×
Newsmax TV & Webwww.newsmax.comFREE - In Google Play
VIEW
×
Newsmax TV & Webwww.newsmax.comFREE - On the App Store
VIEW
Tags: fear | stock | traders | rate

Fear Is Spreading Among US Stock Traders

Fear Is Spreading Among US Stock Traders
(iStock Photo)

Friday, 07 June 2019 08:54 AM EDT

Stocks may be recovering but market angst is quickly spreading -- and not just in the professional ranks.

Retail traders are now the least bullish on the U.S. stock market since December, when the S&P 500 sank to a 20-month low, according to a weekly survey by the American Association of Individual Investors. Bearish bets have also been increasing, climbing to the highest since the start of the year.

Mom and pop traders are joining asset managers in dialing back optimism over the ability of U.S. equities to keep rallying. And although stocks are staging a rebound this week after falling in May, many money managers are flocking to safer instruments, including bonds and defensive equities.

Red flags are popping up in different corners of the market. Deutsche Bank AG strategists noted on May 31 that rising put-call volume ratios as well as retail sentiment deterioration “approaching extremes” signal downside risks for U.S. stocks. For six weeks in a row, money managers have reduced their stock holdings, the longest streak of selling since June 2011, when the market was mired in the sovereign-debt crisis.

U.S. equity funds have been seeing significant outflows, losing $8.4 billion in the week through May 29 just as investment-grade bonds whetted investor appetite, according to EPFR Global data.

It’s a challenging time for investors, who are trying to navigate trade-tariff headlines, negative-yielding debt and near-record premiums for defensive stocks. Their fears can come alive as soon as this month if the U.S. Federal Reserve fails to cut rates -- a market bet that is partially responsible for this week’s market enthusiasm.

If the U.S. monetary authorities hold off on acting now, a plunge similar to that of December could emerge, according to Masanari Takada, a quant strategist at Nomura Securities Co.

© Copyright 2024 Bloomberg News. All rights reserved.


StreetTalk
Stocks may be recovering but market angst is quickly spreading -- and not just in the professional ranks.
fear, stock, traders, rate
296
2019-54-07
Friday, 07 June 2019 08:54 AM
Newsmax Media, Inc.

Sign up for Newsmax’s Daily Newsletter

Receive breaking news and original analysis - sent right to your inbox.

(Optional for Local News)
Privacy: We never share your email address.
Join the Newsmax Community
Read and Post Comments
Please review Community Guidelines before posting a comment.
 
Get Newsmax Text Alerts
TOP

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved
NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved