Investors' bullish, bearish sentiment returning to historical averages

Investors' bullish, bearish sentiment returning to historical averages
Survey also reveals the current most important elements of earnings reports.
OCT 25, 2024

American retail investors are becoming less bullish, more bearish as sentiment returns to near long-term averages in both respects.

The latest weekly AAII Investor Sentiment Survey reveals that bullish sentiment – that stocks will rise over the next six months - has tumbled by almost 8 points to 37.7% this week, just short of the 37.5% historical average, while bearishness – expectation of falling stock prices - increased 4.5 points to 29.9%, not far from the 31% historical average.

The share of respondents who are neutral on stock market prices also increased, by more than three points to 32.4%, putting it above the historical average of 31.5% for the first time in 16 weeks.

The bull-bear spread (bullish minus bearish sentiment) decreased 12.3 percentage points to 7.8%. The bull-bear spread is above its historical average of 6.5% for the 24th time in 25 weeks.

The AAII survey also asked investors about the most important information that they are looking for in the current earnings season. The top answers were:

  • Whether earnings were better or worse than expected: 29.1%
  • Guidance on future revenues and earnings: 26.5%
  • Sales and/or earnings growth: 22.8%
  • Fundamentals such as the balance sheet or cash flow: 16.4%

The recent Morgan Stanley Wealth Management quarterly retail investor pulse survey shows that 59% of respondents are bullish, although this is two points lower than in the previous quarter as the presidential election approaches and geopolitical tensions rise.

Latest News

Powell heads for hot-seat hearings with ongoing pressure from Trump policies
Powell heads for hot-seat hearings with ongoing pressure from Trump policies

The Fed chair is in for some "hyper-charged" meetings, with legislators likely to raise questions on tariff threats and apparent steps to comply with anti-DEI orders.

Revealed: The InvestmentNews Top Advisors for 2025
Revealed: The InvestmentNews Top Advisors for 2025

Driven by long-term vision and a steadfast commitment to client service, the top-ranking advisors are reaching new heights of success.

Trepidation at SEC as Trump workforce overhaul casts shadow on agency
Trepidation at SEC as Trump workforce overhaul casts shadow on agency

While the regulator's lawyers may be exempt, a federal effort to purge workers is causing uncertainty across its broader employee base.

Prime Capital Financial, Carnegie expand Eastern footprints
Prime Capital Financial, Carnegie expand Eastern footprints

The two national RIA firms are bolstering their presence separately in Georgia and Connecticut with new billion-dollar acquisitions.

Embattled TD Bank eyes $14B raise in Schwab stake exit
Embattled TD Bank eyes $14B raise in Schwab stake exit

The banking giant is looking to sell its interest in the online brokerage giant amid the continuing fallout of its historic money-laundering settlement with federal regulators.

SPONSORED Taylor Matthews on what's behind Farther's rapid growth

From 'no clients' to reshaping wealth management, Farther blends tech and trust to deliver family-office experience at scale.

SPONSORED Why wealth advisors should care about the future of federal tax policy

Blue Vault features expert strategies to harness for maximum client advantage.