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2026-02-20 19:00:58
[US Equity Funds See Largest Inflow in Five Weeks as Cooling Inflation Fuels Rate Cut Expectations] ⑴ In the week ending February 18, US equity funds recorded a net inflow of $11.77 billion, the largest weekly inflow since January 14. The core catalyst for this large-scale capital inflow was the cooling of consumer price inflation data, which boosted market expectations for a Federal Reserve rate cut and alleviated concerns about the previous decline in the technology sector. ⑵ Fund flows showed a clear style preference. Value funds were favored for the second consecutive week, attracting a net inflow of $2.65 billion. Growth funds, on the other hand, experienced a net outflow of $2.28 billion, indicating that investors are withdrawing from previously high-performing growth stocks and shifting towards more reasonably valued sectors. ⑶ Sector funds continued their upward trend, with a net inflow of $1.82 billion, marking the second consecutive week of net purchases. The industrial and technology sectors attracted $1.3 billion and $1.19 billion respectively, becoming the focus of capital investment. This indicates that while investors are optimistic about the overall market, they are also making structural adjustments. (4) UBS Global Wealth Management's Chief Investment Officer noted that while the overall outlook for US stocks remains attractive, investors should consider diversifying their concentrated technology stock holdings; selectivity is key. This view echoes the trend of funds flowing out of growth funds and into industrial and technology sub-sectors. (5) The bond market also showed strong demand. US bond funds saw net inflows of $10.27 billion this week, marking the seventh consecutive week of net purchases. Short-to-medium term investment-grade funds, general domestic taxable fixed-income funds, and short-to-medium term government bond funds attracted $3.61 billion, $2.56 billion, and $2.26 billion, respectively. (6) Meanwhile, money market funds saw net inflows of $12.79 billion, the third weekly net inflow in four weeks. This data suggests that despite a recovery in risk appetite, some funds are still maintaining cash positions to cope with subsequent market volatility and policy uncertainty.
