Dec Mullarkey
Managing Director, Investment Strategy
and Asset Allocation


There are two ways to evaluate market sentiment. One is to infer what’s embedded in market prices and the other is to survey investors. And one of the most notable roundups of global fund manager views is from Bank of America. The institution has been tracking opinions and sentiment for decades and can benchmark against those trends.

The conclusion from the bank’s most recent survey is that global investors are no longer extremely bearish. Although not bullish either, they have hit a 17-month high in their equity allocations. U.S. equities are still popular while emerging markets, China in particular, are being avoided.

While these investors forecast weak economic growth, almost three quarters expect either a “soft landing” or indeed no landing or a setback. Most believe the U.S. Federal Reserve is done hiking and that rate cuts will kick in next year. The biggest worry is that sticky inflation pushes central banks to be restrictive for longer.

The overwhelming investing theme is a preference for higher quality assets and predictable earnings. At this part of the cycle, none of this is a surprise. Top tier assets are still being snapped up while investors are very discriminating the further down you go in quality. This still provides opportunity for patient capital. But you need to do your homework.

Source: Bank of America, Bloomberg, 2023.  

The information may include statements which reflect expectations or forecasts of future events. Such forward-looking statements are speculative in nature and may be subject to risks, uncertainties and assumptions and actual results which could differ significantly from the statements. All opinions and commentary are subject to change without notice.

Market insights are based on individual portfolio manager opinions and market observations. These are observations only and are not intended to provide specific financial, tax, investment, insurance, legal or accounting advice and should not be relied upon and does not  constitute a specific offer to buy and/or sell securities, insurance or investment services. Investors should consult with their professional advisors before acting upon any information posted here.



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