AAII Sentiment Survey: Neutral Sentiment Jumps

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

Bullish sentiment, expectations that stock prices will rise over the next six months, decreased 4.7 percentage points to 39.7%. Bullish sentiment is above its historical average of 37.5% for the 10th consecutive week.

Neutral sentiment, expectations that stock prices will stay essentially unchanged over the next six months, increased 6.5 percentage points to 31.3%. Neutral sentiment is below its historical average of 31.5% for the 81st time in 83 weeks.

Bearish sentiment, expectations that stock prices will fall over the next six months, decreased 1.8 percentage points to 29.0%. Bearish sentiment is below its historical average of 31.0% for the seventh time in 10 weeks.

The bull-bear spread (bullish minus bearish sentiment) decreased 2.9 percentage points to 10.7%. The bull-bear spread is above its historical average of 6.5% for the 10th consecutive week.

This week’s special question asked AAII members what they thought about the Federal Reserve’s decision to keep interest rates unchanged.

Here is how they responded:

• They should have raised rates: 7.0%

• It was the right move: 68.6%

• They should have cut rates: 17.1%

• Not sure/no opinion: 7.0%

This week’s Sentiment Survey results:

Bullish: 39.7%, down 4.7 points
Neutral: 31.3%, up 6.5 points
Bearish: 29.0%, down 1.8 points

Historical averages:

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

See more Sentiment Survey results.