Nearly 70% of fund managers believe the global economy has entered into a recession, up from 44% one month ago, according to Merrill Lynchs October global managers survey.
Also, a new high of 59% believe that monetary policy is too restrictive, a record 49% are overweight in cash and 43% a 10-year high believe equities are undervalued.
Fund managers are waiting for the triggers that will give them the confidence to buy, Gary Baker, head of Europe, the Middle East and Africa equity strategy at Merrill Lynch, said in a news release. What they are looking for is a loosening of monetary conditions and for third-quarter earnings to clarify where problems and opportunities lie across equity markets.
Managers are particularly pessimistic about Europe, according to the survey, with 41% underweight in eurozone equities.
The 172 fund managers who participated in the survey, conducted Oct. 3-9, manage a total of $531 billion.