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Investors pull $25.8 billion from U.S. equity funds: BofA

Published 09/25/2020, 05:15 AM
Updated 09/25/2020, 08:26 AM
© Reuters. FILE PHOTO: A worker cleans the floor of the New York Stock Exchange (NYSE)

© Reuters. FILE PHOTO: A worker cleans the floor of the New York Stock Exchange (NYSE)

LONDON (Reuters) - Investors pulled a massive $25.8 billion out of U.S. equity funds in the week to Wednesday, the third biggest outflow ever from the asset class, BofA's weekly fund flow report showed on Friday.

Money was sucked out of sectors which have been the main beneficiaries of the rebound in the wake of the Covid19 March crash, said BofA analysts, citing data for the week to Sept. 23 from financial flow tracking firm EPFR.

Technology stock suffered $1 billion of outflows, the largest since June 2019, while U.S. blue chips haemorrhaged $11.6 billion.

The S&P 500 has lost 7.2% so far in September, its first negative monthly performance since March with the Nasdaq pulling back more than 10%.

"We don't expect big bear move when Fed so easy, Wall Street flushed with cash, vaccine expectations strong", BofA analysts however commented, adding a correction in September and October typically corresponded to a "midlife crisis phase of the investment year".

Other big movements in investment flows this week included high-yield bond funds suffering their largest outflows since March, losing $5.4 billion.

It was also the 12th straight week of inflows for emerging market debt funds while bond funds more broadly added $1.3 billion.

© Reuters. FILE PHOTO: A worker cleans the floor of the New York Stock Exchange (NYSE)

(This story corrects date in the second paragraph to Sept. 23)

Latest comments

The question is WHO is pulling out the cash? Profiteers who bought the first covid dip with ppp and stimulus funds to catch a V wave? Corporate big wigs that used bailout funds to prop up their own share price? Love the capitalism cover of the greed induced stimulus waste creating bigger boom and busts on the backs of the average tax paying worker. We are doomed to repeat and expand a huge depression, god help us all.
The ones pulling out the cash are the same ones that are fed-up with the instability of the trump administration. Chaos rules the day under trump and will only get worse when he refuses to accept defeat after he loses the election. Wait till he does and then watch the flood gates open draining cash as the markets crash.
Why the US dollars is hiking up so strong in front of this fund outflow?
Becaue its a fund outflow.
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