Bank of America’s Global Equity Risk-Love gauge indicates that investor sentiment is showing early signs of euphoria as equity markets worldwide near record highs, according to a recent report from the bank.
The measure sits around the 85th percentile of its historical range dating back to 1987, remaining largely stable over the past month. Volatility levels, put-call ratios, and spread readings suggest optimism, whereas positioning and survey metrics are more moderate.
Emerging Markets and Asia ex-Japan Risk-Love scores have reached their peak since Q2 2021, with 9 of 16 tracked markets now in the top quintile of their historical ranges. China’s metric climbed to the 92nd percentile—its highest since April 2021—while Taiwan sits at the 80th percentile.
India’s indicators continue to show resilience despite negative news flow, reflecting little sign of bearish sentiment. Overall, optimism is broadening across the Asia-Pacific region.
BofA retains its positive market outlook, pointing to rising earnings forecasts, synchronized global monetary easing, a softer U.S. dollar, and strong market breadth as tailwinds for investors. The bank also cautioned that, after six months of steady gains, markets may enter a period of consolidation.
This content is for informational purposes only and does not constitute financial, investment, or other professional advice. It should not be considered a recommendation to buy or sell any securities or financial instruments. All investments involve risk, including the potential loss of principal. Past performance is not indicative of future results. You should conduct your own research and consult with a qualified financial advisor before making any investment decisions.
Leave a Reply