In the week ending August 7, U.S. investors moved a huge $47.48 billion into money market funds, marking the biggest weekly inflow since April 3. This shift came as they pulled $7.39 billion out of stocks, ending a three-week period of buying equities.
The move was prompted by a stock market decline caused by worries about an economic slowdown. A weaker-than-expected U.S. jobs report and poor manufacturing data raised concerns about the economy, leading to more selling in the stock market.
Investors withdrew $2.42 billion from small-cap funds, ending a three-week buying trend. Mid-cap and multi-cap funds also saw outflows, with $400 million and $382 million leaving these funds, respectively. However, large-cap funds saw $1.68 billion in new investments.
In terms of sectors, financials experienced a $1.36 billion outflow as investors became net sellers after three weeks of buying. Technology and communication services also saw significant outflows of $657 million and $521 million, respectively.
Demand for U.S. bond funds decreased, with only $452 million coming in, the lowest weekly amount in ten weeks. Investors also sold $3.07 billion worth of loan participation funds, the largest weekly net sales since October 2020. On the other hand, short/intermediate investment-grade and municipal debt funds saw inflows of $1.31 billion and $674 million, respectively.
U.S. Investors Shift $47.5 Billion into Money Market Funds Amid Economic Concerns, Pull $7.4 Billion from Stocks
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