Investors have become too optimistic over prospects of swift global economic recovery on potential coronavirus vaccines and should be selling the news of positive results of experimental vaccines, Bank of America’s top strategist said in light of the firm’s most recent fund manager survey, according to CNBC.
According to the bank’s latest fund manager survey, investor bullishness has surged to its highest point since January 2018, and fund managers’ allocations to stocks have neared the 50% threshold that indicates “extremely bullish” levels.
Two drugmakers, Pfizer and Moderna, announced positive results of their experimental vaccines earlier this month, triggering hopes for faster economic recovery and rotation of money from defensive assets to small caps, emerging market assets and energy.
“Reopening rotation can continue in the fourth quarter but we say ‘sell the vaccine’ in coming weeks and months as we think we’re close to ‘full bull,'” the team led by Michael Hartnett wrote in the Tuesday note, according to Business Insider.
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