LIVE MARKETS-Individual investor bears levitate, bulls languish - AAII

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INDIVIDUAL INVESTOR BEARS LEVITATE, BULLS LANGUISH - AAII

Individual investor pessimism over the short-term outlook for U.S. stocks remains elevated in the latest American Association of Individual Investors (AAII) Sentiment Survey. With this, optimism edged up, while neutral sentiment decreased.

Meanwhile, half of investors surveyed believe there is a "higher-than-typical chance" of a recession occurring before the end of the year.

AAII reported that bearish sentiment, or expectations that stock prices will fall over the next six months, slipped 1.1 percentage points to 58.1%. Bearish sentiment is still "unusually high" and is above its historical average of 31.0% for the 16th time in 18 weeks.

Of note, this is the first time in the history of the survey that bearish sentiment has exceeded 57% four weeks in a row.

Bullish sentiment, or expectations that stock prices will rise over the next six months, rose 2.5 percentage points to 21.6%. Bullish sentiment is "unusually low" and is below its historical average of 37.5% for the 10th time in 12 weeks.

Neutral sentiment, or expectations that stock prices will stay essentially unchanged over the next six months, dipped 1.4 percentage points to 20.3%. Neutral sentiment is "unusually low" and is below its historical average of 31.5% for the 35th time in 37 weeks.

With these changes, the bull-bear spread gained 3.6 percentage points to –36.5% from -40.1% last week. The bull-bear spread is below its historical average of 6.5% for the 11th time in 13 weeks.

In this week's special question AAII asked its members where they put the odds of a recession occurring before year-end.

Here is AAII's graphic showing how they responded:

(Terence Gabriel)

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