Mutual, pension and hedge fund managers have been investing large quantities of cash in the market in recent weeks, and while the pace of their buying has been slowing, it appears to indicate their faith in a continued rally, Reuters reports.

In the week ended July 21—when the Dow Jones Industrial Average gained 600 points to reach 8,915, many corporate earnings continued to beat estimates and previously owned home sales increased for the fifth month in a row—mutual funds and pension funds placed $1.9 billion in the market, according to Thomson Reuters. The following week, as the Dow continued to hover in that territory, they bailed out of $578 million of stocks, but hedge funds invested $19 million.

“There is some momentum lost among pensions and mutual fund investors, but the move is still generally positive,” noted Jeff Shacket, vice president of corporate services at Thomson Reuters. “These buyers are saying that this market is going to go higher, not lower, anytime soon.

“There is some confidence on the part of long-term investors that we won’t have a had second half,” Shacket added. “All of this suggests how investors overreacted to the downside during the first quarter.”

Then, on Monday, the Standard & Poor’s 500 Index broke above 1,000 Monday on the news of a government report that construction spending rose in June and another report predicting manufacturing will grow next month.

“The market is beginning to smell economic recovery,” Howard Ward, manager of the GAMCO Growth Fund, told the Associated Press. “It may be too early to declare victory, but we are well on our way.”

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