EUROPE – IPE’s monthly investment manager survey of expectations of equity and bond market movements reveal asset managers are less optimistic about global equity markets than last month.

IPE surveys over 100 pensions asset managers on a monthly basis for their six- to 12-month views for equities, bonds and currencies. The asset managers are selected on the basis of having one or more segregated European mandate.

The results, taken from mid-April to mid-May, show that 62% are predicting a rise in US equities, down from 70% last month. 67% are also predicting a rise in euro-zone and UK equities down from 74% and 69% respectively. Only 38% of those surveyed are expecting a rise in Japanese equities – 51% are now predicting stability. 69% see a rise in Asian equities, down from 79% the previous month.

In the bond arena the majority of asset managers surveyed are predicting prices to fall across the major currencies, although to a lesser extent than last month. For dollar-denominated bonds, 59% of asset managers are predicting a fall in price while 31% predict prices to remain stable.

56% of those surveyed expect Japanese yen-denominated bonds to fall in price, while 40% expect prices to remain the same.

Asset managers see more value in euro-denominated bonds. 23% are expecting a rise in prices, and 37% are expecting a fall. In sterling bonds 42% are expecting prices to remain stable and 45% expect a fall.

For currencies, 57% of asset managers are expecting the US dollar to fall against the euro; 30% believe the exchange rate will stay stable. The majority of asset managers surveyed believe the dollar will remain steady versus the yen and sterling.

Individual asset manager expectations can be found in IPE magazine every month, and on the website.