NEW YORK, March 5 Investors in U.S.-based mutual
funds committed $2.3 billion to bond funds in the week ended
Feb. 26, marking a third straight week of inflows, data from the
Investment Company Institute showed on Wednesday.
The three-week run, while modest, marks the longest streak
for the funds since May of last year, according to ICI, a U.S.
mutual fund trade organization. Stock funds attracted $5 billion
in the latest week.
Tax-free municipal bond funds attracted $667 million in net
inflows, their strongest week since February 2013, while taxable
bond funds attracted $1.7 billion.
Investors pulled a record $83.4 billion out of bond funds
last year, the most since ICI began tracking the data in 1984,
on fears that a pullback in the Federal Reserve's monthly
bond-buying program would trigger a spike in interest rates.
The yield on the benchmark 10-year U.S. Treasury note, which
jumped 138 basis points from last May through the end of 2013 to
3 percent, has dropped to around 2.69 percent on lackluster U.S.
economic data and the geopolitical tensions in Russia and
"We're now seeing stability (in bond yields), and that's a
comfort to investors," said Todd Rosenbluth, director of mutual
fund research at S&P Capital IQ.
Investors continued to pour cash into stock funds, with the
latest inflows marking an 11th straight week of new money into
the funds. Funds that mainly hold U.S. stocks attracted $3.1
billion, while funds that specialize in non-U.S. stocks
attracted about $1.9 billion.
The Standard & Poor's 500 stock index rose 0.9
percent over the weekly period.
Hybrid funds, which can invest in stocks and fixed-income
securities, attracted $1.7 billion in new cash, marking 21
straight weeks of inflows.
The following data shows estimated ICI flows for the past
five weeks (all figures in millions of dollars):
1/29/2014 2/5 2/12 2/19 2/26
Total Equity 5,309 1,719 6,909 5,829 4,964
Domestic 1,811 -1,727 3,812 4,094 3,113
World 3,499 3,446 3,097 1,735 1,851
Hybrid* 1,738 1,385 1,874 1,739 1,705
Total Bond -938 -2,854 1,127 2,911 2,327
Taxable -1,448 -3,000 965 2,489 1,660
Municipal 510 146 162 422 667
Total 6,109 250 9,911 10,479 8,997
*Hybrid funds can invest in stocks and/or fixed income