Sales of US-based stock and bond funds slumped on worries about trade during the latest week while demand for international equities fell to its lowest levels since June, Investment Company Institute (ICI) data showed.
During that week, the Trump administration slapped 10 percent duties on another $200 billion of Chinese goods, including many consumer products, after China retaliated against US tariffs on $50 billion in Chinese technology-focused imports.
The trade strife highlighted gaps between a powerful resurgence in US corporate profits as international economies have turn in mixed performance. And the US Federal Reserve continues to set aside those concerns as it withdraws stimulus from the economy in an effort to ward off inflation.
US fund investors walloped international stock mutual funds and exchange-traded funds (ETFs) with $2.1 billion in net withdrawals during the week ended September 26, the most cash pulled from that group of funds since June this year, according to the ICI trade group. Domestic stock funds attracted $942 million.
Overall, US-based stock funds recorded a fourth week of withdrawals in the last five weeks. Bond funds attracted just $1.7 billion, weaker than its $5 billion-per-week average this year, as money rolled out of municipal bond funds for the first time since May.
The end of the third quarter will offer investors new data on the health of the US market's near-decade long rally, with corporate results due in the coming weeks.
Commodity funds, including those invested in gold, pulled in $253 million, a rare respite for a category that has been under assault for most of this year. The dollar has backed off its swift summertime price gains, helping gold, which is priced in greenback.