Global fund managers have trimmed their exposure to U.S. stocks to the lowest levels since 2008 in anticipation of a U.S. Federal Reserve rate rise, with increasing numbers expecting the central bank to move in the second quarter of this year.
In March, a net 19 percent of global asset allocators polled in Bank of America Merrill Lynch's regular fund manager survey were underweight U.S. equities. This marked a swing from net 6 percent overweight in February and is the biggest underweight stance on U.S. stocks since January 2008.
In addition, the proportion of investors saying U.S. equities were overvalued surged to 23 percent, the highest level since May 2000.
The bank's March survey also showed that investors now saw the Fed's first rate hike taking place earlier than before. The proportion of investors expecting the Fed to raise rates in the second quarter rose to 34 percent, from 28 percent last month.