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Fund managers spurn Europe in switch to US

Fund managers are turning their backs on Europe in favour of US markets, according to new research from Lipper.

Fifty-eight per cent of funds in the global growth sector increased their exposure to the US during May while 56 per cent of funds in the same sector reduced their exposure to Europe over the same period.

Gartmore global growth saw the most dramatic switch, increasing its exposure to North America to 35.6 per cent from 32.5 per cent. It reduced its European share to 30.4 per cent from 37.3 per cent.

The top-performing funds in the sector were also revealed to carry much higher cash positions of around 5 per cent, while the bottom performers on average held around half as much in cash.

Lipper Portfolio Services product manager Nick Hamilton says: “Fund managers may have been encouraged by the current US Federal Res-erve interest rate policy and the new administration&#39s tax cuts while concerns have increased about European growth and inflation. These concerns are reflected by May&#39s transfer of European assets into North American assets.”

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