Surging oil prices intensify inflation concerns, global equity fund outflows reach highest level in months

1. As of the week ending September 9, global equity funds saw large-scale capital outflows. Data from LSEG Lipper shows a net outflow of $15.52 billion from global equity funds that week—the largest since March 18—mainly dragged down by a net outflow of $32.27 billion from US equity funds. However, European and Asian equity funds recorded net inflows of $11.16 billion and $3.03 billion, respectively.2. The surge in oil prices is the core factor fueling market concerns. Brent crude oil last Friday reached a nearly four-month high of $109.97 per barrel, heightening worries over persistently high inflation and further rate hikes by major central banks. The US Producer Price Index released Thursday showed strong inflationary pressure in August, further reinforcing expectations for a Federal Reserve rate hike. Friday's August Consumer Price Index registered a month-on-month increase of 0.4% and a year-on-year increase of 3.4%, in line with economists' forecasts.3. In terms of sector funds, there was a net inflow of $2.92 billion that week, including a $1.89 billion net inflow into the technology sector and a $1.25 billion net inflow into the financial sector.4. Global bond funds attracted $8.95 billion, marking their lowest single-week level since July 29. Short-term bond funds attracted $6.65 billion, setting the second-highest weekly inflow in three months. Investors also bought $1.01 billion of loan participation funds and $743 million of government bond funds, while selling $2.37 billion of corporate bond funds.5. Investors increased their holdings in money market funds for the second consecutive week, with net purchases reaching $10.72 billion. In commodity funds, gold and precious metals funds recorded a $537 million net outflow after eight consecutive weeks of net inflows. Energy funds, on the other hand, attracted $211 million of inflows.6. In emerging markets, investors ended an eight-week streak of net buying, with net outflows totaling $1.56 billion. Data covering 28,984 funds shows that bond funds reported inflows for the sixth consecutive week, amounting to $537 million.