Clients of Bank of America were buyers of stocks for the second consecutive week last week, although while the over trend was net buying, some sectors saw heavy selling.

Interesting, the sectors that are most likely to benefit from tax reform saw the most selling. As BoA reports:

“Clients sold single stocks across nine of the 11 sectors last week, led by Discretionary and Industrials (two of the biggest potential beneficiaries of corporate tax reform). Net sales of both sectors were near record levels (11th- and 14th-largest in our data history, respectively). Net sales of Telecom stocks – another tax reform beneficiary – were also elevated (18th-largest in our data history).”

Still, overall the trend was positive with ETF net buys hit the most substantial reported level this year.

ETF Net Buys Hit Record On Tax Reform Hopes

Indeed, according to BoA’s data, clients purchased a net $1.3 billion of stocks last week with ETFs net buys surging to the highest level since January and hitting the third highest level in BoA’s data set. Interestingly, as ETF buys surged, single stock sales also spiked to near a two-standard-deviation vs. the mean. For the year as a whole, retail investors have acquired a net $7.9 billion of equities including ETFs. Excluding ETF buying, clients have sold around $38 billion of stocks year-to-date.

ETF net buys hit a record

Taking the other side of the trade is both corporates and hedge funds. According to BoA, corporate buybacks remained strong (double the avg. weekly Dec. level), led by record Financials buybacks. Meanwhile, Hedge Funds were net buyers for the third week (with net buys by this group at a nine-month high), while private clients were buyers for the first time in six weeks.

Here is a breakdown of the ETF flows reported:

“Clients bought equity ETFs for the fifth consecutive week, where equity ETF net buys were their largest this year. Net buying was chiefly in large cap/Blend ETFs, while both Growth and Value ETFs continued to see inflows for the fifth straight week (with larger but slowing net buys of Value ETFs vs. smaller but accelerating Growth ETF net buys). Clients bought ETFs in seven of the 11 sectors, led by Financials and Materials. Energy ETFs now have the longest buying streak (for eight weeks), followed by Financials (for five weeks).”