State Street Global Exchange today released the results of the State Street Investor Confidence Index® (ICI) for September 2013.
The Global ICI fell to 101.4 in September, down 3.5 points from August's revised reading of 104.9. The fall was driven by sentiment in North America, which declined 7.6 points to 104.5 from August's revised reading of 112.1. Meanwhile, compared to their revised August readings, European confidence rose by 4.7 points to 101.7 while Asian confidence rose by 2.1 points to 95.3.
The Investor Confidence Index was developed by State Street Associates, State Street Global Exchange's research and advisory services business, and Harvard University professor Kenneth Froot. It measures investor confidence or risk appetite quantitatively by analyzing the actual buying and selling patterns of institutional investors. The index assigns a precise meaning to changes in investor risk appetite: the greater the percentage allocation to equities, the higher risk appetite or confidence. A reading of 100 is neutral; it is the level at which investors are neither increasing nor decreasing their long-term allocations to risky assets. The index differs from survey-based measures in that it is based on the actual trades, as opposed to opinions, of institutional investors.
"September's Global reading on investor sentiment, taken before the FOMC's decision to delay the taper, gave back some of the recent gains but remains robust," commented Ken Froot. "Similarly positive business confidence readings suggest that investors will be resilient to the reduction in the Fed's asset purchases when they finally come."
"There is still a sizable but narrowing gap between North American and Asian investors," noted Jessica Donohue, senior managing director and head of research and advisory services at State Street Global Exchange. "The fear of the Fed's liquidity withdrawal has had a disproportionally larger impact in Asia where investors are also worrying about slower growth in China. With the worst of those fears yet to materialize, it will be interesting to see if this sentiment gap diminishes further next month."
About the State Street Investor Confidence Index®
The index is released globally at 10 a.m. Eastern time in Boston on the last Tuesday of each month. More information on the State Street Investor Confidence Index is available at http://www.statestreet.com/investorconfidenceindex/index.html.
About State Street Corporation
State Street Corporation (NYSE: STT) is one of the world's leading providers of financial services to institutional investors including investment servicing, investment management and investment research and trading. With $25.7 trillion in assets under custody and administration and $2.1 trillion in assets under management* at June 30, 2013, State Street operates in more than 100 geographic markets worldwide, including the U.S., Canada, Europe, the Middle East and Asia. For more information, visit State Street's web site at www.statestreet.com.
* This AUM includes the assets of the SPDR Gold Trust (approx. $37 billion as of June 30, 2013), for which State Street Global Markets, LLC, an affiliate of State Street Global Advisors, serves as the marketing agent.
The views expressed in this material are the views of State Street through the period ended September 24, 2013 and are subject to change based on market and other conditions.
This news announcement contains forward-looking statements as defined by United States securities laws, including statements about the financial outlook and business environment. Those statements are based on current expectations and involve a number of risks and uncertainties, including those set forth in State Street's 2012 annual report and subsequent SEC filings. State Street encourages investors to read the corporation's annual report, particularly the section on factors that may affect financial results, and its subsequent SEC filings for additional information with respect to any forward-looking statements and prior to making any investment decision. The forward-looking statements contained in this press release speak only as of the date hereof, September 24, 2013, and the company will not undertake efforts to revise those forward-looking statements to reflect events after this date.