(Adds investor quote and details on equity flows; byline)
By Sam Forgione
NEW YORK Aug 15 Investors worldwide pulled $2.4
billion out of high-yield junk bond funds in the week ended Aug.
13, marking the fifth straight week of withdrawals and
indicating increasing concern over risk assets, data from a Bank
of America Merrill Lynch Global Research report showed on
The outflows from junk bond funds came after record
withdrawals of $11.4 billion in the prior week and against the
backdrop of investors moving into plain-vanilla securities
In fact, bond funds overall attracted net inflows of $3.8
billion, marking their biggest inflows in six weeks, according
to the report, which also cited data from fund-tracker EPFR
Global. Of that, funds that mainly hold U.S. Treasuries
attracted $2.2 billion in new cash, their sixth straight week of
Jeffrey Gundlach, who as co-founder and chief investment
officer at DoubleLine helps oversee $52 billion in assets, said
Treasuries were not only benefitting from flight-to-quality but
also from supply and demand factors.
"One of the other reasons that interest rates have fallen in
2014 is because there aren't any bonds floating around, hardly,"
Gundlach said. "There really isn't that big of a float in bonds,
particularly long-term bonds, because the Federal Reserve bought
so many of the long-term bonds that there's a great fraction
that are not really trading around in the world."
He was referring to the Fed's massive program of asset
purchases, which will end in October if the economy stays on
Investors are still showing some appetite for equities.
Stock funds worldwide attracted $2.8 billion in new cash,
but not after $16.3 billion in outflows in the prior week.
Emerging markets equity funds worldwide had $1.9 billion of
inflows, their 10th straight week of inflows, according to data
That said, European stock funds posted $3.5 billion in
outflows, marking their largest withdrawals since August 2011.
Japanese stock funds attracted $1.8 billion, their biggest
inflows in 17 weeks, while U.S.-focused stock funds attracted
just $1.3 billion.
(Reporting by Sam Forgione; Editing by Chizu Nomiyama and Tom