inflow—the macro-group’s fifth straight weekly inflow. Fixed income ETFs reported a weekly return of positive 0.32% on average, their second consecutive weekly gain.
Government-Treasury ETFs (+$8.4 billion), corporate-investment grade ETFs (+$1.7 billion), and government-mortgage ETFs (+$329 million) logged the top weekly inflows under taxable fixed income subgroups. Government-Treasury ETFs logged their sixth consecutive weekly and their largest weekly inflow of all time.
International & global debt ETFs (-$627 million), corporate-high yield ETFs (-$379 million), and flexible funds ETFs (-$178 million) were the top subgroups to observe weekly outflows. Despite back-to-back weeks of positive performance international & global debt ETFs suffered their first weekly outflow in three weeks.
Municipal bond ETFs reported a $19.5 million inflow over the week, marking only their second weekly inflow in the last nine weeks. The subgroup realized a positive 0.07% average, their third straight week of gains.
iShares: US Treasury Bond (GOVT, +$2.9 billion) and iShares: 7-10 Treasury Bond ETF (IEF, +$2.3 billion) attracted the largest amounts of weekly net new money for taxable fixed income ETFs.
On the other hand, iShares: Short Treasury Bond ETF (SHV, -$903 million) and iShares: JPM USD Emerging Bond ETF (EMB, -$770 million) suffered the largest weekly outflows under all taxable fixed income ETFs.
Conventional equity funds (ex-ETFs) witnessed weekly outflows (-$2.8 billion) for the fifty-ninth straight week. Conventional equity funds posted a weekly return of positive 1.34%.
International equity (-$984 million), global equity (-$504 million), and growth/value-aggressive cap (-$314 million) were the largest subgroup outflows under conventional equity funds. Conventional international equity funds observed their third weekly outflow in the last four weeks, despite appreciating in three of those same four weeks.
Convertible & Preferreds (+$79 million), sector-real estate (+$52 million), and gold and natural resources (+$28 million) were the only subgroups to post a weekly inflow under equity mutual funds. Convertible & Preferreds realized their first weekly inflow in 27 weeks after recording two weeks of positive performance in the last three.
Conventional taxable-fixed income funds realized a weekly outflow of $3.9 billion—marking their fifth straight outflow. The macro-group logged a positive 0.51% on average—their third consecutive week of gains.
Conventional corporate-investment grade funds (-$2.6 billion), flexible funds (-$1.0 billion), and corporate-high yield (-$523 million) reported the largest weekly outflows under taxable fixed income conventional funds. Corporate-investment grade mutual funds witnessed their fourth straight weekly outflow after logging seven consecutive weeks of inflows. The subgroup logged a positive 0.36% on average over the last week.
Conventional government-mortgage (+$287 million), government-Treasury & mortgage (+$194 million), and corporate-high quality funds (+$50 million) were the only taxable fixed income macro-group to produce inflows. Government-mortgage mutual funds attracted net new capital for the second week in three after back-to-back weeks of gains.
Municipal bond conventional funds (ex-ETFs) returned a negative 0.10% over the fund-flows week—their first week of losses in four. The subgroup experienced $447 million in outflows, marking the fifth straight week of outflows.
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