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'Blockbuster!' Investors Pour $24 Billion Into Stock Funds i

'Blockbuster!' Investors Pour $24 Billion Into Stock Funds i
(Anthony Furgison/Dreamstime)

By    |   Friday, 12 January 2018 03:06 PM

Stock funds reportedly raked in $24 billion in the first week of 2018, the sixth-biggest inflow ever and the most in at least six months.

Stock-based funds raked in $24.4 billion for the week through Wednesday, a total that Bank of America Merrill Lynch's Michael Hartnett called "blockbuster," CNBC reported.

"The bull capitulation begins," Hartnett, chief investment strategist at Bank of America, said in his weekly fund flow roundup.

The total was spread around geographically, with $6.4 billion to the U.S. and $4.3 billion to emerging markets.

Big inflows of cash often trigger market tops, though strategist Art Hogan said the early-year run could be just seasonality.

"I think it's more of a seasonal trend than it is that sort of euphoria or concern that you're seeing the wrong money coming in at the wrong time," said Hogan, chief market strategist at B. Riley FBR. "I'd wait until the seasonality flattens out before you jump to a conclusion that you've got money crashing into the markets at the highs."

Meanwhile, more than $2.6 billion flowed into high-yield bond funds during the week ended Jan. 10, according to Lipper Fund Flows data released Thursday, as investors looked to get a piece of a junk-debt rally already blowing through year-end forecasts.

The inflows, which were the sector’s highest since December 2016, according to data compiled by Bloomberg, come as junk spreads narrowed to the tightest since 2007. They’ve been spurred by a growing economy, easy credit conditions for troubled companies and investors seeking higher payouts in a low-rate environment.

“Even with the specter of rate rises this year, income is still a scarce commodity, so we continue to see inflows into credit,” said Robert Arnold, a New York-based portfolio manager at Twentyfour Asset Management.

(Newsmax wire services contributed to this report).

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‘Blockbuster!’ Investors Pour $24 Billion Into Stock Funds in Year’s First Week
investors, billion, stock, funds
Friday, 12 January 2018 03:06 PM
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