Outflows from bond funds continue rise, hit $36.5 bln -TrimTabs

Sun Aug 25, 2013 11:51am EDT

Aug 25 (Reuters) - Investors have withdrawn $36.5 billion from bond funds this month through Thursday on fears the U.S. Federal Reserve will slow its bond-buying program, data from research provider TrimTabs showed on Sunday.

That tally was up from $30.3 billion a few days prior, in what TrimTabs called "an enormous shift for the bond world" this summer. Redemption in the last three months broke a string of 21 consecutive monthly inflows.

In July there was an outflow of $14.8 billion, while in June the outflow was a record $69.1 billion.

Stronger U.S. economic data has led investors to believe that the Fed will cut back on its $85 billion in monthly purchases of Treasuries and agency mortgages soon. The anticipation of a pullback in stimulus has spurred investors to sell bonds.

Anxious investors are also withdrawing money from U.S. stock mutual funds and ETFs.

So far this month, they have withdrawn $12.6 billion from U.S. stock mutual funds and ETFs, according to the latest report by TrimTabs, which said "investors have lost enthusiasm for U.S. equities."

The S&P 500, which has risen nearly 17 percent this year, has fallen about 1.3 percent so far this month.

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