Investing.com -- The number of European investors who believe the continent's economy will improve over the coming twelve months has risen, according to a survey conducted by Bank of America Securities.
According to the lender's study of European fund managers, a net 61% of respondents said they expect to see stronger growth in the region in the next year-long period. It was the highest mark since July 2021.
An overall total of 245 panellists with $642 billion in assets under management participated in the survey, the Bank of America analysts said.
More than a third of the participants said they were anticipating an immediate acceleration, citing waning inflationary pressures and subsequent hopes that the European Central Bank will soon begin to lower interest rates after a series of hikes. In January, only 3% of investors were projecting such an outcome.
Over half of the respondents said that European stocks, which have recently been trading around record highs, are expected to benefit from the potential easing in monetary conditions, the survey found. Meanwhile, 37% are counting on earnings upgrades in response to broader macroeconomic resilience. Overall, 78% are estimating further near-term gains for European equities.
Cyclical and small-cap stocks are expected to be particularly boosted in the months ahead, the figures showed.
The Bank of America analysts also said tech has captured the most sector overweight ratings amongst investors in Europe, replacing energy. Traders are also piling into healthcare and insurance, while real estate, chemicals and media are the least favored, the analysts noted.