AAII Sentiment Survey: Pessimism Makes a Comeback

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

Bullish sentiment, expectations that stock prices will rise over the next six months, decreased 4.8 percentage points to 32.9%. Bullish sentiment is below its historical average of 37.5% for the 16th time in 17 weeks and is above 30% for only the eighth time this year.

Neutral sentiment, expectations that stock prices will stay essentially unchanged over the next six months, decreased 0.3 percentage points to 25.2%. Neutral sentiment is below its historical average of 31.5% for the 45th time in 47 weeks.

Bearish sentiment, expectations that stock prices will fall over the next six months, increased 5.1 percentage points to 41.9%. Bearish sentiment is unusually high and is above its historical average of 31.0% for the 26th time in 28 weeks.

The bull-bear spread (bullish minus bearish sentiment) decreased 10.0 percentage points to –9.0%. The bull-bear spread is below its historical average of 6.5% for the 21st time in 23 weeks.

This week’s special question asked AAII members which factor is most influencing their six-month outlook for stocks.

Here is how they responded:

• Tariffs, the economy, and/or inflation: 63.7%
• Corporate earnings: 10.7%
• Valuations: 10.4%
• Monetary policy/interest rates: 8.9%
• Other: 6.3%

See more Sentiment Survey results.