S&P 500 hits a fresh record high on stronger economic growth, Nvidia pares losses
Investing.com -- U.S. equity flows turned positive last week as the S&P 500 rose 1.9%, with Bank of America (BofA) clients buying $2.3 billion worth of stocks following net selling the week prior.
The bank said the buying was driven largely by individual stocks, while equity exchange-traded funds (ETFs) posted outflows. Most ETF inflows were concentrated in fixed income and other non-equity products.
Hedge funds led the rebound, reversing the previous week’s selling. Private clients also added to their positions and have now been net buyers in 25 of the past 26 weeks, marking the longest streak in BofA’s data history. Institutional investors, however, remained net sellers for the fourth consecutive week.
Corporate buybacks slowed compared to the previous week and remained below seasonal norms for the third week in a row. BofA noted that buybacks typically decline after peaking during earnings season and tend to trend lower into late June.
In terms of sector flows, investors favored cyclical over defensive names, with inflows led by Financials, Consumer Discretionary, and Industrials. By contrast, Technology stocks saw the largest outflows for the third week running, with institutions, hedge funds, and retail clients all reducing exposure.
“Our positioning work suggests that Tech is close to a record underweight by active funds; we recently upgraded Tech from underweight to marketweight," said BofA strategists Jill Carey Hall and Tyson Dennis-Sharma.
ETF activity mirrored broader equity flows. While Value and Growth ETFs attracted fresh capital, Blend ETFs were sold. Broad market and mid-cap ETFs recorded modest inflows, whereas large- and small-cap funds saw outflows.
Sector ETF flows showed continued pressure on Technology, which posted a seventh consecutive week of outflows. Meanwhile, Financials and Health Care ETFs saw the strongest inflows.