Investors poured $3.3 billion into U.S. junk-bond funds this week, the most in four years, according to Lipper.
The inflow is the largest for the funds in a weekly period since October 2011 and the second-largest on record, reducing this year’s net outflows to $4.4 billion, Lipper data show. The high-yield debt has lost 0.6 percent this year, pummeled by concerns about slowing growth in China and a commodities slump.
Investors rushing back to junk bonds may be betting that the Federal Reserve won’t raise raise interest rates this year. Last month, Fed Chair Janet Yellen delayed a rate hike amid market turmoil and rising international risks.
Meanwhile, withdrawals from U.S. mutual funds and exchange-traded funds that buy leveraged loans continued for a 13th straight week. Investors pulled $169 million from the funds, increasing net redemptions to $12.7 billion for the year, according to Lipper.