*Are money managers too bullish?* This month’s survey of fund managers (with a total of $526 billion in assets under management) by Bank of America shows that cash holdings are at their lowest level since April 2015 and allocations to stocks rose in November to 36% overweight. That’s close to “extreme bullish,” according to Bank of America strategists. (The survey was conducted from November 6 through November 12.)
The low cash levels raise the question of where the money will come from to send stocks higher from here. The allocation to stocks is driven by an extreme optimism about economic growth over the next year. Among those surveyed, 91% expect the U.S. economy to be stronger in the next 12 months and 61% believe that we’re in the early stage of a growth cycle in the global economy. The money managers identify a second wave of Covid-19 as the biggest tail risk to economies and financial markets, but they expect a credible virus vaccine to be announced by mid-January 2021. In October fund managers are projecting mid-February for a credible vaccine. As you might expect from a group so bullish on economic growth, 73% of those surveyed expect a steeper yield curve in the bond market. 24% of surveyed investors expect value stocks will outperform growth stocks. And those responding to the survey expect that emerging markets, the Standard & Poor’s 500, and oil will outperform in 2021. 6% of fund managers say they’re taking higher than normal risk levels. That’s the highest reading on that question since January 2018. The allocation to U.S. stocks increased 4 percentage points to 23% overweight, while allocation to euro-area stocks dropped 8 percentage points to 18% overweight. Exposure to emerging markets is rising with 36% of investors overweight emerging market stocks. *Merry Christmas! An unemployment cliff looms for 12 million workers on December 26* According to a report from the Century Foundation, 12 million Americans are set to lose unemployment insurance by the end of 2020 with the bulk of those 7.3 million set to lose their benefits on December 26. When Congress wrote its coronavirus rescue bills, it created a benefits cliff on December 26. That’s when 7.3 millionaire workers on Pandemic Unemployment Assistance, a program for gig and self-employed workers otherwise not eligible under the regular state-run unemployment programs, see their benefits expire. Another 4.6 million workers on the Pandemic Emergency Unemployment Compensation program, which extends unemployment benefits for workers who have exhausted their regular state unemployment benefits, typically after 26 weeks, will also lose benefits. The total comes to more than half of the 21.1 million people currently receiving unemployment benefits of one sort or another. The House-passed stimulus bill would have extended these benefits as well as reinstating the $600 a week bonus unemployment benefit that expired at the end of July. The Senate failed to pass the House bill. Economists estimate that a dollar in unemployment benefits adds $1.61 to GDP. And the worry is that the expiration of unemployment benefits will produce deep, deep pain for American families and send the U.S. economy into a tailspin in 2021. -- Kindly email stock reports at [email protected] For sharing knowledge -- NIFTYVIEWS.COM NOW A FREE OPEN SOURCE WEBSITE. http://www.niftyviews.com/ Disclaimer :- "The opinions expressed by the members on this board are based on their individual experience and perceptions and to share information with other members with the best of intentions to help fellow members in investment decisions as equity investment is a risky venture.The administrator of www.Niftyviews.com just provide a platform for the authors to express their opinion and take no guarantee for the genuineness of the same."ANY member of this forum doesnt prepare or publish any research report; or ii. provide research report; or iii. make 'buy/sell/hold' recommendation; or iv. give price target; --- You received this message because you are subscribed to the Google Groups "Niftyviews.com" group. To unsubscribe from this group and stop receiving emails from it, send an email to [email protected]. To view this discussion on the web, visit https://groups.google.com/d/msgid/stockresearcher/CADFC1KS2ZXJthycWpXuosebhgv0DKrF7ntWVsFe44p27hUx9Ow%40mail.gmail.com.
