Deutsche Bank sees cautious positioning despite market resilience

Deutsche Bank's latest report reveals a cautious approach to equity positioning despite the overall market stability. According to a note released on September 18, 2026, systematic investors are increasing their equity exposure, even in the face of reduced market volatility, while discretionary investors are backing off to a neutral stance.

Survey sentiment has hit an all-time low, with large-cap equity positioning currently sitting at a modest 0.35 standard deviations above neutral. This positioning falls far short of what Deutsche Bank anticipates, projecting a 30% growth in the third-quarter earnings season, which starts in a month's time.

The market's reaction to this week's Federal Open Market Committee meeting followed a familiar trend - a dip on the meeting day, followed by a rally the next day. However, equities have been grappling with high oil prices, rising interest rates, escalating geopolitical tensions, trade disputes, and concerns surrounding artificial intelligence.

Despite these challenges, equities have managed to remain within a narrow range. Sector-wise, positioning is more favorable for large-cap technology and energy stocks, while most other sectors, including cyclical and bond-like defensive ones, are underweight, reflecting growth concerns or rising rates.