U.S. equity mutual funds and ETFs attracted substantial fresh capital in the week to March 25, with investors adding a net $37.24 billion, the largest weekly intake since mid-November 2024, according to LSEG Lipper data. The pickup in flows ended a three-week stretch of net selling as market participants reacted to reports that President Donald Trump postponed a planned strike on Iranian energy infrastructure and offered a proposal aimed at ending the conflict.
Flows were concentrated in large-cap exposures. Investors put money into U.S. large-cap funds for the first time in seven weeks, contributing a net $45.07 billion. By contrast, mid-cap and small-cap strategies experienced withdrawals, with net outflows of $2.15 billion and $1.24 billion, respectively.
Sector-level activity diverged from the overall equity inflows. U.S. sectoral funds posted a combined net outflow of $2.9 billion for the week, the largest weekly withdrawal since December 24. Within that, technology funds saw a net pullback of $1.45 billion, gold and precious metals funds lost $974 million, and healthcare funds experienced $507 million in net redemptions.
Fixed income markets also reflected shifting investor preferences. U.S. bond funds attracted a net $7.56 billion, a decline of nearly one-third from the $12.05 billion added the previous week. Short-to-intermediate investment-grade funds drew a net $2.03 billion, the smallest weekly amount in three weeks, while general domestic taxable fixed income funds recorded net outflows of $1.11 billion.
Short-to-intermediate government and treasury funds stood out, receiving a net $9.07 billion during the week - their largest weekly purchase since at least May 2024. At the same time, money market funds saw significant redemptions, with $57.96 billion in net withdrawals, ending a five-week run of net purchases.
Market price action during the week showed mixed sentiment: although broad equity inflows rose, the tech-heavy Nasdaq Composite fell more than 2% on Thursday amid fresh uncertainty after Iranian officials continued to deny any talks with the U.S., deepening doubts over a swift resolution to the nearly one-month-long conflict.