Study Shows Fund Managers Anticipating Rate Rise, EU QE

Hedge fund managers are increasing their exposure to European stocks, as anticipation of a U.S. interest rate increase grows.

Positive investment sentiment towards Europe is growing in the wake of the recently announced ECB stimulus program, according to a BofA Merrill Lynch Fund Manager Study.

Fund managers' expectations for interest rates

The study, which included 202 panelists with a total of $556 billion in assets under management, finds that fund managers expect to see a bifurcated market between U.S. and European stocks. Real rates in Europe are expected to remain low, while U.S. rates are expected to risk, with the first rate increase anticipated for Spring of 2015.

European stocks are expected to rise heading into quantitative easing, after this battered down...