A Bank of America fund manager survey revealed the lowest cash allocation on record, indicating strong confidence in the stock market. The average cash allocation fell to 3.9% of assets under management, marking a significant shift from the previous month's 4.3% and triggering a contrarian sell signal. This trend is attributed to expectations for growth under President-elect Donald Trump and anticipation of interest rate cuts from the Federal Reserve.
A Bank of America fund manager survey showed a new low on cash allocation going back to at least 2001.
A closely watched survey of global fund managers registered its lowest cash allocation on record this month, underscoring a bullishness on stocks as the equity market nears the end of a strong year.The average cash allocation level of participants in Bank of America's Global Fund Manager Survey fell to 14% underweight, according to data released by the bank on Tuesday.
For the former, traders will get a reading of the Fed's thinking on Wednesday when the central bank delivers its final interest rate decision of the year in the afternoon. Fed funds futures are pricing in a more thanThat stat of net 14% underweight on cash marks a significant turn from the 4% net overweight reading in November. This 18 percentage point drop in cash allocation was the largest monthly decline in around half of a decade, according to Bank of America data.
This comes as Wall Street readies for more gains for stocks into 2025 after a year that has, thus far, well exceeded expectations. The average target of market strategists suggests the. As of midday Tuesday, the broad index is tracking to end 2024 up more than 26% at nearly 6,050. Heading into this year, the most bullish strategist on the Street had expected the index to finish 2024 at just 5,200.
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