Investors continued slowly to add money to stock market mutual funds last week, and sold bond funds at a slightly slower pace than last month, when outflows hit a 10-month high.

TrimTabs, a Santo Rosa, Calif. company that tracks fund flows, said equity mutual funds had inflows of $1.9 billion for the week ended June 9, the third consecutive week of low-volume net purchases. Domestic funds got $978 million of new cash, while international funds had $870 million of net inflows.

Bond funds saw a net outflow of $1.2 billion after seeing net inflows of $100 million the preceding week. Hybrid funds that invest in stocks and bonds saw a second week of scant net inflows, pulling in $100 million more than investors sold.

"Equity flows are treading water," said Carl Wittnebert, TrimTabs director of research. "The public wants the market to go to new highs -- the public likes excitement and they want to make money."

He said recent equity fund investments peaked in January, when investors chasing performance piled in after the fourth-quarter stock market rally. The Investment Company Institute reported net inflows of $43.8 billion for the month.

TrimTabs estimates May equity inflows at $4.6 billion, and expects inflows of $5 billion for June. "This indicates a great deal of caution on the part of fund buyers."

Wittnebert said recent jobs numbers hit bond funds hard, particularly after Alan Greenspan's comments that the

Fed

would consider sharper rate increases if inflation ballooned.

"He's promising to do whatever it takes to contain inflation, even if it takes hikes that aren't gradual, but more sudden," he said.

TrimTabs estimated that bond fund outflows for May will hit $12.6 billion, the highest net outflow since August of 2003. They are on pace to reach $9.8 billion for June.