Fund managers are confident that the bull market still has more to give, according to a new survey.
Cash levels – which indicate how much a fund manager is holding to meet a possible rush of redemptions in the case of a crisis – ticked down slightly from five per cent in April to 4.9 per cent in May, according to Bank of America Merrill Lynch’s monthly Fund Manager Survey.
Meanwhile only two per cent of global investors surveyed expect a recession this year – the consensus is for the first quarter of 2020, though investors are split between 2019 (41 per cent) and 2020 (43 per cent).
“This month’s survey presents good and bad news,” said Michael Hartnett, chief investment strategist at BAML.
“Although cash levels remain high and growth optimism is at the lowest level in over two years, a majority of investors say there is room to grow in this equity bull market and don’t see signs of recession anytime soon.”
The investors were particularly bullish on banks, as on average they held 36 per cent more of the financial institutions than the benchmark. This was the second highest level on record.
However expectations for faster global growth continued to fall, with just one per cent of investors thinking the global economy would grow in the next 12 months.