Confidence among institutional investors is on the rise, indicating that the current resurgence in markets in the US and elsewhere may be more than just a bear market rally.
The State Street Investor Confidence Index, released today, revealed a rise of 3.1 per cent, with confidence in May up strongly in both North America (up 9.6 points to 104.9) and Europe, where it climbed 7.5 points to 84.3.
According to the index, the picture was a little different in Asia, where the index fell 4.9 points to 93.1.
State Street’s Ken Froot said the May increase in global investor confidence affirmed the return of institutional investors to risk-taking behavior after a seven-month hiatus.
Froot pointed to the manner in which the State Street Index had been revised to provide a better guide as to the level of risk tolerance and said that while the risk tolerance of North American investors had increased to the point where they were adding to their portfolios of risk assets, the same could not be said of European and Asian investors, who, while more confident than in past months, remained cautious.
