There were two articles on Bloomberg this week highlighting a shift on Wall Street where institutional investors have turned bullish believing that the inflation battle is ending and that the Fed pivot is inevitably coming.
Some interesting quotes:
– “Equity exposure among quants has turned positive and that of active fund managers is back near long-term averages.”
– “Traders, forced to buy stocks as the great inflation trade showed signs of crumbling, are now overweight equities for the first time this year and momentum signals suggest that they may have to snap up more equities soon…”
– “Some money managers are renewing speculative bets, hoping against hope that a more friendly — or at least less-hostile — Fed, is back in their corner. “
– “Commodity Trading Advisors, which take long and short positions in the futures market, had to buy an estimated $146 billion of stocks in the past month amid a CPI-reading fueled rally — the largest buying spree since March 2020…”
– “Fast-money quants are loading up on stocks at a pace not seen since the start of the pandemic.”
Risk Appetite is Surging Again in Markets Seduced by Fed Hope
Fast-Money Quants Go Long on Stocks for First Time This Year
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