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Illustration: Aïda Amer/Axios

Typically, stocks rise because investors are buying them, increasing prices. But that's not what's happening in 2019.

What's new: U.S. equity prices are soaring to record highs, with the S&P 500 up 17% and the Nasdaq up 21% in just 4 months. But not only are investors not buying, they're selling.

The big picture: Stock funds have seen $4 billion of outflows so far in 2019, surpassing the $2.9 billion of outflows for all of 2018 when the S&P fell by 6%. This year's outflows included a drawdown of nearly $11 billion in just the month of March, according to data from Lipper, which tracks $49.1 trillion in assets globally.

What's happening: The strange phenomenon can partially be explained by investors moving away from traditional mutual funds at a historic pace, particularly in U.S. stock funds.

  • "The negative investor sentiment about domestic equity mutual funds has been a long-term trend," Pat Keon, senior research analyst at Lipper, tells Axios. "The net outflows for this group have been worse over the last several years than even during the global financial crisis."

But that's only part of the story. Investors also are clearly wary of the historic stock rally, now pushing toward an 11-year bull run, and are nervous about global growth slowing. Equity funds have seen 11 straight weeks of net outflows, Lipper's data shows.

  • Safe-haven fixed income funds, on the other hand, have seen $107.7 billion of inflows year to date.

The intrigue: The bond market is reflecting this worry, but stocks so far have not, largely because of company buybacks and low volumes, analysts say.

  • U.S. companies have purchased $272 billion of their own shares so far this year, on pace to break 2018's record $1.085 trillion.
  • There also have been less transactions overall, says Jim Paulsen, chief economist at the Leuthold Group, opening up the market to bigger price moves. That's allowing small buys to have big impacts.

The bottom line: The "Twilight Zone" state of affairs may actually be good news for stocks because it means investors aren't overconfident, say analysts at Bank of America-Merrill Lynch. In fact, sentiment is historically low, according to the bank's consensus indicator.

  • "Historically, when our indicator has been this low or lower, total returns over the subsequent 12 months have been positive 92% of the time, with median 12-month returns of 18%," BAML analysts said in a note to clients.

But, but, but: It may just mean the stock market is pumped full of hot air.

Go deeper: Investors are selling stocks, but the market keeps rising

Go deeper

Updated 53 mins ago - Politics & Policy

Senate action on stimulus bill continues as Dems reach deal on jobless aid

Photo: Alex Wong/Getty Images

Democratic leaders struck an agreement with Sen. Joe Manchin (D-W.V.) on emergency unemployment insurance late Friday, clearing the way for Senate action on President Biden's $1.9 trillion stimulus package to resume after an hours-long delay.

The state of play: The Senate will now work through votes on a series of amendments that are expected to last overnight into early Saturday morning.

Capitol review panel recommends more police, mobile fencing

Photo: Olivier Douliery/AFP via Getty Images

A panel appointed by Congress to review security measures at the Capitol is recommending several changes, including mobile fencing and a bigger Capitol police force, to safeguard the area after a riotous mob breached the building on Jan. 6.

Why it matters: Law enforcement officials have warned there could be new plots to attack the area and target lawmakers, including during a speech President Biden is expected to give to a joint session of Congress.

Financial fallout from the Texas deep freeze

Illustration: Annelise Capossela/Axios

Texas has thawed out after an Arctic freeze last month threw the state into a power crisis. But the financial turmoil from power grid shock is just starting to take shape.

Why it matters: In total, electricity companies are billions of dollars short on the post-storm payments they now owe to the state's grid operator. There's no clear path for how they will pay — something being watched closely across the country as extreme weather events become more common.