CHICAGO, August 1, 2018 – Amidst an intensifying trade war and ongoing political uncertainty at home and abroad, investor confidence remained largely unchanged in July, Spectrem Group reported today in its High Net Worth Insights newsletter. While current events generally influence investor sentiment, economic conditions appear to have left investors uncertain of how best to respond, and this confusion is reflected in both the Spectrem Affluent Investor Confidence Index (SAICI®) and Spectrem Millionaire Investor Confidence Index (SAICI®).
The SAICI remained at 3 for a second consecutive month, but is down nine points from February. Likewise, the SMICI rose slightly in July to 8, but is 10 points below the mark of 18 reached six months ago. The SMICI has effectively not moved in four months. Both indices remain in neutral territory.
The monthly Spectrem Investor Confidence indices track changes in investment sentiment among the 17 MM households in America with more than $500,000 of investable assets (SAICI), and those with $1 MM or more (SMICI). This month’s survey was fielded between July 17-24, 2018 as investors tried to determine whether negotiations with Russia and the European Union were going to be positively or negatively impact the American economy.
Although overall confidence remained largely unchanged, Millionaires and non-Millionaires reacted differently to the events of July. Millionaires increased their stock and stock mutual fund investing slightly while non-Millionaires dropped in both categories, with stock investing at 22.6 percent, the lowest mark of 2018. The percentage of investors ‘Not Investing,’ meaning they have no intention of increasing their investment stakes in the coming month, remained the same for both Millionaires and non-Millionaires, which is a rarity.
The Spectrem Household Outlook, a monthly measure of long-term confidence among investors across four financial factors impacting households, mirrored the lack of enthusiasm recorded in the Confidence indices. In July, the overall Outlook fell to 22.90, the lowest level for that category since June of 2017. Millionaires recorded a drop in their Outlook for Household Assets, Company Health and the Economy, with their July mark for the economy of 12.70 far below the 48.78 registered in January.
“Every day, a new headline indicates a change in global economic relations, and the frequent changes make it difficult for investors to know which way to turn,” said Spectrem President George H. Walper, Jr. “Until current international trade disputes are resolved, investor sentiment will likely remain uncertain and may fail to follow a clear direction.”
Charts, including a deeper analysis of the Index and its methodology, are available upon request.