Global Equity Funds Surge Amid AI Stock Easing & Fed Rate Hopes

In the week leading to February 18, global equity funds saw their strongest inflows in five weeks, driven by easing concerns over AI stocks and investor sector rotation. Renewed hopes for Federal Reserve rate cuts also boosted sentiment towards U.S. growth, with a notable $36.33 billion invested.

Global equity funds experienced their most significant inflows in five weeks by February 18, as eased concerns over artificial intelligence stocks and strategic investor sector rotation fueled demand. The influx was further bolstered by renewed optimism regarding Federal Reserve rate cuts impacting U.S. growth positively.

Investors funneled $36.33 billion into global equity funds that week, marking the strongest weekly influx since January 14, according to LSEG Lipper data. This came amidst U.S. consumer price data revealing a 2.4% inflation increase year-on-year for January, aligning closely with the expected 2.5% rise and reinforcing the market's projection of two Federal Reserve rate cuts during the year.

Regionally, European funds led with $17.22 billion in inflows, mirrored by rising U.S. fund figures of $11.77 billion, following a previous outflow. Sector-focused funds, especially industrials, metals and mining, and technology, remained in high demand, collectively drawing significant capital.