The summer bond crash has fund managers shuffling money into equities, according to the BAML fund manager survey, which shows those overweight stocks rising to 60% in September - the highest level since February 2011. Digging a little deeper finds exposure to consumer staples (XLP) is the highest in 10 years, to European stocks the highest in 6 years, and an 11-year high for U.K. equities (EWU).
Blogger ukarlewitz digs even deeper and finds the spread between equity and bond ratings is the 2nd highest in the 12-year history of the survey.
Undermining this apparent confidence, notes BAML's Michael Hartnett, are cash levels that remain "exceptionally high" at 4.6%. He reminds of the rule to buy stocks when cash is above 4.5%, and sell when it falls below 3.5%.