By Daniel Bases
NEW YORK (Reuters) - Investors pulled cash from U.S.-domiciled equity and fixed income funds in the week ended June 6, illustrating the see-saw nature of the cash flows over the past month, data from Thomson Reuters' Lipper service showed on Thursday.
Equity funds turned negative again with net outflows of more than $2 billion versus inflows of $3.4 billion in the prior week.
Taxable bond funds had net outflows of $658 million in the latest week versus an inflow of $1.9 billion the week before. Corporate high-yield funds had outflows of $2.9 billion, their worst week since August 2011.
"This points to not only uncertainty, but investors are really being challenged on where to allocate. Once again, we are seeing some similarities with last year's volatile markets," said Matthew Lemieux, analyst at Lipper.
This year, equity funds have pulled in $20.2 billion versus a $50 billion outflow in 2011. Taxable bond funds, which have not had a negative year since 2000, have taken in $143.6 billion in net new investment year-to-date.
"This week's data picks up not only the perceived weakness in the domestic economic data, but maybe people are also seeing more uncertainty in the markets at this time of year," Lemieux said.
U.S. economic data in the last week was disappointing, with a weak employment report and a downward revision in first quarter economic output.
The outflow from equities was driven mainly by exchange traded funds. Excluding their influence, the outflows from mutual funds, which are believed to reflect the retail sector, were $37 million.
The large-cap State Street SPDR S&P 500 ETF had the biggest net outflow among ETFs during the course of the reporting week, with $3.1 billion in net redemptions. Over that same period the U.S. benchmark Standard & Poor's 500 stock index plumbed five-month lows but ended the period up 0.14 percent after Wednesday's 2.3 percent rally.
In the fixed income sector, the outflows from high yield was offset by net inflows of $960 million for U.S. government-backed mortgage bond funds. This latest inflow, the best since late February, extends the sector's streak to 33 weeks.
Still, the high-yield outflow of $2.9 billion was made up primarily of mutual fund, or retail investor, selling. Lipper estimates $2.1 billion of the outflows can be ascribed to mutual funds.
"In corporate high yields, we've seen a lot of volatility recently and then there's the fallout from the JPMorgan debacle," Lemieux said. JPMorgan Chase & Co last month revealed a multi-billion dollar trading loss due to a failed hedging strategy.
Returns on the Barclays Capital global corporate high yield aggregate index fell 0.20 percent in the course of the reporting week.
Among the equity sectors, cash was pulled out of financials, healthcare/biotechnology and technology. However, gold and natural resource funds pulled in $219 million while investors put fresh money to work in energy, real estate, and utilities.
Equity income funds had a surge of inflows, bringing in nearly $600 million for their best performance since mid-April.
The weekly Lipper fund flow data is compiled from reports issued by U.S.-domiciled mutual funds and exchange-traded funds.
(Editing by Andrew Hay and Leslie Adler)