Selling slows, no capitulation yet
Last week, during which the S&P 500 fell 0.5%, BofAML clients were net sellers of US stocks for the 16th consecutive week—continuing the longest uninterrupted selling streak in our data history (since ’08). But the magnitude of outflows has been lessening for the past three weeks, with last week’s $1.2bn in net sales the smallest in ten weeks (Chart of the Week, below). Net sales were led by hedge funds, a reversal from institutional client-led selling in the prior nine weeks. Institutional and private clients were still sellers as well, but sales by these groups were both their smallest since Feb. Net sales were entirely in large caps last week, as both small and mid-caps saw net buying. Buybacks by our corporate clients decelerated last week, and month-to-date are tracking below typical May levels. Year-todate, buybacks are tracking slightly above 2015 levels but below 2014 levels.