U.S. stock mutual funds gain $7.5 billion, most since 2001: Lipper

Fri Jan 11, 2013 12:35pm EST
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By Sam Forgione

NEW YORK (Reuters) - Investors in U.S.-based funds poured $7.53 billion into stock mutual funds, the most since 2001, after U.S. lawmakers reached a deal to avert tax increases and spending cuts, data from Thomson Reuters' Lipper service showed on Thursday.

The inflow into stock mutual funds in the week ended January 9 was the biggest since May of 2001, while stock exchange-traded funds gained $10.78 billion in new cash.

When combined, the sums of cash into the two fund groups amounted to a massive $18.32 billion inflow into stock funds overall. That is the most net new cash since mid-2008.

Bond funds, meanwhile, attracted $4.24 billion in new cash. Bond mutual funds attracted $5.45 billion, the most since October of 2011, while bond ETFs suffered outflows of $1.21 billion.

The new cash into stock mutual funds was a far greater weekly turnout for the group than any other week last year, when retail investors opted for bond mutual funds and stock investments were dominated by opportunistic moves into ETFs.

"People were waiting to put money to work," said Tom Roseen, head of research services at Lipper.

"We got a resolution, period. And that was looming over everyone's heads," Roseen said on the "fiscal cliff" of $600 billion in tax hikes and spending cuts.

In a surprising turn, stock ETF investors pulled the most money out of the SPDR S&P 500 ETF, which has been a favorite for investors in past weeks. Investors yanked $1.26 billion out of the fund while catching exposure to emerging markets by giving $2.94 billion to the ishares: MSCI Emerging Market fund.   Continued...