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Investors made the “bigger ever” cut into their US capital allocations in March after President Donald Trump’s disorderly trade struggle spurred fear of the US economy and sparked a heavy Wall Street sale.
US capital allocations fell 40 percentage points, from 17 percent overweight in February to underweight 23 percent in March, according to the American Bank closely viewed by the fund managers survey.
The fear of stagflation, the global war of trade and an end to the US exclusion were quoted as promoters of a “bull collision” in feeling. The fall of the month in the month in the feeling of investors is the largest survey since Covid-19 fall in March 2020.
“At the beginning of the year the investors were all the rabid bulls, but.
“What has changed is that everyone was Bullish in the US and this has faded significantly,” he added.
European chapters have benefited. The allocations in the eurozone shares dance 27 percentage points in the same month, at the highest level since July 2021. This was also the sharper shift from the US and in Europe since 1999, when Bofa records began.
“It is not surprising to see fund managers leaving the US market,” said Trevor Greetham, leader of the Multi-Aset at the Royal London Assset Management. “Iceddened with the price for perfection and the policy that comes out of the White House is not the case.”
Nearly 70 percent of investors say the topic “Extraordinary US”, which pushed the S&P and Nasdaq indices to record high levels in the weeks after the Trump’s election victory in November has reached its peak.
Investors surveyed were particularly negative about technology reserves, moving to a net position 12 percent underweight: lower allocation for more than two years.
Fund managers were more optimistic about municipal services and banking shares, increasing their size of capital in the United Kingdom.
While investor money levels increased slightly to 4.1 percent, government bonds did not benefit from the movement of their capital; Bond allocations fell little and most investors remain underweight.
“It’s not a classic danger, where you sell everything,” said Michael Metcalfe, head of the macro strategy at State Street Global Markets, who described the change as “more ribalance than risk deviations”.
“It doesn’t seem to be investors preparing for a multi-month bear market here.
He stressed that “Unvind had been quite uneven.” Street state capital market positioning data now shows greater retention in European banks than in American technology. Metcalfe described it as “an extraordinary shift at the risk of concentration from the beginning of the year”.
The Bofa survey was conducted in the week until March 13, covering 171 participants with $ 477 billion in management asset.
