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MOVES TO MUTUAL FUNDS FROM CERTIFICATES OF DEPOSIT IN QUARTER MADE RETAIL SECTOR FORCE DRIVING NYSE VOLUME SURGE, SIA SAYS

 /ADVANCE/NEW YORK, May 26 /PRNewswire/ -- The flow of funds from certificates of deposit into mutual funds stressing equities and long- term fixed income securities continued unabated through the first 1993 quarter, enabling the retail sector to remain the driving force behind the surge in New York Stock Exchange volume, a Securities Industry Association economist said Wednesday.
 Overall, the stock and bond markets "sizzled" in the first quarter, benefiting from low interest rates, "renewed economic strength, subdued inflation and a serious effort by the Clinton Administration to reduce the budget deficit," Jeffrey M. Schaefer, senior vice president, research, said in the current "Investor Activity Report" (I.A.R.)
 However, "unless there are concrete signs of an economic recovery, activity in the markets, to say nothing about securities prices, will be more subdued," he cautioned.
 Retail Activity Rose 38 Percent From Year Earlier
 On an absolute basis, retail activity on the NYSE rose 38 percent in the first quarter from the like year-earlier, while institutional and member firm trading advanced 29 percent from the like year-earlier. NYSE volume averaged 267.4 million shares a day in the quarter, compared to 217.3 million shares a day in the like 1992 quarter.
 In fourth 1992 quarter, volume averaged 211.3 shares a day, and for all 1992 averaged 202.6 million shares daily, SIA said.
 Mutual Fund Assets Reached $1.7 Trillion at Quarter's End
 Individual investors continued to be attracted to mutual funds, Mr. Schaefer said.
 At quarter's end, mutual fund assets reached $1.7 trillion, more than doubling since year-end 1988, when mutual fund assets totaled $810 billion, he said.
 From 1990 through 1992, when interest rates trended downward, the assets in equity mutual funds grew 93 percent, bond and income mutual funds 80 percent, and short-term money market funds 9 percent, he said. Meanwhile, individual holdings of bank deposits declined one percent, and holdings of bonds slipped 7 percent, Mr. Schaefer said.
 Moreover, during the first 1993 quarter, assets in equity mutual funds climbed 11 percent, while assets in bond and income mutual funds increased 7 percent, and those in short-term money market funds gained 2 percent.
 -0- 5/26/93/1830
 /CONTACT: Art Samansky or Karen San Antonio both for SIA, 212-608-1500/


CO: Securities Industry Association ST: New York IN: FIN SU: ECO

SM-LR -- NY050 -- 2507 05/26/93 13:33 EDT
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Date:May 26, 1993
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