Bank of America Clients Continue to Buy the Rally, New Data Shows

Bank of America

Bank of America is trading down 1.38% at 33.49

Despite analyst warnings that the ongoing relief rally in equities is close to peaking, Bank of America clients have continued to buy U.S. equities.

Jill Carey Hall, the equity and quant strategist at BofA, noted that the bank’s clients were net buyers of U.S. equities for the sixth consecutive week. Last week, when the S&P closed nearly 0.4% higher, client inflows in stocks were $1.8 billion.

Consistent with recent weeks, clients were buying both single stocks and ETFs while the buying activity was mostly led by institutional clients. Retail clients have also continued to buy – for the sixth consecutive week – while hedge funds were net sellers.

“Clients bought stocks in four of the 11 sectors, led by Tech (largest weekly Tech inflow in our data history since ’08) and Communication Services. While most Tech companies have beaten expectations this quarter, we see risk that Tech may not prove to be as defensive as some investors expect; Nasdaq earnings revisions have continued to lag S&P 500 earnings revisions,” Carey Hall told clients in a note.

On the other hand, Health Care and Consumer Discretionary registered the biggest outflows, with the latter recording the biggest outflow since late June. BofA clients have also continued to buy energy stocks while Industrials currently has the longest selling streak.

On technical fronts Bank of America (BofA) RSI stood at 53.54 and currently it is trading above 20 and 50 days MA & below 5 days MA. So, BUY position can be taken with following target and stoploss:

TRADE SIGNAL – : Bank of America (BofA) – BUY: 33.46, TARGET: 33.91, STOP LOSS : 33.20

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