U.S. equity funds recorded $17.2 billion in net outflows in the week ended July 1, 2026. Bank of America, citing EPFR Global data, said the pullback was the largest weekly outflow since March and ended the market’s multi-month run of positive inflows.
The reversal came quickly. Just one week earlier, some market reports had shown roughly $119 billion in net inflows, making the latest withdrawal a sharp shift in positioning. According to BofA’s client data, institutional investors have now been net sellers for four straight weeks.
Institutional selling centered on individual names
The clearest pressure showed up in single stocks. Net outflows from individual equities reached about $9.9 billion to $10 billion, marking the fourth-largest weekly selling wave since records for the category began in 2008. Retail clients, by contrast, turned into net buyers after six weeks of selling, while hedge funds were also on the buy side, pointing to an active reshuffling of market exposure.
Fund flows also showed a switch in preferred vehicles. While investors were cutting single-stock positions, passive ETFs attracted roughly $4.2 billion in net inflows. That move suggests money managers were reducing concentrated equity risk and leaning more on diversified index products.
Tech and financials faced pressure as money rotated
By sector, technology, financials, and consumer staples saw the heaviest outflows. The report said tech stocks were hit by historic withdrawal pressure, while consumer staples logged record consecutive outflows. At the same time, ETFs tied to small-cap and micro-cap stocks drew record inflows, showing a search for lower-valued areas of the market.
The data also matched Wall Street’s recent discussion around a cooling AI trade. In late June, as megacap tech valuations were pushed to extremes, technology funds started to post record outflows. BofA also noted that its Bull & Bear Indicator is rising, a sign it associates with growing caution as investors head toward an earnings season and labor data releases with the Federal Reserve’s rate-cut path still unclear.