Plastic letters arranged to read “Inflation” are placed on U.S. Dollar banknote in this illustration taken, June 12, 2022. REUTERS/Dado Ruvic/Illustration – RC2LQU9AAPPE
Index Performance
At the close of LSEG Lipper’s fund-flows week ending September 10, 2025, U.S. broad-based indices traded mixed: S&P 500 TR (+0.85%), Nasdaq (+0.44%), Russell 2000 (-1.01%), and DJIA (+1.0%).
Macro Viewpoint
Inflation is back in the spotlight. The Consumer Price Index for All Urban Consumers (CPI-U) rose 0.4% in August, lifting the annual inflation from 2.7% to 2.92%, well above the Federal Reserve’s 2% target. The pressure points were clear: Food (+0.5%) and Energy (+0.7%) led the charge, while core CPI (excluding food and energy) rose 0.3% with the bulk of the increasing coming from shelter (+0.4%), new vehicles (+0.3%), and apparel (+0.5%). Yet despite elevated numbers, financial markets shrugged off the headline. The U.S. dollar softened, Treasury yields dipped, and equites continued to rally.
Fund Flows by Asset Type
Fund flows across major asset classes finished mixed across the board. Money market funds once again dominated with $40.3 billion in net inflows, though this was $13 billion lower than the prior week. This is a sign that investors are cautiously redeploying liquidity. In Fixed Income, demand held firm: U.S. Taxable Bond Funds added $7.6 billion, while U.S. Municipal Bond Funds attracted $2.1 billion, highlighting the persistent bid for yield and tax efficiency. Alternatives came alive, capturing nearly $1.2 billion versus just $59.8 million last week, a sharp acceleration that suggests renewed appetite. On the riskier side, U.S. equity funds lost $6.4 billion, while U.S. mixed-assets funds had an outflow of $91 million, marking these asset classes as the laggards of the week. Commodities, however, still drew interest with $907 million in net inflows, though well off the prior week’s robust $4.5 billion haul. The weekly shift suggests that investors are beginning to take on more duration and explore alternatives, while conviction in equites remains cautious ahead of the upcoming FOMC meeting.
Performance by Lipper U.S. Classifications
Equity performance was uneven across the board. The strongest returns came from Equity Leveraged Funds (+5.81%), supported by risk-on sentiment, while Precious Metals Equity (+4.24%) and Global Science & Technology (+3.98%) also posted favorable gains. On the other hand, Consumer Goods (-0.52%), Energy MLP Funds (-0.32%), and Financial Services (-0.16%) finished in negative territory, highlighting the sector rotation that continues to play out as investors balanced growth opportunities against macro headwinds.
The strength with Fixed Income was led by municipals. General & Insured Muni Debt Leveraged Funds advanced 3.55%, while High Yield Municipal Debt (+2.47%), and California Municipals (+2.44%) also delivered strong returns, reflecting steady demand for tax-exempt income. On the weaker side, Specialty Fixed Income (-0.03%), Short U.S. Treasury Funds (+0.18%), and Loan Participation Funds (+0.18%) lagged, which showed a more muted appetite for niche strategies.
