Jinse reported that Bank of America Global Research stated on Tuesday that global investors have significantly reduced their holdings of U.S. stocks at a record pace over the past two months. They consider the trade war, which could trigger a global economic recession, the biggest risk facing the market. In Bank of America's monthly survey of fund managers, 36% of respondents reported a net reduction in U.S. stock allocation, the highest level in nearly two years. Within two months, the allocation to U.S. stocks dropped by 53 percentage points, marking the largest two-month decline on record.
This trend seems likely to continue, as a record number of respondents also indicated that they plan to cut back their U.S. equity allocations. President Trump's aggressive tariff plans have led to a sell-off in U.S. assets, including stocks, the dollar, and U.S. Treasury bonds. The stock market rebounded on Monday, but the S&P 500 index is still down about 8% year-to-date. Bank of America surveyed 164 investors managing $386 billion in assets.