Investors Pull Billions from U.S. Stocks as Caution Rises, Gold and Bonds Gain

Bank of America and EPFR Global data show investors redeemed $9.8 billion from U.S. equity funds in the week ending June 11, 2025, the largest outflow in nearly three months.

European equity funds also saw $600 million in outflows, their first in nine weeks. These moves signal that investors have grown more cautious about the stock market’s prospects and are shifting capital to safer ***ets.

Several factors drive this trend. Rising U.S. Treasury yields and concerns over the country’s debt and fiscal policies have made investors wary of equities.

The recent downgrade of the U.S. sovereign credit rating by Moody’s and the p***age of a tax-and-spending package have further fueled uncertainty.

These developments have led to a surge in long-term Treasury yields, making bonds more attractive compared to stocks.

Institutional and hedge fund clients led the sell-off, while retail investors showed some buying interest after two weeks of net selling.

The technology sector saw the second-largest outflow since 2008, while communication services and consumer discretionary sectors attracted some inflows.

Exchange-traded funds focused on small-cap and growth stocks also experienced notable redemptions.

Investors Pull Billions from U.S. Stocks as Caution Rises, Gold and Bonds Gain

At the same time, global bond funds attracted $20.15 billion in net inflows, marking the eighth consecutive week of gains.

Euro-denominated bond funds reported their strongest inflows since October 2020.

Investors also poured money into gold funds, which have recorded $85 billion in net inflows so far this year, more than double the previous full-year record set in 2020.

This rush to gold reflects heightened risk aversion and a search for traditional safe havens.

Buffett’s Cash Hoard and Beyond: A Warning for World Markets

Emerging market bond funds continued to attract capital, while emerging market equity funds saw modest outflows.

Money market funds rebounded, drawing $18.1 billion in new investments after significant redemptions the previous week.

These flows reveal that investors prefer safety amid economic and geopolitical uncertainty. The shift from stocks to bonds and gold shows a clear move toward capital preservation.

Market participants are watching closely for further signs of instability, as these trends could impact corporate funding, market liquidity, and economic growth.