Oct 2 (Reuters) - Global equity funds attracted inflows for a second straight week, as optimism around AI investment and softer US inflation pushed up investor demand for stocks despite rising bond yields.
Equity funds recorded net inflows of $34.76 billion in the week through September 30, down from $44.31 billion in the previous week, according to LSEG Lipper data.
Risk appetite was largely supported by optimism over AI spending. Micron Technology on Wednesday forecast quarterly revenue above estimates,
signaling strong demand for memory chips used in AI applications.
Goldman Sachs said that the largest US hyperscalers are on track to spend about $800 billion on capital expenditure in 2026, with consensus expecting spending to rise to $1.1 trillion in 2027. The bank said strong revenue backlogs and a supply-constrained environment were continuing to support investment, while cloud revenue growth among major providers had accelerated sharply this year.
Meanwhile, a Commerce Department report on Wednesday showed that US inflation rose less than expected in August, while July price pressures were more moderate than initially reported, reducing the urgency for the Federal Reserve to raise rates again in October.
Investors made net purchases of $20.6 billion in US equity funds for a second consecutive week. European and Asian equity funds also recorded net inflows of $6.19 billion and $6.16 billion, respectively.
Sectoral funds, however, posted net weekly outflows of $919.7 million as investors withdrew $2.63 billion from technology funds after a three-week buying streak. They bought $1.13 billion in financial funds and $468 million in utility funds.
Global bond funds attracted $4.76 billion in inflows for a second consecutive week, though this was substantially lower than inflows of $9.24 billion in the previous week.
Short-term and government bond funds still registered significant inflows of $5.43 billion and $4.13 billion, respectively, while high-yield bond funds saw outflows of $2.29 billion.
Money market funds posted net outflows of $116.52 billion — the largest weekly withdrawal since April 15.
Among commodity funds, gold and precious-metals funds saw net weekly purchases of $275.2 million, their smallest inflow in three weeks. Energy funds posted net weekly outflows of $559 million, following inflows of $89.3 million the previous week.
In emerging markets, equity funds recorded outflows of $1.37 billion for a fourth straight week. Investors also withdrew a net $1.75 billion from bond funds, according to data covering 29,099 funds.
(Reporting by Gaurav Dogra and Patturaja Murugaboopathy in Bengaluru; Editing by Diti Pujara)
