In a note on Friday, the Bank of America Corp (NYSE: BAC) said that money market funds have witnessed a deluge of more than half a trillion dollars’ worth of capital.
According to the note, money market funds have attracted $756 billion in investments this year amid the banking crisis and the Federal Reserve’s rate hikes, Reuters reported.
The bank said that the flow of capital into money market funds is coming close to a level last seen approximately three years ago when investors panicked and redirected $917 billion into cash funds amid the COVID-19 pandemic.
The downfall of several U.S. banks this year has prompted a significant number of individuals and businesses to withdraw their money from bank deposits and invest in money market funds.
Additionally, the bank revealed that tech stocks continued to maintain appeal, with a steady inflow of $500 million into tech stock funds for the sixth consecutive week.
Last month, Bank of America’s chief investment strategist Michael Hartnett said in a note that the stock market could witness a significant sell-off event in the coming weeks, Bloomberg reported.
Referring to data from the financial analytics firm EPFR, the bank disclosed that stocks experienced their third consecutive week of outflows, amounting to $3.9 billion.
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