The number of fund selectors increasing exposure to European equities decreased sharply from 79% in trueJanuary to only 30% in June, the lowest level since records began in 2012. Moreover, Belgian appetite for European stocks was the highest in Europe back in January this year. Now it has the lowest number of buyers after Norway. Most of previous bulls are now keeping their allocation to the asset class unchanged, with their number having tripled to 65% compared to January. This number might well signal increased uncertainty about the direction markets are taking.
US and Japan on the negative side
US equity sentiment has gone pretty much the same way as that for European stocks, with European stocks still having an edge over American equities. The number of interviewees saying they will increase allocation to US stocks over the next 12 months decreased from 50% to 20%, with most of the previous bulls indeed now choosing to hold to their positions. While sentiment is not outright negative, it is indeed the lowest since records began in 2012.
While European and US equities are markedly less in favour than before, they still have significant numbers of buyers in the Belgian market. This has never been the case for Japanese equities really, but current sentiment on the asset class is as low as never before. The majority of fund selectors we spoke to are either selling the asset class or are currently not using it. Only one fund selector said he will buy more Japanese equities.