AAII Sentiment Survey: Neutral Sentiment Rises to a Five-Week High

The percentage of individual investors describing their short-term outlook as “neutral” rose to a five-week high in the latest AAII Sentiment Survey. Optimism also rose while pessimism plunged.

Bullish sentiment, expectations that stock prices will rise over the next six months, jumped 7.5 percentage points to 41.3%. The increase puts optimism above its historical average of 38.0% for the third time in five weeks.

Neutral sentiment, expectations that stock prices will stay essentially unchanged over the next six months, rebounded by 1.4 percentage points to 32.3%. The historical average is 31.5%.

Bearish sentiment, expectations that stock prices will fall over the next six months, fell 8.8 percentage points to 26.4%. Though a large drop, it only puts pessimism at a three-week low. The historical average is 30.5%.

All three indicators are currently within their typical historical ranges.

The coronavirus outbreak is dampening the economic outlook for some but not all individual investors. Also affecting individual investor sentiment is the market’s upward trend, valuations, the phase-one trade deal between the U.S. and China, the November elections, Washington politics, earnings growth, monetary policy and the economy.

This week’s AAII Sentiment Survey results:

• Bullish: 41.3%, up 7.5 percentage points
• Neutral: 32.3%, up 1.4 percentage points
• Bearish: 26.4%, down 8.8 percentage points

Historical averages:

• Bullish: 38.0%
• Neutral: 31.5%
• Bearish: 30.5%

Want to weigh in? Take the survey yourself and see results online at www.aaii.com/sentimentsurvey.

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See more Sentiment Survey results.