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An
army of retail investors went toe-to-toe with Wall Street
professionals last month by buying into stocks that were heavily
shorted by hedge funds. In the tussle, some funds had to sell
out of their long positions to cover the losses, causing wider
falls in stock prices.
"Big client zeitgeist in past two weeks has unambiguously been
to buy the FAANMG (Facebook, Amazon, Apple, Netflix, Microsoft
and Google-owner Alphabet) underperformance," said Michael
Hartnett, BofA's chief investment strategist.
Big Tech has been one of the biggest winners of the pandemic,
with revenues turbocharged by stay-at-home rules and increased
interest from investors who are taking advantage of the cheap
money available.
Meanwhile, a sudden jump in equity volatility last week also
sent investors running for safety with bonds attracting $21.2
billion, the largest in four months. Those fears, however,
receded this week with Wall Street's main indexes hitting record
highs.
Away from the Wall Street noise, emerging markets stocks have
been the top pick among investors as they poured in $5.7 billion
in the week to Wednesday, marking inflows in 19 of the past 20
weeks.
The retail trading fever also sent silver surging past $30 an
ounce for the first time since 2013 before prices fell back. The
precious metal attracted a record $2.8 billion in the week to
Wednesday, BofA said.
(Reporting by Thyagaraju Adinarayan; Editing by Tommy Wilkes and
Susan Fenton)
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