Investors continue four-week retreat from U.S. stock market

NEW YORK (Reuters) – Investors continued a four-week long retreat from the U.S. stock market last week by unloading a net of nearly $9.6 billion in assets from domestic mutual and exchange-traded funds, according to data released Wednesday by the Investment Company Institute.

The nearly $9.6 billion in outflows came on the heels of a $10.1 billion decline in net assets from the week before, prolonging a streak in which investors have sold into a rising stock market. For the year to date, the benchmark S&P 500 is up 14%, thanks to the Federal Reserve’s decision to pause its pace of interest rate hikes.

Yet signs that the trade war between the United States and China – the world’s two largest economies – could continue has made investors increasingly skittish that the stock market rally could be slowing.

Since January, investors have pulled a net of nearly $40 billion out of domestic stock funds. Taxable and municipal bond funds, meanwhile, have grabbed slightly more than $168 billion in new assets over the same time, including approximately $1.6 billion in new assets last week.

World stock funds lost approximately $1.8 billion in net assets last week, a reversal of the roughly $1.8 billion the category pulled in the week before. For the year to date, world stock funds have dropped $5.3 billion in net assets.