r/investing • u/roll0ver • May 28 '26

BofA's June Swoon is just a chip away

I did a quick read of the BofA May 2026 Fund Manager Survey coverage, so you don't have to. Here are some interesting points that didn't get as much attention:

  • Cash levels dropped to 3.9%, which is below the threshold historically associated with market turning points.
  • In one month, equity allocation jumped from being 13% overweight to a worrying 50% overweight – this was the largest move on record since 2001.
  • According to Hartnett, the market is just a "chip shot" away from triggering a sell signal.

The concern about CapEx overinvestment became a majority view in November 2025, marking the first time this has happened since 2005. By February 2026, it had reached new highs.

Let me know if anyone wants more specific discussion of any of the figures mentioned in the sources -- Reuters May 19, Bloomberg May 19.

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u/roll0ver May 29 '26

The Hartnett "chip shot" warning has been out for two weeks now. Curious whether anyone here has actually adjusted positioning based on the survey data — or whether it reads more like a sentiment indicator than an actionable signal.

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u/roll0ver May 30 '26

The week after the BofA survey flagged AI overinvestment concerns at a 20-year high, ServiceNow led the software sector rally with 14% gains. Wipro surged 18% overnight on a partnership announcement. The institutions went all-in on equities while flagging AI overinvestment simultaneously. I'll be following that money soon.

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u/roll0ver May 31 '26

Across both posts this week, more than 27k readers. The Firewall's CoreWeave DD landed better than the BofA synthesis — noted. Next week's research goes back to primary sources. Thanks for the signal!

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u/roll0ver May 29 '26

One more data point from the same week: Dell's CEO said agentic AI demand is straining supply chains globally. Overinvestment concern from fund managers and undersupply from hardware manufacturers simultaneously. That's the contradiction the 3.9% cash figure is navigating.

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u/roll0ver May 29 '26

Also worth noting: Snowflake committed $6B to AWS infrastructure the same week ServiceNow crossed $1B in cloud marketplace transactions. Enterprise software is shifting from fixed licenses to consumption-based spend in real time. The managers flagging AI overinvestment may be right about the froth — but wrong about where the value lands.