By Senad Karaahmetovic

Investors are buying US equities again with flows in a week to Wednesday the biggest in the last 10 weeks, according to Bank of America’s top strategist Michael Hartnett.

The outflows from cash were $28.2billion, and $20.6billion was invested in equities. The tech sector saw the fifth week of $1 billion outflows. Similar to the tech sector, it saw an 8th week outflow from financials (1.2 billion), while the biggest inflow was recorded by consumer stocks (5 billion).

“Summer rally bandwagon growing…bears (see plunging BofA B&B Indicator) + “peak” inflation + Fed “pause”; most oversold assets relative to 200DMA, i.e. vulnerable to tradable bounce,” Hartnett said in a client note.

In the meantime, BofA Bull & Bear Indicator is at 0.6, which is yielding an “unambiguous contrarian buy” signal, Hartnett notes.

Recent talks with investors showed that the overall mood is bearish, “so bearish most expecting bear market rally to play the ‘Jackson Hole pivot’.”

According to the strategist, BofA would continue to lose rallies. SPX could reach 4200 at maximum.