Stock Fund Hemorrhaging Reverses

Published April 21, 2003, 1:00 a.m. EDT

Updated April 21, 2003, 1:00 a.m. EDT

1 Min Read

Investors put $5.7 billion into stock mutual funds for the week ending Wednesday, adding to the $127 million in inflows recorded the week before, according to AMG Data Services, The New York Times reports. Much of that money went to riskier types of stock funds, including $472 million to technology funds and $1.1 billion into large-company growth funds.

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The inflows into stock funds was the biggest since the $7.9 billion for the week ended April 17. Nonetheless, outflows from stock funds year-to-date have been $49 million.

International funds received $1.7 billion during the week, with all developed and emerging regions reporting inflows.

Investors also put $856 million into taxable bond funds, with high-yield corporate securities taking in $555 million and investment-grade corporate bonds gaining $259 million.

Meanwhile, investors withdrew $27.7 billion from money market funds and $62 million from municipal bond funds.

Investors are flocking back to equity funds because they believe "the war is over and everything is hunky-dory like it was in 1991" at the end of the Gulf War, William E. Rhodes, chief investment strategist

at Rhodes Analytics

, told The New York Times. But the market, economy and international situation are far different today than they were at that time, making a prolonged stock market rally unlikely.