In the 12th consecutive week of equity inflows, Bank of America clients remained net buyers of U.S. equities ($1.0B) despite the S&P 500 experiencing a 2.4% decline.
Inflows were primarily seen in ETFs, while single stocks saw their first week of outflows since August. Hedge fund and retail clients led the inflows, with institutional clients' sales being the largest since July.
Retail clients have been net buyers for five consecutive weeks, and hedge fund clients for four consecutive weeks.
Client activity showed that they sold stocks in seven of the 11 GICS sectors, with Consumer Discretionary experiencing the largest outflow since July, and Industrials also saw significant outflows.
Real Estate, on the other hand, led inflows for the fifth consecutive week, marking the largest inflow since May 2022. Cyclicals saw substantial outflows despite having more positive flows than defensive sectors in most weeks since early August.
“We became more positive on cyclicals this spring, and our sector views have a cyclical tilt,” analysts wrote in a note.
In the ETF space, clients continued to invest in SMID/Broad Market and Value categories. They bought Value ETFs and SMID caps, while Large, Growth, and Blend ETFs experienced outflows.
Value ETFs received inflows for the 17th consecutive week, while Growth ETFs saw outflows for the first time in 11 weeks. Most sector ETFs experienced outflows, with Utilities ETFs leading the outflows, and Energy ETFs leading the inflows.
Corporate client buybacks accelerated last week but have been consistently tracking below seasonal trends since May. Year-to-date, corporate client buybacks as a percentage of S&P 500 market capitalization (0.15%) are below the highs seen in 2022 (0.19%) at this time.