Investments pour in US equities--Bofa Merril Lynch
February survey
Emerging market equities have lost their lustre to US equities this month, according to a February survey of financial managers world-wide conducted by a BofA Merrill Lynch Global Research.
The survey revealed that 34 percent of the respondents comprised of financial managers with some $569 billion in managed portfolio have placed their confidence in US equities, higher from the 27 percent in January. Euro stocks drew a net 11 percent "overweight" from 9 percent "underweight" in January.
BofA Merrill Lynch equity strategists Gary Baker and Michael Hartnett wrote in a report that this February survey "is one of the most bullish in years."
February saw the biggest decline in emerging-market exposure in the survey's history, with net 5 percent of managers now "overweight" global emerging-markets equities, down from January's 43 percent.
Global equity markets have drawn more attention this month than at any time in the past decade as financial managers with more than $565 billion in their portfolio have taken significant positions recently, has indicated.
According to the survey released on Tuesday, a net 67 percent of respondents, who together has an estimated $569 billion in managed funds, had an "overweight" position on global equities, which it said is the highest level recorded since the survey asked the question in April 2001.
"Surging inflation expectations show we are no longer in a Goldilocks environment and a meaningful tactical correction in risk assets could be caused by a jump in interest rates or weaker U.S. growth," a related report of Bloomberg news said.
It said a higher risk appetite compounded by a dramatic downsizing in asset allocation to emerging markets provided the boost for developed market alternatives.
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