The Blubber

Per Yahoo Finance

Retail investors have been busy for the first six weeks of 2023. So far, individual investors have poured a daily average of $1.5 billion into the stock market over this period on ETFs and stocks.

Despite the stock market dropping significantly in 2022, with the S&P 500 dropping by over 18%, per Forbes. Yahoo Finance notes that retail traders were responsible for a rally that closed 10% in January alone, per Vanda Research.

Vanda shared a statement in a recent note, sharing how the purchases of retail investors come shortly before the tax season in the US markets. The note also shared how what will happen to ETF purchases in April.

Vanda: "[The] buying of ETFs and single stocks in April tends to decline in unison. That's because... in April, selling (or rather, less buying) generally occurs across all securities, implying that investors hold back their investments to build cash to pay their tax liabilities."

The firm, however, said that seasonal patterns would suggest that there could be a shift in how retail investors are pouring into the stock market. Vanda expects the deceleration to happen in the weeks ahead.

Vanda: "Should stocks come under pressure on the back of decelerating retail flows in the weeks ahead, capitulation in the less-preferred tech names could help identify an eventual turnaround,"

The Bank of America expects the delay of the US recession to affect the second half of 2023. Economic growth is expected to stay robust, while central banks are still expected to retain their aggressiveness for a longer period.

Klaus Grosby, a Finnish researcher, shares how the US equity market is headed for a collapse in 2052. He published his estimations in a recent paper titled: "Armageddon of Financial Markets: Is the US equity market eventually going to collapse?"

On Jan 31, The Big Short investor Michael Burry reactivated his Twitter accountant and shared a one-word tweet, "sell."

See flow at unusualwhales.com/flow.

Other News:

• Bank of America expects the second half of 2023 to be affected by the delayed US recession
• The US equity market was headed for a collapse in 2052, per a Finnish researcher, Klaus Grosby, published in BI

Resources:

Yahoo Finance