LIVE MARKETS-Investors grow less bearish, but skepticism remains high — AAII 

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INVESTORS GROW LESS BEARISH, BUT SKEPTICISM REMAINS HIGH — AAII

Individual investors grew a little less pessimistic about the stock market this week, according to the latest American Association of Individual Investors (AAII) Sentiment Survey. While bearishness eased, optimism and neutral views both ticked higher.

The biggest shift came from the bears. The share of investors expecting stocks to fall over the next six months dropped 5.2 percentage points to 48.1%. That's still a historically elevated reading, however, and marks the 33rd straight week bearish sentiment has remained above its long-term average of 31.5%.

Bullish sentiment rose 3.9 percentage points to 32.7%, while neutral sentiment edged up 1.3 percentage points to 19.2%. Even with the improvement, bullishness remains below its historical norm of 37.5%, while neutral sentiment remains unusually low and well below its long-term average of 31.0%.

As a result, the bull-bear spread, a closely watched gauge of investor sentiment, improved to negative 15.4% from negative 24.5% a week ago. Even so, it remains well below its historical average of 6.5%, underscoring the caution that continues to characterize individual investors.

AAII's weekly special question focused on the Federal Reserve's decision to raise interest rates by 25 basis points at last week's FOMC meeting. Investors overwhelmingly approved of the move, with 80% saying the Fed made the right call.

The graphic below shows the full breakdown of answers to the special question.

(Terence Gabriel)

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