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Investors put $22.3 billion into stocks and took $37.9 billion
from cash, the first outflow in eight weeks, BofA said citing
EPFR data on Friday.
BofA said individual investor sentiment had risen "with frothy
stocks as investors chase the bull".
"We say 'big rally before big collapse', but the latter now
needs 6% terminal Fed funds, real rates to 2%, unemployment rate
>4%," BofA analysts said.
Global stocks hit their highest in 14 months on Friday, even as
central banks, including the Federal Reserve and European
Central Bank, said more rate hikes were likely this week.
The S&P 500 closed at its highest level since April 2022 on
Thursday and is on track for its fifth consecutive week of
gains, its longest winning streak since November 2021.
U.S. stocks have seen $38 billion in inflows in the last three
weeks, the strongest momentum since Oct. 2022, BofA said, while
tech funds have seen $19 billion flow in in the last eight
weeks, the strongest momentum since March 2021.
"We see max SPX 100-150 points upside versus 300 points downside
between now and Labor Day," BofA said. "We are not convinced we
at start of brand, new shiny bull market."
Citing the same EPFR data, Barclays said the equity inflows were
the largest since November last year, with inflows across all
sectors except energy.
BofA's bull and bear indicator slipped to 3.6 from 3.7 as
slowing inflows to risky bonds offset bullish hedge funds and
better credit technicals, BofA said.
A separate set of data showed global equity funds received their
largest inflow in 12 weeks.
In the week ended June 14, investors added a net $16.18 billion
to global equity funds, nearly offsetting the $17.69 billion in
net selling observed a week earlier, according to data from
Refinitiv Lipper.
(Reporting by Samuel Indyk; Editing by Amanda Cooper and Barbara
Lewis)
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