Investor confidence declined by 2.4 points in July 2019

Ridhima Sharma
Investor confidence declined by 2.4 points in July 2019

State Street Global Exchange has released the results of the State Street Investor Confidence Index (ICI) for July  2019.

The Global Investor Confidence Index decreased to 84.9, down 2.4 points from June's revised reading of 87.3. Investors across all regions expressed a waning appetite for risk. The North American ICI fell from 81.6 to 80.6, the European ICI from 103.3 to 99.3, and the Asian ICI from 95.9 to 91.9.

"The minor stumble in investor confidence is notable not just because it runs counter to the new highs made in the prices of some risky assets, but because confidence fell in all three regions, albeit by different amounts," said Michael Metcalfe, senior managing director and head of Global Macro Strategy, State Street Global Markets.

"Investors may not be bound by the same supply chain linkages that global manufacturing is, but the risk of contagion remains. The fact that confidence fell the furthest in the APAC region is perhaps testimony to questions of how much stimulus will be forthcoming from policymakers in the region."

"Last month's improvement in investor confidence turned out to be short-lived. In July, investors have exhibited renewed risk aversion, and while US equities reached record highs, global equities did not participate in the excitement," commented Kenneth Froot. "In a bid to alleviate the drag on global growth and earnings, developed-market central banks are dovish, and the Federal Reserve is expected to cut rates. And now, in spite of  trade talks between the US and China, continued uncertainty over supply chain disruption and Brexit appears to persist."