U.S. Weekly FundFlows Insight Report: ETF And Fund Investors Focus On Fixed Income During The Fund-Flows Week

Investors were overall net redeemers of fund assets (including those of conventional funds and ETFs) for the eleventh week in a row, withdrawing $7.6 billion for Refinitiv Lipper’s fund-flows week ended October 21, 2020, as they paid attention to increasing uncertainty in the market. Fund investors were net redeemers of money market and equity funds during the week, withdrawing $9.3 billion and $5.7 billion, respectively while being net purchasers of taxable fixed income funds (+$6.8 billion) and municipal bond funds (+$607 million) this week.

Market Wrap-Up

U.S. markets finished in the red for the fund-flows week as investors evaluated the impact of an increasing number of COVID-19 cases, both in the U.S. and abroad, the lack of agreement on another round of fiscal stimulus on Capitol Hill, and the upcoming presidential election on the market and general economy.

On the domestic side of the equation, the Nasdaq Composite Price Only Index (-2.41%) suffered the largest declines for the fund-flows week of the broadly followed U.S. indices, while the Dow Jones Industrial Average Price Only Index (-1.06%) did the best job mitigating losses. Overseas, the Nikkei 225 Price Only Index (+0.71%) and the Shanghai Composite Price Only Index (+0.70%) chalked up the strongest plus-side returns of the often-followed broad-based global indices, while the Xetra DAX Price Only Index (-2.67%) experienced the largest decline.

On Thursday, October 15, the Dow snapped a three-day winning streak after investors learned about rising coronavirus cases that resulted in new business and travel restrictions. A rise in first-time weekly U.S. jobless claims from the week prior by 53,000 also cast a pall over the markets. On Friday, despite several states reporting record numbers of new COVID-19 cases the day before, the U.S. benchmarks closed higher after investors learned of better-than-expected September retail sales and consumer sentiment reports. Near-month gold prices witnessed their first weekly decline in three.

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