The State Street Investor Confidence Index (ICI) crossed the 100 market the global level in February, helped by the US and Europe.
The latest ICI showed that the Global Investor Confidence Index increased to 103.9 in February, up 13.9 points from January’s reading.
North America’s ICI led this increase, up by 12.6 points to 106.2. The European ICI’s 8.3 point increase from the previous month to 93.9 also helped at the global level, although the region lagged the US.
Meanwhile, the Asian ICI fell by 0.2 points to 96.9.
Marvin Loh, senior macro strategist at State Street Global Markets, said: “Investors’ sentiment improved sharply in February, with the index recording one of its biggest monthly gains since recovering from lows established in the early months of the pandemic.”
Loh said that falling Covid caseloads and relaxed restrictions “drove the improving outlook”.
“While the index’s movement back above 100 reflects a more constructive view on risk assets, this outlook will be tested in coming months with growing geopolitical concerns and widespread rate hikes across developed markets. This may be especially true in the case of Europe, which has the lowest reading amongst the three regions tracked,” Loh added.
The Investor Confidence Index measures investor confidence or risk appetite – the greater the percentage allocation, the higher the risk appetite or confidence. A reading of 100 is neutral, whereby investors are neither increasing or decreasing their long-term allocations to risk assets, according to State Street Global Markets.
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