GREENWICH, Conn. (HedgeWorld.com)–Hedge fund managers reversed their bearish view of the U.S. dollar this month, with 61% of those responding to a Van Hedge Fund Advisors survey predicting a January rally for the currency.
With a number of economic analysts having forecast relatively strong 2005 performance for the U.S. economy against lackluster expectations for Europe, the hedge fund managers brightened their outlook for the dollar after taking a majority bearish view for all of the fourth quarter of 2004.
In the same VAN Macro Sentiment Indicators survey, responding fund managers also took a bullish position on U.S. equities for this month, with 57% of them looking for the Standard & Poor’s 500 stock index continue its upward movement in January.
For the second month in a row, the managers had a bearish view of U.S. Treasury 10-Year Notes, with 61% of them expecting to see Treasuries move lower. In December, 80% of them were bearish on the Note, whereas in November an overall slight majority was either neutral (21%) or bullish (33%).
Just 26% of managers were bearish on U.S. equities for January, while 17% were neutral. The rest were bullish.