REUTERS/Shamil Zhumatov

The uncertainty surrounding the US-China trade war has severely depressed corporate earnings expectations and forecasts for global growth, Bank of America Merrill Lynch has found.

The firm's findings came from its monthly global fund manager survey, which takes the temperature of 230 managers with a combined $645 billion in assets under management.

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Expectations for future global growth and corporate profits among fund managers overseeing more than half a trillion dollars have collapsed as President Donald Trump's trade war with China rages on.

That's according to Bank of America Merrill Lynch's June global fund manager survey, released this week, which tracks market and economic outlooks among 230 fund managers with a combined $645 billion in assets.

The survey was the "most bearish survey of investor confidence since Global Financial Crisis," the firm's strategists led by Michael Hartnett wrote in a Tuesday report to clients.

Though the US stock market now trades within shouting distance of its record high, pessimism among investors has been driven by central bank uncertainty as well as trade war and economic slowdown concerns.

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Stocks received a boost Tuesday as investors pinned their hopes on President Trump and Chinese President Xi Jinping moving toward a deal later this month at the G20 summit in Osaka, Japan. Any sign of progress that emerges from a meeting between the leaders may put to rest some of investors' lingering concerns about a trade war resolution.

In the meantime, investors' macroeconomic views are bearish. Fund managers' global growth expectations from May to June plunged by the largest amount since November 1994, BAML found.

Bank of America Merrill Lynch

On a similar note, a record 87% of survey respondents call the global economy "late-cycle." After all, the US economic expansion is closing in on recording its longest run in history.

Read more: The market's safest assets have become the world's most crowded trade — and it shows just how worried everyone is about the trade war

Forecasts for companies' growth is similarly dim as the latest US earnings season narrowly avoided an earnings recession.

Global profit expectations fell by the second-largest amount on record, by BAML's tally, with 41% of fund managers stating they will "deteriorate" over the next year. As such, investors are overweight assets that outperform when interest rates and earnings both fall.

Bank of America Merrill Lynch.

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