Investors still don’t like what they see in the market and decided to pull their money from municipal bond mutual funds for a sixth consecutive week.
The week ending Aug. 31 saw $282 million in outflows from muni bond funds that report their flows weekly, according to Lipper FMI.
The withdrawals have increased from those of the previous week. In the week ended Aug. 24, there were net outflows of $148 million for muni bond funds that report their flows weekly, Lipper reported.
Even though the market mostly took the week off due to fallout from Hurricane Irene and a rapidly approaching holiday weekend, investors decided they were still down on muni bond funds. The industry clearly recalls how money hemorrhaged from muni bond funds between mid-November and early June, often by more than $1 billion a week. In the week of Jan. 19, investors in weekly reporting funds pulled more than $4 billion.
Assets for funds that report their flows weekly rose slightly this week to $331.6 billion from $331.3 billion the previous week.
The value of the holdings for weekly reporting funds increased by $586 million. The previous week, they reported a decrease of $125 million.
The four-week moving average for all municipal bond mutual funds that report their flows weekly saw a $359 million outflow, compared to a $503 million outflow the week before.
High-yield muni funds have also seen their sixth straight week of outflows — after seeing inflows for nine of the previous 11 weeks.
Funds that report weekly saw outflows of $108 million, Lipper reported. The previous week, high-yield funds reported outflows of $35 million.
Also, assets for high-yield funds that report their flows weekly ended at $41.24 billion, up slightly from $41.21 billion the previous week. The value of the holdings for weekly reporting funds rose by just $143 million. Last week, they fell by $20 million.
The four-week moving average for all high-yield muni bond funds that report their flows weekly was a $139.6 million outflow, up a bit from a $142.2 million outflow the week before.
