Investing.com -- Cash drew the bulk of investor interest, while cryptocurrency saw its second-largest weekly inflow on record last week, according to Bank of America (NYSE:BAC).
Money market funds attracted $61.5 billion in the week ending Jan. 22, followed by bonds with $13.4 billion, equities with $5.9 billion, crypto at $4.1 billion, and gold at $500 million.
BofA strategists led by Michael Hartnett said that equity market breadth remains weak but could improve with rising global PMIs and diverging monetary policies, with the Federal Reserve hiking and the rest of the world cutting interest rates.
BofA highlighted the continued dominance of US markets in regional equity flows, which have drawn $1.2 trillion in inflows over the past decade, compared to just $0.2 trillion for the rest of the world.
The bank’s January Global Fund Manager Survey affirmed a continued bias toward "US exceptionalism," with investors holding US equities 1.2 standard deviations overweight relative to a 25-year history.
The most crowded trades remain "long Magnificent 7" tech stocks and "long US dollar." Concerns about tariffs and disorderly bond markets have eased, keeping asset allocation tilted toward risk-on strategies.
For the last week, US equities saw their fourth consecutive inflow at $7 billion, driven by large caps, while emerging markets recorded $3.4 billion in outflows.
Japan attracted $600 million in inflows, and Europe logged its 17th straight week of outflows, totaling $200 million.
In fixed income, investment-grade bonds continued their streak with $6 billion in inflows, marking 65 consecutive weeks of gains.
High-yield bonds rebounded, drawing $900 million—their largest inflow in nine weeks.
Treasury funds extended their run with $1.8 billion in inflows, while emerging market debt faced $600 million in outflows. Bank loan funds also maintained their appeal, with $2 billion in inflows for the week.