Skip to main content
MENU
Subscribe
  • Subscribe
  • Account
  • LOGIN
  • Topics
    • Alternatives
    • Consultants
    • Coronavirus
    • Courts
    • Defined Contribution
    • ESG
    • ETFs
    • Hedge Funds
    • Industry Voices
    • Investing
    • Money Management
    • Opinion
    • Partner Content
    • Pension Funds
    • Private Equity
    • Real Estate
    • Russia-Ukraine War
    • SECURE Act 2.0
    • Special Reports
    • White Papers
  • Rankings & Awards
    • 1,000 Largest Retirement Plans
    • Top-Performing Managers
    • Largest Money Managers
    • DC Money Managers
    • DC Record Keepers
    • Largest Hedge Fund Managers
    • World's Largest Retirement Funds
    • Best Places to Work in Money Management
    • Excellence & Innovation Awards
    • Eddy Awards
  • ETFs
    • Latest ETF News
    • Fund Screener
    • Education Center
    • Equities
    • Fixed Income
    • Commodities
    • Actively Managed
    • Alternatives
    • ESG Rated
  • ESG
    • Latest ESG News
    • The Institutional Investor’s Guide to ESG Investing
    • Climate Change: The Inescapable Opportunity
    • Impact Investing
    • 2022 ESG Investing Conference
    • ESG Rated ETFs
  • Defined Contribution
    • Latest DC News
    • DC Money Manager Rankings
    • DC Record Keeper Rankings
    • Innovations in DC
    • Trends in DC: Focus on Retirement Income
    • 2022 Defined Contribution East Conference
    • 2022 DC Investment Lineup Conference
  • Searches & Hires
    • Latest Searches & Hires News
    • Searches & Hires Database
    • RFPs
  • Performance Data
    • P&I Research Center
    • Earnings Tracker
    • Endowment Returns Tracker
    • Corporate Pension Contribution Tracker
    • Pension Fund Returns Tracker
    • Pension Risk Transfer Database
    • Future of Investments Research Series
    • Charts & Infographics
    • Polls
  • Careers
  • Events
    • View All Conferences
    • View All Webinars
    • 2022 Innovation Investing Conference
    • 2022 Defined Contribution East Conference
    • 2022 ESG Investing Conference
    • 2022 DC Investment Lineup Conference
    • 2022 Alternatives Investing Conference
Breadcrumb
  1. Home
  2. MONEY MANAGEMENT
September 18, 2018 01:00 AM

Managers still bullish on U.S. equities but bearish on global growth – BofA

James Comtois
  • Tweet
  • Share
  • Share
  • Email
  • More
    Reprints Print

    Although money managers continue to regard the U.S. as the most favorable region for equities for the second consecutive month, investors have become bearish on global growth, said Bank of America Merrill Lynch's monthly fund manager survey released Tuesday.

    This month, a net 24% of the managers surveyed said they expect global growth to slow in the next year, up from a net 7% in August. This marks the most negative outlook on the global economy from managers since December 2011.

    In terms of decoupling in the global economy, nearly half of survey participants — 48% — said they believe the current decoupling, in which U.S. growth has been higher than most other developed economies, will end because U.S. growth will begin to slow down, up 16 percentage points from last month. Meanwhile, 24% expect decoupling to continue, while 28% think Asia and Europe's growth will accelerate, down 6 percentage points from last month.

    The U.S. continues to be the most favored equity region globally for the second month in a row as managers buy growth over value. Managers' allocations to U.S. equities inched up 2 percentage points to a net 21% overweight, the biggest overweight since January 2015.

    In addition, when asked about regional expectations for corporate profits, a net 69% of managers surveyed said they found the U.S. to be the most favorable region, a record 17-year high.

    The average cash balance of managers surveyed climbed to an 18-month high of 5.1% this month, up from 5% in August.

    A possible trade war remains the biggest tail risk for managers for the fourth month in a row, with 43% of respondents putting it at the top of their list of concerns. However, that concern is receding: Last month, 57% of respondents considered a trade war the biggest tail risk.

    The top three are rounded out by a China slowdown (18%) and quantitative tightening (15%).

    Managers' allocations to global equities slid 11 percentage points to a net 22% overweight, close to July levels, which were the lowest in 18 months. Meanwhile, managers' allocations to eurozone equities were cut by 6 percentage points, to a net 11% overweight, an 18-month low.

    This month's survey also saw a 9-percentage-point decrease in allocations to emerging markets equities, leaving allocations to the asset class at a net 10% underweight, the lowest since March 2016 and a huge reversal from the net 43% overweight in April 2018, when emerging markets was the most favored region among respondents.

    "Investors are holding on to more cash, telling us they are bearish growth and bullish U.S. decoupling," Michael Hartnett, chief investment strategist at BofA Merrill Lynch Global Research, said in a news release about the survey results. "Fund managers are signaling that they are starting to price in a hawkish Fed."

    The survey of 244 money managers representing a total of $742 billion in assets under management was conducted Sept. 7-13.

