Biggest withdrawal in four months hits U.S. domestic stock funds: ICI

From Reuters - December 27, 2017

NEW YORK (Reuters) - U.S. fund investors walloped domestic equities with the most selling in four months, using the proceeds to buy cheaper stocks abroad that could thrive in a global economic expansion, Investment Company Institute (ICI) data showed on Wednesday.

Nearly $9.6 billion tumbled out of funds focused on U.S. stocks during the week ended Dec. 20, the most in any week since August, while their counterparts focused outside the country took in $8 billion in their best showing since June, the trade group said.

U.S. President Donald Trump on Friday signed into law the largest tax overhaul since the 1980s, which slashes the corporate rate from 35 percent to 21 percent.

That benefit for corporations has stimulated further gains for domestic stocks, but investors have been buying abroad instead, searching for a potentially better value, especially if growth accelerates in Japan, Europe or emerging markets, too.

Im more optimistic than I have been in several months, said Tom Stringfellow, chief investment officer at Frost Investment Advisors.

The emerging markets are not as risky as we anticipated, Europe is getting traction.


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