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<\/p>\nAccording to data from Calastone, more than \u00a33.6 billion flowed out of equity funds over the past three months, including \u00a31.2 billion withdrawn in September alone. The firm\u2019s Fund Flow Index described investors as spooked by \u201csky-high stock markets.\u201d<\/p>\n
Despite these outflows, the FTSE 100 and S&P 500 both hit new record highs last week, even as global markets grappled with uncertainty fuelled by Donald Trump\u2019s tariff campaign. Enthusiasm for artificial intelligence continues to drive share prices higher \u2014 particularly in the US, where AMD shares surged 24% on Monday following news of a chip supply deal with OpenAI.<\/p>\n
Edward Glyn, head of global markets at Calastone, called the trend \u201creally unusual,\u201d noting that it\u2019s rare to see record-breaking markets while investors are \u201cmoving decisively for the exits across such a broad range of funds.\u201d He added that a sustained period of net selling is \u201cnoteworthy\u201d given the long-term bias toward inflows as people save for the future.<\/p>\n
Global equity funds experienced their fourth consecutive month of net selling, with outflows of \u00a3203 million, while UK-focused funds performed even worse, shedding \u00a3692 million.<\/p>\n
The main beneficiaries were bond and money market funds, which attracted \u00a3895 million as investors sought safer havens amid market uncertainty.<\/p>\n
Glyn said UK-focused funds continue to lose capital, although selling had been \u201cmore muted\u201d in recent months before picking up again. \u201cSeeing the UK market reach record levels while still not looking expensive has given some sellers pause for thought,\u201d he said. \u201cBut the doom loop of negative commentary on the UK economy \u2014 with its weak fiscal position, widening credit spreads, low growth, and looming tax rises \u2014 may now be winning out.\u201d<\/p>\n
In contrast, European equity funds bucked the global trend with modest inflows, despite recent political turmoil in France. The country\u2019s new prime minister, S\u00e9bastien Lecornu, who had only recently taken office, resigned on Monday after less than a month, sending French stocks lower and bond yields higher.<\/p>\n
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