Still buying into the ceasefire as April winds down

April ended with another week of record highs for key equity indexes, oil prices holding around $100 a barrel, first quarter earnings reports pouring in and a slew of major central bank policy meetings. Against this backdrop, investors continued to rebuild their positions in riskier asset classes and boost their exposure to US stocks while cutting their leverage and their exposure to Europe.

The latest reporting period, which ended with policymakers at the US Federal Reserve and Bank of Japan opting to keep interest rates on hold, also saw Physical Gold Funds snap a four-week inflow streak, flows into Japan Equity Funds rebound to a level last seen in mid-2Q13 and Bear Funds absorb fresh money for the 15th time year-to-date.

Free cash flow remains important to investors looking for companies that are well-positioned to weather credit market shocks, buy back shares, make dividend payments and acquire complimentary businesses. Free Cash Flow (FCF) Funds have only posted one outflow during the past 10 months and appear to have supplanted Cash Cow Funds as the preferred vehicle for investors focused on this metric.

Overall, investors steered a net $23 billion into all Equity Funds and $19.9 billion into Bond Funds during the week ending April 29. Balanced Funds attracted $1 billion while Alternative Funds surrendered $901 million and Money Market Funds $29.4 billion.

At the asset class and single country fund levels, Municipal Bond Funds pulled in over $1 billion for the 11th time year-to-date, Bear Funds posted their 11th inflow over the past 12 weeks, flows into Regional Bank Funds climbed to a 21-week high and dedicated Copper Funds posted their biggest inflow since early March. Redemptions from Brazil Money Markets hit their highest level in over eight months, Finland Equity Funds extended their longest run of inflows since 2Q25 and Russia Bond Funds posted another record inflow.

Emerging Markets Equity Funds

Going into May, EPFR-tracked Emerging Markets Equity Funds chalked up their third straight outflow as redemptions from domestically domiciled Chinese Mainland ETFs more than offset flows into the diversified Global Emerging Markets (GEM) and Latin America Equity Funds. Funds domiciled in the US did post their fourth straight inflow and funds with socially responsible (SRI) or environmental, social and governance (ESG) mandates recorded their third inflow since the beginning of the month.

The latest outflows from Chinese Mainland Equity Funds took the year-to-date total over the $150 billion mark, with the latest redemptions being attributed to the government’s desire to prevent speculative interest from destabilizing the country’s equity markets. Meanwhile, actively managed GEM and Asia ex-Japan Regional Equity Fund allocations to China rebounded coming into the second quarter, with GEM Fund managers maintaining their small underweight and Asia ex-Japan Fund managers their substantial overweight for this market.

Among the other Asia ex-Japan Country Fund groups, India Equity Funds tallied their 10th straight outflow, flows into Vietnam Equity Funds climbed to a 15-week high and Pakistan Equity Funds took in fresh money for the 20th time since the beginning of December.

EMEA Equity Funds saw a modest shift away from groups dedicated to major oil producers as the overall group racked up its sixth outflow since the beginning of March. Redemptions from Saudi Arabia, Kuwait, UAE and Qatar Equity Funds climbed to four, six, seven and 13-week highs, respectively.

Although Brazil Equity Funds posted another inflow, the latest week’s headline number for all Latin America Equity Funds was underpinned by regional funds. When it comes to sectors, these funds have been rotating from industrial and consumer-related stocks to energy and utilities plays, with allocations to energy at a 29-month high and exposure to utilities at a record high.

Developed Markets Equity Funds

A drumbeat of “on hold” decisions from major central banks and a positive 1Q26 earnings season prompted investors to take a cautiously bullish stance when it came of developed markets equity during the last week of April. They continued to pump fresh money into US and Global Equity Funds and jumped back into Japan. Only Europe-mandated funds got the cold shoulder.

The Bank of Japan’s decision to leave rates where they are was largely expected. But that still leaves domestic borrowing costs at their highest level since late 3Q95. Investors, however, responded with the biggest inflows for Japan Equity Funds since 2013 as the group snapped its longest run of outflows since mid-3Q25. The top 10 funds with the biggest inflows this week were either benchmarked to TOPIX or Nikkei 225. Flows into all funds tied to the TOPIX index totaled over $4.7 billion this week, the most since Oct 2025. 

Australia’s central bank has been more aggressive in moving to combat any inflationary surge stemming from the latest Middle East conflict. As a result, investors see a lower inflation risk for the country, and Australia continues to remain in focus as an energy, commodity and resource play.  Australia Equity Funds have seen just three weeks of outflows since the start of August 2025, pulling in $1.3 billion year-to-date.

