Retail Investors Surge Into Stocks With Largest Buy-In in a Decade, Says JPMorgan

Retail investors made a historic move into the stock market on Thursday, purchasing $4.7 billion worth of equities—marking the largest single-day retail inflow in 10 years, according to a report released by JPMorgan on Friday.

This aggressive "buy-the-dip" strategy saw investors piling into major names such as Nvidia, Amazon, and various S&P 500 exchange-traded funds (ETFs). In contrast, Tesla shares were among the most sold, indicating a shift in sentiment around the EV giant.

Among the most favoured areas for individual investors were small-cap technology stocks, even as institutional investors increased short positions in the same sector. This divergence highlights a growing difference in market outlook between retail and professional investors.

The massive surge in buying activity came on the heels of a dramatic 4.9% drop in the S&P 500 index—the steepest single-day decline since June 2020. The selloff was reportedly triggered by new U.S. import tariffs announced by President Donald Trump, reigniting recession fears and sparking volatility across global markets.

JPMorgan noted that this recent retail buying spree sharply contrasts with the panic-driven selloff during the COVID-19 market crash in March 2020. Unlike then, today’s retail investors appear more confident in capitalising on market dips.

Despite Thursday’s enthusiasm, JPMorgan also pointed out that the average retail portfolio remains down 12.9% year-to-date, underperforming the broader S&P 500 index. Additionally, performance on Thursday itself was largely in line with the index's losses, suggesting that while retail interest is high, returns are still catching up.

Key Highlights:

• $4.7 billion in retail stock purchases on Thursday – highest in a decade

• Heavy buying in Nvidia, Amazon, and S&P 500 ETFs

• Tesla shares saw net selling

• Small-cap tech stocks were a top retail pick, despite growing institutional bearishness

• S&P 500 dropped 4.9%, the worst one-day loss since June 2020

• Retail portfolios are down 12.9% YTD, lagging the index

Conclusion:

The surge in retail trading activity underscores a renewed appetite for risk among individual investors, despite growing macroeconomic concerns. With market volatility on the rise, it remains to be seen whether this wave of buying will pay off or lead to further downside exposure.

(Sources: reuters.com)