A trader works on the floor of the New York Stock Exchange (NYSE) in New York, the United States, on March 5, 2020. REUTERS / Andrew Kelly
LONDON (Reuters) – Investors pulled out of most asset classes, with stocks and bond funds recording a combined total of $ 36 billion in cash outflows during the week of Wednesday, BofA said amid fears of economic damage linked to the coronavirus epidemic.
The stock markets have been selling since mid-February, wiping out around $ 6.5 trillion in market value, with the number of coronavirus cases increasing.
BofA analysts, analyzing weekly data from EPFR flow tracking specialist, said $ 23.3 billion had been withdrawn from equity funds and $ 12.6 billion had left bond funds, the most since December 2018.
The data also showed that risk-averse investors pulled $ 5.3 billion of emerging market stocks, the most in 30 weeks.
Investment-grade, high-yield, and emerging-market stocks have had the biggest draw since the “ taper carum ” of 2013 – the first U.S. Federal Reserve index would reduce a stimulus package introduced during the financial crisis.
Meanwhile, Deutsche Bank said it was “far too early” to declare the stock market liquidation complete. It expects the S&P 500 to drop 15% to 20% from its last peak.
The benchmark for US stocks has so far dropped 10.7% to 3,023.94 points from the record highs it reached on February 19. Deutsche Bank sees the index hit a “sometime” low in the second quarter and recover to 3,250 points by the end of the year.
Thyagaraju Adinarayan report; edited by Larry King
