Investor sentiment for stocks hits seven-month low

A key investor survey shows a sharp decline in confidence for U.S. stocks. The Bank of America's Global Fund Manager Survey recorded its biggest drop in bullish sentiment since March 2020, when the market fell sharply due to COVID-19. Investment strategist Michael Hartnett labeled this decline a "bull crash." Investors are concerned about slowing economic growth and uncertainties related to President Donald Trump's tariff policies. The overall sentiment measure has dropped to its lowest level in seven months. This month also marked the largest decrease in investors' exposure to U.S. equities ever recorded. Many traders are increasing their cash reserves at rates not seen since the pandemic's early days in 2020. The survey also revealed a significant decrease in global growth expectations. Historically, this outlook has been linked to the performance of the S&P 500, suggesting potential troubles ahead for stock prices. Despite the negative sentiment, Hartnett noted that this data might indicate that the worst of the recent stock market decline is over. However, he cautioned that the current levels of investor positioning do not indicate an extreme bearish market or that it is the right time to invest without caution. As markets face increased anxiety about tariffs and slowing growth, the S&P 500 is trying to stay above correction territory, which means a drop of at least 10% from its recent peak.