Investors began to show unease with the stock market's continuing poor performance in May by reducing net inflows into equity mutual funds to $20.7 billion during the month, according to early estimates by of Santa Rosa, Calif.

If's figures prove accurate, net inflows into equity mutual funds will have fallen 38 percent in May from the $33.8 billion that went into equity funds in April, according to the Investment Company Institute of Washington, D.C. May sales of equity funds were half of the monthly average of $42 billion from January through April, said Carl Wittnebert,'s director of research.

While May's $20.7 billion of net equity inflows is still a "huge amount of money," it could be an indication of the public's growing wariness of the weakened stock markets, Wittnebert said.

The average equity fund was down 2.72 percent year-to-date through May 31, while the Dow Jones Industrial Average was down 8.48 percent, the S&P 500 was down 3.31 percent and the Nasdaq Composite Index declined 16.43 percent, according to Lipper of Summit, N.J.

The $33.8 billion invested in equity funds in April seemed to indicate that investors could tolerate a sudden drop in the markets. (MFMN 5/15/00) However, if the markets continue to lose value, net inflows may continue to decrease, Wittnebert said.

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