MILAN (Reuters) - Bullish investors cut cash levels to 3.5%, the lowest since 2010, as they went long stocks and "short everything else", a survey of investors from BofA Global Research showed on Tuesday.

BofA said equity investors rotated into bond-sensitive sectors, such as pharma, biotech, utilities and REITs, and to Europe, as a measure of investor fear of a global recession fell to a 3-year low and a trade war seen as no more than a tail risk.

Tech recorded its largest month-on-month allocation drop since September 2022, according to the monthly global survey of 168 participants with $401 billion of asset under management.

"Long Mag 7" remained the most crowded trade, BofA said, but US exceptionalism peaked, with 89% saying U.S. stocks are overvalued.