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BofA weekly flow data shows USD 20.8bln into bonds (59th straight week of inflows), USD 2.5bln out of cash, USD 31.5bln into stocks, USD 0.7bln out of crypto (record inflows over 5 weeks), USD 2.3bln out of gold (4th straight week of outflows)

Newsquawk Staff ·

  • BULL & BEAR: BofA's Bull & Bear Indicator rose to 8.8 (from 8.7), marking a fourth consecutive week in contrarian sell signal territory (triggered in May 2026). BofA says the rise was driven by strong tech equity inflows, partially offset by HY and EM bond outflows and weaker global stock index breadth. Since 2002, there have been 17 such sell signals, with average losses for global stocks of 2-3% over the following 2-3 months, a hit ratio of around 60% and max drawdowns of 15-20%.
  • EQUITIES: Global stocks drew USD 31.5bln (USD 47.1bln to ETFs, USD 15.3bln out of mutual funds); US equities saw an eleventh straight week of inflows at USD 17.4bln, the longest streak since December 2025; Japan inflows resumed at USD 0.8bln; Europe posted a ninth straight week of outflows at USD 3.9bln; EM equities drew USD 4.5bln, their first inflow in nine weeks, with Korea drawing USD 5.9bln, its biggest inflow since March 2026. By style, US large cap drew USD 11.3bln, while US small cap suffered an outflow of USD 1.1bln, US value USD 1.8bln and US growth USD 4.5bln.
  • SECTORS: Tech drew USD 12.3bln, its biggest weekly inflow ever (including USD 3.0bln to Direxion Daily Semiconductor Bull 3x and USD 2.9bln to iShares Semiconductor ETF); communication services drew USD 1.1bln, financials USD 1.0bln and healthcare USD 0.7bln. Materials saw the largest outflow at USD 2.0bln, followed by consumer at USD 1.4bln, energy at USD 0.6bln, utilities at USD 0.3bln and real estate at USD 0.1bln.
  • FIXED INCOME: IG bonds saw a tenth straight week of inflows at USD 11.8bln; government/Treasuries drew USD 5.0bln for a seventh straight week; munis drew USD 1.6bln for an eighth straight week; TIPS drew USD 0.4bln for a nineteenth straight week; bank loan inflows resumed at USD 1.0bln. HY bonds posted an outflow of USD 0.2bln, as did EM debt at USD 0.2bln.
  • POSITIONING: BofA private clients' AUM stood at USD 4.5tln; equity allocation was 65.5%, bond allocation 17.4% and cash 9.8%. Despite the biggest equity outflow in eight weeks, the underlying bid for equities held up, with GWIM equity ETF share count up 0.3% over the past week and 4.9% YTD. In ETFs over the past four weeks, private clients bought materials, MLPs and TIPS while selling Japan, staples and utilities.
  • TRADING VIEW: BofA warns that booms and bubbles are ended by bonds (punitive cost of capital), leaders, or elections, and is taking trading chips off the table until tighter financial conditions peak once Fed Chair Warsh turns hawkish at the July 29th FOMC. It flags US CPI at 4.2%, almost above the 4.3% unemployment rate, a rare combination that has historically coincided with years of Fed hikes ('66, '73, '90, '00, '08, '21). With headline CPI on course to head above 5% by the November midterms, BofA notes that over the past 100 years, once CPI crosses 4%, the S&P 500 has averaged a -4% loss over the next three months and -7% over six months. It also flags 1994, where a behind-the-curve Fed was forced into big hikes and stocks stalled in a multi-month trading range until yields stopped rising after the December 1994 Mexico peso crisis and Orange County bankruptcy.

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