U.S. mutual fund sales signal retail investor caution

By Trevor Hunnicutt

NEW YORK (Reuters) – U.S. mutual fund investors pulled $13.7 billion from stocks and bonds during the latest week, according to data released on Thursday by Lipper underscoring retail investors’ rising concerns over turbulent markets.

After a sprinting start to 2018 that saw markets rally, the following months have brought concerns over tariffs, rising U.S. interest rates and slowing economic growth. The combination has led, unusually, to mediocre returns across several types of financial assets, including both stocks and bonds.

The average U.S.-based stock fund is down 2.6 percent this year while the typical bond fund has fallen 1.3 percent, according to Refinitiv’s Lipper research service.

“We had a flop in oil and I think it had people concerned about the global growth issue,” said Tom Roseen, head of research services for Lipper.

“People were still waiting to see what is going to happen.”

Benchmark oil futures fell further during the week from their highs this year approaching $80, and on Thursday were down around $51. Meanwhile, trade tariffs continue to be at the top of investors’ worry list ahead of U.S. President Donald Trump’s meeting with Chinese President Xi Jinping on Saturday.

Exchange-traded funds (ETFs) showed positive sales across stocks and bonds during the week, according to Lipper’s data for the seven days through Nov. 28.

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