Retail traders showed signs of capitulation on Monday, selling $20.6 million of shares. This marked the first day of net single-stock selling since November 2023, according to Vanda Research.
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Trade QQQ with leverageRetail demand has edged lower since the start of the U.S.-Iran war on February 28, with the S&P 500 (SPX) falling by 4% since then. “The trend since the start of March has been one of gradually receding retail participation, alongside systematic deleveraging and only modest buying from long-only and hedge fund investors on the other side,” said Vanda Macro Strategist Ruta Prieskienyte.
Retail Traders Pick Up $262 Million of Shares after Brief Selling Spree
Retail traders have emerged as reliable buyers of downside price action since the bull market began three years ago. A break in the trend could create issues for the benchmark index as traders assess the impact of the U.S.-Iran war.
However, the selling didn’t last long, as retail traders purchased $262.3 million worth of shares on Tuesday from the market open to 12:50 p.m. Eastern Time. The group purchased a record amount of shares last year, exceeding the previous record set in 2021 by 17%.