On July 3, Bank of America's latest weekly report revealed that for the week ending July 1, US stock funds experienced a net outflow of $17.2 billion, marking the largest single-week net redemption since March 2026, and recording net outflows for the second consecutive week. Meanwhile, the Bank of America Bull & Bear Indicator rose from 9.1 to 9.5, remaining in the 'extremely bullish' range. Bank of America's Chief Investment Strategist Michael Hartnett stated that the 'sell signal' triggered on May 20 has not yet been lifted. According to Bank of America data, this indicator has triggered 17 'sell signals' since 2002, with global stock markets averaging a decline of 2% to 3% in the following 2 to 3 months, and an accuracy rate of about 60%, with historical maximum drawdowns ranging from 15% to 20%. In terms of fund flows, investment-grade bonds attracted $17.2 billion in inflows during the week, marking 13 consecutive weeks of net inflows; high-yield bonds saw inflows of $3.4 billion, the largest single-week inflow since May 2025. Technology funds had inflows of $14.3 billion for the week, with year-to-date inflows expected to reach a historic record of $152 billion. Additionally, Japanese stock funds attracted $1.9 billion for the week, the largest single-week inflow in nearly seven weeks. Amid the outflow of funds from US stocks, the semiconductor sector faced significant pressure, with the Philadelphia Semiconductor Index declining by a cumulative 11% over the past two trading days. JPMorgan strategists noted that the extreme outperformance of US semiconductor stocks relative to AI mega-scale cloud computing companies has created an unsustainable valuation gap, which is expected to narrow eventually. Commodities and gold continued to face pressure, with gold experiencing an outflow of $3 billion for the week, marking the seventh consecutive week of outflows; cryptocurrencies saw an outflow of $2 billion, the largest single-week outflow since November 2025.

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Bank of America: US Stock Funds Experience Largest Weekly Outflow Since March, 'Sell Signal' Persists for Six Weeks

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