During the week ending March 20, the S&P 500 fell 5.8%, but the actual trading activity of Bank of America Securities clients revealed more than the index movement alone. Net outflows from individual stocks reached $8.3 billion, marking the fourth-largest weekly outflow since 2008. Meanwhile, equity ETFs saw net outflows of $1.1 billion, the highest in nearly six months. Combined, these figures indicate a notably broad-based reduction in exposure.
According to the Flow of Funds report by Jill Carey Hall, Equity and Quant Strategist at Bank of America Securities, this was a “widespread sell-off”—nine of the eleven sectors experienced net outflows. Financials, energy, discretionary and staple consumption, utilities, and materials all recorded outflows at or near historical highs. The communication services sector saw net outflows for the first time since late December. The only exception was technology stocks, which attracted $4.6 billion in net inflows—the largest weekly inflow since Bank of America began tracking the data in 2008.
Client categories showed rare divergence in positioning. Institutional clients were the largest net sellers last week, reversing three consecutive weeks of net buying. Private clients were net sellers for the second week in a row, while hedge funds turned net buyers after four straight weeks of selling. Over the past 12 months, however, the trend has been different—hedge funds and institutional clients have been consistent net sellers, while private clients have been the main net buyers. Last week’s short-term moves ran almost entirely counter to this medium-term pattern.
On corporate buybacks, although last week’s repurchase activity accelerated compared to the prior week, as a percentage of market capitalization, buybacks over the past ten weeks have remained below seasonal norms. The 52-week rolling buyback ratio for the S&P 500 has also declined from a peak of 0.42% at the end of February to 0.22% currently. More notably, buybacks by Bank of America’s corporate clients fell 17% year-over-year, while S&P 500 buybacks still grew 6% year-over-year in the third quarter of 2025. Given the historically strong correlation between these two measures, the persistent gap may signal upcoming pressure on index-level buybacks in the coming quarters.
Institutional Clients Reverse, Hedge Funds Step In
Institutional clients drove the majority of last week’s net outflows from Bank of America clients—with combined net selling in single stocks and ETFs exceeding $11 billion, including roughly $9.9 billion from individual equities. This sharp reversal came after three consecutive weeks of net buying.
Hedge funds were the only net buyers last week, purchasing $2.7 billion in individual stocks while selling approximately $900 million in ETFs, resulting in net buying of about $1.8 billion and ending a four-week selling streak. Private clients sold individual stocks for the second consecutive week (around $1.08 billion) but remained net buyers of ETFs, resulting in relatively limited overall outflows.
Small-cap and micro-cap stocks faced more persistent pressure. These segments have now seen eight consecutive weeks of net outflows—the longest selling streak among all market cap categories.
Record Tech Inflows Hint at Future Outperformance
Last week’s $4.6 billion net inflow into tech stocks was the largest weekly inflow since Bank of America began tracking the data in 2008. Relative to the sector’s market capitalization, it ranked as the eighth-largest inflow on record. This surge followed five consecutive weeks of net selling in the technology sector.
The report highlighted four historical instances where a five-week selling streak was followed by a buying reversal of similar magnitude. In those cases, tech stocks outperformed the S&P 500 by an average of 1.7 percentage points over the following month and 6.0 percentage points over three months. By comparison, the average one- and three-month outperformance for tech stocks overall is only +0.5ppt and +1.6ppt, respectively. Although the sample size is small, the directional signal is consistent.
In contrast, the financial sector has seen net outflows every week since the start of the year, with cumulative outflows reaching approximately $17.5 billion year-to-date—the highest among all sectors. Healthcare was the only other sector besides technology to record net inflows last week.
Energy ETFs and Stocks Diverge; Large-Cap ETFs Sold
The divergence between ETF and single-stock flows was most pronounced in the energy sector: energy ETFs have seen almost weekly net inflows since the beginning of the year, adding another $43 million last week. However, energy stocks saw net outflows of about $1.8 billion, among the largest sector declines. This “buy the basket, sell the stock” pattern suggests investors are maintaining directional exposure to the energy sector while avoiding single-stock selection risk.
By style, clients bought both growth and value ETFs but sold blend ETFs for the second week in a row. By market cap, large-cap ETFs saw the most significant outflows, while small-cap and broad-market ETFs attracted net inflows. Six sectors recorded ETF inflows, led by financials, technology, and energy. Materials ETFs experienced the largest net outflows.
Concerns Lurking in Buyback Data
Buybacks remain a key source of support for U.S. equities, but recent data points to potential weakness. Over the past 12 weeks, the technology and financial sectors led corporate repurchases at $9.9 billion and $6.6 billion, respectively, followed by discretionary consumption and healthcare.
However, at the aggregate level, buybacks by Bank of America’s corporate clients fell 17% year-over-year, contrasting with the S&P 500’s 6% year-over-year growth in the third quarter of 2025. Given the high historical correlation between these datasets, if Bank of America’s client figures are indeed leading, overall S&P 500 buyback momentum may soon weaken—a variable that cannot be ignored in a market heavily reliant on corporate buying.