Fund Managers Cut Cash to 3.5% as AI Spending Optimism Holds

Bank of America’s Global Fund Manager Survey is closely watched as a gauge of institutional risk appetite and portfolio positioning. A decline in cash holdings typically signals greater willingness to take market risk, though elevated technology valuations have kept concerns about a semiconductor and artificial-intelligence bubble in focus. The outlook for hyperscaler spending remains central because their data-center investments support demand across the AI supply chain.

Bank of America’s latest survey showed global fund-manager confidence strengthening as average cash allocations fell to a rare 3.5%. While some respondents continued to flag bubble risks in semiconductors and AI, more than 70% expected major cloud-computing companies not to reduce AI capital expenditure in 2026. The result suggests investors still see hyperscaler investment as a durable earnings and demand driver despite growing scrutiny of returns.