BofA: European managers remain 'downbeat on growth'
81% of the 262 managers polled in July predicted a further economic slowdown in Europe, up from 70% last month
Four out of five (81%) of the 262 managers polled in July predicted a further economic slowdown in Europe, up from 70% last month, while less than 10% expected growth momentum to improve across the continent.
Sentiment has also soured on the US, with 55% now foreseeing monetary policy-induced growth weakness in the US, up from 45% last month. However, 42% still believe US growth will remain resilient near-term, thought still expect it to slow long-term.
BofA: Europe to dodge recession as UK fate looks glum
China has also seen a sharp decline in manager outlooks, with 45% now expecting Chinese growth to continue softening, up from 18% last month.
Globally, 60% of managers expected growth to slow over the next year, but only 21% foresee a 'hard landing' as the most likely outcome.
Managers were also more positive on inflation, with 78% expecting global inflation to decline over the next year, and a record net 95% expecting European inflation to fall.
Nevertheless, 45% still viewed high inflation and hawkish central banks as the biggest tail-risk for markets.
A net 21% of managers also saw scope for lower bond yields, the highest number for 20 years.
Outlook for equities improved somewhat, with 66% of managers now forecasting downside for the European market over the coming months, down from 73% last month, while 55% now expect upside over the next year, up from 52% in June.
However, 82% of managers still see downside for European earnings per share, with 42% viewing earnings downgrades as the most likely cause of a market correction.
In response, having too little in the way of defensive hedges was viewed as
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