May 9, 2018 / 6:40 PM / 10 months ago

U.S. bond funds take in cash for 11th straight week -ICI

    NEW YORK, May 9 (Reuters) - U.S. fund investors are shifting
from stocks to bonds and piled into debt markets for an 11th
straight week, Investment Company Institute (ICI) data showed on
    Investors have been moving into bonds less sensitive to
rising rates in recent weeks. They have sought to shore up
portfolios against higher market volatility while taking
advantage of yields plumped up by U.S. Federal Reserve rate
    A sharp decline in bond prices during April abated as the
month drew to a close. Yields on benchmark 2-year Treasuries
 are at 2.53 percent, up from 2.28 percent at the
beginning of the April. Bond prices fall as their yields rise.
    U.S.-based bond mutual funds and exchange-traded funds
(ETFs) took in $3.5 billion during the seven days through May 2,
according to the trade group. U.S. fund investors pulled $2.5
billion from stocks.
    Short-term corporate bond funds tracked by Thomson Reuters'
Lipper research unit attracted $3.3 billion in April, the most
this year and a 22nd straight month taking in cash.
    Commodities funds have been unable to claim their place as a
safe-haven alternative even with an uptick in market volatility
since the beginning of the year and geopolitical concerns over
the U.S. clashing with Iran. U.S. President Donald Trump on
Tuesday pulled the United States out of an international nuclear
deal with that country.
    Investors pulled $82 million from commodity funds, such as
those that invest directly in gold, during the latest week,
marking the first net withdrawals in five weeks.
    The strength of the U.S. dollar has hobbled the investments,
making the metal more expensive buyers using other currencies.
    The following table shows estimated ICI flows for mutual
funds and ETFs (all figures in million of dollars):
               5/2     4/25    4/18    4/11    4/4/2018
 Equity        -2,459  -879    -251    5,213   -4,501
    Domestic   -2,992  -3,777  -2,377  3,775   -6,018
    World      533     2,898   2,126   1,437   1,517
 Hybrid        -887    -633    -1,090  -1,101  -932
 Bond          3,471   2,242   8,492   6,470   2,943
    Taxable    3,634   2,338   9,321   7,166   3,053
    Municipal  -163    -96     -830    -696    -110
 Commodity     -82     508     167     1,120   547
 Total         43      1,237   7,317   11,702  -1,944
 (Reporting by Trevor Hunnicutt; Editing by Cynthia Osterman)
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