However, the inflows do not necessarily mirror positive sentiment, says Morningstar, as inflows were tepid across most asset classes and U.S.-stock funds experienced outflows. Furthermore, outflows from money market funds no longer appear to be flowing into long-term mutual funds. Year-to-date, including another $14.1 billion in September, investors redeemed about $70.0 billion more from money market funds than they added to long-term mutual funds.  

While U.S.-stock funds continued their run of outflows, losing another $6.9 billion during the month, September was the best month for the asset class since May. However, with the exception of large-blend funds, the eight other major domestic-equity categories all suffered outflows.   

International-stock funds saw positive, yet modest inflows of $3.2 billion. Diversified emerging-markets funds again accounted for the majority of these inflows. The category recorded inflows of $2.7 billion, its greatest monthly intake since March 2011.   

Taxable-bond funds bounced back in September with inflows of $3.5 billion after shedding $12.0 billion in August, but this monthly inflow is well below the three-year monthly average of $16.1 billion for the asset class.   

Municipal-bond funds enjoyed their best month in nearly a year with inflows of $1.7 billion.