Tags: AAII | investors | bearish | stocks

AAII Survey: Individual Investors Turn More Bearish Toward Stocks

By    |   Friday, 03 October 2014 12:26 PM

Retail investors apparently were growing more nervous about the stock market even before its plunge Wednesday, according to the latest weekly sentiment survey from the American Association of Individual Investors.

The report for the week ended Oct. 1 showed that the percentage of AAII members who are bullish on stocks for the next six months totaled 35.4 percent, down 6.4 percentage points from a week earlier and the lowest since Aug. 7.

Bears totaled 30.9 percent, up 2.7 percentage points and the highest since Aug. 7. A total of 33.7 percent feel neutral about the market, up 3.7 percentage points.

The increased pessimism stems from "prevailing valuations, events in the Middle East and Ukraine, the pace of economic growth and Washington politics," said AAII vice president Charles Rotblut, according to CNBC.

As for valuations, the trailing price-earnings ratio on the S&P 500 totaled 18.94 as of Sept. 26, up from 18.32 a year ago, according to Birinyi Associates.

Meanwhile, CNNMoney's Fear & Greed Index, a gauge of market sentiment, has registered extreme fear since Sept. 22.

That might strike you as odd, given that the S&P 500 hit a record high just two weeks ago and remains within 4 percent of that peak.

But the CBOE Volatility Index (VIX) has soared 35 percent during that period. Meanwhile, investors are exiting stocks for bonds, and more stocks have been reaching 52-week lows than 52-week highs, according to CNNMoney.

In addition, trading volume for falling stocks exceeds volume for rising stocks on a daily basis.

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Retail investors apparently were growing more nervous about the stock market even before its plunge Wednesday, according to the latest weekly sentiment survey from the American Association of Individual Investors.
AAII, investors, bearish, stocks
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2014-26-03
Friday, 03 October 2014 12:26 PM
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