Reuters) – Global investors slashed their holdings of equities below 50 percent
this month and piled into cash, reflecting what was lining up to be the worst
August for world stocks since
1998.
They also lifted exposure to bonds in North America, Britain and, to a lesser
extent, the euro zone, where Germany is considered a safe
haven.
Reuters polls of 57 leading investment houses in the United States, Europe
ex-UK, Japan and Britain showed the
average stock holding in a balanced or model portfolio falling to 49.2
percent.
It was the lowest since at least February 2009, when the current
questionnaire was introduced. July’s reading was 52.2 percent, the second month
in a row that it had risen.
Bond holdings rose to 36.1 percent in August from 35.3 percent. Cash — where
investors go in times of trouble — jumped to 5.8 percent from 4.5
percent.
The moves came as investors fled riskier assets because of signs that the
global economy is worsening. The
month also saw the credit downgrading of the United States and the euro zone
debt crisis continuing.
“While we had been expecting a ‘soft patch’ in terms of economic data during
the summer months, the weakness evident in many macroeconomic releases has
proven to be greater than many market participants had predicted,” said Paul
Amer, investment manager at Insight Investment.
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