Reported 8 months ago
Despite record highs in the US stock market, investors remain optimistic and continue to favor bullish views on the market. According to the latest monthly survey by Bank of America (BofA) with fund managers, the optimism in investments has reached a nearly three-year high, with cash allocations at a three-year low, indicating that US stocks are expected to benefit the most from the reallocation of funds. The survey also reveals that investors are keen on investing in risky assets such as stocks, with a significant percentage opting for US stocks, including the 'Big Seven' tech stocks like Microsoft and Nvidia. The bullish sentiment is driven by factors such as the AI boom and expectations of interest rate cuts by the Federal Reserve this year. However, some investors are also looking to buy government bonds. The survey, conducted from June 7th to 13th by BofA with 206 fund managers participating, totaling $640 billion in assets under management, shows a high level of optimism among investors, with the 'Bull and Bear Indicator' reaching the highest level since November 2021. While the performance of the US stock market supports this optimism, global investors' risk appetite has not peaked yet, with the indicator only at 6 out of 10. The positive outlook is attributed to an improved global economic outlook, with 73% of respondents expecting the global economy to avoid a recession. However, inflation and geopolitical risks are identified as major concerns among investors, with a focus on further inflation escalation and the upcoming US elections. Most global fund managers are betting on the Federal Reserve cutting interest rates, with expectations of multiple rate cuts in the next 12 months, including a potential cut at the September 18th policy meeting.
Source: YAHOO