Global fund managers not fully bearish yet: BoA ML survey

Moneycontrol BureauThere is a market adage that the market does not peak out till the last bear has lost hope and it does not bottom out till the last bull has thrown in the towel.Going by that maxim, the ongoing global market correction could still have some more downside left.In a survey of global fund managers by investment bank Bank of America Merrill, only 12 percent of the respondents felt that a global recession can occur in the next 12 months.Fund managers are overweight on equities and underweight on bonds, the survey found.At the same time, they increased their cash holdings to levels last seen in 2009.Most fund managers see a recession in China and a debt crisis in emerging markets as the biggest ‘tail risks’.And while they are no longer in denial about bear market risks, they are yet yet to accept the fact that macro/markets are already well into a normal, cyclical recession/bear market, the BoA ML release says.True capitulation would involve a bout of USD weakness and outperformance of asset classes like BRIC which most global fund managers are bearish on, the BoA ML release says.Also read: Prices attractive, but tail risks not priced: Morgan Stanley