Investors less bullish on Treasuries ahead of Fed

NEW YORK, Nov 2 (BestGrowthStock) – Investors were less bullish on
U.S. Treasury debt just ahead of an expected announcement from
the Federal Reserve on more asset purchases to prop up the
economy, a survey released on Tuesday showed.

Investors moved into a more neutral investment position on
Treasuries and the gap between the share of investors who said
they are long Treasuries and the share of investors who said
they are short Treasuries shrank to 23 percent on Monday from
29 percent a week ago, J.P. Morgan Securities said.

The U.S. central bank is pretty much unanimously expected
to announce a new program of quantitative easing on Wednesday
afternoon at the conclusion of a two-day policy meeting.

Speculation has varied widely over the possible size of the
program, although many expect buying of $100 billion of
Treasuries per month for five months, with an open-ended
commitment to buy more if deemed necessary.

In anticipation of QE2, the share of investors who said
they are “long,” or owning more Treasuries than their portfolio
benchmarks, dipped to 33 percent on Monday from 41 percent a
week earlier, J.P. Morgan said.

According to the latest J.P. Morgan survey, the share of
investors who were “short,” or owning less Treasuries than
their portfolio benchmarks, fell to 10 percent from 12 the week
previous.

In the latest week, the share of investors with a “neutral”
stance, or owning Treasuries equal to their portfolio
benchmarks rose to 57 percent from 47 percent last week.

The share of “longs” made up by active clients, including
market makers and hedge funds, held at 5 percent.

The amount of active clients who were “neutral” was 6
percent, unchanged from the prior week, while the share of
active clients who were “short” has been stuck at zero.
(Reporting by Chris Reese; Editing by James Dalgleish)

Investors less bullish on Treasuries ahead of Fed