Optimism among individual investors about the short-term outlook for stocks increased in the latest AAII Sentiment Survey. Meanwhile, both neutral sentiment and pessimism decreased.
Bullish sentiment, expectations that stock prices will rise over the next six months, increased 7.4 percentage points to 49.2%. Bullish sentiment is unusually high and is above its historical average of 37.5% for the 35th time in 36 weeks.
Neutral sentiment, expectations that stock prices will stay essentially unchanged over the next six months, decreased 3.1 percentage points to 29.1%. Neutral sentiment is below its historical average of 31.5% for the 10th time in 17 weeks.
Bearish sentiment, expectations that stock prices will fall over the next six months, decreased 4.4 percentage points to 21.7%. Bearish sentiment is below its historical average of 31.0% for the ninth time in 10 weeks.
The bull-bear spread (bullish minus bearish sentiment) increased 11.8 percentage points to 27.5%. The bull-bear spread is above its historical average of 6.5% for the 10th consecutive week.
Over the Fourth of July holiday week, we asked AAII members how the stock market’s year-to-date returns compare to their expectations at the start of 2024. The majority of members (66.7%) find them better than expected.
This week’s special question asked AAII members if they were concerned about the concentration—meaning the influence of a small number of stocks—in the S&P 500 index.
Here is how they responded:
- Yes, it is very concerning to me: 23.9%
- It is somewhat concerning to me: 54.8%
- It does not concern me: 16.8%
- Not sure/no opinion: 4.6%
This week’s Sentiment Survey results:
- Bullish: 49.2%, up 7.4 percentage points
- Neutral: 29.1%, down 3.1 percentage points
- Bearish: 21.7%, down 4.4 percentage points
Historical averages:
- Bullish: 37.5%
- Neutral: 31.5%
- Bearish: 31.0%
The AAII Sentiment Survey has been conducted weekly since July 1987.
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