Global Fund Managers are looking at the biggest change in corporate earnings prospects on record, BofA's closely-watched survey indicated Tuesday, amid the coronavirus pandemic, a steep decline in oil prices and a surge in debt default risk.
Fund managers controlling more than half a trillion in assets have pared their expectations for corporate earnings to the lowest levels since 2009, BofA's March survey indicated, with overall sentiment falling to the "bear extremes" of the global financial crisis.
Managers also noted the biggest collapse in equity allocation since the survey began in 1994, BofA said, with investors trimming Eurozone and emerging market allocations, as well as bank stocks, while booting exposure to utilities and healthcare to the highest levels since the first quarter of 2009.
"A record number of investors say corporates over-leveraged," the Survey noted "Sixty-one percent want corporates to improve balance sheets, highest level since Jun'09".
Cash allocations, as a result, have surged by a record 4% from last month to around 5.1% of total assets, while 'long U.S. Treasuries' rises to become the industry's most crowded trade.