U.S. Weekly FundFlows Insight Report: Conventional Funds And ETFs Attract $3.8 Billion Of Net Inflows For The Week

U.S. stock indices closed mixed on Friday, September 3, after the Department of Labor reported the U.S. economy added just 235,000 jobs in August, far lower than the 720,000 forecasted by analysts. However, the unemployment rate declined to 5.2% from 5.4% in July, hitting a new pandemic low. While some investors viewed the report as a reason for the Federal Reserve to delay its long-anticipated plan to taper its asset purchases, others were concerned by the combination of a slowdown in hiring with a surge in wage growth—a worrisome combination for the economy.  Even though the Institute of Supply Management’s August ISM service sector survey fell to 61.7 from a record 64.1 in July, it is still signaling strong growth.

The U.S. markets were closed on Monday, September 6, in observation of the Labor Day holiday. While U.S. stocks ended mostly lower on Tuesday, September 7, as investors assessed the possible impact of slowing economic growth because of the rise in the delta variant, the NASDAQ rose to record highs on the day as some investors kept a keen eye on mega-cap technology issues. The 10-year Treasury yield rose five basis points to close out the day at 1.38% as crude oil futures fell 0.8% to settle at $68.75/bbl.

On Wednesday, September 8, the Dow and S&P 500 ended lower for the third day in a row. The U.S. broad-based indices were weighed down by energy, materials, and information technology issues after investors learned that several U.S. banks cut their U.S. target growth rates as a result of the lower-than-expected nonfarm payroll figures and the Federal Reserve’s Beige Book showed economic growth slowed to a moderate pace in August. The 10-year Treasury yield declined three basis points on the day to close at 1.35%, while crude oil futures rose 1.4% to settle at $69.30/bbl.

Exchange-Traded Equity Funds

Equity ETFs witnessed their second week of net inflows in a row—attracting $3.8 billion for the most recent fund-flows week. Authorized participants (APs) were net purchasers of domestic equity ETFs (+$3.5 billion), injecting money also for the second consecutive week. For the eleventh straight week, nondomestic equity ETFs witnessed net inflows, although attracting just $267 million this past week. SPDR S&P 500 ETF (SPY, +$3.9 billion) and iShares US Real Estate ETF (IYR, +$2.2 billion) attracted the largest amounts of net new money of all individual equity ETFs. At the other end of the spectrum, Invesco QQQ Trust 1 (QQQ, -$1.7 billion) experienced the largest individual net redemptions, and Financial Select Sector SPDR Fund (XLF, -$1.2 billion) suffered the second largest net redemptions of the week.

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