AAII Sentiment Survey: Optimism Contracts

Optimism among individual investors about the short-term outlook for stocks decreased in the latest AAII Sentiment Survey. Meanwhile, neutral sentiment increased and pessimism was unchanged.

Bullish sentiment, expectations that stock prices will rise over the next six months, decreased 2.4 percentage points to 35.4%. Optimism is below its historical average of 37.5% for the first time in five weeks and was last lower on April 25, 2024 (32.1%).

Neutral sentiment, expectations that stock prices will stay essentially unchanged over the next six months, increased 2.3 percentage points to 30.4%. Neutral sentiment is below its historical average of 31.5% for the 25th time in 26 weeks.

Bearish sentiment, expectations that stock prices will fall over the next six months, is unchanged at 34.2%. Pessimism is above its historical average of 31.0% for the sixth time in seven weeks.

The bull-bear spread (bullish minus bearish sentiment) decreased 2.4 percentage points to 1.3%. The bull-bear spread is below its historical average of 6.5% for the third time in six weeks.

This week’s special question asked AAII members their opinion on the Federal Reserve’s decision to cut interest rates by 0.25 percentage points.

Here’s how they responded:

• It was the right move: 43.5%
• They should have left rates unchanged: 41.9%
• They should have cut rates by a larger amount: 3.8%
• They should have cut rates by a smaller amount: 0.9%
• Not sure/no opinion: 9.7%

See more Sentiment Survey results.