EconoIndicators

Investor Confidence At a Glance
Note: There were large revisions to the June index.

• Global Index: 57
• Monthly Change: Down 1.4
• Year-to-year Change: Down 18.8%
• North America Index: 49.9%
• Monthly Change: Down 0.1%
• Europe Index: 73.6%
• Monthly Change: Down 5.9%
• Asia Index: 82.3%
• Monthly Change: Down 5.5%

Technorati Tags: State Street Index, Investor Confidence Index, investor confidence

Investor Confidence Index Declines from 58.4 To 57.0 in November

Boston, November 18, 2008– 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 November 2008.
Global Investor Confidence decreased by 1.4 points to 57.0 from October’s revised level of 58.4. Confidence among North American investors was essentially flat, declining 0.1 to 49.9 from October’s revised level of 50.0. The drivers of the decline in overall sentiment were European investors, whose confidence fell from 79.5 to 73.6, and Asian investors, where sentiment slipped from 87.8 to 82.3.
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 Indexmeasures 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.
“Coming on the heels of last month’s dramatic decline, this month’s readings provide a measure of relief,” commented Froot. “While market prices saw further write-downs on the realization that fundamentals have deteriorated substantially in the face of a looming recession, institutional investors did not react as strongly as last month to these changing circumstances.”
“Last month’s decline in North American Investor Confidence foreshadowed the decline in US consumer confidence to a record low in October, and the declines in European and Asian Investor Confidence that took place this month” added O’Connell. “Nevertheless, the fact that North American institutional investors did not accelerate further the pace of their deleveraging this month could be seen in a positive light.”

Source: State Street Associates