June 27, 2018 / 6:10 PM / 3 months ago

Investors dump $5 bln of equity funds on U.S.-China trade fight -ICI

    By James Thorne
    NEW YORK, June 27 (Reuters) - U.S.-China trade tensions
drove investors to pull $5.16 billion from equity
exchange-traded funds and mutual funds in favor of bonds for the
week ended June 20, the Investment Company Institute said on
Wednesday.
    Cash outflows from equities were led by domestic long-term
mutual funds, which ceded $3.11 billion after $1.15 billion the
prior week. Equity ETFs had negative net outflows of $3.59
billion, seven days after reporting $7.54 billion of inflows.
    "The risk off trade was clearly visible in last week's fund
flows," said Scott Anderson, chief economist at Bank of the
West. "Uncertainty of trade protection is becoming a growing
concern for investors as the U.S.-China trade war heats up."
    On June 15, both the United States and China released lists
of imports to be targeted by tariffs.
    Total ETF and mutual fund bond flows stayed positive for the
18th straight week, attracting $4.55 billion compared with $5.56
billion a week earlier.
    Commodity fund investment declined $264 million as
"investors scaled back expectations for emerging market growth,"
Anderson said.
    Hybrid funds experienced withdrawals of $848 million.
    Demand for all funds was broadly negative at $1.72 billion,
compared with inflows of $9.95 billion in the previous week.
    The following table shows estimated ICI flows for mutual
funds and ETFs (all figures in millions of dollars):
               6/20      6/13      6/6       5/30     5/23
 Equity        -5,157    6,773     -3,651    5,435    3,994
    Domestic   -3,865    7,815     -4,532    4,701    3,352
    World      -1,292    -1,042    881       734      643
 Hybrid        -848      -1,975    -1,118    -643     -816
 Bond          4,550     5,564     1,375     2,235    5,206
    Taxable    3,808     5,238     727       1,574    5,021
    Municipal  742       326       648       661      185
 Commodity     -264      -416      -761      125      -73
 Total         -1,719    9,946     -4,155    7,152    8,312
 
 (Reporting by James Thorne; Editing by Jennifer Ablan and
Richard Chang)
  
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