U.S. mutual fund investors ditch equities despite S&P 500 gains: ICI By Reuters

© Reuters. U.S. mutual fund investors ditch equities despite S&P 500 gains: ICI

By James Thorne

NEW YORK (Reuters) – U.S. mutual fund investors fled from stocks for the 14th straight week as ongoing trade war fears divided markets, Investment Company Institute data showed on Wednesday.

Withdrawals from equity-focused long-term mutual funds totaled $4.2 billion for the week ended July 11, ICI said.

The bearish sentiment among mutual fund investors ran counter to that of exchange-traded fund investors and the broader market. Equity ETFs saw net inflows of $1 billion during a seven-day period in which the added 2.24 percent.

Markets rose for four days on strong economic news before retracing some of the gains after Washington threatened to impose tariffs on an additional $200 billion worth of Chinese goods and Beijing warned that it would hit back.

Combined equity mutual fund and ETF withdrawals rose to a total of$36.9 billion since mid-June.

Ongoing investor demand for safety led to $7.4 billion in deposits to bond funds, the 21st straight week of inflows for the category.

Tax-free municipal bond funds saw the strongest demand since January, attracting $1 billion of investor cash, ICI data showed. Taxable bonds added $6.4 billion, the largest net deposit since April.

Commodity funds broke a five-week trend of outflows with $101 million in cash deposits.

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