Liquidity Vacuum Leaves Stocks Easiest to Sell for BofA Analyst

Equity markets were paying a price for vanishing liquidity around the financial system Friday, with investors who face losses in things like credit and commodities trying to raise cash by selling assets they can find ready buyers for.

That’s according to Savita Subramanian, the chief equity strategist at Bank of America Merrill Lynch, who said in an interview that the withdrawal of Federal Reserve stimulus and curbs on bank risk-taking are contributing to the selloff. The Standard & Poor’s 500 Index slid as much as 3.3 percent Friday, the biggest drop in four months.