BofA: Stocks Attracted $18.5B This Week

Bank Of America’s analysis of weekly fund flow statistics showed that investors bought a lot of global stocks in the week ending Wednesday, as companies reported huge profits and major central banks downplayed concerns related to a return to monetary stimulus.

Equity funds attracted $18.5 billion, which was mainly driven by US stocks linked to the economic cycle closely related to the performance of the economy.

Meanwhile, the bank said, citing EPFR data, that bond funds attracted $13.5 billion in the week ending May 5.

Although the Fed said it would continue to keep the stimulus program open despite the strong economic data, Bank Of America said that it is “bad news to start reducing globally,” in reference to the intention of major central banks to reduce the huge bond purchases that began in March 2020.

This comes a day after the Bank of England slowed its program to buy trillion dollars of bonds, and a month after the Bank of Canada announced that it may start raising interest rates by late 2022 and reduce the size of its bond purchases. Even so, members of the US Federal Reserve are sticking to their accommodative penchant.

Ahead of strong economic data expected in the second and third quarters of the year, Bank Of America told its customers, “The stronger the overall economic performance, the faster and greater the pace of reduction.”