A Most Remarkable Market: In Week The S&P Hit Record High, Everyone Sold

This continues to be truly the most remarkable "market."

Last week, in which the S&P 500 hit new all time highs, BofAML reports that its clients (institutions, hedge funds and private clients) who have sold stocks for all but 2-3 weeks in all of 2016, once again sold $1.9 billion of US stocks, the largest weekly outflow since early June. Net sales were led by institutional clients, which has been true most weeks this year; redemptions from mutual funds amid poor performance is likely one driver here. Private clients were also net sellers (for the fourth week), with sales by this group their largest since early 2014. Hedge funds were small net sellers after buying stocks for the prior seven weeks.

Clients sold stocks across eight of the ten sectors last week, led by sales of Energy stocks as WTI oil fell below $40/bbl for the first time since April.

Maybe it was a surge in buybacks? Nope: "Buybacks by our corporate clients picked up last week, but QTD are tracking at their lowest levels of any comparable period since 2012."

Here is how the buying, pardon selling, by "smart money" looks like both YTD, and since 2008.


Not only did "clients" sell, they sold an almost record amount of energy shares: "Net sales of Energy were the largest since December and the third largest in our data history, led by private clients. Health Care and Financials also saw large outflows last week."

Perhaps the "smart money" finally saw the PE of the energy sector.

 

And the biggest surprise: "Cyclical sectors continue to see bigger outflows than defensive sectors, and Tech has seen the largest outflows quarter-to-date despite reporting better-than-expected results."

From this we can conclude that absolutely everything is now officially upside down: the worst the data, the higher the stocks rise, which in turn leads to even more selling, which result in even higher prices.

Don't try to make any sense of it, just thank the central banks.