Investor sentiment toward China has grown more bullish in only a month, according to a Bank of America Merrill Lynch September survey of global fund managers.
A net 11% of survey respondents this month said China’s economy will strengthen over the next 12 months — a 30-percentage point positive swing from August, when 19% said China’s economy would weaken.
Survey respondents were neutral toward the U.S., eurozone, U.K. and bearish toward Japan.
“Renewed optimism in Chinese economic growth provides some hope of an improvement in investor sentiment in the coming months. The question is whether China is a sufficient catalyst to spark a change,” Michael Hartnett, chief global equities strategist at BofA Merrill Lynch Research, said in a news release.
Overall, as the fourth-quarter approaches, investors are dropping their appetite for risk, according to the survey. A net 15% were underweight bonds in September, compared to 23% underweight in August. Also, a net 20% were overweight cash in September, compared to 10% in August.
Investors were 11% underweight utilities, compared to 27% in August. Four percent were overweight industrials, compared to 12% overweight in August. And the percentage overweight technology was 24% in September, compared to 34% a month earlier.
The survey of 177 fund managers was conducted Sept. 2-9.