AsianFin -- Investor exposure to U.S. equities has seen its steepest decline on record in recent weeks, as concerns over global economic growth mount, according to a survey by Bank of America Corp.

Fund managers’ allocation to U.S. stocks dropped to around 23% underweight—the lowest level since June 2023. Meanwhile, a net 44% of survey respondents in March predicted a deterioration in global growth, a sharp increase from the previous month.

“Pessimism on the global growth outlook is bad news for stocks,” BofA strategist Michael Hartnett wrote in a note.

Amid the downturn, global investors are shifting their focus to other markets. Chinese tech stocks are seeing heightened demand, while European equities have benefited from a stronger regional economic outlook.

Despite the bearish sentiment, Hartnett noted that such a sharp decline in investor confidence typically aligns with the end of a market correction. However, he suggested that the S&P 500 would only surpass 6,000 points if concerns over trade wars and inflation eased. Last week, he recommended buying the index at 5,300 points—around 7% below current levels—following its recent dip to 5,504 amid uncertainty over President Donald Trump’s trade policies.

European stocks have outperformed their U.S. counterparts this year, supported by more attractive valuations. The survey found that a net 39% of global investors are now overweight on European equities, marking the highest allocation since mid-2021.

The survey, conducted between March 7 and March 13, included 171 participants managing a combined $426 billion in assets.