Situation Room Out of bonds, into stocks

Situation Room Out of bonds, into stocks

Out of bonds, into stocks 17 September 2026

Bond funds reported outflows, while stocks reported the largest inflow since June this Credit Strategy past week ending Sep 16th. United States Cross Product Inflows slowed for US HG bond funds and ETFs, with a +$0.42bn inflow down from a Yuri Seliger +$4.74bn inflow in the prior week. Since IG corporates account for about a third of the Credit Strategist high grade universe AUM, that translates into ~$0.1bn demand for IG. Flows turned BofAS negative for HG Funds (to -$2.45bn, the biggest outflow since April 2025, from +$0.46bn), while Inflows slowed for HG ETFs (to +$2.87bn from +$4.28bn). Flows turned Sohyun Marie Lee negative for short-term HG (to -$0.45bn, the biggest outflow since December 2025, Credit Strategist BofAS from +$2.93bn), while inflows moderated ex. short-term (to +$0.87bn from +$1.81bn). Loans > HY Flows turned positive for equities this past week (to +$62.14bn, the biggest inflow in 3 In this report months, from -$4.48bn), while flows turned negative for HY (to -$1.91bn, the biggest outflow in 6 months, from +$0.06bn). Inflows remained lackluster for loans (to +$0.09bn Daily supply snapshot from +$0.17bn), while inflows accelerated for munis (to +$0.74bn from +$0.40bn). On the other hand, flows turned negative for global EM bonds (to -$0.47bn, the biggest Daily dealer inventories update outflow in 3 months, from +$0.34bn). Finally, money markets reported a -$59.50bn Daily HG fund flows outflow this past week (the biggest outflow in 9 weeks), following a -$5.97bn outflow a week earlier. Daily foreign demand tracker

Exhibit 1: Weekly high grade fund flows since 10/2025, $bn HG ETF inflow was +$2.87bn this past week ending Sep-16 (vs +$4.28bn a week prior), and HG Funds inflow was -$2.45bn (vs +$0.46bn a week prior). Since 10/2025, both HG Funds and ETFs, and the 12-week moving average have dipped at the end of 2024 and April 2025. Flows have rebounded since then.

16 11 HG Funds HG ETF 12-week MA (RHS) 10 9

Source: EPFR Global. Note: data are for US-domiciled funds only. BofA GLOBAL RESEARCH

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Exhibit 2: Weekly equity fund flows since 10/2025, $bn Equities inflow was +$62.14bn this past week ending Sep-16 (vs -$4.48bn a week prior). Since Oct 2025, the weekly equity flows and its 12-week moving average accelerated into Dec 2024 and has declined since then.

140 Equities 12-week MA (RHS) 30 120

Source: EPFR Global. Note: data are for US-domiciled funds only. BofA GLOBAL RESEARCH

Exhibit 3: YTD fund flows summary by asset class Exhibit 4: Year to date fund flows, % of AUM As of Sep-16, YtD flows are 7% of AUM for HG, 1% for HY, 7% for loans, All fixed income has had the biggest inflows so far in 2026 as of Sep-16 at and 1% for equities. (7.7% of AUM), followed by High grade: total (7.3%). Last week (% of AUM for YTD (% AUM) weekly YTD (% of All fixed income 7.7% reporting AUM for all High grade: total 7.3% Asset class funds/ETFs) funds/ETFs) YTD ($bn) High grade: total 0.01% 7.3% 374.7 High grade: ex ST 7.3% High grade: ex short-term 0.04% 7.3% 311.1 Munis 7.2% High yield: total -0.57% 1.2% 5.7 Loans 6.9% High yield: ETFs only -1.13% 5.6% 6.6 High yield: ETFs only 5.6% Loans 0.53% 6.9% 12.4 EM 0.41% 3.3% 29.3 EM 3.3% Munis 0.11% 7.2% 79.2 Equities 1.5% All fixed income 0.11% 7.7% 638.5 High yield: total 1.2% Money markets -0.70% 0.9% 74.1 0.9% Money markets Equities 0.33% 1.5% 425.5 Note: Last week flow as % of AUM is based on AUM for weekly reporting funds / ETFs only. YTD 0% 5% 10% flow as % of AUM is based on AUM for the full fund/ ETF universe as of December 31 2020. Global EM funds, US-domiciled funds only for other fund types. Loan results only include Open-End funds Note: Global EM funds, US-domiciled funds only for other fund types. and ETFs which primarily…