Pessimism among individual investors has risen, according to the latest survey from the American Association of Individual Investors (AAII).
Bearish sentiment, which reflects expectations that stock prices will decline over the next six months, is said to have jumped by 6.0 percentage points to 31.0%.
According to the AAII, the increase brings bearish sentiment in line with its historical average for the first time in five weeks.
At the same time, bullish sentiment, which represents optimism about stock price increases, has reportedly dropped by 5.5 percentage points to 39.8%.
Despite this decline, optimism remains above the historical average of 37.5%, continuing a trend seen in 44 of the past 45 weeks.
Neutral sentiment, where investors expect stock prices to remain relatively unchanged, fell slightly by 0.5 percentage points to 29.3%. This marks the 10th consecutive week that neutral sentiment has stayed below its historical average of 31.5%.
Meanwhile, the bull-bear spread, which measures the difference between bullish and bearish sentiment, narrowed by 11.6 percentage points to 8.8%.
This spread remains above its historical average of 6.5%, continuing a broader trend observed in 18 of the past 19 weeks.
In a special question posed to AAII members regarding their perception of the current housing market, responses were mixed. About 55.7% described the housing market as "mixed," while 29.1% viewed it as "weak," and only 9.8% perceived it as "strong."
The latest Sentiment Survey results reveal shifting investor outlooks, with an uptick in bearish views and a corresponding decline in optimism, suggesting caution amid the current market environment.