January 2, 2019 / 11:21 PM / 6 months ago

U.S. fund investors yank most cash from stocks since February -ICI

    By Trevor Hunnicutt
    NEW YORK, Jan 2 (Reuters) - U.S. fund investors anguished
over economic growth and policies pulled the most cash from
stocks in any weekly period since last February, Investment
Company Institute data showed on Wednesday.
    Mutual funds and exchange-traded funds (ETFs) tracked by the
trade group reported $37.8 billion in withdrawals overall, a
12th week of declines and the most cash pulled since a Chinese
growth scare in August 2015. More than $21 billion tumbled out
of stock funds during the week ended Dec. 26, the most since
February 2018.
    And while the withdrawals amount to a sliver of the overall
assets in such funds, fast-declining sales of funds reflect
deteriorating sentiment as people stockpile cash.
    The major broad U.S. stock indexes turned in their worst
year since the 2008 financial crisis in 2018, as investors
adjusted to slowing growth expectations and the Federal
Reserve's attempts to restore U.S. monetary policy to pre-crisis
levels of interest rates and unload the bonds it bought to
encourage risk-taking. The year ended with a week of major
swings up and down in those indexes.
    In addition to the rate hikes, investors have been worried
about excessive corporate borrowing, U.S.-China trade tensions,
a partial U.S. government shutdown and the potential for slowing
economic growth.
    While ETFs, used heavily by institutional investors, were
stock buyers in December, mutual fund investors typically used
by retail investors sucked out a record $86 billion, according
to preliminary estimates last week from Lipper, a research
    Withdrawals from funds primarily invested in international
stocks hit $9.3 billion, the most cash ever pulled, at least
according to records dating to 2013.
    And investors cashed in $9.2 billion of shares in bond funds
despite strong demand for relatively safe-haven municipals.
Funds invested in gold and other assets took in $707 million,
the most cash since April.
    The following table shows estimated ICI flows for mutual
funds and ETFs (all figures in millions of dollars):
                    12/26    12/19    12/12    12/4  11/28/2018
 Equity           -21,048   -9,724  -17,469   4,585      -6,348
      Domestic    -11,731   -2,504  -11,949   5,392      -4,614
      World        -9,317   -7,220   -5,519    -807      -1,734
 Hybrid            -8,268   -9,545   -5,497  -3,457      -3,391
 Bond              -9,230  -12,221  -12,021  -5,244      -3,535
      Taxable     -10,143  -11,710  -12,199  -4,608      -2,639
      Municipal       913     -512      178    -635        -896
 Commodity            707      390      155    -321           4
 Total            -37,839  -31,101  -34,832  -4,436     -13,270
 (Reporting by Trevor Hunnicutt
Editing by James Dalgleish)
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