BofA says cash racing to stocks, bonds as inflation fears ease
BNN Bloomberg
Bank of America says investors are rushing back into stocks and bonds, with signs that inflation has peaked.
Global equity funds pulled in US$7.1 billion in the week through Aug. 10, strategists led by Michael Hartnett wrote in a note, citing EPFR Global data. US stocks saw inflows of US$11 billion, the biggest in eight weeks. Rate-sensitive growth funds posted the largest influx since December, while financial stocks drew cash for a second straight week, marking a reversal after 18 weeks of outflows, the data show. Global bonds saw inflows of US$11.7 billion, while US$4.3 billion was pulled out of cash.
A rally in US stocks gathered pace this week after US inflation data showed a slight cooling in consumer prices, increasing speculation that the Fed will slow the pace of what has been its most aggressive monetary policy tightening in decades. The S&P 500 Index is on course for its fourth straight weekly gain, its longest such winning streak since November.
