Updates with post on BofA client flows
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BofA CLIENTS TAKE TO ETFs
BofA Securities equity and quantitative strategist Jill Carey Hall says that last week, with the S&P 500 index .SPX gaining close to 2%, clients were net buyers of U.S. equities with inflows into both stocks (+$0.9 billion) and ETFs (+$3.8 billion, largest since November 2023).
Clients bought large/mid/small caps (based on stock+ETF flows), but micro-cap stocks saw a second week of outflows.
"Institutional clients led the buying after selling the prior week; hedge funds also were buyers after six (weeks) of selling (biggest buying in 14 (months). Retail clients were buyers for the 3rd straight week," writes Hall in her note.
She adds that corporate client buybacks continued to pick up during the second week of earnings. However, trailing-52-week buybacks as a percentage of market cap have been declining since March and are now their lowest since May 2024.
Hall says that clients bought stocks across 8 of the 11 GICS sectors, led by Staples and Financials. Hall notes that Financials has seen the biggest upward revisions to third-quarter earnings since the start of October.
Tech saw the biggest outflows for the second straight week; clients also offloaded Communication Services and Industrials.
In terms of ETFs, Hall says clients bought across all major asset classes, sizes (Large/Mid/Small/Broad Market) and styles (Growth/Value/Blend), but with Value favored over Growth for a sixth week in a row.
Clients bought ETFs in 8 of the 11 sectors, led by Tech and Communication Services (despite single stock-selling).
Staples ETFs had the largest outflows.
(Terence Gabriel)
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