LIVE MARKETS-BofA institutional clients ramp up their buying

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BOFA INSTITUTIONAL CLIENTS RAMP UP THEIR BUYING

BofA Securities equity and quant strategist Jill Carey Hall says that last week, with the S&P 500 index .SPX surging 3.7%, clients bought U.S. equities, led by both single stock inflows (+$0.9 billion; first inflows in more than a month) and equity ETF inflows (+$3.5 billion; seventh week of inflows).

Clients bought both large and small/micro cap equities (based on stock + ETF flows), but offloaded mid caps, which saw a fifth straight week of outflows.

"Near-record buying by institutional clients (3rd highest since '08 and highest since Jan. '23 when normalized by market cap), primarily driven by single stock inflows. Hedge fund clients sold US equities after buying the prior two weeks, and private clients, who have been the most consistent buyers of equities this year, have now sold for the last four weeks, their longest selling streak since Aug. '24," writes Hall in her note.

She adds that corporate client buybacks slowed last week. Of note, trailing 52-week buybacks as a percentage of market cap have continued to decline since March.

Tech and industrial stocks saw the biggest inflows (after clients sold tech stocks for the prior six weeks). Utilities, real estate and staples also garnered inflows.

Communication services stocks suffered the biggest outflows (fourth straight week of outflows and four-week average net flows are now the most negative in the sector's history since 2018).

Financials and energy experienced the next largest outflows.

In terms of ETFs, Hall says clients snapped up equity ETFs across sizes (large/mid/small/broad market) and major styles (value/growth/blend), but flows skewed toward growth over value for the first time in three weeks.

Healthcare and tech captured the biggest sector ETF inflows, while consumer staples and consumer discretionary ETFs suffered the largest outflows.

(Terence Gabriel)

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