BofA warns US stocks face volatility risk as $14.2 billion flows out in three weeks

MacroAnalystDigital Finance Impact 4
โดย Money & Banking·US·Read original
Summary · why it matters

Strategists at Bank of America, or BofA, are warning that the stock market may face increased volatility after capital flowed out of US equities, even as markets and policymakers have yet to show much concern over surging US Treasury yields. Citing data from EPFR Global, they said US equity funds saw a net outflow of $14.2 billion over the past three weeks, the largest outflow since January, while inflows into global equity funds slowed to an average of just $7 billion a week over the same period, a sharp drop from an average of $52 billion a week in July. Jared Woodard and Michael Hartnett, along with BofA's team of strategists, said markets normally stop panicking when policymakers start to show concern, but the current situation shows almost no sign of alarm from either side, even as the yield on 30-year US Treasuries climbed to its highest level since June 2007 and commodity prices rose rapidly. They warned that the market's complacency and policymakers' confident stance could become factors that lead to volatility. The BofA team also warned of risks from the AI investment boom, noting that although roughly $1.5 trillion has been spent on AI over the past three years, there is still little evidence that such investment has significantly boosted productivity across the broader economy. Meanwhile, total factor productivity is falling below trend, a measure that has been strongly correlated with consumer confidence over the past 50 years, and BofA's strategists said that sometimes Main Street may see what Wall Street has yet to see, reflecting concern that the still-calm market conditions may not be consistent with the growing economic and financial risks.

Impact on stocks 2

Financials▲ · 1 stocks
Bank of America Corp
BAC
± Mixedrelevance

BofA strategists warn of volatility risk and outflows, but this is a market call, not a company-specific financial event.

Others▲ · 1 stocks

Off-coverage companies 1

EPFR GlobalPrivate± Mixed
relevance

EPFR Global is cited only as the data source for fund-flow figures, not as a subject of impact.

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