Bank of America Clients Pull $6.9B from U.S. Stocks Despite S&P 500 Rally

Bank of America Securities reports that its clients pulled $6.9 billion from U.S. equities last week—the largest weekly outflow since August 2023 and the sixth-largest since 2008, even as the S&P 500 rose 1.7% to record highs.

Who's Selling?

• Institutional investors led the exodus, cutting exposure in 8 of the past 9 weeks.

• Hedge funds were net sellers for the third straight week.

• Private clients returned to buying after a brief pause—net buyers in 28 of the past 30 weeks.

💬 “Broad-based sector selling like this hasn't happened since November 2022. Historically, it precedes strong market rebounds,” note BofA strategists Jill Carey Hall and Tyson Dennis-Sharma.

Sector Breakdown

All 11 S&P 500 sectors saw net outflows—a rarity last seen in late 2022.

Heaviest outflows:

• Communication Services

• Technology

• Industrials

Utilities continued their losing streak with seven consecutive weeks of outflows—the most sector-specific selling in H1 2025.

ETFs: Value Rotation Continues

While individual stocks were dumped, ETF flows remained positive, showing a rotation from Growth to Value.

Bought:

• Blend and Value ETFs (5th straight week)

• Energy and Real Estate sector ETFs

• ETFs across all market-cap sizes

Sold:

• Growth ETFs (5th outflow in 7 weeks)

• Technology and Financial sector ETFs

Buybacks Hit 8-Month Low

Corporate share repurchases slowed to the lowest level since October 2023, but BofA expects buybacks to rebound during earnings season over the next 6 weeks.

Takeaway

Despite bullish price action in major indexes, underlying flows signal institutional caution, sector rotation, and a divergence between private vs. institutional sentiment. For contrarian investors, such broad-based selling has historically preceded strong short-term rallies.