Catenaa, Friday, July 03, 2026- US equity funds saw renewed inflows in the week to July 1 as easing tensions in the Iran war and renewed demand for tech stocks lifted sentiment.
Investors bought a net $1.03 billion of US equity funds, partially reversing the previous week’s $3.47 billion in net sales, LSEG Lipper data showed.
A softer-than-expected June employment report, showing the economy added just 57,000 jobs last month, reduced expectations of a Federal Reserve rate hike by year-end.
Technology sector funds attracted $3.42 billion as sentiment improved following net sales of $19.97 billion the previous week. Financial and healthcare funds also drew inflows of $1.96 billion and $1.47 billion, respectively.
US small-cap, mid-cap and equity income funds, however, posted outflows of $694 million, $2.1 billion and $1.33 billion, respectively. Large-cap funds drew $7.2 billion in weekly inflows.
US bond funds attracted a net $9.88 billion, extending their buying streak to an 11th straight week.
Short-to-intermediate investment-grade funds and general domestic taxable fixed income funds saw notable inflows of $4.22 billion and $3.53 billion, respectively. Short-to-intermediate government and Treasury funds, however, had $2.1 billion in outflows.
Investors also allocated $47.82 billion to money market funds, the largest amount in four weeks.
Meanwhile, Bank of America said that investors are turning away from US stocks at the fastest pace since March, with the country’s stock funds having $17.2 billion in outflows in the week through July 1.
Investors turned to some international stocks instead, with Japanese equities seeing their biggest inflows in seven weeks at $1.9 billion.
The mood around US stocks is turning after a strong start to the year in terms of fund flows. Last week, American equity funds registered their first redemptions in three months.
JPMorgan Chase & Co. strategists said earlier this week that the extreme outperformance of US semiconductor stocks relative to AI hyperscalers has created an unsustainable valuation gap that they expect will ultimately narrow.
Overall, equities had $13.9 billion in outflows, while investment-grade bonds attracted $17.2 billion. Elsewhere, high-yield bond funds saw their biggest inflows in over a year at $3.4 billion.