With the major European equity markets still under pressure as next steps on the ceasefire have leaders seeking clarity amid uncertain times, only France Equity Funds posted a modest inflow. It was a rare week of outflows for Switzerland Equity Funds – their second of the past eight weeks – redemptions from Germany Equity Funds picked up to a four-week high, and Sweden Equity Funds a six-week high, while UK Equity Funds suffered their biggest outflows in 25 weeks.

Global Equity Funds saw inflows pick up momentum towards the end of the week, with ex-US funds – which allocate on average over 50% of their portfolios to European stocks – lagging their global peers when it came to attracting fresh money.

Global Sector, Industry and Precious Metals Funds

Earnings from several major tech leaders – and companies in sectors elsewhere that are embracing AI – arrived at a fast pace in late April, prompting a swift reaction from all sector-oriented investors as they looked for evidence that massive capital expenditures are paying off. As a result, the total trading volume (absolute value of outflows + inflows) for all EPFR-tracked Sector Fund groups was nearly double the previous week at $10 billion.

Overall, five of the 11 major groups posted inflows, ranging from $678 million for Telecom Sector Funds to nearly $3 billion for Technology Sector Funds, and six experienced net redemptions during the final week of April.

Technology Sector Funds started the latest reporting period with a collective $3.7 billion outflow as leveraged funds offering 2x or 3x exposure to benchmarks (NYSE Semiconductors) or single stocks (SK Hynix, SanDisk, Nvidia) weighed on the headline figure. But inflows on the final two days brought in over $6.6 billion, leaving the group firmly in positive territory.

Data Centers & Digital Infrastructure Funds fed into the overall story for Tech, with the latest inflows marking their 38th straight week and biggest since the start of 3Q21. But those funds, which straddle the real estate universe, did little to move the needle for Real Estate Sector Funds as the group posted a sixth consecutive week of outflows.

Turning to the major Precious Metal Fund groups, after a steady run of inflows that lasted from mid-November to the end of January, Gold Funds posted their fifth outflow of the past 13 weeks and brought the end to a four-week inflow streak. The price of gold has increased by $100 in the past month but is still well down from the record seen at the start of March. Silver Funds and a custom grouping of Platinum Funds also experienced outflows, their third consecutive and ninth of the past 10 weeks, respectively.

Bond and other Fixed Income Funds

After a lull in the weeks after the US strikes on Iran, flows to EPFR-tracked Bond Funds have started to accelerate again. During the week ending April 29 those inflows climbed to a 10-week high as all of the major groups by geographic mandate took in fresh money despite the growing risks of another spike in global inflation due to higher energy prices.

As April wound down, the central banks of the Eurozone, US, Japan, the UK and Canada met and left interest rates on hold as policymakers weighed threats to growth and price stability. Although post-meeting statements flagged inflationary risks, and Inflation Protected Bond Funds chalked up their 13th consecutive inflow, investors discounted the threat of future rate hikes. High Yield, Emerging Markets and Municipal Bond Funds all recorded solid inflows and Collateralized Loan Obligation (CLO) Bond Funds added to their current inflow streak.

While barely half of the previous week’s total, net flows into Emerging Markets Bond Funds exceeded $3 billion with local currency funds attracting $3 for every $2 committed to their hard currency counterparts. At the country level, investors gravitated to Asia-mandated funds with India, Korea, Thailand and Chinese Mainland Bond Funds all absorbing over $200 million.

The latest allocations data for all Global Emerging Markets (GEM) Bond Funds shows that managers have lifted their exposure to Argentina and Venezuela to the highest level since 2Q19 and 3Q17, respectively, while the average weighting for Peru has fallen to a four-year low and Indonesia’s allocation is at a level last seen in late 3Q13.

Europe Equity Funds enjoyed solid inflows, the biggest share of which went to Europe ex-UK Regional Funds, with sovereign debt-mandated funds attracting 10 times the amount of fresh money that found its way to corporate funds. Retail share classes, which compiled a 20-week inflow streak during the second and third quarters of last year, saw money flow out for the seventh time over the past two months.

Foreign domiciled US Bond Funds tallied their ninth outflow since late February, but over $10 billion flowed into domestically based funds during a week when Jerome Powell chaired his last Federal Reserve rate policy meeting and his nominated successor, Kevin Warsh, moved closer to confirmation. Intermediate term was the preferred duration.

Global Bond Funds recorded their biggest inflow since mid-February. While funds with fully global mandates absorbed the bulk of the fresh money, Global ex-US Bond Funds extended a run of inflows stretching back to early August of last year.

Did you find this useful? Get our EPFR Insights delivered to your inbox.