U.S. equity funds record nine-month high outflows as oil stokes inflation fears

Sept. 11 (Reuters) - U.S. equity funds came under heavy selling pressure in the week through September 9 as the Iran war drove oil prices sharply higher, heightening inflation fears and borrowing-cost concerns.

U.S. investors recorded net sales of $32.27 billion in equity funds during the week, their largest since $52.45 billion in disposals in the week to December 17, 2025, LSEG Lipper data showed.

West Texas Intermediate crude futures surged above July's high of $93.50 a barrel earlier in the week, reaching a four-month high of $104.46 on Friday and raising concerns that persistent inflation could prompt the Federal Reserve to raise interest rates as early as next week.

The U.S. producer price report released on Thursday, ahead of Friday's consumer price data, indicated that inflation remained elevated in August.

U.S. large-cap funds posted record weekly outflows of $40.44 billion, while mid-cap funds recorded net sales of $682 million. In contrast, multi-cap funds attracted $3.52 billion and small-cap funds drew $274 million in inflows.

Investors also purchased $1.46 billion in U.S. sectoral funds, led by technology, which attracted $1.71 billion, and financials, which gained $720 million.

U.S. bond funds recorded a 21st consecutive week of net purchases, totaling $6.56 billion.

Short-to-intermediate investment-grade funds attracted $3.75 billion, their largest weekly inflow in nine weeks. Short-to-intermediate government and Treasury funds also recorded a notable $2.78 billion in weekly net purchases.