Bank of America clients withdrew money from US equities at the fastest pace in 10 weeks, reducing their exposure as the S&P 500 capped its best quarter since 2023, ending June at a record high. All major client groups, including institutions, retail traders, and hedge funds, collectively pulled US$1.3 billion (A$2 billion) from US stocks last week, according to quantitative strategists at the bank. The data was included in a note written by Jill Carey Hall and her team.
Hall is a senior US equity strategist at Bank of America and heads the firm’s US small- and mid-cap strategy. She is known for her proprietary analysis of client flow data and regularly appears in financial media.
The selling occurred as the S&P 500 Index rose 3.4 per cent across five sessions, achieving its first record since February. This risk-off sentiment emerges amid growing uncertainty about the sustainability of the rally that has helped the S&P 500 Index recover from its April lows. The benchmark is currently near its most overbought level since July 2024.
According to Hall, client groups sold stocks in eight sectors, with industrials and real estate experiencing the most significant selloffs. Both sectors have seen outflows in each of the last four weeks. Utilities have seen six weeks of selling, marking the longest recent streak. Hall noted that utilities and clean-tech stocks could face headwinds from Donald Trump’s tax legislation, which is currently under consideration in Washington.
In contrast, technology stocks saw the largest inflows for the third consecutive week. Clients also purchased financials and consumer discretionary stocks, according to Hall’s note. “Clients were bigger net sellers of defensive sectors than cyclical sectors in aggregate after two weeks of flows skewing in favour of defensives,” Hall wrote, highlighting a shift in investment strategy among Bank of America’s client base. Bank of America is a multinational investment bank and financial services company. It provides a range of services including banking, investment management, and wealth management.
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