Global equity and bond funds saw strong inflows last week, with European stocks experiencing their biggest boost since before the Ukraine war, according to Bank of America (BofA).
Key Highlights from BofA Report
Equity Inflows: $16.8 billion flowed into global stock funds.
Bond Inflows: Investors poured $16.2 billion into bonds.
Gold Demand: $2.2 billion in inflows.
Crypto Outflows: $200 million in withdrawals.
Money Market Funds: $3.3 billion added.
Regional and Asset Trends
European Equities: Attracted $4.0 billion, the largest weekly inflow since February 2022.
US Stocks: Inflows of $12.1 billion, rebounding from prior outflows.
Emerging Markets: $5.3 billion in outflows, marking the third straight week of declines.
Japanese Stocks: Outflows of $18 million for the second consecutive week.
Treasuries: Largest six-week inflow at $3.7 billion.
High-Yield Bonds: Best five-week streak since October 2024.
Major Market Shifts
BofA analysts, led by Michael Hartnett, identified secular shifts driving global market breakouts:
European Stock Rally: The Euro Stoxx 50 index surpassed its 2000 high.
US Market Peak?: Strategists suggest US stocks may underperform global peers.
Tech Sector Shift: The “Magnificent 7” is now being called the “Lagnificent 7,” implying that mega-cap tech stocks could struggle to maintain dominance.
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Conclusion
The record inflows into European equities and bonds highlight shifting investor sentiment as the US market faces potential headwinds. With emerging markets seeing outflows and tech sector leadership evolving, investors should stay alert to broader market rotations in the coming months.
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