The data in the article below is sourced from Lipper’s Global Fund Flows application. GFF can be found on LSEG Workspace (“FundFlows”).
During LSEG Lipper’s fund-flows week that ended April 24, 2024, investors were overall net purchasers of fund assets (including both conventional funds and ETFs) for the first week in three, adding a net $5.5 billion.
Last week the fund market saw an astonishing $143.5 billion in outflows—the largest weekly outflow since the week ending September 16, 2009. Most of this was due to money market funds (-$118.5 billion) seeing their third largest weekly outflow on record—trailing only the weeks ending March 3, 1995 (-$193.0 billion) and December 31, 2003 (-$131.6 billion).
This past week, money market funds (+$5.7 billion), commodities funds (+$401 million), taxable bond funds (+$305 million), and municipal bond funds ($+200 million) each reported inflows.
Alternative investments (-$630 million), mixed-assets funds (-$381 million), and equity funds (-$106 million) suffered outflows.
Actively managed equity (-$3.3 billion) and fixed income funds (-$79 million) reported outflows, whereas both passive equity (+$3.2 billion) and fixed income funds (+$585 million) netted inflows.
Spot bitcoin ETFs reported their second smallest weekly intake since coming to market (+$28 million), marking their fifteenth straight weekly inflow since launching. Grayscale Bitcoin Trust (GBTC, -$376 million) was the only spot bitcoin ETFs to post weekly outflows.
Index Performance
At the close of LSEG Lipper’s fund-flows week, U.S. broad-based equity indices reported positive returns for the first week in four—the DJIA (+2.28%), Nasdaq (+0.19%), Russell 2000 (+2.44%), and S&P 500 (+0.98%) were all in the black.
Both the FTSE U.S. Municipal Tax-Exempt Investment-Grade Index (-0.02%) and FTSE U.S. Broad Investment Grade Bond Total Return Index (-0.18%) fell over the week, while the FTSE High Yield Market Total Return Index (+0.71%) appreciated for the first week in four.
Overseas broad-based indices realized mostly positive returns—DAX (+2.28%), FTSE 100 (+2.31%), Nikkei 225 (+1.08%), and S&P/TSX Composite (+1.68%) posted gains. The Shanghai Composite (-1.01%) saw losses for the second week in three.
Rates/Yields
The two-year (-0.14%) fell, while the 10-year (+1.24%) Treasury yield rose over the course of the week. At the close of session Wednesday, the 10-two Treasury yield spread disinverted to its highest end of day level since January 31.
According to Freddie Mac, the 30-year fixed-rate average (FRM) increased for the fourth consecutive week, with the weekly average currently at 7.17%—highest level since November. Both the United States Dollar Index (DXY, -0.09%) and VIX (-14.03%) decreased over the course of the week.
The CME FedWatch Tool currently has the likelihood of the Federal Reserve cutting interest rates by 25 basis points (bps) at 2.9%. This tool forecasted a 9.6% possibility of a 25-bps cut one month ago. The next meeting is scheduled for May 1, 2024.
Exchange-Traded Equity Funds
Exchange-traded equity funds recorded a $5.8 billion weekly inflow, a nice bounceback from last week’s $13.4 billion outflows. This was the eighth inflow over the past 10 weeks. The macro-group posted a 1.48% gain on the week, the first plus-side return in four weeks.
Large-cap ETFs (+$5.8 billion), equity income ETFs (+$1.2 billion), and multi-cap ETFs (+$953 million) were the top equity ETF groups to log inflows. Large-cap ETFs witnessed their first inflow in three weeks, as they were led by Lipper’s Equity Leverage (+$1.9 billion) and Large-Cap Growth (+$1.9 billion) classifications.
Mid-cap ETFs (-$946 million), small-cap ETFs (-$763 million), and emerging markets ETFs (-$670 million) suffered the largest weekly outflows under equity ETFs. This was the first outflow in five weeks for mid-cap ETFs despite seeing their first gain (+2.22%) in four.
