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In its weekly ‘The Flow Show’ note, BofA said bond inflows recorded their longest eight-week inflow streak since Nov 2021.
Bond inflows were $4.9 billion, while US equity outflows were $9B, the third straight week of outflows, revealed BofA analysts.
The outflows resumed to financials after four consecutive weeks of inflows, while they resumed from US growth after two straight weeks of inflows.
BofA’s private clients are now 61% in stocks, 20.7% in bonds, and 11.4% in cash, BofA stated, while ETF flows show that its private clients are buying EM debt, healthcare, industrials, selling bank loans, HY, and REITs over the past four weeks.
The analysts also stated that there is now “short-term gain, long-term pain” with fiscal stimulus panic very “successful in averting recession in early-2020s; but deficits rising again.”
“The great irony of inflationary 2020s will be in next recession Fed forced to resort to YCC to bail out US government…and that’s when the next great bull market in risk begins,” they wrote.
