LONDON (Reuters) – Financial markets could benefit from a near-term rebound before resuming the downward move that has sent the U.S. Nasdaq 100 index down more than 25% year-to-date, analysts write from BofA in their weekly strategy note.
“Fear and loathing suggest equities are ripe for a near-term rally but we don’t believe ultimate lows have been reached,” said the team led by Chief Investment Strategy Officer Michael Hartnett. of the American bank.
For BofA, the current market turbulence, which has particularly affected technology stocks and cryptocurrencies, is now comparable in its magnitude to the crash of internet stocks of 1999-2000 or the “subprime” crisis of 2008, adds the note. .
The “techs” indeed suffered their worst releases since the beginning of the year during the week to Wednesday, with 1.1 billion dollars in net outflows from specialized equity funds, specifies BofA, citing data from EPFR .
At the same time, investors withdrew $11.4 billion from bond funds, which have posted six consecutive weeks of net outflows. Funds specializing in corporate bonds classified in the “investment grade” category posted 11.6 billion outflows.
At the same time, those specializing in US government bonds, considered safe havens, benefited from their largest inflows since March 2020 with an inflow of $11.5 billion.
BofA also notes that equity funds from emerging countries now show seven consecutive weeks of net outflows, a series that reaches 13 weeks for European equity funds.
(Report Julien Ponthus, French version Marc Angrand, edited by Jean-Michel Bélot)
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