(Adds analyst comments, market performance, table)
By Sam Forgione
NEW YORK, May 22 Investors in U.S.-based funds
pulled $7.6 billion out of stock funds in the week ended May 21
on weak U.S. economic data and disappointing corporate results,
data from Thomson Reuters' Lipper service showed on Thursday.
All of the outflows stemmed from stock exchange-traded
funds, which posted $9.6 billion in withdrawals, while stock
mutual funds attracted $2 billion in net inflows, which were the
biggest in four weeks. The net outflows were the biggest since
ETFs are thought to reflect the behavior of institutional
investors, while mutual funds are commonly purchased by retail
investors. The SPDR Standard & Poor's 500 ETF Trust,
which tracks the benchmark S&P 500 stock index, posted
the biggest outflows, of $4.2 billion.
The outflows from stock ETFs could speak to a lack of
confidence in the U.S. economy and worries about a correction in
U.S. stocks, said Pat Keon, research analyst at Lipper. The S&P
500 edged 0.03 percent lower over the week after hitting record
highs a week earlier.
Data over the week showed U.S. industrial output fell at its
fastest rate in more than 1-1/2 years in April, while a monthly
gauge of U.S. consumer sentiment fell in May.
The iShares: Russell 2000 Index Fund, which tracks
the small-capitalization Russell 2000 index, posted the
second-biggest outflows of $3.6 billion. The outflows came as
the index entered correction territory over the week on
continued weakness in small-cap stocks.
Emerging market stock funds attracted $1.5 billion in
inflows, their highest inflows in six weeks and their ninth
straight week of inflows. Analysts have said the Federal
Reserve's pullback in its monthly bond-buying has proceeded
smoothly, which has reassured emerging markets investors.
Taxable bond funds attracted $3.4 billion in new cash,
marking their 11th straight week of net inflows. Riskier
high-yield bond funds attracted $744 million, marking their
biggest inflows since February.
Funds that mainly hold U.S. Treasuries posted about $380
million in outflows, the biggest since March.
The inflows into bond funds came after yields on benchmark
10-year U.S. Treasury notes fell to 2.47 percent on May 15, the
lowest level since Oct. 30, on geopolitical tensions surrounding
Ukraine and underwhelming U.S. and European economic data. Bond
yields move inversely to their prices.
The latest week showed investors putting cash to work.
Low-risk money market funds, which are viewed as a safe place to
store cash, posted $10.1 billion in outflows, marking their
biggest outflows in five weeks.
The weekly Lipper fund flow data is compiled from reports
issued by U.S.-domiciled mutual funds and exchange-traded funds.
The following is a broad breakdown of the flows for the
week, including exchange-traded funds (in $ billions):
Sector Flow Chg % Assets Assets Count
All Equity Funds -7.556 -0.19 4,030.581 10,747
Domestic Equities -10.692 -0.36 2,967.422 7,839
Non-Domestic 3.136 0.30 1,063.159 2,908
All Taxable Bond 3.357 0.19 1,775.522 5,446
All Money Market -10.054 -0.44 2,295.200 1,316
All Municipal Bond 0.664 0.23 291.241 1,443
(Reporting by Sam Forgione; Editing by Richard Chang)