Investors sell record $39 billion of stocks in past week: BAML

FILE PHOTO: United States one dollar bills are seen on a light table at the Bureau of Engraving and Printing in Washington November 14, 2014. REUTERS/Gary Cameron/File Photo

LONDON (Reuters) – Investors cashed out of equity funds at a record pace over the past week, with redemptions hitting $39 billion, Bank of America Merrill Lynch (BAML) said on Friday.

Investment grade bond fund outflows also touched a record high of $8.4 billion up to Wednesday, in what was a “capitulation out of stocks, investment grade (and) financials,” according to BAML.

U.S. stocks had a similarly torrid week, with U.S. equity funds recording their second-largest ever week of redemptions at $27.6 billion, the bank said in a note after analyzing EPFR flow data.

This meant that year-to-date outflows from U.S. equity funds is also around of $27.6 billion, with the number being essentially flat the week before last.

With Britain’s Brexit political drama intensifying, investors have now pulled $9.8 billion out of UK equity funds so far in 2018, more than in any previous year.

But year-to-date inflows into Japanese equities at $63.57 billion and emerging market stocks at $50.92 billion helped keep the overall equity flows overwhelmingly positive for 2018 at $74 billion.

It has been a different story for high-yield and investment grade bond fund this year so far, with record redemptions of $63 billion.

Investors retreated to the safety of government bonds, with those funds recording $3.2 billion of inflows over the past week, $20 billion over the past 10 weeks, and $46 billion year-to-date.

“Investors have no satisfactory

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