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NewsMacro

Bank of America Bull & Bear indicator hits 9.7, highest since 2021, as optimism extreme draws rotation warning

The Bull & Bear indicator, Bank of America's (BAC) sentiment gauge, hit 9.7, its most extreme reading since 2021. Strong stock market performance, credit inflows, and tighter spreads drove the move, arriving as global equities reached record highs. Friday's U.S. jobs report is the next definitive test for a setup that has, by this measure, left little room for error.

By Desmond ChoiNewsroomAugust 7, 20262 min read
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Key takeaways

  • Bank of America's Bull & Bear indicator hit 9.7, its most extreme reading since 2021.
  • The move was driven by strong stock market performance, credit inflows, and tighter credit spreads as global equities reached record highs.
  • Bank of America treats the reading as an extreme signal for caution and recommends rotating portfolios toward defensive assets, bonds, and the U.S. dollar.
  • No specific allocation figures accompanied the rotation recommendation, which communicates direction rather than magnitude.
  • Friday's U.S. jobs report is the next major test Bank of America flagged for markets.

The Bull & Bear indicator, Bank of America's (BAC) sentiment gauge, hit 9.7, its most extreme reading since 2021. Strong stock market performance, credit inflows, and tighter spreads drove the move, arriving as global equities reached record highs. Friday's U.S. jobs report is the next definitive test for a setup that has, by this measure, left little room for error.

What the 9.7 print reflects

Three inputs moved the gauge to its current level: stock market performance, credit inflows, and spread compression. Each arrived together in a period when global equities reached record highs. The combination put the indicator at a point Bank of America treats as extreme.

The last time the Bull & Bear indicator sat this high was 2021. Bank of America framed the reading as a signal for caution, placing it in territory that has historically preceded a shift away from risk. The firm's position is that the tape has absorbed enough good news to warrant reducing exposure.

Bank of America's rotation call

The firm recommends moving portfolios toward defensive assets, bonds, and the U.S. dollar. No specific allocation figures accompanied the recommendation. The direction, rather than the magnitude, is what the call communicates.

Bonds and the dollar as paired destinations represent a classically defensive lean. Bank of America's case for the move rests on spreads that are already tight, equities at record highs, and an indicator reading that places sentiment at its highest point since 2021. The firm has not specified a level that would shift that view.

What to watch

Friday's U.S. jobs report is the event Bank of America flagged as the next major test for markets. The setup entering that print has the Bull & Bear indicator at 9.7 and a formal rotation call already on the table. A weak number could give the defensive posture momentum. A strong print would test whether sentiment at this level can hold.

The last time the gauge reached this extreme was 2021. Friday arrives with that reference point in view and Bank of America's warning on record.

About this story

Filed by the newsroom of MarketPR on August 7, 2026. Source: MarketPR newsroom. Indicative figures are not investment advice.

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Frequently asked

What is the Bull & Bear indicator?

It is Bank of America's sentiment gauge, which recently hit 9.7, its most extreme level since 2021.

Why did the indicator reach 9.7?

Three inputs moved it: strong stock market performance, credit inflows, and spread compression, all arriving as global equities reached record highs.

What does Bank of America recommend investors do?

The firm recommends moving portfolios toward defensive assets, bonds, and the U.S. dollar, a classically defensive lean.

What is the next major test for markets?

Friday's U.S. jobs report, which Bank of America flagged as the next definitive test, with a weak number potentially favoring the defensive posture and a strong print testing whether elevated sentiment can hold.

When was the last time the indicator was this high?

The last time the Bull & Bear indicator reached this extreme level was in 2021.