Bullish investors primed to drive stock rally, says BofA
![](https://s32566.pcdn.co/wp-content/uploads/2024/03/bull-market-in-the-us-stock-market.jpg-s1024x1024wisk20cQJVFonFqKJLjYlzrU8dzEBzzj-3lWXKKG4i5nRtOoWo-951x634.jpg.optimal.jpg)
US stocks and global equities will be the biggest beneficiaries as dollars rotate from cash, suggests survey.
Global investors are likely to keep pumping money into record-hitting stock markets, according to a survey by Bank of America Corp.
Answering a question about the asset class that would benefit most from a reallocation of money-market funds, 32% of respondents opted for US stocks. Another 19% said the cash would go into global equities, while a quarter of the respondents indicated they would buy government bonds.
The survey — conducted from June 7 to 13 and canvassing 206 participants with $640 billion in assets under management — showed investors remained the most bullish since November 2021, with cash levels in money-market funds at a three-year low. Cash funds currently have about $6.1 trillion in assets, according to data compiled by Bloomberg.
Long bets on the so-called Magnificent Seven technology behemoths such as Microsoft Corp. and Nvidia Corp. now stand at 69% — among the most single crowded trades in history, the survey showed.
US stocks have rallied to all-time highs, driven by the buzz around artificial intelligence as well as optimism that the prospects for easing inflation would allow the Federal Reserve to cut interest rates this year. A 15% rally in the S&P 500 this year has lifted the benchmark’s forward 12-month price-to-earnings ratio to 21, well above a long-term average of 16, according to data compiled by Bloomberg.
Still, the valuations haven’t deterred a range of Wall Street strategists, including at Citigroup Inc. and Goldman Sachs Group Inc., from turning even more bullish on the outlook for the S&P 500.
Bank of America’s poll showed 41% of fund managers expect large-cap growth stocks to continue to drive the US rally. Big tech has contributed nearly three quarters of the S&P 500’s rally this year, with Nvidia alone driving 34% of the gains, according to data compiled by Bloomberg.
Learn more about reprints and licensing for this article.