“(The) recent blue wave bullish consensus reflects liquidity addiction, new ‘buy-the-rip’ not ‘buy-the-dip’ mentality, rather than future policy,” Bank of America said in a research note, referring to rising chances of a clean sweep by Democrats in the upcoming U.S. elections.
Bank of America (BofA) analysts, citing data from financial flow tracking firms such as EPFR, said a “chunky” $24 billion was pumped into equity funds in the last four weeks.
A “big” $12.2 billion was invested in investment grade and high-yield bond funds in the week to Wednesday.
Investors have pulled $237 billion from money market funds, the U.S. investment bank said, highlighting a still-high $4.4 trillion held in cash.
Throwing money at everything, BofA said investors also pumped $1.2 billion into gold funds. Mortgage backed securities saw inflows of $1.8 billion.