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Investor sentiment remained cautious in July, according to the latest global fund manager survey, released Tuesday by Bank of America Global Research.
In June, BofA reported that investors had moved past "peak pessimism," but were "nowhere near dangerously bullish."
The new report found that investors had positioned themselves for possible bad news on three fronts: the coronavirus pandemic, the macro situation and the November U.S. presidential election.
Cash levels rose to 4.9% from 4.7% in June, well down from April and May levels, but still on the high side; the 10-year average is 4.7%.
Fund managers' cash allocation fell one percentage point to net 32% overweight, again elevated relative to history, BofA said.
The survey was conducted from July 2 to July 9 with participation by 210 fund managers with $607 billion in assets under management.
Seventy-two percent of investors said they expected stronger global growth over the next 12 months, up 11 points from June and the highest level since January 2014. However, their conviction in the recovery's strength and duration was low.
Only 14% said they expected a V-shaped recovery. Forty-four percent said, rather, that it would take the shape of a U, and 30% anticipated a W-shaped one.
Fifty-four percent of survey respondents said the U.S. Federal Reserve would not introduce yield curve control in September.
