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☆ Fading risks, fear of missing out may fuel US stocks after near 20% rally
▼ + stars: | 2023-06-08 | by ( Lewis Krauskopf | ) www.reuters.com time to read: +5 min

"Further strength might beget further strength because of the FOMO factor," he added, using the popular acronym for "fear of missing out." "Inflation has clearly subsided, and yet labor market strength has remained intact," wrote BMO Capital Markets chief investment strategist Brian Belski in a recent note. “Moving past the debt ceiling and at least having some economic data that looks ok is actually enough to get some people interested,” said Keith Lerner, co-chief investment officer at Truist Advisory Services. Lerner on Monday shifted his expected S&P 500 range for this year up to 3,800-4,500, from 3,400-4,300 previously, citing improving earnings trends among other factors. For Hans Olsen, chief investment officer at Fiduciary Trust Co, that’s an ominous sign.

Persons: Cash, Chuck Carlson, Brian Belski, BofA, ”, Keith Lerner, Lerner, Monday, John Lynch, Hans Olsen, Olsen, Lewis Krauskopf, Ira Iosebashvili, Diane Craft Organizations: YORK, BofA Global, Deutsche Bank, Horizon Investment Services, BMO Capital Markets, ” BMO, Reuters Graphics, ISI, Advisory, Comerica Wealth Management, Microsoft, Nvidia, Reuters, Thomson

☆ Dollar bears bide their time as US economic strength persists
▼ + stars: | 2023-06-05 | by ( Saqib Iqbal Ahmed | ) www.reuters.com time to read: +5 min

Fund managers in the latest BofA Global Research survey named shorting the dollar as the market's third "most crowded" trade. The dollar is "in a very messy transition from bull market to a bear market," said Aaron Hurd, senior portfolio manager, currency, at State Street Global Advisors. Hurd expects the dollar to remain buoyant over the very short term, but decline steadily over the next few years. Most investors believe the dollar will likely remain elevated until U.S. data turns decidedly weaker, allowing the Fed to cut rates. "The dollar strength is entirely related to the fact that U.S. data is actually pretty good," said Alvise Marino, a strategist at Credit Suisse.

Persons: Aaron Hurd, Hurd, Alvise Marino, Bipan Rai, Christine Lagarde, Brian Rose, Saqib Iqbal Ahmed, Ira Iosebashvili, Leslie Adler Organizations: YORK, Futures Trading Commission, Fund, Research, Street Global Advisors, Bears, Federal Reserve, Fed, Traders, Credit Suisse, Reuters, U.S . Treasury, CIBC, UBS Global Wealth Management, European Central Bank, ECB, Thomson Locations: U.S, North America, Europe

☆ Commercial real estate has taken a beating. But recovery may be slow for one big reason.
▼ + stars: | 2023-06-05 | by ( Al Yoon | ) www.businessinsider.com time to read: +4 min

Investment volume in commercial real estate fell off a cliff last quarter. But with few transactions on which to peg market values, is the market truly down? Last week, Alfred Brooks, the head of JPMorgan's commercial real estate group, said he's seen distressed buyers already raising money to pick up the pieces, once prices get low enough. Indeed, commercial real estate values are down, by other measures. April was the first month since 2010 that prices of all types of commercial property fell on an annual basis, according to MSCI.

Persons: haven't, —, dealmaking, It's, Alfred Brooks, he's, Richard Rubin, Insider's Alex Nicoll, Rubin, Blackstone, MSCI Organizations: Bank of America, Service, BofA Global Research, RCA, BofA Global

☆ Wall St Week Ahead: Surging US megacap stocks leave some wondering when to cash out
▼ + stars: | 2023-06-02 | by ( Lewis Krauskopf | ) www.reuters.com time to read: +5 min

The benchmark S&P 500 (.SPX) has risen 11.5% this year and stands at a 10-month high. The S&P 500 rose 1.45%. The recent surge in Nvidia showed how a stock can keep climbing even after posting hefty gains. At the same time, only 20.3% of S&P 500 stocks have outperformed the index on a rolling three-month basis, a record low dating back five decades, according to Ned Davis. Kotok views narrowing breadth as an ominous sign for the broader stock market, saying that equities also look less favorable in certain asset valuation metrics.

