EconoIndicators

Investor Confidence At a Glance

• Global Index: 65.9
• Monthly Change: Down 9.9
• Year-to-year Change: Down 22.1
• North America Index: 65.3
• Monthly Change: Down 10.1
• Europe Index: 85
• Monthly Change: Up 1.1
• Asia Index: 85.8
• Monthly Change: Down 0.8

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Investor Confidence Index Falls from 75.8 to 65.9 in December

Boston, November 20, 2007 – 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 December 2007.

Global Investor Confidence fell by 9.9 points to a level of 65.9, from last month’s reading of 74.3. North American investors were once again the key drivers of this decline, as their confidence fell over 10 points from 75.4 to reach an all-time low of 65.3. Elsewhere, European investor appetite improved from 83.9 to 85.0, while the confidence of Asian investors fell from 86.6 to 85.8.

Developed through State Street Global Markets’ research partnership, State Street Associates, by Harvard University professor Ken Froot and State Street Associates Director 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 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.

“This month, our quantitative measure of global investor confidence established a new low, cementing the evidence that investor risk appetite has been strongly impacted by the one-two punch of the August and November credit crises,” commented Froot. “In very recent days, we do see institutional investors following more of a holding pattern than a selling pattern, but the overwhelming conclusion from the data is that they are much more skeptical about fundamentals than they were in the first half of the year.”

“Continuing the pattern established two months ago, it is the North American investor who has the bleakest outlook,” added O’Connell. “European and Asian institutional investors have maintained their risk appetite again this month, albeit at lower levels than we saw a year ago. The North American pessimism is mirrored almost exactly in the behavior of US Consumer Confidence over recent months, the first time since 2003 that we have seen such congruence.”

Source: State Street Associates