The US stock market was expected to record double-digit growth for the third year in a row, but the market stagnated this week as the Fed's hawks became more assertive.

Bank of America Corporation reported a net outflow of global equity funds this week for the first time since 2021 because of pessimism about US President Joe Biden's spending plans, according to a routine report released on Friday et. Much of the outflow has been diverted to cash, government bonds and gold.

Global equity funds outflowed $24.2 billion, the largest outflow since March 2020, according to EPFR, while the US stock market had a net outflow of $28.6 billion as of Sept. 22, compared with a net inflow of + $45 billion last week, the largest outflow since February 2018.

By region:

Us: largest outflow since February 18 ($28.6 billion)
Japan: largest inflow in eight weeks ($500 million)
Europe: largest outflow since December 20 ($1.8 billion)
Emerging markets: capital inflows in the past seven weeks ($2.6 billion)

In terms of style:

Capital outflows are mainly concentrated in US small cap stocks (US $2.9 billion), US value stocks (US $3.3 billion), US growth stocks (US $9.8 billion) and US large cap stocks (US $14.2 billion).

By industry:

Capital outflows are concentrated in energy (US $200m), real estate (US $200m), materials (US $12 million), coms svs (US $100m), utilities (US $200m), hcare (US $100m), finance (US $500m), consumers (US $1 billion) and technology (US $1.2 billion).

According to BofA, a key driver of the outflow was pessimism about the settlement of $1,000bn of BIB (bipartisan infrastructure bill Bipartisan Infrastructure Bill) and $3.5 trillion of BBB (better reconstruction programme Build Back Better), which led to the second-largest outflow of infrastructure funds in history and the largest outflow of consumer funds so far this year.

Recently, there has been growing concern that the Fed's gradual withdrawal of economic stimulus during the epidemic will hit the market. BofA strategists point out that global central banks will inject only $100m of liquidity into the market in the second half of 2022, well below the $3.1 trillion injected this year.

At the same time, BofA analysts also pointed out that despite large capital inflows in 2021, the New York Stock Exchange (US stocks, ADR, bond ETF), weighting indices such as the S & P 500 and a wide range of global indices such as ACWI (excluding the US) have been holding high over the past six months.

According to Zero Hedge, net sales of benchmark products in global emerging markets are offset by net inflows of products from specific countries. By industry, the largest net outflow (by the size of assets under management) comes from industry. Inflows into fixed income products have also cooled slightly (though still positive), while foreign exchange flows to the renminbi.