US equity funds post fourth weekly outflow on inflation worries, rate concerns

Sept 18 (Reuters) - US equity funds recorded outflows for a fourth consecutive week in the week to September ‌18, as rising crude oil prices heightened inflation ‌concerns and expectations of a Federal Reserve rate hike added to investor caution ​ahead of its policy decision.

US equity funds recorded net redemptions of $31.44 billion during the week, largely matching the $32 billion withdrawn a week earlier, LSEG Lipper data showed.

Crude oil prices rose to ‌four-month highs during the ⁠week, fueling inflation concerns and lifting Treasury yields, which weighed on growth-oriented funds.

The Fed raised interest ⁠rates by 25 basis points on Wednesday and signaled that further tightening may be needed to curb inflation fueled by ​higher energy ​costs linked to the war ​in Iran.

Investors withdrew $28.71 billion, $1.73 billion ‌and $3.16 billion from US large-cap, mid-cap and multi-cap funds, respectively. In contrast, small-cap funds attracted $568 million in weekly inflows.

Equity sectoral funds, meanwhile, recorded weekly inflows of $2.29 billion - the largest in seven weeks - led by financials, consumer discretionary and technology, which ‌attracted net purchases of $1.37 billion, $795 million ​and $775 million, respectively.

Net purchases in global ​bond funds, meanwhile, eased ​to a five-month low of $554 million.

Short-to-intermediate government and ‌Treasury funds led the gains, ​attracting $3.49 billion in ​inflows for an 11th consecutive week. Meanwhile, municipal debt funds and short-to-intermediate investment-grade funds recorded notable outflows of $1.81 ​billion and $817 million, ‌respectively.

Money market funds recorded net weekly outflows of $58.87 billion, ​the largest weekly withdrawal since July 15.

(Reporting by Gaurav ​Dogra; Editing by Vijay Kishore)