One of the market’s most popular trades, technology, has seen investors shying away and has recorded its lowest level since February 2009, this month’s Bank of America Merrill Lynch’s (BofA) survey found out.
November’s survey showed that only 18% of investors revealed they were overweight in global tech. This shows a 25% drop compared to October 2018, according to the BofA.
Investors decided to switch to healthcare and utilities, seen as more defensive stocks compared to technology, the survey found.
However, the BofA showed there are still positive attitudes towards Faangs and Bats (Facebook, Amazon, Apple, Netflix and Google – and China’s Baidu, Alibaba and Tencent). The bets for these companies are still well perceived by investors as they have been since the beginning of the year, the BofA’s research shows.
October 2018 saw the market tumble abruptly, also because of the growing tensions and concerns over the US-China trade relations and the US interest rate rises. Tech was among the most affected with Taiwanese stocks falling more than 6%.
“We remain bearish, as investor positioning does not yet signal ‘The Big Low’ in asset markets,” said Michael Hartnett, chief investment strategist at the BofA.