China as % of MSCI ACWI Market Capitalization Assuming that China’s market capitalization as a percentage of the MSCI ACWI rises to its 2018 high of 4.0%, this scenario presents a potential upside of approximately 30% for investors. Image: BofA Global Investment Strategy
Emerging Market Debt + Equity Flows The substantial inflows into emerging market assets highlight a robust interest from investors. Image: BofA Global Investment Strategy
Money Market Fund Flows In the lead-up to U.S. elections, money market funds, which are seen as a safe haven, frequently see inflows as investors aim to lower their risk exposure. Image: BofA Global Investment Strategy
Market Pricing of Fed Rate Cuts BofA expects the Fed to cut another 75bp this year, consistent with market pricing, particularly in light of recent economic conditions and the Fed’s recent decision to cut rates by 50bp. Image: BofA Global Research
U.S. vs. Developed Market Equities (ex-US) Price Relative While there is potential for U.S. equities to maintain their lead in the near term due to strong earnings and market dynamics, historical cycles suggest that this dominance may wane as international markets recover and valuations adjust. Image: BofA Global Investment Strategy
Market Capitalization of Six Largest Companies as Share of S&P 500 Total With the six largest companies accounting for 29% of the S&P 500’s total market capitalization, discussions about diversification have become increasingly relevant. A well-diversified portfolio is vital for effective risk management. Image: Goldman Sachs Global Investment Research
Fed Funds Forecast vs. Market Pricing While the Fed has made progress in the fight against inflation, BofA holds a significantly more hawkish view on Fed policy compared to market expectations. Image: BofA Global Research
Current Market Pricing for Fed Funds Rate Traders predict that the Federal Reserve’s terminal rate, which marks the end of the rate cut cycle, will be around 3%. Image: BofA Global Investment Strategy
Implied Equity Allocation by Non-Bank Investors Globally Despite concerns about potential economic slowdowns, investors are currently maintaining an overweight position in global equities, suggesting a positive outlook for stock markets. Image: J.P. Morgan
All Money Market Funds Total Net Assets Investors currently hold $6.22 trillion in money market funds, a figure that is being interpreted as contrarian bullish for the stock market. Image: BofA Global Research
Active Global Equity Fund Flows and % MSCI ACWI Members Trading Above 200-DMA Flows to active global equity funds correlate strongly with stock price dispersion. Higher dispersion creates more opportunities for active managers, especially in volatile markets, boosting investor interest and inflows. Image: BofA Global Investment Strategy