April 18, 2018 / 5:22 PM / 5 months ago

TABLE-Easing trade fears spur demand for U.S. stock funds

    By Trevor Hunnicutt
    NEW YORK, April 18 (Reuters) - Waning trade-war fears drove
fast-money investors back into the market, helping U.S.-based
stock funds net cash for the first time in four weeks,
Investment Company Institute (ICI) data showed on Wednesday.
    U.S.-based equity funds collected $5.2 billion in new cash
during the seven days ended April 11, according to the trade
group, following three weeks of punishing withdrawals of tens of
billions of dollars.
    More than $6.2 billion of cash moved into exchange-traded
funds, which are used heavily by quick-traded institutional
investors. That was slightly offset by more than $1 billion
pulled from mutual funds favored by buy-and-hold retail
investors, ICI data showed.
    During the week, Chinese President Xi Jinping promised to
cut import tariffs, giving succor to investors worried about a
clash between the world's two biggest economies.
    Investors are looking ahead to strong profit results
expected from an earnings season now underway.
    "We're going to see rising corporate earnings, and the
economy is certainly humming," said Rick Platte, chief
investment officer of Schwartz Investment Counsel Inc, which
manages Ave Maria Mutual Funds.
    "It seems like corporations are optimistic. Consumers,
generally, are optimistic."
    Some $6.5 billion poured into bond funds during the same
weekly period, representing the largest haul for those funds in
four weeks, according to ICI.
    The data revealed a move to take more risk in bonds as well.
Demand for relatively low-risk municipal bond funds, backed by
government debt, sank to $696 million of withdrawals, the most
that has been pulled from those products since January 2017, ICI
said.
    Earlier data for the same week from Thomson Reuters' Lipper
research unit showed strong demand during the week for corporate
bonds, including riskier high-yield debt.
    Funds invested in commodities, such as gold, took in $1.1
billion during the seven-day period, their best showing in 11
weeks.
    The following table shows estimated ICI flows for mutual
funds and ETFs (all figures in million of dollars):
               4/11    4/4     3/28     3/21     3/14
 Equity        5,213   -4,499  -11,676  -13,766  25,210
    Domestic   3,776   -6,016  -12,377  -17,107  19,062
    World      1,437   1,517   701      3,341    6,148
 Hybrid        -1,099  -930    -1,314   151      -611
 Bond          6,448   2,943   263      5,315    8,444
    Taxable    7,144   3,053   137      4,546    7,741
    Municipal  -696    -110    126      769      703
 Commodity     1,120   547     -332     938      30
 Total         11,683  -1,939  -13,059  -7,363   33,072
 
 (Reporting by Trevor Hunnicutt; editing by Jonathan Oatis)
  
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