March 21, 2018 / 4:50 PM / a year ago

U.S. stock funds attract most cash since mid-2017 -ICI

    By Trevor Hunnicutt
    NEW YORK, March 21 (Reuters) - U.S. fund investors steered
the most cash since mid-2017 into stocks, Investment Company
Institute (ICI) data for the most recent week showed on
Wednesday, as cool economic data drew hot money into the market.
    A week after pulling billions from U.S.-based equity funds,
investors turned on a dime during the seven days ended March 14.
A jobs report during that period showed strong gains in
employment but not in wages, suggesting muted pressure on prices
and profits.
    That gave fast-money traders an excuse for exuberance, with
$25.2 billion rolling into U.S.-based equity funds during the
week, according to the ICI, a trade group. That is the most cash
since June 2017.
    U.S.-based technology sector stock funds took in $2 billion
during the same period, the most since the tech mania of the
year 2000, Thomson Reuters' Lipper research unit reported last
    Bond funds, meanwhile, pulled in $8.4 billion, the most cash
in six weeks, ICI said.
    The reporting period does not include the market swings of
more recent trading days, including a steep slide in Facebook
Inc shares this week on data privacy concerns.
    Economic data released after the stock fund inflows has also
showed more evidence of inflation, with the largest gain in
imported consumer goods prices recorded since 2014.
    The data supports concerns that a weaker U.S. dollar and the
Trump administration's tough talk on trade could put push prices
but not economic output higher, potentially forcing a
destabilizing set of rate hikes by the U.S. Federal Reserve. 
    Those may be problems for another day. In the meantime, the
economy is supporting markets, said Thomas Melendez, investment
officer at MFS Investment Management, the fund brand of the
Massachusetts Financial Services Co.
    "We seem to be in a pretty decent spot economically," he
said. "We're seeing growth from all parts of the world."
    The following table shows estimated ICI flows for mutual
funds and ETFs (all figures in million of dollars):
                3/14    3/7      2/28    2/21    2/14/2018
 Equity         25,219  -6,453   11,703  2,505   1,517
    Domestic    19,080  -10,974  6,397   -4,899  -7,562
    World       6,139   4,521    5,306   7,405   9,079
 Hybrid         -611    -500     -422    -965    -1,456
 Bond           8,440   1,521    5,177   4,452   -12,114
    Taxable     7,737   1,307    5,067   3,970   -11,474
    Municipal   703     214      110     481     -640
 Commodity      30      210      278     477     189
 Total          33,079  -5,222   16,736  6,469   -11,864
 (Reporting by Trevor Hunnicutt; Editing by Bernadette Baum)
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