Global funds recorded record outflows. Where are investors withdrawing money from?

Global equity funds have recorded the largest weekly outflow of funds for the entire period of observation. In the period from January 14 to 21, market participants withdrew their funds from the shares of companies in the U.S. and China, while the European stock market, on the contrary, was recorded an inflow, writes Reuters, citing data from BofA Global Research.

According to BofA Global Research, for the week ended Wednesday, January 21, a total of $43.2 billion was withdrawn from global equity funds. This is the largest weekly outflow of funds in the history of observation, writes Reuters.

- And the share of Chinese shares accounted for the largest and record outflow of $49.2 billion, according to a study by BofA, conducted using EPFR data. Analysts attribute this to sales by the so-called "national team" - state-backed investors in China. In parallel, Chinese regulators have been taking steps in recent weeks to curb the growth of the BOE market, Reuters specifies.

- Nearly $17 billion was withdrawn from funds focused on U.S. stocks. U.S. stock markets came under pressure after U.S. President Donald Trump threatened to impose tariffs on a number of European countries as part of his attempt to gain control over Greenland. Against this backdrop, the "sell America" strategy, which was already trending in the spring of 2025 after Trump announced tariffs ranging from 10% to almost 50% on almost all goods imported into the US, regained popularity.

- At the same time, European equity funds recorded on January 14-21 the strongest six-week inflow of funds since June, writes Bloomberg. Japanese funds, in turn, attracted $2.2 billion - the maximum since October 2025, indicates Reuters.

The BofA survey was based on EPFR data from January 14-21, so it could not take into account the market reaction to Trump's softening stance on Greenland and his refusal to impose additional duties on European goods on January 22. Prior to these events, on January 20, amid geopolitical tensions, all U.S. indices posted their strongest decline since October. Subsequently, the U.S. stock market recovered most of this fall, Bloomberg writes.

At the opening of trading on January 23, amid persistent geopolitical risks, as well as the fall in Intel shares after the report, the S&P 500 and Dow Jones indices went into a small minus. Nasdaq Composite, on the contrary, added 0.48%. The Bloomberg Dollar Spot Index (which reflects the performance of the U.S. dollar against a basket of major world currencies), meanwhile, fell to a three-week low on Jan. 23 and is down 0.8% over the past five days, Bloomberg wrote. "The world realizes that the political nightmare in the U.S. is not over yet," Spectra Markets President Brent Donnelly commented on the situation to the agency.

This article was AI-translated and verified by a human editor