Persons: Ned Davis, Peter Tuz, Jay Hatfield, ” Hatfield, “, Brendan McDermid Michael Purves, Purves, Kevin Mahn, Refinitiv, ”, Mahn, Dow, David Kotok, Lewis Krauskopf, Ira Iosebashvili, Nick Zieminski, Diane Craft Organizations: YORK, BofA Global Research, Ned Davis Research, Chase Investment, Nvidia, Apple, Microsoft, Google, Federal Reserve, New York Stock Exchange, REUTERS, Tallbacken Capital Advisors, Nasdaq, Hennion, Walsh Asset Management, Dow Jones, Cumberland Advisors, Thomson Locations: megacap, BofA, New York City, U.S

☆ Tech shares see biggest-ever weekly inflow on AI boom-BofA
▼ + stars: | 2023-06-02 | by ( ) www.reuters.com time to read: +2 min

Stocks in general saw $14.8 billion of inflows, the largest weekly inflow since February. Investors are chasing a "summer rip tide into tech and stocks", BofA analysts wrote in a note, which referred to an AI "baby bubble", though they said they themselves remain bearish due to the impact of higher interest rates causing liquidity to tighten. Cash funds, normally in demand when investors are nervous, also saw inflows of $11.3 billion, their sixth straight week of inflows, while gold funds saw $200 million of outflows, according to BofA. They describe the trade as: "Buy HSI sell AI". Reporting by Alun John; Editing by Amanda Cooper and David HolmesOur Standards: The Thomson Reuters Trust Principles.

Persons: BoFa, Stocks, Cash, BofA, Alun John, Amanda Cooper, David Holmes Organizations: Technology, BofA Global, Tech, Nasdaq, Nvidia, Microsoft, Google, Meta, Hang Seng Tech, Thomson Locations: China

☆ Wall St Week Ahead Surging US megacap stocks leave some wondering when to cash out
▼ + stars: | 2023-06-02 | by ( Lewis Krauskopf | ) www.reuters.com time to read: +5 min

The benchmark S&P 500 (.SPX) has risen 11% this year and stands at a 10-month high. He is overweight megacaps, including Nvidia, Microsoft and Google-parent Alphabet (GOOGL.O). The recent surge in Nvidia showed how a stock can keep climbing even after posting hefty gains. At the same time, only 20.3% of S&P 500 stocks have outperformed the index on a rolling three-month basis, a record low dating back five decades, according to Ned Davis. In one commonly used valuation metric, the S&P 500 is trading at 18.5 times forward earnings estimates compared to its historic average of 15.6 times, according to Refinitiv Datastream.

Persons: Ned Davis, Peter Tuz, Jay Hatfield, ” Hatfield, “, Michael Purves, Purves, Kevin Mahn, Refinitiv, ”, Mahn, Dow, David Kotok, Lewis Krauskopf, Ira Iosebashvili, Nick Zieminski Organizations: YORK, BofA Global Research, Ned Davis Research, Chase Investment, Nvidia, Apple, Microsoft, Google, Tallbacken Capital Advisors, Nasdaq, Hennion, Walsh Asset Management, Dow Jones, Cumberland Advisors, Thomson Locations: megacap, BofA

☆ Wall St Week Ahead Artificial intelligence gives real boost to U.S. stock market
▼ + stars: | 2023-05-19 | by ( Lewis Krauskopf | ) www.reuters.com time to read: +4 min

NEW YORK, May 19 (Reuters) - Recent advances in artificial intelligence are fueling optimism over how businesses can operate more productively in the years ahead. They are also providing a big boost to the stock market. About 25% to 50% of those gains are owed to "the buzz around artificial intelligence," she noted. Indeed, optimism over AI is a key factor supporting a stock market facing numerous headwinds. His firm owns shares of Microsoft, Nvidia and Alphabet.

☆ Investors still pouring into cash, but pace slows - BofA
▼ + stars: | 2023-05-19 | by ( Lucy Raitano | ) www.reuters.com time to read: +2 min

LONDON, May 19 (Reuters) - Investors pumped $25.1 billion into cash in the week to Wednesday, but the flow into cash funds has slowed recently, reflecting a greater degree of investor confidence, according to a report from BofA Global Research on Friday. Meanwhile, investors bought $5.6 billion of bonds and pulled $7.7 billion from equity funds in the week to May 17. The report also showed U.S. Treasuries clocking up 14 straight weeks of inflows, with investors buying $4.3 billion in the week to May 17. A total of $1.1 billion went into tech stocks, marking a fifth week of inflows, as investors chose growth names over value. Investors took $700 million out of financial funds, while real estate investment trusts saw their largest outflows since November 2022, totaling $600 million.

