A recent survey from BofA Global Research indicates a dramatic reduction in global investors’ allocation to U.S. stocks in March. This represents the steepest drop ever recorded, fueled by fears of stagflation, escalating trade wars, and a perceived end of U.S. exceptionalism. As a result, investors have raised their cash allocations from 3.5% to 4.1%.

Key Findings from the Survey

• Record Decline in U.S. Stock Allocation:
  Fears of stagnant economic growth and increasing trade tensions have driven investors to cut back significantly on U.S. equities.
• Heightened Cash Holdings:
  The uncertainty surrounding the U.S. market has led global investors to bolster their cash reserves, indicating a cautious approach to equity markets.
• Declining Global Growth Expectations:
  The survey revealed a significant drop in global growth expectations, reflecting widespread pessimism regarding the near-term economic landscape.
• Increased Interest in Eurozone Stocks:
  Despite the downturn in U.S. equities, allocations to eurozone stocks have reached the highest levels since July 2021, particularly within the banking sector.

The survey included 171 participants managing a cumulative total of $426 billion in assets, emphasizing the current climate of uncertainty. The swift decline in U.S. stock allocations appears to be a direct response to ongoing fears of stagflation compounded by the implications of aggressive trade policies.

Conclusion

Survey results suggest that global economic uncertainties—fueled by worries about stagflation and trade wars—are steering investors away from U.S. equities. This increasing cash allocation and tilt toward eurozone stocks, particularly in the banking sector, convey a cautious market outlook. As these trends unfold, leveraging reliable data resources through Entreprenerdly.com will be essential for investors navigating this volatile environment.