1. Fund managers' pessimism on U.S. stocks rose to 36% underweight in April. 2. Cash held by fund managers surged to 4.8%, the most since COVID. 3. Global growth expectations are at a 30-year low; 49% expect a hard landing. 4. S&P 500 has rebounded 11% from early April lows after tariff announcements. 5. Survey results may offer contrarian investment ideas despite negative sentiment.
A significant number of fund managers are now underweight U.S. stocks, signaling bearish sentiment. Historical examples show that when fund manager sentiment declines, market performance often follows suit.
The shift to a more negative outlook among fund managers and cash accumulation indicates potential market instability. This behavior can lead to reduced buying pressure on the S&P 500, thus impacting prices.
Recent decisions on tariffs can cause immediate market reactions, evidenced during prior similar events. The pessimism observed in the survey reflects a downturn in confidence affecting short-term trading strategies.