Investors poured nearly $9 billion into US exchange-traded funds on Wednesday, according to the latest FactSet flows data.
The SPDR S&P 500 ETF Trust accounted for more than half of these inflows, bringing in about $4.9 billion, the most since the S&P 500’s last record closing day on January 3. Another $3.2 billion went to the Invesco QQQ Trust to track the 100 largest companies on the Nasdaq Composite, hitting an 11-month high.
The SPDR ETF is down 1.3% on Thursday, bringing its loss so far this year to 12%, while Invesco’s ETF has been essentially flat, leaving 17% in 2022. Stream data for Thursday won’t be available until after the market closes.
So far, streams have not been able to maintain high standards. Both indices were hit hard this week as investors reacted to Russia’s escalation into the conflict in Ukraine, with the S&P 500 sliding into correction territory and the Nasdaq Composite approaching bear market territory.
However, analysts are still calling on investors to boost their exposure to US companies, saying they are in a better position to deal with the spillover economic effects of the Russian incursion.
“While tensions in Ukraine are likely to persist at least in the medium term, we continue to favor domestic stock markets over international ones,” Scott Wren, senior global market analyst at Wells Fargo Investment Institute, wrote to clients on Thursday.
He added that the bank prefers large and medium stocks, with a balance between growth stocks and the more economically sensitive sectors.
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