Investors worldwide poured $8.2 billion of new cash into stock funds in the week ended on Wednesday, showing a steady appetite for risk on a rebound in stock market performance, a Bank of America Merrill Lynch Global Research report showed on Friday.
The inflows into stock funds marked the third straight week of new cash into the funds, according to the report, which also cited data from fund tracker EFPR Global. Investors had pulled $28.3 billion out of the funds in the week ended February 5.
Investors were also chasing stronger stock market performance. The Standard & Poor's 500 stock index, which fell 5.2 per cent from the start of the year through February 5, had since risen 5.4 percent through Wednesday. Investors pulled $3 billion out of funds that hold emerging market stocks, however, extending a record outflow streak to 18 weeks. Year-to-date outflows from these funds have hit $25.6 billion.
Russian President Vladimir Putin put combat troops on high alert for war games near Ukraine on Wednesday after mounting tension between the emerging-market nations. MSCI's global emerging market equities index fell 0.3 percent over the week. Bond funds worldwide attracted $2.9 billion in new cash in their fourth straight week of inflows.
Bond investors also distanced themselves from emerging markets and pulled $1.8 billion out of those debt funds. That was the 22nd straight week of outflows from the funds and their longest outflow streak on record, the report said.
Still, investors showed their risk appetite by putting $2.1 billion of the total bond fund inflows into high-yield funds. That marked the third straight week of new cash into the funds, which hold lower-rated corporate credit.
Commodities funds, which mainly hold physical gold, attracted $900 million in new money, marking their first inflows in 16 weeks. Most of the cash flowed into gold and silver exchange-traded funds, the report said.
The inflows came even as gold prices retreated from four-month highs on Wednesday because the advancement of the dollar and the new home sales data dented bullion's safe-haven appeal.
