Tech holds the crown, but caution grows: BofA

Meanwhile, the Economic Times daily newspaper is available online now.

Key points

• Top Trending Stocks: SBI Share Cost, Axis Bank Share Rate, HDFC Bank Share Cost, Infosys Share Rate, Wipro Share Cost, NTPC Share Rate.
• While investors increasingly viewed the region's equities as undervalued, meanwhile, investor optimism toward Asia ex-Japan equities rose to the 89th percentile in August.
• Will Uncle Sam's 100% tariff threat stop India's Russian oil imports?
• Most investors additionally see USD/JPY at 165 as the probable trigger for intervention by Japanese authorities.
• Technology remains investors' top choice, but Asia fund managers are turning defensive, with 59% hedging AI downside through value, cyclical and defensive sectors.

Meanwhile, the Economic Times daily newspaper is available online now. Tech holds the crown, but defensive positioning grows: BofA survey. Tech holds the crown, but defensive positioning grows: BofA survey. ETMarkets.comLast Updated: Aug 19, 2026, 05: 33: 00 PM IST.

Technology remains investors' top choice, but Asia fund managers are turning defensive, with 59% hedging AI downside through value, cyclical and defensive sectors. While Japan exposure remains concentrated in banks and semiconductors against the backdrop of policy expectations and weaker semiconductor sentiment, asia ex-Japan optimism rose.

Technology remains the top preference among investors, but fund managers have clearly shifted toward a more defensive stance, according to Bank of America Securities' August Asia Fund Manager Survey. "Tech is still king, but defensives are rising, " BofA Securities remarked.

Meanwhile, the survey further demonstrates that 59% of investors are hedging AI downside risk by rotating into value, cyclical and defensive sectors, more than double the level seen in July. Almost two-thirds of investors additionally require clearer evidence of AI monetization before increasing their exposure to AI-related stocks. The defensive shift is particularly evident in Asia ex-Japan. Investors rotated out of cyclicals and technology and into defensive sectors including Utilities, Banks, Staples, Healthcare and Telecoms. Industrials and Tech Hardware recorded the sharpest declines in investor positioning.

While investors increasingly viewed the region's equities as undervalued, meanwhile, investor optimism toward Asia ex-Japan equities rose to the 89th percentile in August. Live Events.

For context, the combination of rising optimism toward Asia ex-Japan equities and a more defensive sector allocation highlights a shift in how investors are positioning within the region. Japan positioning remains concentrated In Japan, investor exposure remains heavily concentrated in Banks and Semiconductors, with Banks rising to a historical high, according to BofA. The positioning comes as investors increasingly anticipate a shift in Japanese monetary policy. Almost 60% expect the next Bank of Japan rate hike to occur as early as next month, in line with BofA's economist expectation.

Most investors additionally see USD/JPY at 165 as the probable trigger for intervention by Japanese authorities. Investors become more selective on the AI trade BofA remarked views on the semiconductor cycle weakened sharply in August, pointing to a less favourable stance toward the sector. Meanwhile, Power & Energy remain the most favored segments of the AI value chain, indicating that investors continue to favour selected areas linked to AI infrastructure even as their broader view of the semiconductor cycle weakens. (Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times).

Asia fund manager surveyBank of America SecuritiesAI investmentdefensive sectorsJapan stockssemiconductor cycleAI monetisationinvestor positioningPower and Energy sectors.

Power shift, a déjà vu: Air India could be new CEO's toughest flight yet. The Nifty doesn't predict India. It records it.

ET Prime special series: Bigger or Better? Bharat Electronics' 2013 to 2026 journey – Part 2. Will Uncle Sam's 100% tariff threat stop India's Russian oil imports?

For now, tech holds the crown, but caution grows: BofA remains the part of the story worth watching, and further updates are likely as more details are confirmed.