Equity Fund Inflows Surge 24% to Rs 23,587 Crore in June: AMFI Reports Strong Recovery

India's mutual fund industry witnessed a remarkable turnaround in June 2025, with equity fund inflows rising 24% to Rs 23,587 crore, according to the latest data released by the Association of Mutual Funds in India (AMFI) on July 9. This significant recovery comes after a sharp 22% decline recorded in May, demonstrating renewed investor confidence in equity markets.

Market Performance Drives Investor Optimism

The surge in equity investments coincided with positive market performance during June. The Nifty gained 2.7% while the Sensex rose 3.1%, despite ongoing global trade tensions and geopolitical uncertainties in the Middle East. This stability appeared to boost investor sentiment and encourage fresh capital deployment into equity funds.

The strong performance was reflected in the industry's overall assets under management (AUM), which reached an all-time high of Rs 74.41 lakh crore in June, compared to Rs 72.20 lakh crore in May and Rs 69.99 lakh crore in April. This growth was primarily driven by mark-to-market gains in equity holdings.

SIP Investments Hit New Record High

Systematic Investment Plan (SIP) inflows demonstrated exceptional resilience, reaching a new record of Rs 27,269 crore in June 2025. This represented a 2.2% increase from May's Rs 26,688 crore and a 5.2% rise from March levels, highlighting the growing discipline among retail investors.

The number of active SIP accounts expanded from 8.56 crore to 8.64 crore in June, with SIP assets under management climbing to Rs 15.31 lakh crore. Notably, SIPs now account for 20.6% of the mutual fund industry's total assets, up from 20.2% in May.

Category-wise Performance Analysis

Equity Fund Categories Show Strong Growth

Different equity fund categories exhibited varying levels of investor interest:

• Small Cap Funds led the charge with inflows of Rs 4,024.5 crore, up 25% from Rs 3,214 crore in May
• Mid Cap Funds recorded Rs 3,754 crore in inflows, marking a 34% month-on-month increase
• Large Cap Funds attracted Rs 1,694 crore, rising 35% from the previous month
• Sectoral/Thematic Funds saw a significant decline, with inflows dropping 77% to Rs 475.61 crore

Mixed Performance in Specialized Categories

ELSS (Equity Linked Savings Scheme) funds continued to experience challenges, with outflows of Rs 556 crore in June, though this was an improvement from May's Rs 678 crore outflows. Dividend Yield Funds showed a positive turnaround, posting inflows of Rs 45.55 crore after experiencing outflows in the previous month.

ETF and Hybrid Fund Developments

The Exchange Traded Fund (ETF) segment witnessed dramatic shifts in investor preferences. Gold ETFs experienced remarkable growth with inflows of Rs 2,080.9 crore, representing a massive 613% surge from May's Rs 292 crore. This surge likely reflects investors' hedge against economic uncertainty.

Hybrid funds maintained their appeal, with inflows rising to Rs 23,223 crore from Rs 20,765 crore in May. Arbitrage funds remained popular, attracting Rs 15,584 crore in inflows, though slightly lower than May's Rs 15,702 crore.

Debt Fund Market Dynamics

The debt fund segment showed mixed performance across different duration categories:

• Short Duration Funds saw exceptional growth, jumping 474% to Rs 10,277 crore
• Ultra Short Duration Funds rose 59% to Rs 2,944 crore
• Liquid Funds continued heavy outflows of Rs 25,196 crore, though down from May's Rs 40,205 crore
• Corporate Bond Funds attracted Rs 7,124 crore, though 41% lower than May

Industry Outlook and Expert Perspectives

Venkat Chalasani, Chief Executive of AMFI, expressed confidence in the industry's trajectory, emphasizing their commitment to establishing a robust mutual fund framework with standardized disclosure protocols and ongoing investor education initiatives.

Naval Kagalwala from Shriram Wealth Ltd highlighted that 65.7% of growth came from Equity & Hybrid schemes, representing growing interest in Indian equity markets. However, he cautioned that 25% of monthly growth was concentrated in higher-risk Mid, Small & Sectoral/Thematic schemes, advising investors to diversify across categories and asset classes.

Retail Investor Participation

The retail segment showed strong engagement with total mutual fund folios reaching 24.13 crore as of June 2025. Retail mutual fund folios across equity, hybrid, and solution-oriented schemes increased to 19.07 crore in June from 18.84 crore in May, with retail AUM standing at Rs 43.99 lakh crore.

Market Implications and Future Trends

The June data suggests a maturing investor base with preferences shifting toward balanced risk strategies. The significant inflows into hybrid and arbitrage funds indicate that investors are seeking diversified exposure while maintaining equity participation.

