Bank of America’s October survey, covering 161 participants who manage ₹143 billion, reports that 37% of fund managers now hold tech stocks overweight, up from 30% in September and the highest since August 2020. The data were released on Friday, sparking a brisk uptick in tech‑heavy indices as traders reacted to the heightened exposure.
The same poll revealed a sharp divide on the AI narrative: 45% of respondents anticipate a bubble next year, whereas 42% dismiss the worry. This split echoes a cautious drift from the euphoric AI rally that drove the S&P 500 up 120% over the past four years.
Tech stocks themselves are feeling the squeeze. Samsung Electronics and SK Hynix fell sharply on Tuesday, dragging the MSCI Korea index to its lowest point since August. Even the Nasdaq‑100‑tracking ETFs slipped 0.6% as investors weighed the semiconductor sector’s crowdedness.
Bond sentiment has never been brighter. About 37% of participants said a 10‑year Treasury yield at 6% would tempt them to shift from stocks to bonds; 19% have already begun reallocating. With the yield hovering at 5.19% today, the pull toward fixed income is tangible.
Overall, the survey paints a picture of a market at a crossroads: tech exposure at a record high, AI hype on the brink, and a looming shift toward bonds as yields creep up. Analysts are watching the next earnings season closely, hoping to gauge whether tech fundamentals can sustain the inflated valuations.
Going forward, investors will likely double‑check the sustainability of AI‑driven gains and monitor Treasury yields for signs of further bond‑market inflows. The market’s reaction to upcoming quarterly reports will be a key barometer for whether the tech rally can endure or if a correction looms.