$19 Billion Equity Surge: Markets Roar Back on Trump’s Tariff Truce and Inflation Relief

Global stock markets just got a massive jolt of optimism. In the week ending May 14, global equity funds pulled in a stunning $19.57 billion—the largest weekly inflow in nearly two months—fueled by a mix of geopolitical relief and easing inflation fears. According to LSEG Lipper data, this marks the biggest vote of confidence from investors since March 26.

The biggest trigger? A 90-day tariff truce between the U.S. and China, brokered by President Donald Trump, has dramatically lowered the risk of a full-blown trade war. Markets had been rattled in recent weeks by fears of a global slowdown. But with both economic superpowers stepping back from the brink, recession alarms have temporarily gone silent.

Meanwhile, U.S. inflation data for April came in softer than expected, offering investors additional comfort. For weeks, fears had been mounting that Trump’s aggressive tariff policies would worsen inflation and delay any potential interest rate cuts by the Federal Reserve. But the latest data has led many to believe that the Fed could still consider a rate reduction later this year—boosting investor confidence.

U.S. equity funds led the global rally with $12.86 billion in net inflows, reversing a four-week streak of withdrawals. European and Asian equity funds weren’t left out, garnering $3.29 billion and $2.89 billion, respectively. Sector-specific equity funds, particularly those focused on technology, industrials, and financials, each saw more than $1 billion in net purchases—halting a five-week selling spree.

The rally wasn’t limited to stocks. Global bond funds attracted $15.81 billion, the strongest inflow since early March. High-yield bond funds stood out with $3.56 billion in net inflows, their best performance in seven months. Government bond funds and loan participation funds also saw solid demand, pulling in $2.28 billion and $1.15 billion, respectively.

However, money didn’t flow in from everywhere. Global money market funds saw $32.22 billion in net outflows, partially reversing the $66.97 billion in inflows from the previous week. Gold and precious metals funds continued their losing streak, registering $198 million in outflows for a third straight week after an earlier 11-week rally.

Emerging markets also joined the rebound. Data from 29,660 funds showed bond funds drawing $1.52 billion, while equity funds brought in $508 million, marking three consecutive weeks of net inflows.

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