Investors are buying European stocks at the fastest pace in almost a year. Meanwhile, inflows into US equities have been sluggish amid recession fears. A report from Bank of America (BofA) showed.
European equity funds received $3.4 billion in inflows in the week ended Friday, according to the report, which strategists including Michael Hartnett cited EPFR Global data. This is the most since February last year, but it is only the second week of inflow after 48 consecutive weeks of outflow. $7.9 billion flowed into emerging market equities. Meanwhile, US stocks saw their first inflow in four weeks, but only $300 million.
Source: Bloomberg
Earlier this year, Hartnett said he expected US stocks to underperform the rest of the world. Wall Street strategists have also become more bearish on US stocks, given the outlook for interest rates, the economy and corporate earnings.
BofA strategists said in a note dated June 26 that there are several signs that the US economy will have a “hard landing” in 2023. The condition for the US economy to enter a recession is that financial conditions tighten further in the spring this, he said.
Strategists called the S&P 500 “sold” after it hit the 4100-4200 range, up 3.4% from current levels, at a level where “high stocks are starting to push yields higher.”
Original title:BofA Says Investors Flock To European Stocks, Leaving US Behind （抜粋）
