The Pulse

Bring Back The Bulls...

E*TRADE study reveals a significant rise in bullish sentiment, yet volatility remains top of mind for investors

April 12, 2019 — NEW YORK–(BUSINESS WIRE)–E*TRADE Financial Corporation (NASDAQ: ETFC) today announced results from the most recent wave of StreetWise, the E*TRADE quarterly tracking study of experienced investors. Results show an increase in positive investor sentiment as the market has steadily moved ahead from December 2018 lows.

Bullish sentiment returns. Bullishness rose 12 percentage points since last quarter to once again represent the majority of investors at 58 percent.

Investors believe there’s more room for the bull market to run. Two-thirds of investors say they think the bull market has a year or more to go (66%), up seven percentage points from last quarter.

The majority gave the US economy a passing grade. Investors who gave the economy an “A” or “B” grade rose 9 percentage points this quarter, to 64%.

Volatility concerns remain. Investors who believe volatility will stay the same was up by 8 percentage points from Q1.
“It’s been a great start to the year for the market,” said Mike Loewengart, VP of Investment Strategy at E*TRADE Financial.

“While economic data has shown some slowing, many encouraging data points remain, particularly in the labor market. Investors have shown their resilience and, at least for now, seem to have shrugged off growth concerns from the Fed, as well as auxiliary geopolitical concerns from Brexit, Iran, and Latin America. Hopes of a trade deal with China spring eternal, and any clarity on that front could serve to further drive investor confidence.”

Sector Opportunities

The survey also explored investor views on sector opportunities for the second quarter of 2019:

Health care
Health care remains the top choice among investors (48%) this quarter, as the sector is traditionally viewed as non-cyclical amid global growth concerns.

Energy
Nearly half of investors (48%) see opportunity in the energy sector amid crude’s recent rally and after coming under pressure at the end of 2018.

IT
Despite semiconductor weakness amid ongoing trade disputes, IT holds its place at third this quarter with relatively attractive valuations.

 

Referenced Data

When it comes to the current market are you?
Total
Q2’19Q1’19Q1’18Q1’17
Bullish58%46%68%64%
Bearish42%54%32%36%
How many years do you think we have left in the bull market?
Total
Q2’19Q1’19
5+ years5%5%
3–4 years24%20%
1–2 years37%34%
The end is near23%32%
I don’t know11%9%

What grade would you give the current state of the U.S. economy right now?

Total
Q2’19Q1’19
A15%14%
B49%41%
C29%32%
D5%10%
F2%3%

Over the next quarter, do you think volatility will…

Total
Q2’19

Q1’19

Greatly increase9%16%
Somewhat increase45%42%
Stay the same41%33%
Somewhat decrease5%9%
Greatly decrease0%0%
What industries do you think offer the most potential this quarter? (Top three)
Q2’19Q1’19Q4’18Q3’18Q2’18
Health care48%50%44%41%46%
Energy48%40%42%43%41%
Information technology44%38%49%45%44%
Financials34%36%40%41%40%
Utilities27%29%23%24%22%
Consumer staples22%30%21%19%24%
Communication services22%23%21%27%24%
Industrials22%20%21%22%22%
Materials19%16%17%20%20%
Consumer discretionary15%17%22%19%18%

 

 

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About the Survey
This wave of the survey was conducted from April 1 to April 11 of 2019 among an online US sample of 917 self-directed active investors who manage at least $10,000 in an online brokerage account. The survey has a margin of error of ±3.20 percent at the 95 percent confidence level. It was fielded and administered by Research Now. The panel is broken into thirds of active (trade more than once a week), swing (trade less than once a week but more than once a month), and passive (trade less than once a month). The panel is 60% male and 40% female, with an even distribution across online brokerages, geographic regions, and age bands.
About E*TRADE Financial and Important Notices
E*TRADE Financial and its subsidiaries provide financial services including brokerage and banking products and services to retail customers. Securities products and services are offered by E*TRADE Securities LLC (Member FINRA/SIPC). Commodity futures and options on futures products and services are offered by E*TRADE Futures LLC (Member NFA). Managed Account Solutions are offered through E*TRADE Capital Management, LLC, a Registered Investment Adviser. Bank products and services are offered by E*TRADE Bank, and RIA custody solutions are offered by E*TRADE Savings Bank, both of which are national federal savings banks (Members FDIC). More information is available at www.etrade.com.
The information provided herein is for general informational purposes only and should not be considered investment advice. Past performance does not guarantee future results.
E*TRADE Financial, E*TRADE, and the E*TRADE logo are trademarks or registered trademarks of E*TRADE Financial Corporation. ETFC-G
© 2019 E*TRADE Financial Corporation. All rights reserved.
E*TRADE Financial Corporation and Research Now are separate companies that are not affiliated. E*TRADE Financial Corporation engages Research Now to program, field, and tabulate the study. Research Now Group, Inc. provides digital research data and has locations in the Americas, Europe, the Middle East and Asia-Pacific. For more information, please go to www.researchnow.com.