The U.S. equity funds received their most significant weekly capital inflows since November as investors purchased stocks because of improved artificial intelligence expectations despite ongoing trade disputes. LSEG Lipper reports U.S. funds received $31.6 billion during the week ending July 2 which established their highest net gain since November.
The market experienced a surge because Micron Technology predicted positive AI-chip trends which boosted investor confidence in the sector and led to strong demand for Nvidia and AMD stocks. The largest capital inflows went to large-cap equity funds which received more than $31 billion. The net outflows from mid-cap and small-cap funds reached $1.72 billion and $1.09 billion respectively.
The sector-focused funds received $3.4 billion in investments while technology and financial sectors led the way. The market continued to attract U.S. bond investors who put $6.66 billion into fixed income funds. Investment-grade corporate debt received the highest level of investor interest.
The equity market continues to rise without any indication of a slowdown despite upcoming trade deadlines. Investors make wagers that robust corporate earnings together with AI-driven growth will overcome possible tariff-related impacts. The market situation could rapidly change if trade negotiations fail or economic indicators show deterioration according to analyst warnings.
Fund flows indicate market optimism but also indicate a potentially unstable situation that could reverse direction if market sentiment shifts.
