Investors are getting ready to hunker down.
Bank of America just published its January fund manager survey, which was conducted between January 8 and January 14 and took in the views of 211 panelists with $610 billion in assets.
In a note titled 'Not yet max bearish', strategists led by Michael Hartnett said that just 12% of respondents to the survey believe a global recession will take place in the next 12-months, and investors remain long equities.
That said, investors are allocating more to cash, with the survey reading for cash levels jumping to the third highest level since 2009, and earnings per share expectations have turned negative.
Investors are also moving into defensive investments like healthcare stocks, bonds and cash, and away from equities, energy, and banks.
"Investors no longer in "denial" about recession/bear market risks," the note said.
Bank of America Merrill Lynch
As the chart below shows, the percentage of investors who think the global economy is now "late-cycle" has risen to the highest level since September 2008.
Bank of America
Here is the chart on global profit expectations turning negative for the first time since October 2012.
Bank of America Merrill Lynch