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Investors pull most money of 2016 from U.S. large cap funds: ICI

Published 06/08/2016, 12:29 PM
Updated 06/08/2016, 12:40 PM
© Reuters.  Investors pull most money of 2016 from U.S. large cap funds: ICI
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By Trevor Hunnicutt

NEW YORK (Reuters) - Investors ignored equity market gains and pulled the most money this year from U.S. mutual funds holding large-cap domestic stocks, Investment Company Institute data for the latest week showed on Wednesday.

U.S.-based large-cap mutual funds recorded $2.8 billion in outflows during the week ended June 1, the worst result for the funds since the week ended December 2. That week, the funds bled $3.5 billion, according to ICI.

"While the S&P 500 is near all-time highs, mutual fund investors are acting concerned that there will be near-term volatility given the sluggish earnings results," said Todd Rosenbluth, director of exchange-traded and mutual fund research at S&P Global Market Intelligence.

The outflows added to a tough series of weeks for stock mutual funds. The exodus from those funds totals $148 billion over the last 52 weeks, ICI said, with some of those dollars moving to bond funds and some to index-tracking exchange-traded funds.

The outflows continued even in weeks when the stock market gained. During the latest week measured by ICI, for instance, the S&P 500 capped off its strongest week since March.

Funds invested in international stocks posted a more moderate $280 million outflow during the latest week, the data showed.

U.S. mutual funds overall posted a $5.1 billion outflow. That was the biggest withdrawal since the week ended Jan. 27, when they posted a $9.3 billion outflow, according to ICI, a trade group for funds. Mutual funds and ETFs, taken together, attracted $1 billion during the latest week.

Bond funds, thriving this year on investors' thirst for safe yields, attracted $1.9 billion in their 14th straight week of new cash.

But investment-grade, taxable government, multisector and municipal bond funds all took in less money than last week.

Only high-yield funds attracted more money than in prior weeks, adding $118 million. Global debt funds, which have posted withdrawals for four weeks, slowed their outflows to $1.1 billion during the week, from $1.8 billion the week prior, according to the data.

The following table shows estimated ICI flows for the past five weeks (all figures in millions of dollars):

6/1 5/25 5/18 5/11 5/4/2016

Total equity -6,419 -6,262 -1,169 -4,448 -3,030

Domestic -6,139 -5,244 -2,013 -4,878 -2,371

World -280 -1,018 844 430 -659

Hybrid -615 225 -221 -313 -309

Total bond 1,940 3,480 3,671 4,140 3,527

Taxable 941 1,992 1,488 2,127 2,030

Municipal 999 1,487 2,183 2,014 1,497

Total -5,095 -2,557 2,281 -621 188

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