By Trevor Hunnicutt
NEW YORK (Reuters) - Investors withdrew money from U.S.-based stock mutual funds for the ninth straight week, Investment Company Institute data showed on Wednesday, reflecting skepticism about the market's growth prospects, tepid corporate earnings and mixed economic data.
Stock funds posted $4.4 billion in outflows during the latest week, the data showed. The latest figures add to a pattern for U.S.-based stock funds, which have recorded outflows in 39 of the last 52 weeks, according to ICI, a trade group for funds.
During the week ended on May 11, underwhelming profit reports from Walt Disney Co and Macy's Inc weighed on markets. But strong inflation data and continued U.S. economic growth have raised expectations that the U.S. Federal Reserve will nonetheless hike interest rates.
"There's been stronger economic data, combined with disappointing earnings from consumer discretionary companies in the past week," said Todd Rosenbluth, director of exchange-traded and mutual fund research at S&P Global Market Intelligence. "Investors have favored the safety of bond mutual funds over U.S. equity ones amid uncertainty."
Some contrarian investors have taken the fund withdrawals as a sign that the market will deliver more gains despite a volatile path that has left the benchmark S&P 500 with just a 1 percent return over the last year, including dividends.
Funds invested in U.S. shares posted $4.9 billion in outflows, while those focused on international stocks netted cash for the first time in nine weeks ahead of a June 23 referendum on Britain's membership in the European Union.
U.S.-based international stock funds added $430 million after posting $6.6 billion in outflows over the preceding eight weeks, the data showed.
"One week is too soon to consider it a trend," said Rosenbluth. "As the 'Brexit' vote nears, it will be interesting to see how investors respond to that potential risk."
Bond funds, meanwhile, have pulled in more than $50 billion over the last 11 weeks, including $4.1 billion in the latest week, ICI said.
U.S. municipal bond funds attracted $2 billion, and taxable government bond funds gathered $1.2 billion, ICI said, extending an unbroken streak of popularity this year for the two categories.