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Merrill Lynch: Investors Are Ditching U.S. Stocks

August 29, 2017

Merrill Lynch’s private clients are becoming more defensive as the U.S. equities market continued its longest streak of outflows since 2004, CNBC writes. Nonetheless, while investors are increasingly averse to risk, they have not yet gone to such safe-haven stalwarts as precious metals, according to the news website.

Investors have pulled $30 billion out of U.S. stocks in the 10 weeks ending August 23, despite the S&P 500 reaching a new high August 8, CNBC writes. That marks the longest stretch of outflows since 2004, Merrill Lynch said last week, citing data from EPFR Global. In addition, U.S. Treasury bonds had the largest inflows in 10 weeks, attracting $900 billion, while riskier high-yield bonds had eight weeks out of 10 of withdrawals, Merrill Lynch found.

Investors are becoming more defensive, according to CNBC. The only U.S. equities area to see inflows in the third week ending August 23 was the utilities sector, the news website writes. Merrill Lynch also says its private clients have become more defensive, according to CNBC.

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On the other hand, client allocations to precious metals ETFs remain at the same lows reached last year, according to the report. Instead, investors are flocking to European and Japanese equities, which drew in $36 billion in the 10 weeks in question, CNBC writes.

By Alex Padalka
  • To read the CNBC article cited in this story, click here.