September 6, 2018 / 10:30 PM / 7 months ago

UPDATE 1-U.S.-based money market funds attract $11.84 bln in latest week -Lipper

 (Adds quotes, context, money flow details)
    By Jennifer Ablan
    NEW YORK, Sept 6 (Reuters) - U.S.-based money market funds
attracted $11.84 billion in the week ended Wednesday, following
outflows of $6.39 billion the previous week, Lipper data showed
on Thursday, indicating investors' appetite for risk-taking
waned as talks between the United States and Canada to
renegotiate the North American Free Trade Agreement continued.
    U.S.-based equity funds posted $7.2 billion of outflows in
the week ended Wednesday, following two weeks of inflows, Lipper
said. U.S.-based taxable bond funds posted over $1.1 billion of
outflows in the week ended Wednesday, following four weeks of
inflows, according to Lipper.
    "It was risk-off week, pointing to the outflows for
high-yield bond funds, too, of about $639 million as well as the
inflows into money market funds," said Pat Keon, senior research
analyst at Thomson Reuters Lipper. "NAFTA talks as well as China
tariffs contributed to this." 
    Keon was referring to a public comment period, on the Trump
administration's plan for fresh tariffs on $200 billion in
Chinese imports, ending on Thursday. China has warned of
retaliation if Washington implements any new tariff measures. 
    "Of note, among the equity fund outflows was a $3.6 billion
outflow for equity ETFs. This broke a streak of eight
consecutive weekly net inflows for equity ETFs with the largest
individual outflow belonging to SPDR S&P 500 ETF (SPY) which saw
$9.1 billion leave," Keon said.
    Keon also noted the continued net inflows for the Ultra
Short Obligation Funds (USO) peer group, which took in $950
million last week. That was their 26th straight weekly net
inflow for a total take of $19.5 billion, he said. The
year-to-date net inflows for the group are $31.9 billion.
    "This would be their highest annual net inflow ever, beating
last year’s plus $24.7 billion," Keon said. "USO funds are used
to offset interest rate risk, which has been growing with the
Fed raising rates as well as the narrowing of the yield curve,"
he said.
    The following is a breakdown of the flows for the week,
including mutual funds and ETFs:
 Sector              Flow Chg    Pct of  Assets      Count
                     ($ blns)    Assets  ($ blns)    
 All Equity Funds    -7.218      -0.09   7,524.424   12,233
 Domestic Equities   -6.614      -0.12   5,389.376   8,692
 Non-Domestic        -0.604      -0.03   2,135.048   3,541
 All Taxable Bond    -1.112      -0.04   2,814.139   6,060
 All Money Market    11.836      0.43    2,750.357   1,034
 All Municipal Bond  -0.181      -0.04   430.724     1,437
 (Reporting by Jennifer Ablan; editing by Diane Craft and James
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