VTI - AAII Sentiment Survey: Pessimism Remains Above Average For 11th Consecutive Week

2023-05-04 14:07:43 ET

Summary

• Bullish sentiment, expectations that stock prices will rise over the next six months, decreased 0.1 percentage points to 24.1%.
• Neutral sentiment, expectations that stock prices will stay essentially unchanged over the next six months, decreased 6.3 percentage points to 31.0%.
• Bearish sentiment, expectations that stock prices will fall over the next six months, jumped 6.4 percentage points to 44.9%.

Pessimism among individual investors stayed above average for the 11th consecutive week in the latest AAII Sentiment Survey. Neutral sentiment decreased, as did optimism.

Bullish sentiment, expectations that stock prices will rise over the next six months, decreased 0.1 percentage points to 24.1%. Optimism continues to be at an unusually low level. Bullish sentiment is unusually low for the 50th time out of the past 70 weeks.

Neutral sentiment, expectations that stock prices will stay essentially unchanged over the next six months, decreased 6.3 percentage points to 31.0%. This ended neutral sentiment’s five-week streak of above-average levels, and it is below average for just the second time in 18 weeks.

Bearish sentiment, expectations that stock prices will fall over the next six months, jumped 6.4 percentage points to 44.9%. Bearish sentiment is still above its historical average of 31.0% for the 71st time out of the past 76 weeks. Additionally, bearish sentiment is at a five-week high.

The bull-bear spread (bullish minus bearish sentiment) decreased 6.4 percentage points to –20.8%. The bull-bear spread remains at an unusually low level for the eighth time out of the last 11 weeks.

This week’s responses were recorded prior to the 0.25% interest rate increase by the Federal Open Market Committee ((FOMC)).

This week’s special question asked AAII members which asset class they think will provide the highest return over the next six months. Here are their responses:

• Domestic stocks: 39.6%
• Bonds: 13.0%
• Gold: 9.0%
• Money market funds: 27.1%
• No opinion/Not sure: 10.7%

This week’s AAII Sentiment Survey results:

• Bullish: 24.1%, down 0.1 percentage points
• Neutral: 31.0%, down 6.3 percentage points
• Bearish: 44.9%, up 6.4 percentage points

Historical averages:

• Bullish: 37.5%
• Neutral: 31.5%
• Bearish: 31.0%

The AAII Sentiment Survey has been conducted weekly since July 1987.

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