(Boursier.com) — Equity funds are still seeing inflows despite deeply pessimistic sentiment as the “final capitulation” is not yet here, say Bank of America Corp strategists quoted by ‘Bloomberg’. Global equity funds attracted $9.2 billion in the week ended Oct. 19, according to data from EPFR Global. Money market funds recorded inflows of $14.5 billion, while $12.2 billion left bond funds. The exodus to European equity funds also continued for a 36th consecutive week. American funds, on the other hand, recorded a second consecutive week of positive flows ($12 billion).
With inflation remaining consistently high and recession risks rising daily, stock markets still have room to fall, says Michael Hartnett, strategist at BoA. The latter remains negative “despite pervasive bearish sentiment”, as the global recession and credit shocks are just beginning.
Citigroup and Morgan Stanley strategists also warned this week that earnings estimates and stocks did not yet fully reflect the outlook for slowing global growth.
©2022 Boursier.com