Investors show strong interest in emerging markets, eurozone equities – survey

Investors showed strong interest in emerging markets equities in March, the highest since April 2017, and eurozone stocks, the fastest since June 2020, Reuters reported on Tuesday, citing Bank of America’s (BofA) fund manager survey.

Global growth expectations among surveyed fund managers reached a two-year high, with “risk appetite” at its peak since November 2021.

Strong US data releases boosted global stock markets, although it reduced the likelihood of a Federal Reserve interest rate cut, impacting bond prices. The US S&P 500 hit record highs.

The survey revealed a shift in sentiment, with fewer respondents expecting lower bond yields in the next 12 months compared to December 2023. Inflation was now seen as the main market risk, replacing concerns about a global recession.

March saw outflows from US equities, particularly in discretionary and tech stocks. However, the long Magnificent Seven tech stocks remained popular.

Survey respondents turned positive on corporate profit growth for the first time since January 2022, reflecting increased investor optimism.