Institutional investors lead equity inflows -Lipper
By Daniel Bases NEW YORK, June 14 (Reuters) - Institutional investors placed big bets on equity funds in the week ended June 13 while retail investors returned to the sector after three weeks of selling, data from Thomson Reuters' Lipper service showed on Thursday. Exchange traded funds pulled in a net $9.1 billion for the week with two-thirds of the total new cash moving into the large-cap State Street SPDR S&P 500 ETF. The $6.4 billion net inflows into the fund was the best weekly performance since October 2008. ETFs are anecdotally believed to represent the investment behavior of institutional investors while mutual funds are thought to represent the retail investor. Excluding ETFS, retail investors broke a three-week outflow streak and placed a net $643 million into equity mutual funds. In the course of the reporting week, the U.S. benchmark Standard & Poor's 500 stock index was essentially flat. However, it captured a good portion of the best week of the year on rumors, since confirmed, that Spain would ask for aid to prop up its banking sector. Taxable bond funds also pulled in cash, representing somewhat of a safe-haven play by investors unnerved by the Europe's ongoing credit crisis and the potential turmoil from Greece's elections on Sunday. The parliamentary elections on Sunday have raised the possibility that a new government could backtrack on a commitment to austerity measures set forth under Greece's 130 billion euro international bailout package. Spanish benchmark bond yields rose above 7 percent on Thursday after Moody's Investors Service cut the country's credit rating by three notches to Baa3, pushing borrowing costs to levels that had triggered full-scale bailouts for other euro zone states. Moody's said the aid plan for Spain's strained banks would increase the country's debt burden. As Europe's credit problems head toward another crescendo moment, money market funds, which typically act as a safe haven, had net outflows of $11.7 billion. Taxable bond funds pulled in $1.1 billion. Government mortgage funds pulled in $748 million. "That is a huge number for that sector and represents a safety play for the retail investors," said Tom Roseen, head of research services at Lipper. Municipal bond funds maintained their inflow streak, bringing in $365 million, down from the prior week's $593 million inflow. One streak that had been in place for over a year was an outflow from equity income mutual funds. Excluding ETFs, the sector had an outflow of $229.3 million, its first negative week since early May 2011. The weekly Lipper fund flow data is compiled from reports issued by U.S.-domiciled mutual funds and exchange-traded funds. The following is a broad breakdown of the flows for the week, including exchange-traded funds (in $ billions): Sector Flow Chg % Assets Count ($Bil) Assets ($Bil) All Equity Funds 9.780 0.37 2,642.851 10,343 Domestic Equities 8.946 0.44 2,019.659 7,747 Non-Domestic Equities 0.833 0.13 623.191 2,596 All Taxable Bond Funds 1.142 0.08 1,407.772 4,657 All Money Market Funds -11.678 -0.51 2,276.563 1,426 All Municipal Bond Funds 0.365 0.12 299.092 1,358
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