LIVE MARKETS-BofA clients snap up staples

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BOFA CLIENTS SNAP UP STAPLES

BofA Securities equity and quant strategist Jill Carey Hall says that last week, with the S&P 500 index .SPX clawing higher by 0.34%, clients were net buyers of U.S. equities for the second straight week, driven by both single stock and equity ETF inflows (+$1.2 billion and +$1.4 billion, respectively). All major client groups were net buyers of U.S. equities.

"Retail clients were the biggest buyers, with inflows for the 4th straight week. Hedge funds have now been buyers for 7 weeks, their longest streak since Nov. '23, while institutional clients were buyers for the 2nd week," writes Hall in her note.

She adds that "Inflows were driven by large caps, with both single stock & ETF inflows. Clients sold small-cap ETFs but bought single stocks (4th week of small-cap stock inflows). Outflows from mid caps (stocks + ETFs) were the largest since Jan. '20."

Corporate client buybacks slowed week-over-week and as a percentage of market cap are tracking below average at this point in earnings season. Trailing 52-week buybacks as a percentage of market cap are now at their lowest since December 2023 and slightly below their long-run average since 2010.

Hall says that clients bought stocks in five of 11 sectors, led by Communication Services and Staples. In fact, she notes that the rolling four-week average of Staples inflows are the largest in BofA's data history since 2008 (both in absolute terms and as a percentage of market cap).

Tech suffered the biggest outflows followed by Energy.

In terms of ETFs, Hall says clients were buyers of blend ETFs as they were selling growth/value ETFs. By size, only large-cap and broad-market ETFs garnered inflows.

Clients sold ETFs in seven of 11 sectors, led by Tech. In contrast to single stock outflows, inflows were led by Energy and Industrials.

(Terence Gabriel)

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