Large-cap stocks have seen a sharp increase in interest from money managers as small-caps appear to have soured, according to a quarterly poll of investment managers conducted by Russell Investment Group.
The poll found that money managers are nearly three times more bullish on large-cap stocks than small-cap stocks and large-cap growth and value rank as the two most favored asset classes.
The bullishness on large-cap value rose 18% during the quarter to 54% and support for large-cap growth rose to 69%.Small-cap growth bullishness dropped 30% to 27%, with small-cap growth and value reaching all-time lows at 27% and19%, respectively.
"The survey's sharp swings reflect a growing view that rising oil prices, inflation, a slower housing market and two years of steady interest rate hikes may finally begin to bite," said Randy Lert, chief portfolio strategist at Russell, in a statement. "Money managers expect an environment where major corporations will be the best performing segment of the economy, and now appear to be aligning their expectations and investments accordingly. Big is in and small is out."
The poll also found that support for international equities fell across the board, including in emerging markets, where bullishness dropped 15% to 30%.