AUSTRALIA - Confidence among Australian fund managers in local markets is at its highest level since 2005, according to the latest Russell Investments Manager Outlook.
Only 8% of the managers surveyed foresee an overall dip in the market over the next 12 months, while a record 65% expect further gains.
The outlook - which generates a quarterly snapshot of Australian investment manager sentiment - said that the cautiously optimistic outlook which emerged during the previous quarter had strengthened, with the industrial, consumer, and financial sectors expected to perform well.
Russell Investments portfolio manager Scott Bennett said, "The outlook for all asset classes has continued to improve since the June turnaround - except for a minor retraction for international shares. What's also apparent...is that Australian shares are firmly in the lead in terms of bullish sentiment. In fact, we have not seen such a high level of conviction in the local market since June 2005."
Amidst the optimism the survey also indicated that fund managers should tread carefully when investing in certain asset classes. The outlook for Australian bonds still appears to be bearish, reflecting expected increases in inflation rates. Caution also remains evident in real estate investment trusts due to expected hikes in future interest rates.
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