Ahead of the announcements of several Covid-19 vaccines in November last year, DBS Bank had made the call to investors to position for a recovery play. The timing of the move, as it turned out, had proven to be “prescient”, DBS chief investment officer Hou Wey Fook and strategist Dylan Cheang write in a note dated April 23.

But now, the bank is advising investors to rotate back to pandemic-proof assets, particularly technology stocks and gold. The switch to a recovery play in anticipation of vaccine discoveries, it says, is showing signs of “fatigue”.

According to DBS, the technology-heavy Nasdaq Composite Index over US small caps had peaked on Aug 26 last year. The index had subsequently undergone a sharp relative underperformance as global portfolio allocators jumped onto the bandwagon of piling into domestic plays in anticipation of vaccine discovery.

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