The final tally for April shows fund investors were feeling good about stocks, though May estimates indicate that the good vibes may be sinking with stock prices.

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Investments into stock funds outpaced redemptions by $19.3 billion in April, according to figures released Wednesday by the

Investment Company Institute

, the fund industry's largest trade group. The bonny month predictably coincided with rising stock prices as the

Nasdaq Composite


S&P 500

notched April gains of 15% and 8.8%, respectively. This comes on the heels of net outflows from stock funds in each of the past two months, when both the Nasdaq and the S&P 500 lost ground.

Preliminary May cash flow estimates from liquidity-tracker

show stock-fund inflows this month at just $2.3 billion, as the Nasdaq and S&P cling to modest gains for the month.

The bottom line: As usual, fund investors are proving more likely to buy shares of stock funds when stock prices are on the rise than when the major stock indices are tumbling.

Cash flows to mutual funds are closely watched as a barometer of investor sentiment, and they can give dry powder to both bulls and bears. For instance, optimists might make the logical argument that rising inflows are a positive sign for the market because fund managers putting that cash to work in the market would help boost stock prices.

But last year a record $309 billion flowed into stock funds according to the ICI, and that didn't keep the S&P 500 and the Nasdaq from losing 9% and 29%, respectively. In fact, in the contrarian and often illogical world of Wall Street, pessimists can read high inflows as a sign that stocks have hit a near-term high.

While flow figures may lead to murky conclusions for market strategists, this year's figures do starkly demonstrate the lasting effects of the Nasdaq's collapse last year. Consider that through the first four months of 2000 stock funds raked in nearly $176 billion, compared with just $20.6 billion over the same period this year, according to the ICI.

While fund investors' appetite for stock-fund shares is well off the 2000 pace, they're investments in less risky bond and money market funds are much higher.

If fund investors were more inclined to buy stocks in April, so were fund managers. The average stock fund's cash stake dipped from 5.8% at the end of March to 5.5% at the end of April. This level, normal by historical standards, is still well above the inordinately low 4.3% average cash stake funds' carried at the end of 1999.