BofA data shows largest equity outflows in nearly two months

Investing.com -- U.S. equities saw their biggest weekly outflows in seven weeks, according to Bank of America, as institutional and private clients cut exposure across most sectors despite modest gains in the broader market.

BofA strategist Jill Carey Hall said clients “sold US equities for the 3rd consecutive week,” with single-stock outflows of $8.6 billion, the largest since late October.

Equity ETFs continued to attract money, with inflows of $3.5 billion and “inflows every week since mid-Oct.”

Institutional clients are said to have “led the selling,” marking their first net sales in five weeks, while private clients were sellers for a seventh straight week.

Retail flows, BofA noted, “tend to be most negative in Dec. … amid tax loss selling.” Hedge funds were the only net buyers after three weeks of net selling.

By size segment, clients sold large and mid caps and bought small caps, according to Hall, though micro caps also saw outflows.

Corporate buybacks reportedly accelerated to their strongest weekly pace since June, but the bank said trailing 52-week repurchases as a share of market cap “have continued to fall since March … and are now in-line with the average since 2010.”

Sector flows showed broad selling pressure. BofA reported that Communications Services suffered “the biggest outflows in its history (since ’18),” while Consumer Staples saw its largest outflows since early 2018.

Financials experienced “record” outflows, with clients selling the sector for six consecutive weeks. Despite pressure, BofA’s banks team sees valuations as offering “relative defensibility.”

ETF demand remained more balanced, with clients buying across most size categories and seven of 11 sectors, led by Industrials.

Financials ETFs also saw inflows “despite record stock outflows,” while clients sold Staples and Tech ETFs for a fourth and third straight week, respectively.

You May Also Be Interested In

• Bank of America (BAC) PT Raised to $65 at RBC Capital
• Standard Nuclear slashes IPO plans to 10 million shares
• BofA Securities Starts Ring Energy, Inc. (REI) at Buy