The Dow Jones Industrial Average fell fast and furiously at the opening of trading, losing as much as 283.21 points before settling at the close with a loss of 77.67 points at 8533.65 on Friday. That brought the blue-chip gauge's losses to 160 points in the past two trading days, though it was up 109 points for the week.

According to mutual fund managers, redemptions by fund holders were not a major factor in the selloff, which reflected intensifying concerns over banking crises in Russia and Japan and the fears of an imminent devaluation of the Venezuelan bolivar.

"The average investor is sitting on the sidelines, trying to sort it out," said Pittsburg-based Federated Investors fund manager, Charles Ritter, who oversees four funds with assets totalling about $750 million.

"I don't plan ondoing anything today, but I'm going to take a careful look next week and am leaning toward increasing stocks and cutting back on bonds," Ritter said, echoing other fund mangers, who say they have not seen a change in investor attitudes.

Ritter added that he currently averages 60 per cent in stocks and the rest in bonds with no cash.

Joyce Cornell, the manager of Kemper's Emerging Markets Growth fund said her funds have not had redemptions and in fact have had some inflows from institutional clients.

"I won't mislead you and tell you its massive, it's not, but the direction is positive."

At discount broker, Charles Schwab Corp redemptions were not seen as prevalent over the past two days.

"Our anecdotal evidence over the last two days shows that the calls have slowed and we think the investors are sifting through the news and biding their time," said Greg Gable, a spokesman for the company.

According to mutual fund flow tracking service AMG Data Services Inc all US equity funds took in $2.67billion in the week ended August 19 compared to $1.54 billion the week before.

International equity funds took in $682 million during the week ending August 19, after taking in $145 million in the previous period ended August 12.

But the money flowing to funds outside the United States, the largest equities market in the world, was focused on two areas, according to AMG's Bob Adler.

"The bottomline is, the only two international sectors, either regional or say by an investment objective that enjoyed inflows or positive investor sentiment this past week were funds that invested in large-cap global growth companies and funds that invest in Europe," Adler said.

"Latin American outflows are not accelerating, but they are decidedly negative and certainly in response to the negative markets," Adler added.

The damage done to emerging markets on Friday was evident in the latest data from Lipper Analytical Services, a tracker of mutual funds. The service's emerging markets index fell 3.53 per cent onFriday.

Michael Lipper, the firm's founder and president, said, "I'm sure we've got market timers jumping out, but I think the funds are probably reasonably in good share."