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The
funds took in $7.8 billion, according to the research service's
data, which covers the seven days through July 13. The inflows
into stock funds were led by heavy buying of exchange-traded
funds and funds focused specifically on domestic stocks, Lipper
found.
Pat Keon, research analyst for Thomson Reuters Lipper, said
U.S.-domiciled funds - including both mutual funds and ETFs -
took in $33.5 billion of net new money for the fund-flows week.
ETFs are typically representative of institutional buying.
"This was the largest positive weekly net inflow of the year
coming in at over twice that of the $16.6 billion net inflow for
the fund-flows week ended January 27, 2016," Keon said. "Of
note, equity funds broke a 10-week streak of net outflows by
taking in $7.8 billion in net new money and municipal bond funds
recorded their 41st straight week of inflows as they grew their
coffers by $1.2 billion."
During the latest reporting period all-time highs were set in
both the Dow Jones Industrial Average and the Standard & Poor's
500 index.
Keon said the "Brexit" vote, Britain's decision on June 23 to
leave the European Union, has played a major factor in
non-domestic cash withdrawals.
Non-domestic equity mutual funds saw money leave the group for
the third straight week "as they continue to feel the effects of
the Brexit vote," Keon said. "Since the vote, non-domestic
equity funds have suffered net outflows of $5.5 billion -
including $1.5 billion this week - which has reduced their
year-to-date net inflow to $2.5 billion," he said.
Investors also continued their distaste for U.S.-based stock
mutual funds, pulling $7.5 billion in the latest week, their
18th consecutive week of cash withdrawals, Lipper said.
Larry Fink, chairman and chief executive of BlackRock, the
world's largest asset manager, said on CNBC on Thursday that the
stock market rally has been supported by institutional investors
covering shorts, or bets that stocks would fall, and not
individual investors feeling bullish.
"Since Brexit, we've seen ETF flows almost at record levels,"
Fink said. "However, in the mutual fund area, we're continuing
to see outflows."
Overall, investors have been cherry-picking yieldier assets as
market participants believe the Federal Reserve "will not
entertain raising rates in the foreseeable future due to Brexit
uncertainty," Lipper's Keon said.
High-yield junk ETFs posted inflows of $2.6 billion in the
latest reporting period, while high-yield junk bond mutual funds
attracted $1.8 billion, according to Lipper. In addition,
high-yield muni debt funds posted inflows of $317 million,
Lipper said.
U.S.-based investment-grade bond funds took in $2.9 billion over
the weekly period, the largest intake for the funds since late
April. U.S.-based emerging markets debt funds attracted $485
million over the weekly period, their largest haul since March,
and U.S.-based emerging markets equity funds took in $1.7
billion over the weekly period, their largest intake in a month,
Lipper said.
Even so, low-risk U.S.-based money market funds attracted $15.8
billion over the weekly period, after $34 billion of outflows
the previous week, Lipper said.
(Reporting by Trevor Hunnicutt; Editing by Jennifer Ablan and
Grant McCool)
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