Investors are the most underweight on US equities since 2005 as improving market sentiment sends them flocking toward cheaper regions, according to Bank of America Corp.’s global fund manager survey.
Participants in the January poll were “a lot less bearish” than in the fourth quarter, sparking a rotation to emerging markets, Europe and cyclical stocks, and away from pharmaceuticals, technology and the US, strategists led by Michael Hartnett wrote in a note. Allocation to US equities “collapsed” during the first month of 2023, with investors a net 39% underweight the asset class, they said, exceeding even the UK’s 15%.
