Bank Of America Fund Manager Survey

Some key takeaways from the latest Bank of America Fund Manager Survey, released Tuesday:

• Investors "rotating" not "chasing" stocks following rally from March lows; BofA Bull & Bear Indicator unchanged at 3.9. Positioning implies SPX 3300-3600 range holds, and cyclical rotation still in early phase.
• 58% of investors say new bull market has begun (25% in May).
• First time since Feb more investors (49%) say macro in early-cycle phase than recession (37%); net 84% say global growth up next 12 months.
• 61% predict U- or W-shaped recovery vs 20% looking for V-shaped; 51% still prefer balance sheet discipline vs 37% looking for increased capex (was 13% in Apr); shows investor doubt on sustainability of upturn.
• Cash levels rose from 4.6% to 4.8% (greed <4%, fear >5%).
• Long US tech most "crowded trade" of all-time (80%); "tech bubble" now #2 tail risk after COVID-19 "second wave".
• 41% say credible COVID-19 vaccine most likely trigger for higher bond yields, followed by inflation (37%); investors say vaccine announcement most likely to come in Q1 '21; only 11% think 10Y UST yields will break out from 50-100bp range by year-end; 4 in 5 investors say flip in US Senate will be risk-off.