Connect with us

Hi, what are you looking for?


Investors are less worried about an equities market meltdown in 2018

Global investors are less worried about stock markets peakin..

Global investors are less worried about stock markets peaking in 2018, according to a new survey, as the consensus expectation for when prices will begin to decline has slipped from the second quarter of 2018 to 2019 or beyond.

The number of investors taking out protection against a near-term correction in the markets, meanwhile, has fallen to the lowest level since 2013, according to Bank of America Merrill Lynch (BoAML)'s closely watched monthly survey.

But although 30 per cent of investors predicted the peak to hit in 2019 or beyond, the remaining 70 per cent still think it could occur at some point this year.

Read more: Fund managers are more optimistic than pessimistic about economic conditions for the first time in six years

Equities became the asset of choice for investors in January, as allocation to stocks globally hit a two-year high and bonds fell to a four-year low. BoAML researchers attributed the shift to "bond paranoia".

“Investors continue to favour equities,” said Michael Hartnett, chief investment strategist at the bank. “By the end of the first quarter, we expect peak positioning to combine with peak profits and policy to create a spike in volatility.”

As investors piled into stocks, cyclical plays such as tech, industrials and emerging markets took the limelight from defensive sectors such as telecoms, utilities and the UK.

Read more: UK pay growth will slow, according to a Bank of America Merrill Lynch survey

In fact, the popularity of the UK as a region sank to the lowest since 2001 as Brexit continues to play on investors' minds.

Fears names by investors included inflation and/or a crash in global bond markets, followed by a policy mistake from the European Central Bank or the US Federal Reserve and market structure.

The jump in the popularity of equities comes as Jeremy Grantham, founder of asset management firm GMO, earlier this month warned that stock markets were headed for an imminent "melt-up" which would precede a crash.

Read more: Half of fund managers think monetary policy is too loose ahead of European Central Bank meeting

Original Article





In an interview with ET Now, Dabur India Director Mohit Burm..


The 147th Open championship will be at Carnoustie Golf Club in Scotland. Jan Kruger/R&A Golfers ..


Enlarge Oliver Morris/Getty Images) In response to an Ars re..


Enlarge/ You wouldn't really want to use Nvidia's ..