FYI: The stock market’s fall into correction mode in February and subsequent sideways trading action isn’t driving bulls to give up the ghost, said analysts at Bank of America Merrill Lynch on Tuesday.
Citing the firm’s monthly survey of fund managers from around the globe, they argued that bulls have been “silenced, not routed” and that risk assets can bounce, though the range between 2,550 and 2,850 for the S&P 500 SPX, +0.97% remains intact. The S&P 500 remains around 6% below the all-time high set above 2,870 in late January, while the Dow Jones Industrial Average DJIA, +0.79% is off around 6.9% from its record.
The amount of cash held by funds jumped in April to 5%, from 4.6%, amid 18-month lows in profit expectations and equity allocations (see chart below). That’s above the survey’s average of 4.5% over the past 10 years and remains a “contrarian buy signal,” the Merrill analysts said.
Regards,
Ted
https://www.marketwatch.com/story/stock-market-bulls-have-been-silenced-not-routed-fund-manager-survey-finds-2018-04-17/print
