In the week ended November 6, investors pulled $1.8 billion out of global equity funds.
U.S. equity funds were hit the hardest, recording a whopping $7.5 billion in redemptions — and the majority of those outflows were from ETFs.
BofA Merrill Lynch chief investment strategist Michael Hartnett describes it as a "classic risk-off week," pointing to "outflows from equities, cyclicals, HY bonds & EM debt vs flight to govie, IG bonds & money-markets."
Below is a complete breakdown of this week's fund flows, via Hartnett.
Asset Class Flows
Equities: $1.8bn outflows (note $3.0bn ETF outflows vs $1.3bn LO inflows) (Table 1)
Bonds: $1.7bn inflows (largest inflows in 6 weeks)
Precious metals: $0.2 outflows (8 straight weeks)
MMF: third straight week of inflows post debt-ceiling resolution
Europe: 19 straight weeks of inflows ($2.8bn) (Table 2)
Japan: 9 straight weeks of inflows
US: $7.5bn outflows (majority out of ETF’s – SPY, IWM, UWM)
EM: $1.0bn outflows (largest in 5 weeks)
By sector, chunky outflows from cyclicals (Tech & Financials); in fact, largest weekly outflows from Tech funds ($1.2bn) since Sep’08
Fixed Income Flows
Largest inflows to IG bond funds since May’13 ($1.5bn)
72 straight weeks of inflows to floating-rate debt
First outflows from HY bond funds in 9 weeks (Table 3)
First inflows to govt/tsy funds in 9 weeks ($0.9bn)
6 straight weeks of outflows from EM debt funds
30 straight weeks of outflows from TIPS
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