NEW YORK, March 8 Fund investors worldwide
placed $7.14 billion in stock funds in the latest week as the
Dow Jones industrial average hit record highs and global
markets rallied, data from EPFR Global showed on Friday.
Inflows into stock funds in the week ended March 6 trounced
the prior week's cash gains of $1.2 billion. Appetite for U.S.
stocks largely accounted for the inflows, as $4.95 billion
flowed into funds that hold the stocks, reversing the prior
week's redemptions of $411 million.
The inflows came on the heels of the Dow's record closing
high of 14,253.77 points on March 5, which it surpassed a day
later. Loose policies of monetary easing from the U.S. Federal
Reserve and signs of growth in the U.S. economy contributed to
The MSCI world equity index, meanwhile, rose
1.6 percent over the weekly reporting period.
Investors worldwide have poured over $21 billion into funds
that U.S. stocks so far this year, showing a change in sentiment
after redeeming heavily from the funds in 2012 and favoring
stable returns in bonds.
The appetite, or lack thereof, for equities serves as an
important barometer of investor confidence and how people feel
about the state of economic growth.
The flows into U.S. stocks overshadowed demand for emerging
market stocks, as just $102 million flowed into emerging market
stock funds. That amount, albeit small, is an improvement from
outflows of $1.07 billion the prior week.
Investors withdrew $290 million from European stock funds,
despite expectations that the European Central Bank would
maintain its loose monetary policy at a meeting.
Concerns remained, however, that political instability in
Italy would stall the country's economic reforms and reignite
the euro zone debt crisis.
Investors also sought profits in high-yield "junk" bond
funds, to which they gave $1.9 billion, the most since
mid-January. Many view high-yield bonds as a risk asset, and yet
a safer alternative to stocks.
Bond funds overall reaped inflows of $4.5 billion in the
latest week, slightly below cash gains of $4.68 billion the
previous week. Funds that hold U.S. bonds took in $3.86 billion
of the new money.
Funds that hold emerging market bonds attracted just $409
million in new money, a weak turnout after attracting inflows of
more than $1 billion in the first six weeks of the year.
The move out of European stocks also applied to the region's
bond funds, which suffered redemptions of $974 million over the