JPMorgan: Institutions Set to Sell $165B in Equities in End-of-Q2 Rebalancing

JPMorgan estimates that institutional investors are preparing to sell up to $165 billion in equities and purchase an equivalent amount of bonds during the end-of-Q2 rebalancing period, marking the largest such shift in at least four years.

Key contributors include Japan's GPIF ($1.9 trillion in assets) selling ~$60 billion in equities, Norway's Norges Bank ($2.1 trillion) selling ~$40 billion, US defined benefit pension funds ($9.6 trillion) selling ~$55 billion, and the Swiss National Bank selling ~$25 billion (though this could drop to ~$8 billion if its equity allocation rises to 30% from 28%). On the buying side, balanced mutual funds ($4.0 trillion) are estimated to purchase ~$15 billion in equities.

The rebalancing reflects a broad shift from equities to bonds across major institutional investors, with potential implications for global market liquidity.