While the U.S. continues to fuel economic optimism, investors have become more bullish about emerging markets, especially China.
Respondents have taken a net overweight position in emerging markets equities for the first time since August 2008. A net 4 percent are overweight the sector compared with net 4 percent being underweight in February. At the same time, commodities have made further gains with the number of investors underweight the asset class falling to a net 6 percent, down from a net 25 percent in January.
“Optimism on growth has been expressed with higher weightings in emerging markets equities and commodities,” said Michael Hartnett. In contrast, investors have further reduced equity investment in the eurozone and Japan. “Investors might look to review their extreme underweight positions in eurozone and Japanese equities if economic data follow growth expectations higher,” Hartnett said.
A net 40 percent of respondents are now underweight eurozone equities and a net 39 percents are underweight Japanese equities.
A total of 213 fund managers, managing a total of US$533 billion, participated in the global survey from March 6 to March 12. A total of 183 managers, managing US$365 billion, participated in the regional surveys. The survey was conducted by Banc of America Securities – Merrill Lynch Research with the help of market research company TNS. Through its international network in more than 50 countries, TNS provides market information services in over 80 countries to national and multi-national organizations. It is ranked as the fourth-largest market information group in the world.
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