Investing.com — Bank of America Securities said its clients continued buying US equities last week, adding $1.2 billion for an eleventh consecutive week. While single stocks saw strong buying, exchange-traded funds (ETFs) experienced outflows for the second straight week.
Private clients were the primary net buyers, alongside corporate clients. Private investors continued purchasing equities for a sixth consecutive week, with month-to-date inflows as a percentage of market capitalization already far exceeding a typical full January—6.4 times larger.
In contrast, institutional and hedge fund clients, who historically sell US equities in January, were net sellers.
“Last week, hedge funds were sellers for a seventh straight week and institutional clients were net sellers after buying the prior week,” BofA strategists Jill Carey Hall and Nicolas Woods said in a note.
Corporate buybacks gained momentum during the week, with activity in the first three weeks of January tracking at elevated levels similar to recent years and above 2010 benchmarks. This suggests corporate management sees value in repurchasing shares despite higher interest rates.
Last year, corporate buybacks as a percentage of market capitalization reached the highest levels in BofA’s data history.
By sector, Healthcare stocks saw record inflows, driven by a large industry conference in San Francisco.
Clients bought equities in seven of the 11 GICS sectors, with Healthcare and Communication Services leading inflows.
Private clients focused heavily on Healthcare and Financials, with Financials seeing their largest inflows since March 2023.
Institutional clients also increased their exposure to Healthcare, marking their largest inflow into the sector since July 2024. Meanwhile, hedge funds remained net sellers of Healthcare stocks.
Meanwhile, in the ETF space, BofA clients sold Growth and Blend ETFs along with large-, mid-, small-, and broad-market ETFs. Value ETFs, on the other hand, attracted inflows.
Sector-wise, ETFs generally saw inflows, led by Consumer Discretionary and Staples ETFs. Despite record inflows into Healthcare stocks, Healthcare ETFs recorded their largest weekly outflows since 2017.