BofA Bullishness Gauge Reaches Highest Level Since 2021
BofA’s Bull & Bear Indicator climbed to 9.7, its highest level since 2021, as equity breadth, high-yield inflows and tighter credit spreads reinforced investor optimism. The extreme reading raises the risk of a pullback in global risk assets.
MSA market desk
Desk brief
Bank of America’s Bull & Bear Indicator rose to 9.7 from 9.4, reaching its most elevated level since 2021 and entering territory associated with a contrarian warning for risk assets. Strategists led by Michael Hartnett cited broadening equity-market participation, strong high-yield bond inflows and tighter credit spreads as evidence of increasingly optimistic positioning.
The signal does not necessarily imply an immediate market reversal, but it suggests that favorable sentiment and crowded positioning may leave equities and credit markets more vulnerable to disappointing macroeconomic data, higher interest rates or weaker earnings. Similar readings in recent months have coincided with calls to reduce, rather than eliminate, exposure to risk assets.
For African Eurobonds, the backdrop is initially supportive because tight global credit spreads and demand for high-yield debt can improve access to emerging-market risk. However, an eventual reversal in crowded positioning could widen spreads rapidly, particularly for lower-rated sovereign issuers and countries with large refinancing needs or limited foreign-exchange buffers.
Continue the desk read
Related market intelligence
US Equity and Treasury Moves (Sept 28, 2026): Higher US Yields Squeeze Long-Dated African External Credit
US Treasury and equity moves on Sept 28 reprice global discount rates. A rise in US yields would hit long-dated African external paper hardest—raising refinancing premia, widening sovereign and corporate spreads and squeezing FX reserves on importers.
US 10-Year Near 5.2%: Duration and Discount-Rate Shock Compresses Appetite for Long-Dated African Credit
A US 10-year around 5.2% raises the global discount rate and duration losses for long-dated African eurobonds. Higher long-end US yields disproportionately widen spreads on higher-beta sovereign long maturities (Ghana, Zambia) and raise rollover premia for USD-liable borrowers.
Dollar Strength Near 101.1: FX Pressure Raises External Debt Service Risk for FX-Liable African Borrowers
A firmer dollar near 101.1 raises local-currency costs of servicing USD liabilities, pressuring FX-exposed sovereigns and corporates. Net importers and dollarised economies will face greater fiscal and rollover strain, increasing refinancing premia on external debt.
Fed Hike to 3.75–4.00%: Dollar and Funding Costs Reprice African External Debt
A 25bp Fed hike and a firmer SEP lift US discount rates and dollar funding costs, pressuring long-dated African eurobonds via duration and raising refinancing premia for importers; oil exporters and IMF-backed credits should show relative resilience.