European Stocks Allocation Surge

MILAN (Reuters) – European stocks experienced their second largest allocation in 25 years during January, as risk assets began to catch up, according to a survey from BofA Global Research published on Tuesday.

In the report titled “Make Europe Great Again”, BofA noted that asset allocation remained risk-on, with investor optimism directed towards the U.S. dollar and stocks, while sentiment was bearish towards other sectors.

The survey showed that investors were the most underweight on bonds since October 2022, and cash levels dipped to 3.9%. The survey included 182 participants collectively managing $513 billion in assets.

BofA highlighted that a disorderly rise in bond yields was viewed as the most bearish development anticipated for 2025.