    Related Articles
    Managers more bullish on U.S. equities, corporate profits – BofA
    Investors believe there's still life left in the old bull
    U.S. equities, alts power strongest returns for plans
    Commentary: In the brave new world of asset management, managers must adapt – o…
    Managers see S&P 500 peaking at 3,056; confidence wanes on global growth
    Recommended for You
    MassMutual_Logo_i.jpg
    MassMutual becomes equity investor in Kudu
    ONLINE_180819917_AR_0_ZXNMFGHRAFDD.jpg
    Westwood to acquire Salient Partners for $35 million
    Intermediate Capital inks new ESG, sustainability leader
    OCIO, Anchor in Rough Seas
    Sponsored Content: OCIO, Anchor in Rough Seas

    Reader Poll

    May 23, 2022
    SEE MORE POLLS >
    Sponsored
    White Papers
    Crossroads: Politics, Inflation, & Bonds
    Credit Indices: Closing the Fixed Income Evolutionary Gap
    Forever in Style: Benchmarking with the Morningstar® Broad Style Indexes℠
    Q2 2022 Credit Outlook: Carry On
    Leverage does not equal risk
    Is there a mid-cap gap in your DC plan?
    View More
    Sponsored Content
    Partner Content
    The Industrialization of ESG Investment
    For institutional investors, ETFs can make meeting liquidity needs easier
    Gold: the most effective commodity investment
    2021 Investment Outlook | Investing Beyond the Pandemic: A Reset for Portfolios
    Ten ways retirement plan professionals add value to plan sponsors
    Gold: an efficient hedge
    View More
    E-MAIL NEWSLETTERS

    Sign up and get the best of News delivered straight to your email inbox, free of charge. Choose your news – we will deliver.

    Subscribe Today
    May 23, 2022 page one

    Get access to the news, research and analysis of events affecting the retirement and institutional money management businesses from a worldwide network of reporters and editors.

    Subscribe
    Connect With Us
    • RSS
    • Twitter
    • Facebook
    • LinkedIn

    Our Mission

    To consistently deliver news, research and analysis to the executives who manage the flow of funds in the institutional investment market.

    About Us

    Main Office
    685 Third Avenue
    Tenth Floor
    New York, NY 10017-4036

    Chicago Office
    130 E. Randolph St.
    Suite 3200
    Chicago, IL 60601

    Contact Us

    Careers at Crain

    About Pensions & Investments

     

    Advertising
    • Media Kit
    • P&I Content Solutions
    • P&I Careers | Post a Job
    • Reprints & Permissions
    Resources
    • Subscribe
    • Newsletters
    • FAQ
    • P&I Research Center
    • Site map
    • Staff Directory
    Legal
    • Privacy Policy
    • Terms and Conditions
    • Privacy Request
    Pensions & Investments
    Copyright © 1996-2022. Crain Communications, Inc. All Rights Reserved.
    • Topics
      • Alternatives
      • Consultants
      • Coronavirus
      • Courts
      • Defined Contribution
      • ESG
      • ETFs
      • Hedge Funds
      • Industry Voices
      • Investing
      • Money Management
      • Opinion
      • Partner Content
      • Pension Funds
      • Private Equity
      • Real Estate
      • Russia-Ukraine War
      • SECURE Act 2.0
      • Special Reports
      • White Papers
    • Rankings & Awards
      • 1,000 Largest Retirement Plans
      • Top-Performing Managers
      • Largest Money Managers
      • DC Money Managers
      • DC Record Keepers
      • Largest Hedge Fund Managers
      • World's Largest Retirement Funds
      • Best Places to Work in Money Management
      • Excellence & Innovation Awards
      • Eddy Awards
    • ETFs
      • Latest ETF News
      • Fund Screener
      • Education Center
      • Equities
      • Fixed Income
      • Commodities
      • Actively Managed
      • Alternatives
      • ESG Rated
    • ESG
      • Latest ESG News
      • The Institutional Investor’s Guide to ESG Investing
      • Climate Change: The Inescapable Opportunity
      • Impact Investing
      • 2022 ESG Investing Conference
      • ESG Rated ETFs
    • Defined Contribution
      • Latest DC News
      • DC Money Manager Rankings
      • DC Record Keeper Rankings
      • Innovations in DC
      • Trends in DC: Focus on Retirement Income
      • 2022 Defined Contribution East Conference
      • 2022 DC Investment Lineup Conference
    • Searches & Hires
      • Latest Searches & Hires News
      • Searches & Hires Database
      • RFPs
    • Performance Data
      • P&I Research Center
      • Earnings Tracker
      • Endowment Returns Tracker
      • Corporate Pension Contribution Tracker
      • Pension Fund Returns Tracker
      • Pension Risk Transfer Database
      • Future of Investments Research Series
      • Charts & Infographics
      • Polls
    • Careers
    • Events
      • View All Conferences
      • View All Webinars
      • 2022 Innovation Investing Conference
      • 2022 Defined Contribution East Conference
      • 2022 ESG Investing Conference
      • 2022 DC Investment Lineup Conference
      • 2022 Alternatives Investing Conference