Sentiment among global investors improved in August to its least bearish since February 2022 with cash allocations falling to a 21-month low, a Bank of America survey showed on Tuesday.
The poll of fund managers with $545 billion of assets found that investors remain of the view that global growth will weaken in the next 12 months but expectations improved significantly.
Three out of four respondents expect a soft landing or no landing in global growth and the proportion of those expecting weaker growth fell markedly to net 45% from 60% in July.
Cash allocations fell to 4.8% from 5.3% last month and the underweight in equities narrowed to the smallest since April 2022. BofA said bearish positioning was a strong tailwind in the first half of 2023 but that was not the case in the second half.
There was capitulation in positioning on REITS to levels last seen during the Global Financial Crisis, as investors rotated into stocks and commodities, according to the poll.