☆ Analysis: US debt ceiling deal could stall safety flight fueling megacap rally
▼ + stars: | 2023-05-19 | by ( David Randall | ) www.reuters.com time to read: +5 min

Their rally has been responsible for all of the 8.3% year-to-date gain in the S&P 500 (.SPX) through Wednesday's close, a Deutsche Bank report showed. A recent survey of global fund managers from BofA Global Research showed that 71% believe a deal to raise the debt ceiling will be reached before the X-date. Excitement over artificial intelligence, which has boosted some megacap names this year, is another factor that could support the category. At the same time, the debt ceiling has been only one of of several worries weighing on the market. Paul Christopher, head of global market strategy at Wells Fargo Investment Institute, expects lawmakers will reach an agreement to extend the debt ceiling through September.

☆ Wall St Week Ahead US. consumer price data to test feared stagflation scenario
▼ + stars: | 2023-05-05 | by ( David Randall | ) www.reuters.com time to read: +5 min

Some also believe the recent banking sector tumult will hurt lending and further constrain growth, forcing the Fed to cut rates before inflation is tamed. April’s survey of global fund managers from BoFA Global Research showed stagflation expectations near historical highs, with 86% saying it will be part of the macroeconomic backdrop in 2024. Next week’s consumer price data for April, due on Wednesday, May 10, could offer a clearer picture of whether the Fed’s interest rate increases are cooling inflation. Charlie McElligott, managing director of cross-asset macro strategy at Nomura Securities, pointed to the Atlanta Fed's GDPNow estimate, which is projecting a 2.7% growth rate in the second quarter, up from 1.8% on May 1. At the same time, expectations that the Fed is unlikely to raise rates much higher has created a better backdrop for investors, he said.

☆ Bank of America details 3 retail stocks that have more than 20% upside as they benefit from mass closures of Bed Bath & Beyond stores
▼ + stars: | 2023-05-04 | by ( Laila Maidan | ) www.businessinsider.com time to read: +3 min

Bed Bath & Beyond is closing hundreds of stores this year after filing for bankruptcy. Another 360 Bed Bath & Beyond locations and 120 buybuy Baby locations are set to shutter their doors by the end of June. BoA expects these hot spots to be gobbled up by off-price retailers that have near-term plans to expand. TJX's HomeGoods subsidiary is a runner-up, with only 38% of BBBY stores being within a one-mile radius and 52% within two miles. Off-price retailers' store proximity to Bed Bath & Beyond store locations.

☆ Point72 and Citadel outpaced rival hedge funds in April. Here's how Millennium, D.E. Shaw, and other multi-strats are faring this year.
▼ + stars: | 2023-05-04 | by ( Alex Morrell | ) www.businessinsider.com time to read: +1 min

Point72 led multi-strategy hedge funds in April with a gain of 1.58%. Citadel was up 1.11% and leads peers year-to-date with a gain of 5.37%. Point72 had the best month among multi-strategy hedge funds, up 1.58% in April and 4.63% for the year. Citadel continues its hot streak with a 1.11% return in April and leads among peers year-to-date, up 5.37%. Fund April performance Year-to-date performance Point72 1.58% 4.63% Citadel 1.11% 5.37% D. E. Shaw (as of 4/21) 0.60% 1.90% Balyasny 0.82% 1.32% ExodusPoint (0.10) 0.80% Millennium Flat 0.50% Schonfeld 0.30% 0.20%April saw a reversal of sorts among hedge fund strategies.

☆ Investors pile into cash, but snap up Chinese stocks in tricky markets
▼ + stars: | 2023-04-28 | by ( ) www.reuters.com time to read: +2 min

LONDON, April 28 (Reuters) - Uncertainty over the economic outlook and the banking sector prompted investors to move money back into cash and gold in the week to Wednesday, according to BofA Global Research. But the current environment is tricky to trade, as evidenced by a push into perceived risky assets such as tech stocks and the largest inflows into Chinese equities in well over a year, BofA's note, which cited data from EPFR, said on Friday. There were $52.3 billion of inflows to cash funds in the week, a resumption of inflows after one-off outflows a week earlier, and also $200 million of inflows to gold. There have been $634 billion of inflows into cash in the year to date compared to $11 billion for the whole of 2022. Meanwhile, in the week to Wedensday there were $6.1 billion of inflows to Chinese equity funds, the most since January 2022, and $1.2 billion of inflows to tech funds, the most since November 2022.

