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Risk appetite lifts as growth expectations pick up - BOML

FXStreet (Barcelona) - According to the Research Analysts at BofA Merrill Lynch, Global investors have a restored appetite for risk amid greater optimism over the outlook for profits and the economy.

Key Quotes

“A net 47 percent of the global panel expects the economy to strengthen in the year ahead, a rise from a net 33 percent in October.”

“Investors have expressed similar positivity over profits – a net 42 percent say that global corporate profits will improve in the coming year, up from a net 27 percent last month.”

“Investors have signaled that their optimism has been translating into action over recent weeks. In October, a net 16 percent of the panel said they were taking lower than normal levels of risk. This month, a net 2 percent are taking above-normal risk.”

“The proportion taking out protection against a sharp fall in equities in the coming three months has fallen to a net -39 percent from a net -35 percent.”

“Asset allocators have shifted out of cash and increased their allocations to equities. A net 13 percent of respondents to the global survey are overweight cash in November, down from a net 27 percent in October."

“The proportion of asset allocators overweight equities has risen by 12 percentage points to a net 46 percent. Hedge funds have also increased their net allocations to equities – 43 percent of surveyed hedge funds are net long equities, up from 35 percent one month ago.”

“Japan is the region most in favor, while investors are sending mixed signals about appetite towards Europe. Real Estate allocations have reached the highest overweight recorded since its inclusion in the survey in 2006.”

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