Investors’ Cautious Optimism Driven by Prospects of Tax Reform

The number of articles being written about the “dangerous” levels of the U.S. stock market is coming at an ever-increasing rate. And perhaps, for good reason. The Dow Jones industrial average has notched 42 all-time highs in 2017, the S&P 500 index has booked 37 records, while the Nasdaq has ended at a record 49…

 

Readers Split on Benefit of Fed, Interest Rate Hike

After a decade of holding interest rates near zero, the Federal Reserve has raised rates three times in a year. While many would agree that the “free money” environment following the financial crisis of 2007-2009 has fueled the stock market to its long bull run, savers have been seriously hurt by low money market rates….

 

Bulls Retreat During Mixed Week

Weekly Market Summary U.S. stocks struggled to find direction this week, with some of the major indexes moving in a tight range while still eking out new all-time highs. Meanwhile, technology suffered through its worst slump in several months and consumer staples companies were rocked at the end of the week by the surprising news…

 

Market Shrugs Off “New Normal” of Rising Interest Rates

To the surprise of almost no one, the Federal Reserve announced this week that it would raise short-term interest rates and offered greater details of its plans to shrink its $4.5 trillion portfolio of bonds and other assets, which it expects to start later this year. The Fed said it would increase its benchmark federal…

 

Rate Hike Fails to Shake 60% of Surveyed Investors

This week’s Sentiment Survey special question asked AAII members how the FOMC’s raising of interest rates has impacted their market outlook. Approximately 60% of respondents said that the rate hikes are having no or very little impact on their outlook and/or their portfolio decisions. Many of these respondents said that last week’s announcement by the…

 

AAII Sentiment Survey: Neutral Sentiment Rises as Pessimism Pulls Back

Pessimism among individual investors is down for the second consecutive week, according to the latest AAII Sentiment Survey. At the same time, neutral sentiment is now at its highest level since mid-February. Bullish sentiment, expectations that stock prices will rise over the next six months, rose 4.1 percentage points to 35.3%. The historical average is…

 

The Fed-Trump Divergence

To the surprise of almost no one, the Federal Open Market Committee (FOMC) announced that it raised its benchmark interest rate by 25 basis points (0.25%) to the range of 0.75% to 1.0%. This was the third interest rate hike in a decade, but the second since December. This seems to signal that the Federal…

 

AAII Sentiment Survey: Pessimism Declines While Neutral and Bullish Sentiment Rise

Pessimism among individual investors fell from last week’s AAII Sentiment Survey, while bullish and neutral sentiment rose. Bullish sentiment, expectations that stock prices will rose over the next six months, rose 1.2 percentage points, to 31.2%. Despite the slight increase, bullish sentiment remains below its historical average of 38.5% for the third week in a…