☆ Banks aren't the only ones that hold risky commercial-real-estate debt. Pension funds are about to feel the pain, too.
▼ + stars: | 2023-04-24 | by ( Al Yoon | ) www.businessinsider.com time to read: +4 min

Pension funds, REITs, and insurers hold more than $1.2 trillion in commercial-real-estate debt. CalSTRS, a California pension fund, told the FT it will be writing down its real-estate portfolio. Among them are the large pension funds, REITs, and insurance companies, together accounting for more than $1.2 trillion — or 22% — of the $5.62 trillion in total commercial-real-estate debt outstanding, according to BofA Global Research. Some pension funds were already planning to reduce their exposures to commercial real estate even before the recent bank failures magnified the risks. In September, fund managers at Artemis Real Estate Partners and PGIM Real Estate said at a Bisnow conference that their investors indicated they'd be reducing allocations to real estate, just because the assets had been outperforming others.

☆ Investors cut cash holdings as market focus shifts to inflation
▼ + stars: | 2023-04-21 | by ( Lucy Raitano | ) www.reuters.com time to read: +1 min

Market focus has shifted to inflation and the outlook for monetary tightening in recent weeks as fears around banking stocks receded and a market measure of volatility (.VIX) fell to its lowest level since November 2021. Cash funds saw outflows of $65.3 billion, BofA said, citing EPFR data. Bond funds recorded inflows of $4.6 billion, while investors sold $2.6 billion of global stocks and pulled $70 million out of gold funds. Last week data showed U.S. consumer prices rising in March, while data this week showed signs of the labor market cooling. "Core inflation in big economies remains stubbornly high," the BofA analysts said, adding that inflation is being aided by structurally low unemployment rates.

☆ Investors cut cash holdings for first time in eight weeks-BofA
▼ + stars: | 2023-04-21 | by ( ) www.reuters.com time to read: 1 min

LONDON, April 21 (Reuters) - Investors cut their cash holdings for the first time in eight weeks, while shedding equities and gold in the week to Wednesday, according to a report from BofA Global Research on Friday. Cash funds saw outflows of $65.3 billion, BofA said, citing EPFR data. Bond funds, meanwhile, recorded inflows of $4.6 billion, while investors sold $2.6 billion of global stocks and pulled $70 million out of gold funds. Emerging market debt funds saw their first weekly inflow in 10 weeks of $600 million. Investors put $2.3 billion into emerging markets equities, the biggest inflow in four weeks.

☆ Wall St Week Ahead- Tech earnings to test markets' 'most crowded' trade
▼ + stars: | 2023-04-21 | by ( David Randall | ) www.reuters.com time to read: +4 min

NEW YORK, April 21 (Reuters) - A blistering rally in megacap growth and technology shares has buoyed markets this year, and earnings reports in coming weeks could help investors determine if those gains are justified. Technology earnings are seen falling 14.4%. Earnings will show "whether this is really a safe haven if you are worried about recession." Still, gains could fizzle if the Fed does not cut interest rates this year, as widely expected. Growth stocks are especially vulnerable to high borrowing costs, which threaten to erode the value of their longer-term cash flows.

☆ Landlords pumped billions into apartment buildings during the pandemic. That bet could now go horribly wrong.
▼ + stars: | 2023-04-16 | by ( Daniel Geiger | ) www.businessinsider.com time to read: +4 min

Big money investors pumped billions into buying up apartment buildings in the pandemic era. But fault lines have emerged for investors who paid top dollar for assets that depended on substantial rent increases and persistent low interest rates to achieve profitability. In those years, investors purchased $355.5 billion and $299.2 billion worth of apartment buildings, according to MSCI — unprecedented sums that far surpassed the previous $194 billion record of multifamily sales in 2019. "It's early, but it's going to become a bigger story, especially if interest rates stay high and lending standards are tight," said Alan Todd, the head of commercial-mortgage-backed-securities strategy at BofA Global Research. As these short-term debts come due, they will be difficult to swap with commensurately sized loans today, because of the falling values, higher interest rates, and lender caution.

☆ Some new offices are mini towns with their own restaurants, doctor offices, and hotels. Workers actually want to go.
▼ + stars: | 2023-04-13 | by ( Alex Nicoll | ) www.businessinsider.com time to read: +9 min

The idea is getting replicated from the Bell Labs location, or Bell Works New Jersey, Keating said. The spaces run by Bell Works' own coworking brand, CoLab, are nearly 100% occupied. At Bell Works New Jersey, Zucker partnered with Toll Brothers to build a 185-home 55-and-over community. At BRIC, tenants can take advantage of a dozen art galleries, some of which show the work of building tenants. A lobby area near offices at Bell Works Chicagoland.

