News
A trading rule measuring stock flows is about to trigger a sell signal
Published
5 months agoon
By
admin
Things may be getting dicey for the stock market. Bank of America chief investment strategist Michael Hartnett pointed out that inflows into global equities and high-yield bonds over the past four weeks make up 0.9% of assets under management for the company’s clients. That’s dangerously close to triggering a contrarian sell signal. “When inflows to global equities & high yield bonds > 1.0% of AUM in 4 weeks … sell,” he said in his weekly Flow Show note to clients. He noted that the signal will flash “if global equity fund inflows > $20bn and HY bond inflows > $1.5bn next week.” The major averages have had a record-setting week. The S & P 500 this week topped 6,700 for the first time. The Nasdaq Composite is 0.7% away from reaching 23,000 through Thursday’s close. The Dow Jones Industrial Average set an all-time closing high of 46,519.72. .SPX YTD mountain SPX year to date That said, with investors piling into risky assets such as stocks and high-yield bonds, it may be a sign that equities are due for a pullback. On top of that, another potential sell signal is close to being flashed. The S & P 500’s relative strength index is sitting at 69 as of Thursday’s close. When an asset or index reaches an RSI of 70 or greater, it enters oversold territory, signaling investors it may be due for a pullback. To be sure, investors and traders still see reasons to stay long equities. “The market from a valuation standpoint is expensive, but the market has double-digit earnings growth, free cash flow growth of mid teens … companies are buying back a ton of stock, you have margin expansion,” said Thorne Perkin, president of Papamarkou Wellner Perkin. “I think you’re going to see the market tick up into the end of the year.” Gregory Faranello, head of U.S. rates strategy at AmeriVet Securities, also pointed out that volatility across asset classes has “come down a lot” from the beginning of the year, “which is constructive for equities.” “But with markets at these levels, you do start to get a little nervous,” he said. ( Learn the best 2026 strategies from inside the NYSE with Josh Brown and others at CNBC PRO Live. Tickets and info here . )
This industrial giant is emerging as a big AI play, says Wells Fargo
Novo Nordisk’s strategy tested as investors push back on board revamp
Alibaba plans AI subscriptions, stablecoin-like payments with JPMorgan
In the age of AI, CEOs quietly signal that layoffs are a badge of honor
UK borrowing costs spike on report government to scrap plans to raise income tax
Trump’s threatened the BBC with a $1B lawsuit: Here’s what’s going on
Wells Fargo sees Caterpillar continuing to roar higher, emerging as an artificial intelligence play. The bank initiated shares of...
Flags with the logos of Danish drugmaker Novo Nordisk, maker of the blockbuster diabetes and weight-loss treatments Ozempic...
Key Points Alibaba plans to use “tokenization” of payments for cross-border transactions in its business-to-business arm. Kuo Zhang, president...
Rachel Reeves, U.K. chancellor of the exchequer, delivers a speech in London, UK, on Tuesday, Nov. 4, 2025. Bloomberg...
US President Donald Trump speaks to reporters as he arrives at Palm Beach International Airport on Oct. 31,...
Investors looking for global diversification opportunities should look to a specific subset of stocks in Europe, according to UBS...
Eakarat Buanoi | Istock | Getty Images LISBON, Portugal — Top tech executives told CNBC they’re concerned about...
Tan Su Shan, deputy chief executive officer and managing director of institutional banking at DBS Group Holdings Ltd., speaks during...
CHENGDU, CHINA – OCTOBER 18: People walk past the Louis Vuitton store at Taikoo Li, a high-end shopping area that...
The United States said Thursday it will remove tariffs on some foods and other imports from Argentina, Ecuador, Guatemala and...
