NEW YORK (Reuters) - Risk aversion was on display this week given geopolitical concerns and uncertainty over North Korea as investors in U.S.-based funds pulled $1.1 billion out of stock funds in the week ended Sept. 6, and moved money into “safe haven” money-market and gold funds, data from Thomson Reuters’ Lipper service showed on Thursday.
U.S.-based money-market funds attracted $6.8 billion of inflows over the weekly period, while taxable bond funds attracted $1.6 billion in inflows to mark their ninth straight week of inflows, with funds that specialize in safe-haven U.S. Treasuries drawing $458 million of that sum to mark their fourth straight week of inflows.
U.S.-based commodities precious metals funds, which include gold futures, attracted $878 million of inflows over the weekly period, their biggest inflows since early February, according to Lipper data.
“Risk off is driven by geopolitical concerns and uncertainty over North Korea,” said Pat Keon, senior research analyst at Thomson Reuters Lipper.
“Markets tanked the first day back from Labor Day weekend after North Korea announced they tested a hydrogen bomb, and in response, the U.S. engaged in saber rattling with Secretary Defense (James) Mattis threatening a massive military response and United Nations Ambassador Nikki Haley telling the U.N. that North Korea was begging for war.”
U.S.-based corporate investment-grade bond funds posted their first cash outflows of the year, albeit a small amount, according to Lipper. The group saw investors pull $43 million.
Emerging markets equity funds posted $107 million in outflows over the weekly period, their first cash withdrawals in three weeks, Lipper said. Emerging markets debt funds attracted $184 million, their third straight week of inflows, Lipper added.
Reporting by Sam Forgione; Editing by Jennifer Ablan