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Investing.com -- Bank of America Securities (BofA) said its clients remained net buyers of U.S. equities for the sixth consecutive week, with inflows of $500 million.
However, buying activity was at its lowest level in six weeks. The inflows were entirely driven by exchange-traded funds (ETFs), as clients turned net sellers of single stocks for the first time since late October.
Private clients continued their buying streak for the 13th straight week, marking the longest start-of-year trend in the firm’s data history since 2008.
Yet, over the past five weeks, this group has shifted to selling single stocks while still buying ETFs.
“Institutional clients were the biggest sellers (second week of selling/largest outflow since Oct.) and hedge funds were sellers for the fourth consecutive week,” said BofA strategists Jill Carey Hall and Nicolas Woods in a note.
Meanwhile, corporate buybacks slowed, falling below typical seasonal levels for the first time in eight weeks.
By sector, clients sold stocks in six of the 11 GICS sectors, with the largest outflows coming from Technology, Financials, and Consumer Discretionary.
“Tech outflows were led by private clients, with institutional and hedge fund clients selling as well,” the strategists continued.
Moreover, Financials saw the largest institutional selling in the firm’s data history since 2008. Despite the heavy selling, BofA maintains an overweight position in Financials, though its latest positioning data signaled crowding risks.
Meanwhile, inflows were not defensive. Energy saw the strongest inflows, while clients also bought stocks in Communication Services, Industrials, Materials, and Real Estate.
In the ETF space, clients bought ETFs in six of the 11 sectors, with Technology ETFs leading inflows despite single-stock outflows. Financials and Industrials ETFs saw the biggest outflows.