StateStreet Investor Confidence Index falls to 91.2 in May
State Street Global Markets, the investment research and trading arm of State Street Corporation has released the results of the State Street Investor Confidence Index for May 2007.
Global Investor Confidence fell by 1.8 points to 91.2 from April’s revised reading of 93.0. Looking regionally, the confidence of North American institutional investors decreased from 102.6 to 99.9, but confidence elsewhere improved, with European sentiment seeing an improvement from 90.5 to 94.2, and Asian sentiment rising from 81.7 to 84.3.
The State Street Investor Confidence Index measures investor confidence on a quantitative basis by analysing the actual buying and selling patterns of institutional investors. The index is based on financial theory that assigns precise meaning to changes in investor risk appetite, or the willingness of investors to allocate their portfolios to equities. The more of their portfolio that institutional investors are willing to devote to equities, the greater their risk appetite or confidence.
According to State Street, in the wake of a weak domestic first quarter, US investors continue to behave with some trepidation. However, globally, prospects remain good as worldwide demand remained better through the first quarter, impacting inventories. This provides the backdrop for the improved sentiment outside the US.
In May, a slight see-saw in flows, as institutional investors evinced caution in the early part of May before returning in strength to a broad array of global equity markets in the recent weeks.
26-Jun-2007
