U.S. Equity Funds Experience High Demand Amid Mixed Market Signals

U.S. equity funds attracted substantial investments amid eased tariff concerns, with investors contributing a net $22.24 billion. Amid ongoing tariff announcements and market volatility, U.S. equities are expected to outperform other regions in 2025. While funds saw significant inflows, sectoral equity funds faced net outflows, led by consumer discretionary sectors.

U.S. equity funds experienced a surge in demand during the week ending March 26, spurred by signs of a more measured tariff stance from the Trump administration. This shift in focus towards potential growth in corporate earnings resulted in net inflows of $22.24 billion into U.S. equity funds, the highest since November.

Despite the fluctuating market, brought about by President Trump's 25% import tax on foreign vehicles, equity strategist Mark Haefele of UBS Global Wealth Management remained optimistic. Haefele forecasts continued volatility but believes U.S. equities will outperform European and Asian markets through the remainder of 2025.

Continuing this trend, investors channeled $23.1 billion into U.S. large-cap equity funds, reversing previous outflows. However, while large-, small-, and multi-cap funds saw positive inflows, sectoral funds faced negative pressure, with consumer discretionary funds leading the decline with $737 million in outflows.

(With inputs from agencies.)