U.S. bond funds hit with more than $10 billion in outflows: ICI
Investors in mutual funds based in the United States pulled more than $10 billion out of bonds funds in the week ending June 5, on fears the U.S. Federal Reserve would begin winding down its bond-buying program, data from the Investment Company Institute showed on Wednesday.
Total estimated outflows from long-term mutual funds were $11.53 billion for the week. The last time fund outflows reached a similar figure was in early October 2012.
Bond funds saw outflows of $10.93 billion, compared to inflows of $1.36 billion during the previous week. Taxable bond funds saw a withdrawal of $8.68 billion, while municipal bond funds had outflows of $2.26 billion.
Equity funds also saw redemptions of $942 million for the week, compared to outflows of $1.00 billion in the previous week.
The benchmark S&P 500 stock index fell 2.4 percent over the reporting period on investors' fears related to the U.S. Federal Reserve's next move. The Fed, which is buying $85 billion in Treasuries and agency mortgage debt per month, signaled on May 22 that it could reduce its bond-buying this year depending on upcoming economic data.
Domestic equity funds had also investors pulling out $2.52 billion, while world equity funds saw $1.58 billion of inflows.
Hybrid funds, which can invest in stocks and fixed income securities, reaped modest inflows of $347 million for the week, compared to inflows of $1.13 billion in the previous week.
(Reporting by Manuela Badawy)
