LIVE MARKETS-Pessimism is rising: AAII

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PESSIMISM IS RISING: AAII

Pessimism among individual investors about the short-term outlook for stocks increased in the latest AAII Sentiment Survey and according to the weekly survey, optimism and neutral sentiment decreased.

Bullish sentiment, or expectations that stock prices will rise over the next six months, decreased 1.9 percentage points to 32.7%, according to AAII. And bullish sentiment is now below its historical average of 37.5% for the sixth time in 10 weeks.

Neutral sentiment, or expectations that stock prices will stay essentially unchanged over the next six months, fell 2.0 percentage points to 23.9%. So neutral sentiment is now below its historical average of 31.5% for the 59th time in 61 weeks.

Bearish sentiment, or expectations that stock prices will fall over the next six months, rose 3.9 percentage points to 43.4%. This puts bearish sentiment at unusually high levels and above its historical average of 31.0% for the 40th time in 42 weeks.

The bull-bear spread, referring to bullish minus bearish sentiment, dropped 5.8 percentage points to –10.7%. And the bull-bear spread is below its historical average of 6.5% for the 29th time in 31 weeks.

For this week’s special question, AAII members were asked how they would describe the current state of the economy.

Here is how they responded:

Great: 4.0%

Good: 34.9%

Mixed: 54.7%

(Sinéad Carew)

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