Long stocks and gold are the most crowded trades according to BofA's survey

BofA's Fund Manager Survey indicates that long stocks and gold are the most crowded trades in the current market. Among participants, 54% are focused on long 'Mag 7', and 29% are targeting gold. This reflects strong bullish sentiment among global investors amidst rising macroeconomic and policy expectations. Recently, Fed Chair Powell downplayed inflation risks while emphasizing labor market weaknesses, which has led many investors to remain invested in risk assets. However, with the Fed adopting a dovish stance, uncertainty remains about the degree of rate cuts ahead, which may cause corrections in risk assets. Upcoming U.S. employment and CPI data will significantly influence market dynamics. Strong data could lead to hawkish repricing, causing pullbacks in risk assets, while benign data could provide support.