February sees marginal rise in investor confidence

Investor confidence rose 1.5 percentage points to 70.9 in February, according to State Street’s Investor Confidence Index.

The Index is up from January’s reading of 69.4 percentage points, with sentiment amongst European investors skyrocketing 6.1 points to 96.0, while North American investors showed a minimal uptick in confidence from 65.7 points to 66.3 points.

Asian investors on the other hand looked a little irked by the trade war perhaps, with the Investor Confidence Index dropping 3.5 points to 96.4.

Despite the index rising, State Street Associates’ Kenneth Froot said institutional investors remained cautious in February, and continued to show hesitance towards riskier assets.

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“With lingering growth and trade policy uncertainty, it appears that the more dovish Fed and the hopes for progress on the US-China trade front are not enough to tip the scales – related to risk aversion,” he said.

Managing director and head of behaviour research at the firm, Rajeev Bhargava, also said global institutional investor confidence exhibited little signs of recovery following last month’s sharp decline in the Index.

“Although cross-asset volatility has tempered, the crude memories of Q4’s market decline, along with increasing  growth concerns in Europe and China, place headwinds on investor confidence,” he said.