30 Nov 2012, by
In this podcast, Tom talks about this week's mutual fund and ETF flows trends. Despite a shortened trading day on the Friday after Thanksgiving, US stocks rallied on better-than-expected economic news from Germany and China and on preliminary news that shoppers did indeed head to the retail stores on Black Friday. During the week ended Wednesday, November 28, the market suffered from a little bipolar behavior: the Dow Jones Industrial Average witnessed its best Friday-to-Friday weekly performance since the week ended June 8, 2012, rising 3.35%, only to decline 1.01% on the first two trading days of the new week on fears the debt talks had stalled. This was despite investors’ learning of better-than-expected durable goods orders and the sixth consecutive month of increasing home prices in September. However, on Wednesday markets rallied once again after comments by President Obama and Speaker of the House John Boehner suggested a budget deal hopefully would be reached before Christmas. Despite the rollercoaster ride, for the week fund investors injected a net $21.1 billion into the funds business (including open-end funds and ETFs), allocating net new money into all of Lipper's major macro-classifications, with money market funds attracting the lion's share (+$11.4 billion). For the first week in three equity funds witnessed net inflows (+$7.4 billion, erasing the previous week's outflows), while taxable bond funds (+$1.8 billion) attracted inflows for the twentieth week in twenty-one. For the fourth consecutive week municipal bond funds attracted net new money (+$0.5 billion).