After the Federal Reserve announced that it may slow down the pace of its asset purchases this year, several investors reacted by withdrawing their investments in mutual funds.

In May, the threat of this reduced bond buying activity caused a 2% decline in the US$10.5 trillion treasuries market. This was the worst decline that the market has ever seen since December 2009. According to Bank of America Merrill Lynch index, there was another 1.3% decline in June.

On the other hand, according to data from TrimTabs Investment Research, investors pulled out US$70.8 billion worth of mutual funds from the market. This data was for the market's activity last month until June 27. In addition, there was a withdrawal of exchange-traded funds amounting to US$9 billion in the same period.

Meanwhile, Japanese investors sold US29.7 billion in May, says the country's Ministry of Finance. This was the highest number recorded since 2005.