MILAN, July 14 : Global investor sentiment has climbed to its strongest level since February, with fund managers growing more optimistic on the economic outlook, artificial intelligence-linked spending and the prospect of a dovish Federal Reserve, Bank of America's latest Global Fund Manager Survey showed.Cash allocations fell to an "uber-low" of 3.6 per cent from 4.1 per cent in June, level that triggered BofA's contrarian sell signal, while a record share of respondents said they expect a "no landing" for the global economy.The survey was carried out between July 2 and July 9, after the interim deal to end the U.S.-Iran war and largely before hostilities resumed. Key findings from the July survey in more detail:
• Investor sentiment rose to its highest level since February, reflecting optimism about economic growth, AI-related capital expenditure and expectations for easier monetary policy.• A record 54 per cent of respondents expect a "no landing" scenario for the global economy, while only 2 per cent anticipate a hard landing.• U.S. equity allocations were raised to the highest overweight position since December 2024.• Long global semiconductor stocks remained the market's most crowded trade for a third consecutive month, cited by 82 per cent of investors.• While some investors trimmed technology positions in July, none reported being short the sector.• 61 per cent of respondents say hyperscalers are unlikely to cut capital expenditure this year, versus 28 per cent expecting reductions.• AI bubble risks rose to the top spot among largest tail risk facing markets, pointed to by 45 per cent of respondents.• 83 per cent do not expect the Fed to raise interest rates before the U.S. midterm elections in November.• Investors cut their end-2026 oil price forecast to $71 a barrel from $86 in June.
