U.S. equity funds lure inflows on earnings optimism

(Reuters) - U.S. equity funds saw money inflows for the first time in four weeks in the week to Oct. 19, as strong third-quarter earnings calmed investor fears that rising interest rates would hit corporate profits substantially. U.S. equity funds drew a net $4.57 billion, marking their first weekly inflow since Sept. 21, data from Refinitiv Lipper showed.

Graphic: Fund flows: US equities, bonds and money market funds - https://fingfx.thomsonreuters.com/gfx/mkt/zgpobwmonvd/Fund%20flows%20US%20equities%20bonds%20and%20money%20market%20funds.jpg

Better-than-expected quarterly earnings results from companies including Goldman Sachs Group Inc, Netflix Inc and Johnson & Johnson, boosted sentiment in a market that was otherwise worried about rising treasury yields and further rate increases. U.S. large-, mid- and small-cap equity funds all saw inflows, worth $4.28 billion, $418 million, and $308 million, respectively. By sector, tech and financials obtained inflows worth $769 million and $595 million, respectively, after outflows in the previous week.

Graphic: Fund flows: US equity sector funds -

Meanwhile, bond funds saw a fifth straight week of net selling, as investors withdrew a net $4.16 billion. U.S. short/intermediate investment-grade and loan participation funds recorded disposals worth $4.16 billion and $896 million, respectively, but safer government bond funds had an eighth weekly inflow, amounting to $4.52 billion.

Graphic: Fund flows: US bond funds -

Money market funds had $5.85 billion of weekly outflows after $5.88 billion in inflows a week ago.

(Reporting by Gaurav Dogra in Bengaluru; Editing by Kim Coghill)