Over the past fund-flows week, the two top equity ETF flow attractors were Invesco QQQ Trust Series 1 (QQQ, +$1.2 billion) and iShares Core S&P 500 ETF (IVV, +$819 million).
Meanwhile, the two bottom equity ETFs in terms of weekly outflows were iShares Russell Mid-Cap Value ETF (IWS, -$828 million) and iShares Russell Mid-Cap Growth ETF (IWP, -$644 million).
Exchange-Traded Fixed Income Funds
Exchange-traded taxable fixed income funds observed a $2.5 billion weekly inflow—the macro-group’s fourth inflow in five weeks. Fixed income ETFs reported a gain of 0.24% on average, the first plus-side weekly return in four.
Short/intermediate investment-grade ETFs (+$1.7 billion), short/intermediate government & Treasury ETFs (+$881 million), and high yield ETFs (+$628 million) were the top subgroups under taxable bond ETFs to observe inflows. After a record setting weekly inflow two weeks ago, short/intermediate investment-grade ETFs realize their seventh straight week of net new money.
Government & Treasury ETFs (-$1.1 billion) was the only two taxable fixed income ETF subgroup to witness outflows on the week. Government & Treasury ETFs suffered their largest weekly outflow in just over one year as they saw their first outflow over the last six weeks.
Municipal bond ETFs reported a $588 million inflow over the week, marking the group’s second weekly inflow in three. Municipal bond ETFs saw their fifth weekly loss (-0.01%) in six weeks.
iShares Core US Aggregate Bond ETF (AGG, +$496 million) and SPDR Bloomberg High Yield Bond ETF (JNK, +$430 million) attracted the largest amounts of weekly net new money under fixed income ETFs.
On the other hand, iShares 20+ Year Treasury Bond ETF (TLT, -$1.3 billion) and Invesco Senior Loan ETF (BKLN, -$281 million) suffered the largest weekly outflows.
Conventional Equity Funds
Conventional equity funds (ex-ETFs) witnessed weekly outflows (-$5.9 billion) for the one-hundred-and-fifteenth straight week. Conventional equity funds posted a weekly return of positive 1.41%, the first week of gains in four.
Large-cap funds (-$1.3 billion), mid-cap funds (-$1.2 billion), and small-cap funds (-$1.1 billion) were the top conventional equity fund subgroups to realize weekly outflows. Large-cap conventional mutual funds witnessed their nineteenth consecutive week of outflows.
Conventional multi-cap funds (+$104 million) reported their first weekly inflow in five weeks as they returned a positive 1.50% on average. The subgroup was led by Lipper’s Multi-Cap Value (+$373 classification).
Conventional Fixed Income Funds
Conventional taxable-fixed income funds realized a weekly outflow of $2.2 billion—marking the third consecutive weekly outflow. The macro-group logged a gain of 0.03% on average—their first positive weekly return in four.
Short/intermediate investment-grade funds (-$2.3 billion), world income funds (-$239 million), and government & Treasury funds (-$112 million) were the top taxable fixed income mutual fund subgroups to post weekly net outflows. Short/intermediate investment-grade funds suffered their largest weekly outflow since the week ending October 25, 2023.
General domestic taxable fixed income funds (+$428 million) and emerging markets debt funds (+$123 million) were the only groups under taxable fixed income mutual funds to log inflows over the week. General domestic taxable fixed income funds which have recently been led by Lipper’s Multi-Sector Income Funds were boosted this past week by Corporate Debt BBB-Rated (+$272 million) and Loan Participation Funds (+$211 million). General domestic taxable fixed income funds have reported 17 inflows over the past 18 weeks.
Municipal bond conventional funds (ex-ETFs) returned a positive 0.03% over the fund-flows week, giving the subgroup its first gain in six weeks. Tax-exempt fixed income mutual funds experienced a $387 million outflow, marking the fourth week of outflows in the last five.
*Lipper weekly fund flows period is from the prior Thursday through Wednesday.
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Quarterly Fund Market Insight Reports reveal that short-duration fixed income funds and large-cap/growth-oriented funds continue to lead the pack in performance, but not necessarily flows.
