Investor Shift: Safe Havens and Market Movements Amid Trade Tensions

Global money market funds saw a surge in inflows as investors sought safe havens following new U.S. tariffs on imports. While equity funds experienced slumps, bond funds continued to attract investments. Key sectors like technology faced outflows, highlighting market volatility amid escalating trade tensions.

In a week overshadowed by escalating trade tensions, global money market funds experienced a significant surge in inflows, as investors sought refuge amid economic uncertainties. The U.S.'s decision to impose steep tariffs on imports from major trading partners Canada, Mexico, and China has stirred concerns about potential economic fallout.

Despite the rise in money market funds, global equity funds faced challenges, witnessing a four-week low in demand. Notably, U.S. equity funds saw approximately $9.54 billion in net outflows, conversely, European and Asian funds each gained over $5 billion, reflecting investors' shifting strategies.

Specific sectors, particularly technology, faced substantial outflows amounting to $2.91 billion, marking its largest weekly net sales since late 2021. Meanwhile, global bond funds continued their steady climb, attracting $17.02 billion for the tenth consecutive week, amidst a complex and evolving financial landscape.

(With inputs from agencies.)