Investors continued to pull out of U.S. stocks last week, as worries about slowing global growth and a lackluster start to the third-quarter earnings period dampened investors' spirits.
U.S. stock mutual funds lost $2.3 billion during the week ended Oct. 10, according to data from the Investment Company Institute. That was far less than the prior week, when investors yanked $10.6 billion. Nonetheless, it still marked the 12th straight week of outflows.
Pessimism toward the stock market continued as the World Bank downgraded its outlook for growth in Asia and warned that worsening conditions in Europe could add pressure to Asia's economy. Investors also geared up for a potentially disappointing earnings season, as Alcoa (AA) reduced its forecast for global aluminum demand due to the slowdown in China.
So far this year, U.S. stock mutual funds have bled nearly $105 billion. By comparison, those funds lost around $57 billion during the first nine months of 2010, and $80 billion during the first nine months of 2011.>
Meanwhile, bonds continued to attract investors seeking safety.
Bond funds raked in $10.9 billion last week, up from an average of about $6 billion a week this year, and the most since the week ended Oct. 21, 2009. So far this year, bond funds have drawn in more than $270 billion.
And ICI data show that hybrid funds, which invest in both stocks and bonds, brought in $139 million.
Shares of McDonald's and KFC-owner Yum! Brands declined Friday amid growing fears about slowing economic growth in China.
McDonald's announced that its sales at stores open at least a year in the Asia, the Middle East and Africa region declined 1.7% in May, with particular weakness in Japan and China.
In fact, sales in China declined for the first time since November 2009, said Lynne Collier, analyst at Sterne Agee. Collier said that her conversations MOREHibah Yousuf - Jun 8, 2012 12:36 PM ET
Not a member yet?Sign up now for a free account
|No! Greek vote shocks Europe|
|Markets tumble as Greece heads for the exit|
|Your 401(k) may nosedive after Greece's vote - but don't panic|
|What 'No' vote means for Greece and Europe|
|Greece Crisis 101: No way out|