The record-breaking SIP inflows demonstrate the growing adoption of disciplined investment approaches among retail investors, which bodes well for long-term market stability and growth.

New Fund Offers (NFOs) saw a decline in interest, with inflows of Rs 1,986 crore representing a 52% drop from May's Rs 4,170 crore, suggesting investors are favoring established funds over new launches.

Disclaimer: The views and investment tips expressed in this article are for informational purposes only and do not represent financial advice. The views expressed are those of the sources cited and not necessarily those of this website or its management. Investing in equities or other financial instruments carries the risk of financial loss. Readers must exercise due caution and conduct their own research before making any investment decisions. We are not liable for any losses incurred as a result of decisions made based on this article. Please consult a qualified financial advisor before making any investment.

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Trump Announces 50% Copper Tariff: Market Surges as Futures Hit Record High

President Donald Trump has announced plans to implement a 50% tariff on copper imports, sending shockwaves through commodity markets and pushing U.S. copper futures to unprecedented levels. The announcement, made during a White House cabinet meeting on July 8, 2025, caught industry experts off guard with both its timing and magnitude.

Copper Futures Soar to Record Heights

The market reaction was immediate and dramatic. U.S. Comex copper futures surged more than 12% following Trump's announcement, reaching an all-time high. This explosive move reflects the significant impact such tariffs would have on global copper supply chains and pricing dynamics.

The timing of the announcement surprised industry watchers, as it came ahead of the expected November deadline for the Section 232 investigation into U.S. copper imports. Commerce Secretary Howard Lutnick indicated that the tariffs would likely be implemented by the end of July or early August 2025.

Strategic Push for Domestic Production

The tariff announcement is part of a broader strategy to revitalize American copper production. "The idea is to bring copper home, bring copper production home," explained Secretary Lutnick during a CNBC interview. This initiative aims to reduce America's dependence on foreign copper suppliers and strengthen domestic industrial capacity.

Currently, the United States imports approximately half of its copper requirements annually. This heavy reliance on imports makes the country vulnerable to supply chain disruptions and price volatility in global markets.

Industries Set to Feel the Impact

Copper plays a crucial role across multiple sectors of the economy:

• Construction industry - Essential for electrical wiring and plumbing systems
• Transportation sector - Critical component in electric vehicles and traditional automotive manufacturing
• Electronics manufacturing - Vital for circuit boards and electronic components
• Power grid infrastructure - Fundamental for electrical transmission and distribution
• Military hardware - Important for defense equipment and systems

Key Countries Affected by Tariff Policy

The tariff will primarily impact copper imports from three major suppliers: Chile, Canada, and Mexico. These countries were the top sources of refined copper, copper alloys, and copper products to the U.S. in 2024, according to Census Bureau data.

Interestingly, all three nations have existing free trade agreements with the United States. Representatives from Chile, Canada, and Peru have previously communicated to the administration that their copper exports do not pose a threat to U.S. national interests.

Market Winners and Challenges

Domestic copper producers are positioned to benefit significantly from the tariff implementation. Freeport-McMoRan, the world's largest copper producer, saw its stock price jump nearly 5% following the announcement. The Phoenix-based company produced 1.26 billion pounds of copper in the U.S. last year and stands to gain from reduced foreign competition.

However, industry experts warn of potential challenges. Ole Hansen, head of commodity strategy at Saxo Bank, noted that a 50% tariff would impact U.S. companies that rely on copper, as the country remains years away from meeting its domestic demand.

Storage Levels and Market Dynamics

Despite the tariff announcement, current copper storage levels in the U.S. appear adequate. Hansen observed that "the U.S. has imported a whole year of demand over the past six months, so the local storage levels are ample." This suggests that the immediate impact on supply availability may be limited.

The expert also predicted a potential correction in copper prices following the initial surge, indicating that markets may stabilize once the initial shock of the announcement subsides.

Looking Ahead

The copper tariff represents a significant shift in U.S. trade policy, with far-reaching implications for both domestic and international markets. While the policy aims to boost American copper production and reduce import dependence, its success will depend on the industry's ability to rapidly scale up domestic mining operations.

Investors and industry stakeholders will be closely watching for additional details about the tariff's implementation timeline and any potential exemptions or modifications to the policy.

Disclaimer: The views and investment tips expressed in this article are for informational purposes only and do not represent financial advice. The views expressed are those of the sources cited and not necessarily those of this website or its management. Investing in equities or other financial instruments carries the risk of financial loss. Readers must exercise due caution and conduct their own research before making any investment decisions. We are not liable for any losses incurred as a result of decisions made based on this article. Please consult a qualified financial advisor before making any investment.

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