Bank of America: The Overbought U.S. Stock Market May Remain Overbought

According to a report by Jinse Finance, in terms of capital flows, U.S. equity funds have seen their largest weekly net inflow in eight months. Data provided to Yicai by the London Stock Exchange Group (LSEG) shows that U.S. stock funds recorded a net inflow of $31.6 billion over the past week. Despite the so-called "reciprocal tariffs" 90-day deadline approaching and relatively limited progress in trade negotiations, U.S. stocks have reached record highs, driven by optimism around artificial intelligence and expectations of a more accommodative Federal Reserve. Amid this heated market environment, Bank of America is seeking to cool investor enthusiasm. The bank’s star strategist, Michael Hartnett, stated that if the S&P 500 surpasses 6,300 points in July, it could trigger a "sell signal." "An already overbought market can remain overbought, as greed is harder to conquer than fear," Hartnett wrote in his report. He described the market outlook as "bubble or bust," and believes that with the House passing the $3.4 trillion "Big and Beautiful" bill, the risk of a bubble in U.S. stocks will rise this summer.