One-Quarter of Investors More Cautious About Market as Coronavirus Cases Increase

This week’s Sentiment Survey special question asked AAII members how the recent increase in coronavirus cases is impacting their outlook for stocks. Responses were mixed. About 28% of respondents say that the recent increase in coronavirus cases is causing them to be more cautious and is negatively affecting their outlook for stocks. This compares to 27% of respondents who say that the recent increase in coronavirus cases is having little to no impact on their outlook for stocks.

In addition, 15% of respondents say that market volatility will continue with the recent increase in coronavirus cases. About 12% of respondents say that they are more concerned with the election. Additionally, 7% of respondents note that they are waiting on the vaccine. Lastly, 11% of respondents fall into the ‘other’ category.

Here is a sampling of the responses:

• “It puts the economic recovery, already in big trouble, in jeopardy. The stock market can continue to pretend that the economy does not matter as long as the Federal Reserve prints money, but both economic theory and common sense say that this will not end well. I predict that this is not going to be a 2008 crash, but rather the painful, slow decline of 2000 potentially repeating itself.”
• “Without a vaccine, a rise in cases is not a surprise as we move deeper into fall. What else could have occurred? I think it’s a non-event for the markets.”
• “With or without the coronavirus, I believe the market is in for losses in the next six months.”
• “I am more cautious than in previous years, but I think the government will continue to pour in stimulus, thereby propping up the U.S. markets.”

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