UPDATE 1-U.S.-based junk bond funds see $3.28 bln net outflow -Lipper

Thu Jun 13, 2013 5:53pm EDT

By Alison Griswold

June 13 (Reuters) - Investors in funds based in the United States pulled a net $3.28 billion from corporate high-yield bond funds in the week ended June 12 as concerns lingered that the Federal Reserve would taper its stimulus program, data from Thomson Reuters Lipper service showed on Thursday.

The latest week's large junk bond outflows followed a record $4.63 billion in outflows from high-yield bonds in the preceding week. All taxable bond funds, meanwhile, had net outflows of $5.51 billion in the latest week, after seeing their largest outflows since October 2008 in the previous week.

Emerging markets equity funds were also big underperformer in the latest week. They had outflows of $2.13 billion, the largest since February 2011. Emerging market debts funds had redemptions of $622 million, their third consecutive week of outflows.

All equity funds had net outflows of $608 million. Domestic equities had inflows of $1.28 billion, while non-domestic equities had outflows of $1.89 billion.

Investors continued to pull cash from bond funds as worry remained that the Fed would begin to reduce its quantitative easing in the coming months. The Fed is purchasing $85 billion in Treasuries and agency mortgage securities per month in an effort to boost hiring and lower long-term borrowing costs.

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