LIVE MARKETS-Individual investors most bullish since December - AAII

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INDIVIDUAL INVESTORS MOST BULLISH SINCE DECEMBER - AAII

Optimism among individual investors over the short-term outlook for U.S. stocks surged in the latest American Association of Individual Investors (AAII) Sentiment Survey. With this, both pessimism and neutral sentiment declined.

Meanwhile, about two-thirds of investors surveyed said that they believe the new tax legislation being debated will raise the national deficit "too much."

AAII reported that bullish sentiment, or expectations that stock prices will rise over the next six months, jumped 9.9 percentage points to 45%. (Last higher December 4, 2024 at 48.3%). Bullish sentiment is above its historical average of 37.6% for the only second time in 22 weeks. It is also above 40% for only the third time this year.

Bearish sentiment, or expectations that stock prices will fall over the next six months, fell about 7 percentage points to 33.1% (Last lower on January 22, 2025 at 29.4%). Bearish sentiment is above its historical average of 31.2% for the 31st time in 33 weeks.

Neutral sentiment, or expectations that stock prices will stay essentially unchanged over the next six months, dipped 2.8 percentage points to 21.9%. Neutral sentiment is below its historical average of 31.2% for the 50th time in 52 weeks.

With these changes, the bull-bear spread jumped 17.1 percentage points to +11.9% from -5.2% last week. The bull-bear spread is above its historical average of 6.5% for only the third time in 24 weeks.

In this week's special question AAII asked its members what is their opinion of the new tax legislation, the One Big Beautiful Bill Act, being debated in Congress?

Here is AAII's graphic showing how they responded:

(Terence Gabriel)

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