Opalesque Industry Update - State Street Global Markets, the investment research and trading arm of State Street Corporation (NYSE:STT), today released the results of the State Street Investor Confidence Index® for July 2010.|
Globally, Investor Confidence rose 4.8 points to 96 from June’s revised reading of 91.2. Confidence increased in North America, gaining 5.4 points to 99.9 from June’s revised reading of 94.5. Among European investors confidence rose 2.4 points from 97.6 to 100.0, and in Asia, following suit, confidence ticked up 2.1 points from 102.4 to 104.5. Developed through State Street Global Markets’ research partnership, State Street Associates, by Harvard University professor Ken Froot and State Street Associates Paul O’Connell, the State Street Investor Confidence Index measures investor confidence on a quantitative basis by analyzing the actual buying and selling patterns of institutional investors. The index assigns a precise meaning to changes in investor risk appetite: the greater the percentage allocation to equities, the higher is risk appetite or confidence. The index differs from survey-based measures in that it is based on the actual trades, as opposed to opinions, of institutional.
“This month saw concerns about the sovereign debt situation in Europe providing a catalyst for confidence,” commented Froot. “The sequence of relatively disappointing macroeconomic data emerging from the US over the month led to a decline in global equity prices, but institutions have responded by seeking to capitalize on these lower valuations.”
"From last month’s somewhat pessimistic levels, confidence rose in all three regions to settle at more neutral levels,” added O’Connell. “Relatively strong earnings announcements from the US corporate sector, coupled with improved macroeconomic readings from Europe have given investor confidence a different character from recent observations on consumer confidence. The last time this divergence was observed, in February 2009, equity markets went on to rally. It remains to be seen whether slower US growth in the coming quarters and on-going government and consumer de-leveraging will present an obstacle to such a rally this time round.”
About State Street Global Markets
State Street Global Markets’ research team of leading academic and industry experts is committed to continually advancing the science, including theory and application of its proprietary investor behavior research and innovative portfolio & risk management technologies to help its clients challenge conventional thinking, shape ideas, make more informed investment decisions and deliver measurable results.
About the State Street Investor Confidence Index
About State Street Corporation
State Street Corporation (NYSE: STT) is one of the world's leading providers of financial services to institutional investors, including investment servicing, investment management, and investment research and trading. With $19 trillion in assets under custody and administration and $1.8 trillion in assets under management at June 30, 2010, State Street operates in 25 countries and more than 100 geographic markets worldwide. For more information, visit State Street at Source