Investors Turn the Most Bearish Since February 2009

Investors Turn the Most Bearish Since February 2009

$SPY

The economic shock from the coronavirus pandemic shocked US investors 5 wks, and now they are expressing the most pessimism about the direction of the stock market since February and March 2009, in the aftermath of the previous financial crisis, according to an AAII survey conducted during the week ended Wednesday, 25 March.

Some 52.1% of investors surveyed were Bearish about the US stock market, up 0.9 percentage pt from last week and well above the historical average of 30.5%.

Bullishness, meanwhile, dipped 1.4 pts to 32.9%, compared with a historical average of 38%.

Neutral sentiment, which the survey defined as expectations that stock prices will remain essentially unchanged over the next 6 months, rose 0.5 pt to 15%, less than 50% of its historical average of 31.5%.

The benchmark S&P 500 index is down more than 20% for the year to date after hitting record highs as recently as 19 February, ending a Bull market that began on 9 March 2009.

The index rose 4.4% in afternoon trading Thursday after record high unemployment claims boosted expectations for more stimulus measures.

Overall, 38% of investors surveyed by AAII said they were not making any changes to their portfolio due to the coronavirus-linked selloff, while 28% said they were actively looking for bargain stocks. Approximately 11% of respondents said they were planning on adding more dividend-paying Aristocrat stocks.

This is a contrarian Bullish indicator.

Have a healthy weekend, stay home!

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