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BofA Survey Shows Full Investor Capitulation Amid Pessimism

  • Global growth optimism at all-time low: fund manager survey
  • BofA says inflation seen falling but mood still stagflationary
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WATCH: PGIM’s Greg Peters says “we’re looking at a prelude to a recession.”Source: Bloomberg
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Investors slashed their exposure to risk assets to levels not seen even during the global financial crisis in a sign of full capitulation amid a “dire” economic outlook, according to Bank of America Corp.’s monthly fund manager survey.

Global growth and profit expectations sank to an all-time low, while recession expectations were at their highest since the pandemic-fueled slowdown in May 2020, strategists led by Michael Hartnett wrote in the note. Investor allocation to stocks plunged to levels last seen in October 2008 while exposure to cash surged to the highest since 2001, according to the survey. A net 58% of fund managers said they’re taking lower than normal risks, a record that surpassed the survey’s global financial crisis levels.