Just in:
Infineon and HD Korea Shipbuilding & Offshore Engineering jointly develop ship electrification technology // First-Ever Fortune Innovation Forum Draws Top Global Leaders to Hong Kong, Promoting Agendas On Collective Cross-Sector Advancement // Sharjah Chamber Breaks Ground on Final Expansion with New HQ Pact // German Job Market Resilience Bodes Well for Economic Recovery // Arvind Kejriwal Was Used By BJP In 2011 Movement To Take On The Congress // Renewables Surge Sets Record, But Global Equity Lags // Meta Earth Official Website Launch: The Pioneer Explorer in the Modular Public Blockchain Domain // Superland Announced Annual Results for 2023, 2023 Net Profit Increased approximately 39.5% to approximately HK$22.2 million as Compared to the 2022 Adjusted One // Emirates Post Speeds Up Deliveries for GCC with Special Day // Ajman Celebrates Conclusion of Ramadan Activities with Grand Ceremony // TUMI Hosts Global Launch Event in Singapore to Unveil Women’s Asra Collection and Announce Global Ambassador, Mun Ka Young // Experience Ultimate Shopping Freedom at 4.4 Shopee Spree: Don’t Worry, Shop Shopee! // Emirati Aid Reaches Ukraine as Food Shortages Bite // Samsung Partners National Heritage Board to Bring a Slice of Singapore’s Cultural Heritage to Samsung The Frame TV // Hope for Respite as UAE Endorses UN Plea for Gaza Truce // Andertoons by Mark Anderson for Thu, 28 Mar 2024 // Sharpening the Focus: Sharjah Health Department Refines Evaluation Criteria for “Healthy Schools Programme” // Konica Minolta is named ASEAN 2023 Market Leader in Colour Light and Mid Digital Production Printers // No running of govt from jail, says Delhi Lt Governor // Lisboeta Macau’s world first LINE FRIENDS PRESENTS CASA DE AMIGO and BROWN & FRIENDS CAFE & BISTRO has officially opened //
HomeMarketsInvestors’ appetite for bond funds returns

Investors’ appetite for bond funds returns

8e9306e4 b0dc 11e6 a37c f4a01f1b0fa1

Investors have returned to the world of debt in a cooling of the Trumpflation trade that pummelled bond markets and propelled equities to record highs after the US election.

The shift, which has included fresh inflows to municipal, Treasury and emerging market bond funds over the past week, dovetails with a near month-long rally in haven US Treasuries and fatigue in benchmark stock indices.

ADVERTISEMENT

Municipal funds, which had suffered 10 consecutive weeks of redemptions, counted their first week of inflows in the seven days to January 11, adding $762m during the period, according to data from EPFR. More than $14.5bn had been drained from the asset class in the preceding eight weeks.

Emerging market bond funds saw their second straight week in which contributions surpassed $1bn, while separate data from Lipper showed the largest inflows into investment grade US corporate bond funds in nearly two years.

Overall, global bond funds took in $8.4bn in the past week, a 14-week high.

Cameron Brandt, the director of research for EPFR, characterised the investor positioning as a “return to reality . . . indicating a more realistic view of what Mr Trump might actually be able to accomplish”.

Stock indices, after rocketing higher after the election, have hovered in a range of roughly 1 per cent over the past month. Investors betting on lower taxes and a looser regulatory regime have been confronted by an acrimonious political environment that has cast a shadow over President-elect Donald Trump’s incoming administration.

“The Trump euphoria will fade . . . because he’s getting inaugurated on January 20 and investors are looking at the world being perfect on January 21,” said Bob Doll, chief equity strategist of Nuveen Asset Management.

US stock funds counted $251m of withdrawals in the past week, only the second time US equities sustained a weekly outflow since the election, according to the EPFR data. A week earlier, investors added $6.2bn to US equity funds.

The rally in Treasuries has bolstered emerging markets hit hard by the election and December Federal Reserve meeting, when policymakers signalled a faster pace of rate rises than the market expected.

The Trump euphoria will fade . . . because he’s getting inaugurated on January 20 and investors are looking at the world being perfect on January 21

Lower yields on US government debt have supported the appeal of emerging market securities, with stock funds devoted to the asset class recording their first inflows in a month. Russian stock funds have enjoyed their longest inflow streak since 2012.

Overall, emerging market stock funds added $476m in the week to January 11, reversing a majority of the previous week’s outflows.

Inflows to risky high-yield US corporate bond funds decelerated from the first week of the year, but remained in positive territory for the eighth straight week. Lipper data, which track US-based portfolios, showed $4bn of cash added to investment grade corporate bond funds.

The inpouring has helped absorb the record pace of corporate and bank debt issuance, with more than $94bn of the bonds sold in the US since the year began, according to Dealogic.

“It has been a nice opening salvo so far. There is a lot of demand for credit and you have had very heavy supply,” said Sabur Moini, a portfolio manager with Payden & Rygel.

“Demand is strong globally, not just from the big US insurance companies,” he added. “There is a strong bid for credit and . . . following the Treasury rate rise in November and December, even if spreads are a little tighter, you are getting higher yields.”

[email protected]

Twitter: @ericgplatt

Source link

ADVERTISEMENT

ADVERTISEMENT
Just in:
Ingdan Announces 2023 Annual Results // Universal Language for Healthcare: General Authority Embraces Global Coding System // Samsung Partners National Heritage Board to Bring a Slice of Singapore’s Cultural Heritage to Samsung The Frame TV // Following the Money Trail: US and UK Investigate $20 Billion in USDT Transfers Tied to Sanctioned Russian Exchange // Andertoons by Mark Anderson for Thu, 28 Mar 2024 // Sunshine’s Debut Features Leave Tech World Scratching Its Head // US reiterates concern over Kejriwal arrest, Cong accounts // Sharjah Chamber Breaks Ground on Final Expansion with New HQ Pact // Infineon and HD Korea Shipbuilding & Offshore Engineering jointly develop ship electrification technology // Arvind Kejriwal Was Used By BJP In 2011 Movement To Take On The Congress // Global Audience to Witness Thrill of Dubai World Cup // Sharpening the Focus: Sharjah Health Department Refines Evaluation Criteria for “Healthy Schools Programme” // TUMI Hosts Global Launch Event in Singapore to Unveil Women’s Asra Collection and Announce Global Ambassador, Mun Ka Young // Hope for Respite as UAE Endorses UN Plea for Gaza Truce // Emirates Post Speeds Up Deliveries for GCC with Special Day // Ajman Celebrates Conclusion of Ramadan Activities with Grand Ceremony // Lisboeta Macau’s world first LINE FRIENDS PRESENTS CASA DE AMIGO and BROWN & FRIENDS CAFE & BISTRO has officially opened // Emirati Aid Reaches Ukraine as Food Shortages Bite // German Job Market Resilience Bodes Well for Economic Recovery // Superland Announced Annual Results for 2023, 2023 Net Profit Increased approximately 39.5% to approximately HK$22.2 million as Compared to the 2022 Adjusted One //