(Boursier.com) — The Nasdaq may well have signed an almost historic performance on Thursday by soaring more than 7%, Bank of America strategists are calling for caution. Although the “inflationary shock” – the main market narrative of 2022 – has now passed, a sharp rise in services and labor costs will continue to weigh on growth stocks, warn the teams of the American bank led by Michael Hartnett.
They therefore expect the FAANG (the famous Big Five) to underperform the market over the next few years. A “multi-year tech and FAANG pullback is just beginning,” the analysts write in a note. The tech cohort of Meta Platforms, Amazon.com, Apple, Netflix and Alphabet will make way for “new leadership”, coming from commodities, small caps, US industrials, European banks and emerging markets, say BoA’s strategists.
In addition, during the week ended November 9, the day before the US inflation data, global equity funds recorded outflows of $4.6 billion, according to EPFR data reported by BoA. . US funds suffered their first redemptions in five weeks while European equities suffered a 39th week of outflows.
Over the same period, investors poured $3 billion into bond funds and $2.4 billion into money market funds.
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