Europe buys the US again, with global equity and fixed income funds both posting net inflows

Overview

The report tracks global fund flows for the week ending 2026-05-20. The core conclusion is that both equity- and fixed income-related funds recorded positive inflows, and cross-border fund flows were positive overall, showing that risk appetite is still supported. The key observation behind the title Europe Buys US Again is that Euro Area funds continued to flow into US Treasury funds, while Asia funds remained cumulative outflows. The report also notes that the US dollar traded more sideways, partly due to tighter foreign exchange management.

Core views

First, global equity funds continued to see net inflows, but momentum slowed markedly from the previous week; global benchmark funds and demand for US funds were the main support. Second, fixed income fund inflows were tilted toward government bonds, broad bond funds, short-duration bond funds, and inflation-protected bond funds. Third, regional fund flows diverged clearly, with Mainland China equity funds and Global EM benchmark funds seeing outflows, while Korea equity funds returned to inflows. Fourth, at the sector level, financial sector funds saw relatively large outflows, while technology sector funds led inflows, indicating that risk appetite is not broad-based but is being reallocated across regions and sectors.

Analysis framework

The report uses a fund flow monitoring framework, breaking flows down by asset class, fund domicile, investment region, sector, and fund type, while combining cross-border FX flows, fund domicile, and AUM shares to observe portfolio allocation direction. Some charts use cumulative fund flows, year-to-date flows, and 4-week moving averages to smooth short-term noise and identify trends.

Methodology notes

• Fund flow analysisglobal fund flows

  Track net subscriptions/redemptions in funds across equities, fixed income, money markets, and subcategories.

  This method is used to gauge marginal funding preferences across asset classes and regions, but it is not the same as fundamental earnings forecasts or individual stock investment ratings.

• Cross-border fund flowscross-border FX flows

  Estimate cross-border equity and fixed income fund flows based on underlying fund domicile, excluding hard currency EM bond funds and FX-hedged products.

  This measure is closer to unhedged cross-border allocation behavior and can be used to observe FX-related funding pressure and risk sentiment.

• Trend identification4-week moving average

  Use a 4-week moving average to observe short-term trends in sector fund inflows and outflows.

  This method reduces weekly noise, but it may lag turning points in fund flows.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• US equity funds

  Benefiting from positive global equity fund inflows and strong demand for US funds.

  Strengths

  Strong demand for US funds, and cumulative foreign inflows remain large.

  Weaknesses

  Weekly global equity fund inflows slowed versus the prior week.

  Comparison

  Compared with the Euro Area, the US has a larger cumulative foreign inflow; however, the Euro Area also accelerated relative to its own trend.

  Risks

  If risk appetite cools or dollar volatility rises, inflows into US equity funds could slow.

• US Treasury funds

  Supported by continued inflows from the Euro Area, but contrasted by cumulative outflows from Asia.

  Strengths

  Euro Area cumulative inflows of about +$11bn show strong overseas allocation demand.

  Weaknesses

  Asia's cumulative outflows of about -$5.5bn indicate uneven regional funding sources.

  Comparison

  The flow directions from the Euro Area and Asia into US Treasury funds differ significantly.

  Risks

  FX management, the dollar trend, and rate volatility may affect cross-border bond fund flows.

• global fixed income funds

  Overall supported by inflows into government bond, broad bond, short-duration bond, and inflation-protected bond funds.

  Strengths

  The fixed income inflow structure is broad, and government bonds and agg-type bond funds are performing well.

  Weaknesses

  EM hard-currency bond funds recorded net outflows.

  Comparison

  EM local-currency bond funds posted net inflows and outperformed hard-currency bond funds.

  Risks

  Interest rates, inflation expectations, and FX volatility could change bond fund allocation directions.

• technology sector funds

  Recorded the largest net inflows among sector funds during the week.

  Strengths

  The technology sector continues to attract capital, with cumulative fund flows still positive.

  Weaknesses

  The chart shows that technology inflows are volatile, and YTD strength is below Industrials, Energy, and some other sectors.

  Comparison

  Technology outperformed financials during the week; on a YTD basis, Industrials and Energy have seen stronger inflows.

  Risks

  If growth valuations or rate expectations adjust, technology sector inflows could fluctuate.

• Mainland China equity funds

  The report shows net outflows during the week, and YTD fund flows are also significantly negative.

  Strengths

  The historical cumulative chart once showed periods of sizable inflows.

  Weaknesses

  Recent flows have weakened, with YTD around -22% of AUM.

  Comparison

  Korea and Brazil have much stronger YTD fund flows than Mainland China.

  Risks

  If domestic risk appetite, policy expectations, or overseas allocation interest do not improve, outflow pressure may continue.

Key data

• Global equity fund net inflows for the week+$2bnFor the week ending 2026-05-20, the prior week was about +$20bn.
• Money market fund assets+$1bnThe report says money market fund assets increased by about $1bn.
• Cumulative inflows into US Treasury funds from the Euro Areaabout +$11bnVisual estimate from the chart, covering Jan-2025 to May-2026.
• Cumulative inflows into US Treasury funds from Asiaabout -$5.5bnVisual estimate from the chart, showing that Asia's cumulative flows turned into outflows since 2025.
• Mainland China YTD equity fund flowabout -22% of AUMVisual estimate from the chart; one of the larger outflow items in the regional YTD view.
• Korea YTD equity fund flowabout +39% of AUMVisual estimate from the chart; one of the stronger inflow items in the regional YTD view.
• Industrials YTD sector equity flowabout +21% to +22% of AUMVisual estimate from the chart; one of the stronger sector inflows year-to-date.
• Consumer Goods YTD sector equity flowabout -5% of AUMVisual estimate from the chart; one of the more notable sector outflows year-to-date.

Impact & implications

The implication for asset allocation is that global capital is still adding to risk assets and high-quality fixed income, but flows are not evenly distributed. US assets continue to attract overseas capital, especially Euro Area allocations to US Treasury funds; meanwhile, Asia's cumulative outflows from US Treasury funds, Mainland China equity fund outflows, and financial sector fund outflows indicate that regional and sector risk appetite remains clearly differentiated. For macro trading, cross-border inflows support risk sentiment, but the dollar, interest rates, and regional capital rebalancing remain key things to watch.

Risks

• Fund flow data are high-frequency weekly indicators and may be affected by short-term subscriptions/redemptions, rebalancing, and seasonality.
• Some chart values are visual estimates and lack support from exact underlying data tables.
• Fund flows do not equal final asset price performance and cannot replace fundamental or valuation analysis.
• Cross-border flows are affected by FX controls, exchange rate volatility, and fund domicile conventions, so interpretation should avoid over-attribution.
• The report does not provide individual stock ratings or target prices and cannot be used as a standalone investment recommendation for a single security.

What to watch

• Whether cumulative inflows from the Euro Area into US Treasury funds continue.
• Whether cumulative outflows from Asia from US Treasury funds narrow or widen.
• Whether global equity fund net inflows re-accelerate from +$2bn or continue to slow.
• Whether Mainland China equity funds and Global EM benchmark funds stabilize after outflows.
• Whether inflows into the technology sector can continue and whether financial sector outflows ease.
• The subsequent inflow strength of short-duration bonds, inflation-protected bonds, and EM local-currency bond funds.