The relative resilience of US investor confidence, measured by State Street’s investor confidence index, might give some hope that this downturn will be short-lived, according to State Street Global Markets’ report.
Although the data indicated that the index dropped in March, State Street’s global head of macro strategy, Michael Metcalfe, stressed it was a relatively modest fall compared to the collapse in consumer sentiment reported last week.
“The relative resilience of US investor confidence seems to hint at an element of hope that this downturn will be short-lived and that policy measures already in place will be enough to restart the economy once the storm passes,” he noted.
According to Metcalfe, the data was even more apparent once the regional breakdown of the confidence indicator was taken into account as it showed that confidence of investors based in Asia Pacific actually improved in March and China showed tentative signs of going back to work.
“With this in mind, markets will be looking closely at the latest activity indicators in China, as to whether they portend a future turning point for Western markets once their storm also passed,” Metcalfe said.
Investors have slashed their US equity allocations to the lowest level on record, according to new data from Bank of America.
The message from experts in international trade and economists is that the Australian government should refrain from retaliating with reciprocal tariffs.
The market correction forecast by AMP’s chief economist is in full swing, with three weeks of turbulence culminating in significant losses on Tuesday.
Following a strong risk appetite in January, institutional investors have pulled back in February, with risk-seeking activity dropping to zero amid a decline in equity allocations.