Investors continue to position for reflation via TIPS over munis, HY over gold & Japan over US equities; but the re-positioning feels grudging and flows have yet to show big asset allocation capitulation out of bonds into stocks.
>>> Asset Class Flows
- Equities: tiny $0.2bn inflows ($5.5bn mutual fund outflows vs $5.6bn ETF inflows)
- Bonds: $8.6bn inflows (largest in 4 months) (5 straight weeks)
- Precious metals: $0.2bn outflows (outflows in 10 of past 11 weeks
>>> Equity Flows
- Japan: strong $3.1bn inflows (inflows in 4 of past 5 weeks)
- EM: $1.0bn inflows (largest in 3 months)
- Europe: small $0.2bn inflows US: $6.3bn outflows (largest in 4 months)
- By sector: largest healthcare outflows ($1.0bn) from healthcare in 10 months (outflows in 8 of past 9 weeks); largest tech inflows in 14 months ($1.0bn); inflows to materials in 11 of past 12 weeks ($0.6bn)
>>> Fixed Income Flows
- Inflows to HY bond funds in 8 of past 9 weeks ($1.5bn)
- 5 straight weeks of IG bond inflows ($3.6bn)
- 11 straight weeks of inflows to bank loan funds ($1.1bn)
- 7 straight weeks of inflows to TIPS funds ($0.5bn)
- First outflows from EM debt funds in 4 weeks ($0.4bn)
- Largest govt bond fund inflows since Jul’16 ($1.4bn)