macro

Title: Key Takeaways From September 2024 Bank of America Global Fund Manager Survey.
- FED rate cuts has boosted fund managers sentiment for the first time since June, according to a global survey by Bank of America Corp.

- Global growth expectations improved slightly from August’s survey, but remained pessimistic with a net 42% of participants predicting a weaker economy.

Macro Strategist at BlockBase Venture: https://blockbase.co/

More information: https://insights.blockbase.co/author/phuc-duong/

- Fund managers see a 79% chance of a soft landing as rate cuts support the economy.

- The survey indicated that economy-linked — or so-called cyclical — stocks are likely to benefit from a bigger rate cut on a tactical basis. For now, investors prefer sectors that are considered bond proxies, with exposure to utilities hitting the highest since 2008.

- Tech stocks have the smallest overweight since April 2023.

- Biggest tail risks: US recession (40%), geopolitical conflict (19%), accelerating inflation (18%), systemic credit event (8%), US election “sweep” (6%) and AI bubble (5%).

- The "long Magnificent 7" trade remains the most crowded trade for the 18th consecutive month. However, it has become less crowded compared to previous months, with 46% of investors holding this trade in September, down from 53% in August. Additionally, 19% of participants now consider "short China equities" as the most crowded trade, up from 15% in August (it is understandable due to expectations for Chinese growth are at a three-year low).

- Overall, I do not see the correction in risky assets as the start of a downturn. This type of short-term crisis and panic presents good opportunities for bargain hunting, particularly in equities and crypto, which are now available at bigger discounts. If you have spare money to invest, now may be a good time to do so.