January 31, 2019 / 11:37 PM / 6 months ago

UPDATE 1-U.S. fund investors slash $13.5 bln of stock holdings in latest week -Lipper

 (Adds quotes, table)
    By Trevor Hunnicutt
    NEW YORK, Jan 31 (Reuters) - U.S.-based stock funds posted
$13.5 billion of withdrawals in the week ended Wednesday, Lipper
said on Thursday, as investors booked profits following the S&P
500 index's best monthly performance since October 2015.
    The net outflow can be attributed to equity exchange-traded
funds (ETFs), as equity mutual funds took in net new money for
the 4th straight week, with three individual ETFs accounting for
the overwhelming majority, noted Pat Keon, senior research
analyst at Refinitiv's Lipper research service. 
    Keon said the iShares Core S&P 500 ETF posted
outflows of $7.3 billion; the Invesco QQQ Trust 1 posted
outflows of $2.1 billion; and the SPDR S&P 500 ETF
posted outflows of $1.8 billion.
    Investors in exchange-traded funds are thought to represent
the institutional investor, including hedge funds. Mutual funds
are thought to represent retail investors.
    “We’re not off to the races. The Federal Reserve’s policy
posture is broadly supportive of markets, but we have other
issues that need to be resolved and haven’t been resolved," said
Mike Ryan, Chief Investment Officer Americas at UBS Global
Wealth Management. "Global growth is decelerating ... We have to
acknowledge that mid-2018 was probably one of the high-water
marks for growth."
    Fed Chairman Jerome Powell said on Wednesday that economic
growth remained "solid" and that the Fed expected growth to
continue. But in a sharp reversal of the Fed's stance just six
weeks ago, Powell said the Fed had "the luxury of patience" in
deciding whether to raise rates again.
    Investors have been flocking to safe-haven bonds. 
    In the latest week, U.S.-based taxable bond funds attracted
$1.6 billion, the group's fourth straight week of inflows,
Lipper said. U.S.-based commodities precious metals funds
attracted $794 million over the weekly period, the largest
inflows in five weeks, Lipper said.
    Investors have also been gravitating toward non-domestic
equities with attractive valuations relative to the United
States as well as the weaker U.S. dollar. U.S.-based
non-domestic equities funds attracted more than $988 million in
the latest week ended Wednesday, the sector's fourth consecutive
weekly inflow, Lipper data show.
    The following is a breakdown of the flows for the week,
including mutual funds and ETFs:  
 Sector                      Flows    Pct of   Assets    Count
                            Change    Assets  ($ blns)   
                           ($ blns)                      
 All Equity Funds           -13.554   -0.20   6,940.668  12,148
 Domestic Equities          -14.543   -0.30   4,918.714  8,629
 Non-Domestic Equities        0.988    0.05   2,021.954  3,519
 All Taxable Bond Funds       1.568    0.06   2,756.187  5,983
 All Money Market Funds     -12.812   -0.44   2,907.892  1,004
 All Municipal Bond Funds     1.064    0.25    423.299   1,405
    

 (Reporting by Trevor Hunnicutt in New York
Editing by Jennifer Ablan and James Dalgleish)
  
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