U.S. equity fund outflows have extended to a second consecutive week as rising tensions between the U.S. and Iran weigh on investor sentiment. Data from the latest week shows a net outflow of .2 billion from U.S. equity funds, marking the second week of sustained withdrawals. Analysts attribute this trend to heightened geopolitical risks following recent military clashes and sanctions, which have created uncertainty in global markets. The S&P 500 and Nasdaq indices have both seen declines amid the selloff. This development signals growing caution among investors, particularly in risk-on assets like U.S. equities. The outflows reflect a shift toward safer assets such as U.S. Treasury bonds and gold, which have seen increased demand. Traders are also monitoring the Federal Reserve's policy response, as prolonged geopolitical tensions could influence inflation and economic growth forecasts. The broader market impact could ripple into emerging markets, including Gulf equities, which are sensitive to global risk appetite. For Gulf and MENA investors, the sustained outflows from U.S. equities highlight the need to reassess portfolio allocations in light of geopolitical volatility. Key assets to watch include the S&P 500, gold, and the U.S. dollar, as cross-asset correlations may intensify. Investors should also track developments in U.S.-Iran relations and potential Fed rate decisions, which could further shape market dynamics in the coming weeks.

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