Nearly half of fund managers surveyed by Bank of America Merrill Lynch expect global GDP to fall in 2019 and 55% say they're bearish on both the world's growth and inflation outlook next year.

Why it matters: That's causing many to increase their cash positions, cut back on allocation to stocks and strangely to increase their holdings of emerging market assets.

What it means: Emerging market stocks and bonds are typically thought of as more risky than developed market securities because emerging countries have less deep and less developed capital markets and are often more vulnerable to large swings in volatility.

  • In times of uncertainty, investors typically sell, not buy.

Yes, but: BAML strategists say that despite the overall wall of worry — the U.S.-China trade war tops the list of biggest tail risks cited by investors for the ninth straight month — EM was the most crowded trade for the first time in survey history. That's even more impressive considering shorting EM was the third most crowded trade just last month.

  • But since the third quarter of 2018, EM has not only outperformed developed market peers like the U.S. and Europe, it has been less volatile.

What they're saying: Julian Howard, head of multi-asset solutions at GAM, said on CNBC in August that the market may have reached the peak of the anti-EM trade.

Go deeper: Brazil's deadly dam collapse could shock emerging markets

Go deeper

Updated 2 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Global: Total confirmed cases as of 12 p.m. ET: 30,241,377 — Total deaths: 947,266— Total recoveries: 20,575,416Map.
  2. U.S.: Total confirmed cases as of 12 p.m. ET: 6,681,251 — Total deaths: 197,763 — Total recoveries: 2,540,334 — Total tests: 91,546,598Map.
  3. Politics: Trump vs. his own administration on virus response.
  4. Health: Massive USPS face mask operation called off The risks of moving too fast on a vaccine.
  5. Business: Unemployment drop-off reverses course 1 million mortgage-holders fall through safety netHow the pandemic has deepened Boeing's 737 MAX crunch.
  6. Education: At least 42% of school employees are vulnerable.
2 hours ago - Economy & Business

Anxious days for airline workers as mass layoffs loom

Sara Nelson, president of the Association of Flight Attendants, during a Sept. 9 protest outside the Capitol. Photo: Alex Wong/Getty Images

The clock is ticking for tens of thousands of anxious airline employees, who face mass reductions when the government's current payroll support program expires on Sept. 30.

Where it stands: Airline CEOs met Thursday with White House Chief of Staff Mark Meadows, who said President Trump would support an additional $25 billion from Congress to extend the current aid package through next March.

House Democrats ask DOJ watchdog to probe Durham's Trump-Russia investigation

Attorney General Bill Barr. Photo: Kamil Krzaczynsky/AFP via Getty Images

Four Democratic House committee chairs on Friday asked the Justice Department's inspector general to launch an "emergency investigation" into whether Attorney General Bill Barr and U.S. Attorney John Durham, his appointee, are taking actions that could "improperly influence the upcoming presidential election."

Catch up quick: Last year, Barr tapped Durham to conduct a sweeping investigation into the origins of the FBI's 2016 Russia probe, after he and President Trump claimed that it was unjustified and a "hoax."