A week which ended with an expected increase in U.S. interest rates, and an unexpectedly subdued performance by the major nationalist party in the Netherlands’ general election, saw EPFR Global-tracked High Yield Bond Funds experience their biggest outflows since late-4Q14 and Dividend Equity Funds their biggest inflows since late 1Q15. The second week of March also saw redemptions from Emerging Markets Equity and Balanced Funds hit year-to-date and eight-month highs respectively.
The solid macroeconomic data that underpinned the Federal Reserve’s Open Markets Committee’s decision to increase the benchmark U.S. interest rate by a further 25 basis points encouraged equity investors to commit another $12 billion to U.S. Equity Funds. But the better than expected outcome of the Dutch election, from a European Union perspective, came too late to stop Europe Bond and Equity Funds from recording fresh outflows.
Overall, investors committed more than $14 billion to EPFR Global-tracked Equity Funds during the week ending March 15. Meanwhile, Bond Funds recorded their first collective outflow — totaling $740 million — since the third week of December and nearly $11 billion flowed out of Money Market Funds.
At the country level, investors pulled over $100 million from France Equity Funds for the fourth week running, redeemed over $300 million from both Russia and Korea Equity Funds and left Emerging Europe Equity Funds looking at their biggest weekly outflow since early 2Q15.