BofA clients fuel modest inputs; Tech sees biggest flow since August by Investing.com

Investing.com — Bank of America Securities said clients made modest purchases of stocks last week, bringing in $0.6 billion after a week of outflows.

Investors focused on both single stocks and exchange-traded funds (ETFs), with the latter seeing higher inflows, BofA revealed in a note on Tuesday. Large-cap and small-cap stocks saw positive inflows, while mid-caps saw outflows.

Private customers, along with businesses, were the main net buyers, marking the first inflows from this group since early September. Meanwhile, institutional clients and hedge funds continued to sell stocks for a second straight week.

Corporate buybacks have slowed but remain above seasonal norms as a percentage of market capitalization, according to the note. Redemptions 52 weeks ago as a percentage of the index’s market capitalization are at an all-time high.

As the tax-loss selling season approaches, institutional clients’ stock sales tend to pick up, especially ahead of the Oct. 31 deadline for most mutual funds to realize capital gains.

“Indeed, this group has sold shares in six of the past seven weeks,” strategists note. “Sales by retail investors typically pick up in December, ahead of the 12/31 cut-off for individual investors.”

BofA says its clients bought stocks in six of the 11 sectors last week, with consumer discretionary, communications services and health care leading the flows.

Instead, Tech and Industrials saw the largest outflows, with Tech net sales hitting their highest level since August.

Real Estate remains on a seven-week selling streak, although BofA continues to view the sector favorably for earnings and quality.

Upstream ETF flows, seven of 11 sectors saw inflows, with utilities leading the way. Consumer discretionary, real estate and health care ETFs also drew positive flows.

Clients showed interest in both Growth and Value ETFs while selling Blend ETFs. They also favored large-cap and broad-market ETFs, but were net sellers of small- and mid-cap ETFs.