U.S. equity funds saw a significant increase in net purchases for the week ending October 16. This was driven by strong third-quarter earnings from major banks and optimism about a potential Federal Reserve rate cut in November, as well as signs of cooling inflation.

The financial sector had the highest inflows in three months, with technology and industrial sector funds also experiencing net purchases. Large-cap funds had a substantial increase in net purchases, while mid-cap, multi-cap, and small-cap funds also saw inflows.

In the bond market, U.S. bond funds had the largest weekly inflow in three months. Investors showed strong interest in general domestic taxable, short-to-intermediate investment-grade, and municipal debt funds. Money market funds, on the other hand, had net sales for the first time in four weeks.