Exchange-traded funds took in more than $30 billion in their strongest week this year, led by U.S. equity funds, as major market benchmarks hit new highs, according to EPFR Global.
Investors poured $31.6 billion into ETFs globally in the week ending on Wednesday, beating a previous high for the year of $26.5 billion during the week to April 26.
In spite of a high-profile sell-off in technology shares, particularly among the so-called Faangs — Facebook, Amazon, Apple, Netflix and Google — all four of the major U.S. indices hit new highs over the past week. The S&P 500, Nasdaq Composite and Russell 2000 reached intraday highs on Friday, while the Dow Jones Industrial Average hit a fresh high on Wednesday.
"Everyone talks about Faangs, but it is a little bit of Fomo [fear of missing out]," said Matthew Bartolini, head of SPDR Americas research at State Street Global Advisors. "The equity market continues to rally."
"It looks like classic peak-performance chasing," added Nicholas Colas, an independent analyst in New York.
While non-U.S. funds have taken strong flows this year, Mr. Bartolini pointed to a shift back towards the U.S. in the latest week.
EPFR data show global equity funds excluding the U.S. taking in money for every week this year for a year-to-date total of $48.54 billion. That compares with global equity funds, which include US exposure, having cumulative inflows of $17.13 billion so far this year.
Elsewhere, emerging market bond funds had their 20th consecutive week of inflows at $1.33 billion, bringing the total for the period to more than $35 billion.
The sector has benefited from persistently low yields on U.S. debt and a weaker dollar recently, the latter boosting areas with high levels of dollar-denominated debt.
UK equity funds suffered the eighth straight week of outflows with net redemptions totalling $563 million, amid continued political uncertainty. Investors withdrew more than $3 billion from these funds in the eight-week period.