BofA strategist Jill Carey Hall has reflected on last week’s client flows when the S&P 500 fell 2.1%.
Overall, BofA clients were small net buyers of US equities ($0.1 billion) for the first time in four weeks with clients buying single stocks and selling ETFs for the 3rd consecutive week.
“Institutional clients were net buyers for the first time in three weeks, while both hedge funds and private clients were net sellers for the seventh and second straight weeks, respectively (and only the third time YTD that retail clients were sellers),” Carey Hall said in a client note.
Clients were buying and selling small/mid caps, according to Carey Hall. Looking at sectors, Materials and Industrials stocks saw the biggest inflows last week to increase their YTD gains. On the other hand, clients were selling Energy and Financials.
“Following extreme outflows from Consumer Discretionary stocks over the last four weeks (and the biggest cumulative net sales of any sector YTD), clients bought the sector last week. Such extreme outflows have typically suggested performance could be close to bottoming.”
As far as buybacks are concerned, the activity from corporate clients picked up in the last 2 weeks.
By Senad Karaahmetovic