AAII Sentiment Survey: Pessimism Eases

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

Bullish sentiment, expectations that stock prices will rise over the next six months, increased 0.2 percentage points to 38.3%. Bullish sentiment is above its historical average of 37.5% for the third time in 12 weeks.

Neutral sentiment, expectations that stock prices will stay essentially unchanged over the next six months, increased 6.6 percentage points to 28.7%. Neutral sentiment is below its historical average of 31.5% for the 94th time in 96 weeks.

Bearish sentiment, expectations that stock prices will fall over the next six months, decreased 6.7 percentage points to 33.3%. Bearish sentiment is above its historical average of 31.0% for the 13th consecutive week.

The bull-bear spread (bullish minus bearish sentiment) increased 6.9 percentage points to 5.4%. The bull-bear spread is below its historical average of 6.5% for the 12th time in 13 weeks.

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: 7.5%

• It was the right move: 71.7%

• They should have cut rates: 15.0%

• Not sure/no opinion: 5.8%

This week’s Sentiment Survey results:

Bullish: 38.3%, up 0.2 points
Neutral: 28.7%, up 6.6 points
Bearish: 33.0%, down 6.7 points

Historical averages:

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

See more Sentiment Survey results.