The Zhitong Finance App learned that last week, institutional investors drastically sold individual stocks, with a total net outflow of 11 billion US dollars from US stocks. Capital is concentrated and withdrawn from the technology sector. This is also the third highest weekly outflow of individual stocks in Bank of America statistics history.
Bank of America strategist Jill Carey Hall wrote in a recent report that market pressure mainly comes from the technology sector, which recorded the fourth largest weekly capital outflow since 2008; at the same time, the four-week rolling average capital flow of technology stocks turned negative for the first time since July.
Nine of the 11 sectors experienced capital outflows, and the communications services and industrial sector also experienced massive sell-offs — the latter has recorded a net outflow for the 10th week in a row — while materials and real estate are the only two sectors that have achieved net capital inflows.
This round of individual stock capital flight stemmed from institutions reducing individual stock holdings for the second week in a row; hedge funds and retail investors bucked the trend and became net buyers. This is also the first time since the end of July that retail capital has returned to the stock market.
Bank of America pointed out that despite the massive sell-off of individual stocks, demand for allocation of overall market exposure is still strong. Customers have injected capital into stock ETFs for 15 consecutive weeks, totaling US$3.2 billion. They prefer value and hybrid funds over growth funds, while shifting capital from the technology sector to healthcare ETFs.
