U.S.-based stock funds post $3.2 billion outflows in latest week: ICI

By Sam Forgione

NEW YORK (Reuters) - Investors in U.S.-based mutual funds pulled $3.2 billion out of stock funds in the week ended Sept. 9 on nervousness ahead of the Federal Reserve's policy meeting, data from the Investment Company Institute showed on Wednesday.

The outflows reversed inflows of $2 billion over the prior week, according to the data from ICI, a U.S. mutual fund trade organization. Most of the total outflows from stock funds came from funds that specialize in U.S. shares, at $3 billion.

Funds that specialize in international shares, meanwhile, posted $237 million in outflows. Those withdrawals reversed the prior week's $191 million in inflows and marked just the second week this year that investors have pulled cash from the funds.

Bond funds posted $2.4 billion in outflows to mark their seventh straight week of investor withdrawals. The latest outflows were down from $6.3 billion in outflows the prior week.

Investors likely pulled cash from stock and bond funds on uncertainty regarding the Fed's policy announcement due on Thursday, said Robert Stein, chief executive at Astor Investment Management in Chicago.

Market participants are watching to see if the Fed hikes rates for the first time since June 2006. The move is expected to hurt U.S. Treasury prices and trigger volatility in U.S. stocks.

Hybrid funds, which can invest in stocks and fixed income securities, posted $905 million in outflows to mark their seventh straight week of outflows.

(Reporting by Sam Forgione; Editing by Meredith Mazzilli)

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