US Equity Inflows Surge To $64 Billion While India-Focused Funds Face 7-Week Outflow High
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US equity funds attracted $64 billion during the week following the Fed’s September decision, marking their highest inflow in three months. In contrast, India-focused funds recorded $496 million of outflows, their highest in seven weeks.
US equity funds saw a significant revival in inflows after the United States Federal Reserve’s 16 September 2026 rate decision. Most of the money went into domestic exchange-traded funds (ETFs), while emerging-market funds faced renewed redemptions.
The divergence extended to India, where India-focused funds recorded their highest weekly outflow in seven weeks.
The latest flow data highlights how investors have been reallocating across regions following the Fed decision and a rise in US Treasury yields.
US Equity Funds See Highest Inflows In Three Months
US equity funds attracted inflows of $64 billion for the week, the biggest weekly inflow in three months. Most of the money was invested in domestic ETFs, suggesting a relative allocation towards US shares following the decision by the Fed.
At the same time, global emerging-market (GEM) funds registered their first outflow in 10 weeks, with redemptions reaching $877 million.
The Fed's decision included a 25-basis-point rate hike. The move came against a resilient growth backdrop rather than signalling a deterioration in economic conditions.
Record Outflow For India-Focused Funds
India-focused funds saw outflows rise to $496 million during the week, the highest level in seven weeks. Redemptions were broadly divided between long-only funds and ETFs.
Long-only funds accounted for $251 million of the outflows, while ETFs recorded another $245 million in redemptions. The recent increase in crude oil prices could be contributing to the pressure on India-focused funds.
The broader emerging-market flow picture was also mixed. South Korea-dedicated funds recorded their largest outflow in 22 weeks at $2.5 billion, while Taiwan-dedicated funds attracted $1.7 billion.
Gold Funds Attract Inflows While High-Yield Bonds Face Outflows
Global high-yield bond funds recorded $2 billion of outflows, their largest in six months. The movement coincided with the Fed rate hike and a renewed rise in US Treasury yields.
The US 10-year Treasury yield returned to around 5% during the week and briefly moved above that level, its highest since 2007. A sustained move above 5%, combined with tighter Fed policy and elevated inflation, could put further pressure on high-yield valuations.
In contrast, gold funds recorded their 11th consecutive week of inflows, attracting $3.4 billion. Global consumer goods funds also saw $1.37 billion of inflows, their highest since April 2023. Global industrial funds attracted $1.2 billion, their highest inflow in six weeks. The Global Industrial Index also moved marginally below its 200-day moving average for the first time since March 2025.
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This article is for informational purposes only and should not be considered investment advice from Kotak Neo. For compliance T&C and disclaimers, Visit www.kotakneo.com/disclaimer
Vishwa has spent 10+ years across fintech and FMCG doing what most people miss, connecting the dots, catching trends before they trend, and finding the angle nobody else thought to ask about.
At Kotak Neo, she drives content strategy for neoshorts, Kotak News Desk, and Investing Guide, turning market noise into something worth reading.
When she's not decoding markets, she trades charts for canvases, chasing art, painting, and architecture across cities she's yet to explore.
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