FUND managers are moving back into shares again as optimism grows about US and Chinese economic data, a global survey says.
About 75 per cent of global fund managers were holding an overweight position towards equities in the first quarter of this year, an increase from 40 per cent in the last quarter, the HSBC survey released on Friday found.
No fund manager held a positive outlook for bond or cash, with more than 60 per cent underweight on cash as an asset class.
More than 30 per cent of fund managers were underweight on bonds, compared with 20 per cent in the fourth quarter last year.
''It's a material shift in the overweight stance towards equities,'' HSBC's head of wealth management, Mike Danby, said.
''The Australian economy is so globally linked, that's always good news. I've heard the negative slant, which is when the world sneezes, the Australian market catches a cold. There's obviously the reverse of that and I think we're seeing it.
''There's no question any signs of improvement in the US's and China's underlying performances are going to drive a positive reaction here as well, and I think you can see that as an underlying trend.''
Last year, the sharemarket turned in its best performance since 2009, finished the year 14.6 per cent higher, as interest rates fell and investors chased higher-yielding stocks.
Mr Danby said fund managers were looking at stronger prospects in equities and selective fixed-income markets, based on valuations and following improving economic indicators in the US and China.
Within equities, 75 per cent of fund managers were bullish towards North America amid signs of a US economic recovery and despite uncertainty about further political wrangling over the debt ceiling.
At the same time, about half of those surveyed said they had a favourable view of greater China and European equities.
About 40 per cent of fund managers were also more bullish about equities in the Brazil, Russia, India and China (BRIC) group of large emerging economies.
The search for yield remained a factor for the respondents, with high-yield and emerging market bonds proving attractive. For the second quarter in a row, there were no fund managers holding a underweight stance towards Asian bonds in US dollars.
HSBC found that equity funds were an important contribution to the total growth of funds under management in the third quarter last year - about 46.2 per cent of the total increase, or $US78.4 billion. The top region for equity and bond investments for that quarter was North America, just ahead of Europe.