U.S. fund investors cut stocks for 3rd straight week -ICI

NEW YORK, April 11 (Reuters) - U.S. fund investors pulled back from stocks for a third consecutive week, buying bonds as the U.S.-China trade conflict roiled markets, Investment Company Institute (ICI) data showed on Wednesday. Equity mutual funds and exchange-traded funds (ETFs) recorded $4.5 billion in withdrawals during the week ended April 4, according to the trade group. Debt funds took in $3 billion. During the week, investors puzzled over how the U.S.-China trade conflict would affect markets. U.S. stocks gained on Tuesday following a promise by Chinese President Xi Jinping to open the country's economy further, but struggled to extend those gains the next day as U.S. President Donald Trump warned Russia of imminent military action in Syria over a suspected poison gas attack. "It's hard to tell what to watch because it seems like it's changing so regularly. First it's trade, then it's geopolitics, and it used to be tax cuts," said Dave Lafferty, chief market strategist at Natixis Investment Managers LP, referring to the U.S. tax cut enacted in late 2017. "It doesn't seem like the markets can settle on a narrative at this point." The S&P 500 has recorded 29 days of declines in 68 full trading sessions in 2018, with its return falling just under 1 percent in price terms for the year. Day-to-day swings in price and sentiment have sent investors to the refuge of international stocks. Funds focused on domestic companies posted a third straight week of withdrawals, with $6 billion cashed out, ICI said. Funds invested in shares outside the United States attracted $1.5 billion, adding a 70th straight week to their successful fundraising streak. The following table shows estimated ICI flows for mutual funds and ETFs (all figures in million of dollars):

4/4 3/28 3/21 3/14 3/7/2018 Equity -4,501 -11,701 -13,766 25,210 -6,440 Domestic -6,018 -12,377 -17,107 19,062 -10,973 World 1,517 676 3,341 6,148 4,533 Hybrid -930 -1,314 151 -611 -500 Bond 2,953 263 5,315 8,444 1,524 Taxable 3,063 137 4,546 7,741 1,310 Municipal -110 126 769 703 214 Commodity 547 -332 938 30 210 Total -1,931 -13,084 -7,363 33,072 -5,207

(Reporting by Trevor Hunnicutt; Editing by Richard Chang)