Wall Street was the big story driving the drops in the January Spectrem Investor Confidence indices. The Spectrem Affluent Investor Confidence Index (SAICI®) and the Spectrem Millionaire Investor Confidence Index (SMICI®) fell 8 points and 14 points, respectively. The SAICI posted a reading of -4, a 27-month low, while the SMICI is at -3, a 38-month low.
U.S. stocks suffered the worst 10-day start to a calendar year ever, driven primarily by concerns over a slowdown in China’s economy, falling oil prices, the alleged nuclear test in North Korea and escalating tensions in the Middle East.
Not surprisingly, the highest percentage of Affluent investors we surveyed in mid-January cited Stock Market Conditions as the one factor they would say most affects their current investment plans. Thirty five percent responded this way, up from 30 percent in October when this question was last asked. This is the highest level of concern over Stock Market Conditions since October 2014, when 38 percent of surveyed Affluent investors said Stock Market Conditions were the factor most affecting their investment plans.
The next highest percentage of Affluent investors (16 percent) cited Retirement as the primary factor affecting their current investment plans, an indication of how hits to their portfolios during the recent market drops would impact their retirement savings.
Thirteen percent of Affluent respondents said the Economic environment was the key factor affecting their investment plans today. This is up from 10 percent in October.
Seven percent of respondents said that Household Income is most affecting their current investment plans. A scant two percent consider the Political Climate to be a driving factor in their investment plans, which suggests Affluent investors are for the moment tuning out the presidential campaign and partisan rancor to focus more on Wall Street.
Millionaires expressed slightly more concern than Affluent investors overall in the Economic Environment (16 percent vs. 13 percent) and Retirement (17 percent vs. 16 percent. Generally more confident investors, Millionaires were less likely than Affluent investors overall to say that Stock Market Conditions were the factor most affecting their current investment plans (31 percent vs. 35 percent).
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