Why are fund managers so bullish?: Chart of the day

Bank of America Global Fund Managers Survey shows sentiment amongst fund managers is the most bullish since November 2021.

Yahoo Finance Anchor Julie Hyman breaks down the survey from Bank of America and what it could signal for investors.

For more expert insight and the latest market action, click here to watch this full episode of Asking for a Trend.

This post was written by Nicholas Jacobino

Video transcript

B of a security is a global Fund Manager survey.

Sentiment is the most bullish since November 2021.

Yahoo Finance's Julie Hyman joins me now with a closer look.

Yeah, this is our chart of the day here today.

You just heard Jared talking about this fund manager survey which is closely watched by us here.

Um And basically you've got the sentiment right about here.

You can see that it does.

I mean, this is a long term chart going back to 2001 and you can see that sentiment does tend to swing between streams.

It is the highest that it has been in quite some time, but it is not yet at an extreme according to Bank of America.

They measure this by looking at the sentiment from their fund manager survey.

They also look at things like cash levels, equity allocation and economic growth expectations.

And they're saying your global risk sentiment is not yet extreme.

So that's something that is positive because it's in extremes when you see sort of snap backs uh potentially in the market here.

So if you look at this chart just to give a little context down here when the sentiment was quite low is when we saw the collapse of Silicon Valley Bank.

So just a little bit of uh context there for some of the swings uh that we see in this, in addition to uh Bank of America say, bringing us this chart, some of the, again, the color behind us here, 73% of their respondents to their survey say they see no recession right now, especially when you look over the next 12 months.

And that soft landing is sort of the consensus here and that hard landing expectations are at new lows.

Also just 8% say that there will be no rate cuts for the next 12 months.

So most people are looking for a rate cut.

In fact, 39% in the survey said they expect the first cut to come in September.

So that's sort of the backdrop for this bullishness that we are seeing here, low expectations for a recession and expectations for the fed to begin cutting rates.

And also, as you talked to Jared about still some optimism here around large cap tech and earnings performing in that particular arena.

Back to you, Josh Julie Hyman.

Thank you.