Market decline

Equity funds see inflows, despite market decline

Fund investors are apparently not the ones who have been bailing out stocks in recent days.

Data from EPFR Global indicates that for the week ended Wednesday, exchange-traded funds and mutual funds saw inflows of $17.1 billion, according to Bank of America.

Mutual funds actually saw an outflow of $7.8 billion during the week, but ETFs saw an inflow of $24.9 billion. Overall, only two out of 18 trading days have shown an exit so far this year.

Year-to-date through Jan. 26, equity ETFs and mutual funds saw an inflow of $84.16 billion. Of course, these figures do not include sales of individual stocks and sales of equity derivatives.

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But the numbers show “zero capitulation in stock positioning,” BofA strategists led by Michael Hartnett wrote in a comment Friday.

Other data from EPFR shows that bond funds took it on the chin, recording an outflow of $10.2 billion last week. It certainly makes sense with rising interest rates. The 10-year Treasury yield rose 10 basis points to 1.85% in the first three days of last week.

Meanwhile, money market funds saw an inflow of $14.9 billion over the past week, which could be an indicator of investor caution, much like the $2 billion inflow into gold funds over the past week.

Hartnett calls this a period of “selling in pride, buying in humiliation,” given the decline in speculative assets like cryptocurrencies, clean energy stocks and ETF Ark Innovation. (ARKK) – Get the ARK Innovation ETF report.