UPDATE 1-US-based stock mutual fund inflows most in 3 weeks -ICI

NEW YORK, March 20 (Reuters) - Investors in U.S.-based mutual funds put $3.86 billion into stock funds as the Dow Jones industrial average continued its record-breaking rally, data from the Investment Company Institute showed on Wednesday. The estimated inflows into stock mutual funds over the week ended March 13 were the most in three weeks, said ICI, a U.S. mutual fund trade organization. Funds that hold U.S. stocks had inflows of $849 million over the week, reversing two weeks of outflows. Funds that hold non-U.S. stocks, meanwhile, had inflows of $3.01 billion, down modestly from the prior week's inflows of $3.51 billion. Bond mutual funds attracted inflows of $1.64 billion, the least since the week ended Jan. 2 and down from cash gains of $6.42 billion the prior week. The Dow's nine-day winning streak through March 13 marked the longest consecutive run since November 1996. The benchmark S&P 500 was about 1 percent away from an all-time intraday high on March 13. The Dow was up 1.1 percent over the reporting period, while the S&P 500 was up 0.85 percent. Signs of strength in the U.S. economy, including a drop in the jobless rate to a four-year low of 7.7 percent, and the Federal Reserve's easy monetary policy have advanced the rally in stocks. Municipal bond funds suffered outflows of $335 million in the latest week, their first redemptions since late December of 2012. Hybrid funds, which can invest in stocks and fixed income securities, attracted inflows of $2.07 billion, the least in three weeks. The following table is a breakdown of estimated ICI flows for the past five weeks (all figures in the millions dollars):

2/13/13 2/20/13 2/27/2013 3/6/2013 3/13/2013 Total Equity 5,681 4,562 1,049 2,936 3,861 Domestic 520 1,092 -1,131 -571 849 World 5,160 3,470 2,179 3,507 3,012 Hybrid* 2,029 2,018 2,386 2,496 2,073 Total Bond 5,009 4,708 4,974 6,417 1,638 Taxable 4,169 4,118 4,395 6,056 1,973 Municipal 840 590 579 361 -335 Total 12,719 11,288 8,408 11,848 7,572 *Hybrid funds can invest in stocks and/or fixed income

securities.