Global investors' optimism towards the Indian market has reached its highest level in two and half years, as per a popular survey. “Interestingly, India became the most favorite market since April 2010 (coinciding with 22% year to date rally in Indian equities),” said a fund manger survey by Bank of America Merrill Lynch (BoAML) released today.
As per the survey, fund managers expect the Indian market to do well over the next 12 months. They are also optimistic on Thailand after a similar 22% year to date rally in equities there. Meanwhile, investor outlook towards markets like Australia, New Zealand and Malaysia has seen deterioration.
Overall, fund managers have positive on the state of the global economy as a net 20% of investors believe the global economy will strengthen in the coming 12 months – a rise of three percentage points from September.
“However, even as sentiment towards the global economy and equities continues to improve, investors concerns are growing about the impact of the huge fiscal cliff in the US . Nearly three quarters of global investors believe that the fiscal cliff is not substantially priced into global equities and macroeconomic data,” said a release by BoAML. “EU sovereign debt funding risk is seen as less of a threat.”
As per the survey, equity allocations have risen significantly month-on-month in October. “A net 24% of asset allocators are overweight equities, up from a net 15% in September. Fund managers increased allocations to seven of the 11 global sectors, including banks and industrials. Allocations to the eurozone and global emerging markets increased, but allocations to Japan fell to a three-year low,” the release said.
An overall total of 269 panelists with $734 billion of assets under management participated in the survey from 5 October to 11 October,” said BoAML.
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