The May survey covered ~266 managers with $747 Billion in assets under management.
OUTLOOK:
- A net 72% among survey respondents expect global profits to decline over the next month, the most since October 2008 and up from a net 66% in May.
- 83% said they expect stagflation (below-trend growth and above-trend inflation), which was up from 77% in May and represented the highest percentage since June 2008.
SENTIMENT:
- Optimism on global growth fell to a new low in June, with the net percentage of fund managers expecting a stronger economy — meaning the difference between those expecting a stronger economic minus those expecting a weaker economy — hitting -73% this month, the lowest since 1994.
- Only 12% of fund managers expect a global economic boom (above-trend growth and inflation) over the next 12 months, down from 17% in May.
POSITIONING:
- A net 48% of respondents said they are currently taking lower-than-normal risk levels, up from a net 49% in May.
- Investors are long cash, US dollar, commodities, healthcare, resources, high quality and value stocks, while short positioning dominates bonds, European and emerging-market stocks, tech and consumer shares.
MOST CROWDED TRADES
- Long oil and commodities was the most crowded trade.
BIGGEST TAIL RISKS:
BANK OF AMERICA COMMENTARY:
