Fasten those seatbelts readers. Make sure you have some fresh batteries and your you-know-what is in upright position. From BI: It's been a historic month for fund flows into the
stock markets, and the final week of January was no exception. This week, total flows into equity funds
amounted to $18.8 billion, making it the third-largest week on record.
In a note to clients this morning titled "Sell-Signal
Triggered," BofA Merrill Lynch strategist Michael Hartnett says flow
signals are now pointing to a correction, or a decent-sized sell-off. According to Hartnett, last time this signal
was triggered, in January 2011, an 8 percent correction on the MSCI All World
Country Index (an index of global stocks) followed over the course of February
and March.
Hartnett writes, "On average, a 'sell' signal precedes
a 5 percent correction in global stocks over the subsequent 4-5 weeks."
We've seen a lot of similar calls from other strategists in
recent days. Citi strategists, for example, sees these flows as seasonal, which
indicates to them that a correction is looming
No comments:
Post a Comment