Interactive Brokers shares jump as it secures spot in S&P 500
Investing.com -- Investors continued to deploy capital across risk assets, with $30.7 billion flowing into cash, $20.8 billion into bonds, and $16.3 billion into equities in the latest week, according to Bank of America.
Tech and financials each saw $1.9 billion in inflows — the most for both sectors in months — while emerging market equities recorded their largest weekly inflow since January 2023 at $3 billion.
BofA private clients, who oversee $4 trillion in assets, now hold 64.0% in stocks — the highest since March 2022 — and just 10.7% in cash, the lowest since October 2021.
Their recent ETF purchases have favored low-volatility stocks, high-yield bonds, and EM debt, while trimming exposure to Japan, equity growth, and TIPS.
Michael Hartnett points to a growing consensus for further equity gains through the summer, followed by a pullback.
“Trading consensus is more S&P500 upside/catch-up into Aug Fed Jackson Hole meeting, then healthy ‘back’n’fill’ correction,” he wrote.
Hartnett said the majority of investors expect Q2 earnings to surprise to the upside and anticipate rising AI capital expenditure (capex) forecasts.
However, he warns that there is “less sure” conviction that the AI-driven EPS boost will materialize broadly across the corporate sector this quarter.
The strategist noted the prevailing equity positioning remains a barbell of U.S. growth stocks and Rest-of-World value, while active managers continue to “bemoan concentration of performance.”
In fixed income, inflows continued across most segments in the past week. Investment-grade and high-yield bonds posted their 11th consecutive week of gains, while EM debt inflows extended to a 12th week.
Government bond inflows resumed at $2.6 billion, while TIPS saw outflows.
Regionally, the U.S. posted its first equity inflow in three weeks, while Europe saw its fourth straight week of gains. Japan extended its streak of outflows, and EM equity inflows resumed at $2.6 billion.