Confidence among all regions decreased in July expect for Asia that rose 2.6 points to 89.5, according to State Street Investor Confidence Index (ICI).
Despite this rise, confidence in Asia is still below the neutral reading of 100 thanks to the China’s volatile equity markets, State Street’s executive vice president, Jessica Donohue, said.
“While the aggressive response of the Chinese authorities to calm investors’ nerves seems to have had a net positive effect on sentiment within the region in the month to July 22nd, the continued volatility in equity markets highlights how temporary such measures can be,” she said.
Overall, the global ICI decreased to 114.6, down 12.5 points from June, North American ICI decreased 20.6 points to 122.6, and the European ICI fell 2.1 points to 100.4.
“The roller-coaster ride across China’s equity markets and the absence of a definitive Greek bail-out agreement has certainly weighed heavily on risk appetite with our North American ICI slipping by 20.6 points, the largest monthly decline since 2009,” Donohue said.
Co-developer of the index, Kenneth Froot noted that investors still remain largely optimistic as the North American ICI remains well above 100 points.
“A weaker earnings season in the US and great uncertainty on the global growth front were the likely factors driving the sharp decline in North American investor sentiment in July,” he said.