☆ Goldman Sachs no longer expects Fed rate hike in June
▼ + stars: | 2023-04-12 | by ( ) www.reuters.com time to read: +2 min

April 12 (Reuters) - Economists at Goldman Sachs (GS.N) no longer expect the U.S. Federal Reserve to raise interest rates in June, according to a research note published on Wednesday following data that showed consumer prices cooled faster than expected in March. Goldman Sachs had previously expected consecutive rate hikes at the Fed's May and June meetings. Economists led by Jan Hatzius said in the research note they still expect a rate hike in May. CME interest rates futures were little changed following Wednesday's inflation report and continued to imply traders mostly expect a 25 basis point rate hike in May, no rate hike in June and a significant chance of a rate cut in July. In another client note, BofA Global Research said the March inflation data likely keeps the U.S. central bank on track for a May rate hike.

☆ Landlords who bought thousands of apartments are facing a reckoning
▼ + stars: | 2023-04-11 | by ( Daniel Geiger | ) www.businessinsider.com time to read: +9 min

Investors showed outsize interest in apartment buildings during the pandemic. Rents and occupancy rates were rising, interest rates remained relatively low, and rental-property prices were climbing with no sign of letting up during a surge in housing demand. Laguna Point did not respond to a request for comment. Marc McDevitt, a senior managing director at Cred iQ, said it was possible Laguna Point had lost some, or even all, of its investment in the deal. While offices have been going through a paradigmatic shift as more workers do their jobs remotely, apartment buildings have experienced robust demand from tenants.

☆ BofA sees 'meaningful risks' of Q2 U.S. economic contraction
▼ + stars: | 2023-04-10 | by ( ) www.reuters.com time to read: 1 min

April 10 (Reuters) - The U.S. economy is at risk of shrinking in the second quarter, BofA Global Research wrote in a client note, following recent economic data that hinted that the Federal Reserve's aggressive interest rate hikes were cooling the economy. "This week's data flow is consistent with our view that the U.S. economy slowed steadily over the course of 1Q 2023," BofA economists wrote in a note dated Friday and emailed Monday. We see meaningful risks of a contraction in GDP in 2Q." BofA pointed to data from April 3 showing U.S. manufacturing activity slumped in March to the lowest level in nearly three years as new orders plunged. Reporting by Reuters markets team; Editing by Mark PorterOur Standards: The Thomson Reuters Trust Principles.

The ADP National Employment report showed U.S. private employment rose by 145,000 jobs last month, compared with economists' projections of an increase of 200,000 jobs, adding to recent signs of a cooling labor market. With growing concerns about a worsening economic outlook following the recent turmoil in the banking sector, market expectations have shifted in favor of the U.S. central bank hitting the brakes on its interest rate hikes. "But at the same time, I think investors are closely watching to make sure that we don't fall into a deep recession." Traders' bets of a pause by the Fed in May shot up to 62.2%, while odds of a 25-basis point interest rate hike fell to 37.8%, according to CME Group's Fedwatch tool. All eyes are now on the non-farm payrolls data for March, a more comprehensive employment report, that is due on Friday for more conclusive clues on the state of the labor market.

☆ Here are Monday's biggest analyst calls: Apple, Amazon, Tesla, Macy's, Netflix, Sunnova, Intel & more
▼ + stars: | 2023-04-03 | by ( Michael Bloom | ) www.cnbc.com time to read: +7 min

Morgan Stanley initiates Sunnova as overweight Morgan Stanley said it sees 124% upside for the solar company. " Morgan Stanley downgrades First Solar to underweight from equal weight Morgan Stanley downgraded the stock mainly on valuation. Bank of America adds Lowe's to the US 1 list Bank of America added the home improvement giant to its top ideas list. Bank of America names Netflix a top second-quarter pick Bank of America said it's bullish on the streaming giant as the second quarter begins. Morgan Stanley downgrades Marqeta to equal weight from overweight Morgan Stanley said in its downgrade of the card payment and solutions company that it sees too many negative catalysts. "

☆ BofA reports inflows into global stocks are on a record-setting pace — and ETFs may be a way to play the hot trade
▼ + stars: | 2023-04-01 | by ( Sean Conlon | ) www.cnbc.com time to read: +1 min

There's a corner of the market gaining traction among ETF investors, according to The ETF Store's Nate Geraci. BofA Global Research's latest market data out late this week appears to support Geraci's thesis. Tierney of Schwab Asset Management contends retail investors don't own enough global stocks. "Rebalancing [to international stocks] to get some more exposure could make sense for a lot of investors," said the senior investment portfolio strategist. His firm's Schwab International Equity ETF , which tracks large- and mid-cap companies in over 20 developed global markets, is up 8.1% so far this year.

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