(Adds additional flow data, market performance, analyst
By Sam Forgione
NEW YORK, April 10 Investors in U.S.-based funds
poured $8.9 billion into stock funds in the week ended April 9,
even as equity markets were hit with sharp selling that
particularly weighed on tech and biotech shares, data from
Thomson Reuters' Lipper service showed on Thursday.
The net inflows into stock funds were the biggest in four
weeks. Stock mutual funds attracted $3.1 billion of the inflows,
while stock exchange-traded funds attracted $5.8 billion. Mutual
funds are commonly purchased by retail investors, while ETFs are
thought to represent the institutional investor.
"Stock investors were starting to feel like they could get
back into stocks after a couple days of losses," said Jeff
Tjornehoj, head of Americas research at Lipper.
The U.S. stock market has been hit with a wave of selling,
particularly in high-growth stocks in the technology and
biotechnology industries. Until recently, the effect on the
broader market had been limited, though selling across sectors
has picked up of late.
Through Thursday, the Nasdaq Composite Index has fallen 2.9
percent since Jan. 1. Accelerated losses in recent weeks have
sparked concerns that the market has reached a top for the time
Funds that hold emerging market stocks attracted $2.3
billion in new cash, marking the third straight week of inflows.
In the past two weeks alone, the funds have attracted $5
billion, marking their best two-week run since early last year.
While the Standard & Poor's 500 stock index fell 1
percent over the weekly period, MSCI's index of global emerging
market stocks rose 1 percent. Analysts have said that
the prospect of fresh stimulus in China and the euro zone have
helped boost emerging market stocks.
The iShares MSCI Emerging Markets ETF attracted $2.1
billion of the total inflows into emerging market stock funds,
as investors again sought exposure to rising prices of emerging
market shares. The ETF attracted more than $2 billion the prior
Taxable bond funds attracted $2.9 billion in new cash, for a
fifth straight week of inflows. Investors sought riskier bonds
and committed $368.3 million to emerging market bond funds,
marking a second straight week of inflows, and $640 million to
high-yield bond funds, a seven-week high.
Funds that mainly hold U.S. Treasuries reported outflows of
$182 million, for the first outflows in four weeks.
Minutes from the Federal Reserve's latest policy meeting in
March helped boost appetite for riskier bonds, said Tjornehoj of
Lipper. The minutes suggested the U.S. central bank may not
raise interest rates anytime soon.
"The Fed is telling people risky assets are not going to be
harmed," Tjornehoj said.
Commodities and precious metals funds, which mainly invest
in gold futures, posted outflows of $228.7 million, marking
their second straight week of outflows. Low-risk money market
funds posted $11.2 billion in outflows, marking their sixth
straight week of withdrawals.
"It hasn't paid to stand on the sidelines," Tjornehoj of
Lipper said on the outflows from money market funds. So far this
year through Thursday, the Standard & Poor's 500 is down 0.8
percent, while the Barclays U.S. Aggregate bond index had risen
2.27 percent through Wednesday.
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 ($Bil) Count
All Equity Funds 8.935 0.22 4,029.978 10,709
Domestic Equities 5.228 0.17 2,991.585 7,818
Non-Domestic 3.708 0.36 1,038.393 2,891
All Taxable Bond 2.854 0.16 1,741.181 5,387
All Money Market -11.177 -0.48 2,324.246 1,322
All Municipal Bond 0.274 0.10 282.993 1,436
(Reporting by Sam Forgione; Editing by Diane Craft and Steve