Investors Pull 7.77 Billion Dollars From US Equity Funds
Investors pulled 7.77 billion dollars from U.S. equity funds as Middle East conflict hit oil supplies. Capital moved into safer bond and money market funds.
Equity funds in the United States faced a second consecutive week of outflows as geopolitical tensions involving Iran dampened investor sentiment. According to data from LSEG Lipper, investors withdrew a net $7.77 billion from U.S. equity funds during the week ending March 11, following a substantial $21.91 billion divestment in the preceding period. The selling pressure intensified as attacks on energy infrastructure in the Middle East heightened fears of economic stagflation.
The impact was most visible in the energy markets, where U.S. crude prices surged 9.7% on Thursday. This spike brought month-to-date gains to approximately 42.88% as global oil markets grappled with significant supply risks.
"The current situation represents the largest oil supply disruption in history, with shipping in the Gulf and the narrow Strait of Hormuz coming close to a standstill."
Within the equity market, large-cap funds saw the heaviest liquidations, totaling $20.98 billion in net outflows. Mid-cap and small-cap funds also recorded modest exits of $405 million and $8 million, respectively, while multi-cap funds managed to attract $9.32 billion in new capital. Investors also rotated out of growth funds, which lost $4.48 billion, while favoring value-oriented options. Value funds—which include defensive consumer staples like Colgate-Palmolive Company—secured $2.91 billion in net inflows, marking their fifth successive week of gains.
Fixed-income assets remained a primary destination for capital as investors sought safety. Bond funds attracted roughly $8.21 billion in net inflows, marking their 10th consecutive week of popularity. Short-to-intermediate government and treasury funds were particularly sought after, drawing $4.05 billion—the largest weekly amount since late December. Additionally, investment-grade and municipal debt funds attracted net purchases of $2.77 billion and $614 million, respectively. U.S. money market funds also remained in favor, gaining approximately $1.5 billion as investors extended their recent buying streak into a fourth week.
