BofAML Flow Show: Humpty-Dumpty starts to wobble

•   Risk-off flows: $1.3bn outflow from equities, $3.5bn into bonds, $0.5bn into gold
•   Bull & Bear indicator drops from v bullish 7.7 to 7.2
•   Humpty-Dumpty watch: confidence, spreads, DXY, tech leadership

Risk-off flows: $1.3bn weekly outflow from equities, $3.5bn into bonds, $0.5bn into gold.

HY & EM outflows cause Bull & Bear indicator to drop: biggest HY bond fund outflows in almost six months as spreads jump; first EM equity and debt outflows in almost six months coincide with bounce in oversold USD.

Humpty-Dumpty: more imminent Aug/Sept risk-off trade plausible if poor politics shows up in consumer confidence, US dollar rises despite lower UST yields and further drop in US presidential approval ratings; US high yield credit spreads gap toward 500bps; tech leadership reversal.

18 Aug 2017 - 11:06- EquitiesEconomic Commentary- Source: BofAML

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