Investor Sentiment

Investor sentiment is the view of the market by investors. This is the combined view of all investors at any one time. Since this is not static, but rather always changing, investor sentiment is usually seen in three general categories: extremely optimistic (bullish); extremely pessimistic (bearish); and neutral or equal in number of optimists and pessimists. The view of investor participants can be based on either fundamental or technical reasons. Investor sentiment is seen as moving the main indices, which will push individual stocks in its wake. For example, a company might not be a great stock, but if the investor sentiment for the overall index is extremely bullish, this optimism will push up the price of most, if not all, stocks. Many view extreme market sentiment readings as a contrary indicator; when most people are bullish (optimistic), the market is close to a short-term top and vice versa.


The late Sir John Templeton said it best when he explained investors’ emotions at major turning points in stock market cycles. He said, “Bull markets are born on pessimism, grow on skepticism, mature on optimism, and die on euphoria.” Investor…

It looks like large-cap technology stocks, especially those related to online businesses, are experiencing a slowing down of what’s traditionally been some very solid growth. Amazon.com, Inc. (AMZN), Netflix, Inc. (NFLX), LinkedIn Corporation (LNKD), and Groupon, Inc. (GRPN) have all…

Amid all the turmoil in capital markets, I’m reminded of all the good corporate earnings being released. Of course, the stock market is a system of discounting future business conditions and the recent sell-off has been pronounced, but stocks have…

Financial reporting is ramping up and what corporations actually say about their businesses is the best market intelligence available to investors. Acuity Brands, Inc. (AYI) is in the business of making lights for indoor and outdoor applications. Based in Atlanta,…

For years Micron Technology, Inc. (MU) struggled on the stock market as both competition and demand in the personal computer (PC) market took its toll on the chip maker. Now the company is experiencing a bit of a renaissance, and…

With the Dow Jones hitting 17,000 being pretty likely in the not-too-distant future, from there, it’s only another 18% or so until the Dow hits 20,000, which is pretty incredible. These numbers seemed so unrealistic just a few years ago…

The great monetary expansion is still alive and well and the effect on equity securities continues to be profound. But what I find striking about the stock market’s continued advancement is that it’s blue chips that are pushing through to…

This stock market continues to show material resilience as financials have turned a bit and are helping the S&P 500 index. Wells Fargo & Company (WFC) just hit a new record-high on the stock market with a forward price-to-earnings ratio…

There still is no real trend in the equity market. One day, stocks sell off big-time; the next, the S&P 500 and Dow Jones Industrial Average hit new record-highs. This is a very tough market to figure; anything can happen…

If investor sentiment has changed to, once again, favor blue chip stocks over the market’s more speculative issues, oil and gas still have sectoral price momentum. This is evident in the price action of many of these stocks, as well…

First-quarter earnings results for Harley-Davidson Inc. (HOG) were good. The motorcycle manufacturer did a solid job boosting its bottom line on what was a decent gain in sales, particularly internationally. First-quarter earnings per share grew 22% to $1.21. U.S. dealers…

The S&P 500 index really hasn’t done much since the beginning of the year but churn…but then again, why shouldn’t it? For stocks, 2013 was an exceptional year. If we get another positive year on top of dividends, then it’s…

With the broader stock market selling off, it’s amazing to see a company’s share price defy the near-term trend and appreciate in value. Time and time again, Johnson & Johnson (JNJ) gets bid when the broader market faces convulsion. It’s…

Stocks are churning without any notable trend, influenced by geopolitical events, the lack of corporate reporting, and a recent change in investor sentiment regarding valuations. The fact is that a lot of stocks are ahead of themselves, and this is…

The current stock market sentiment is bullish and based on the charts, there are indications that the market wants to go higher, especially technology and small-cap stocks. The S&P 500 is eyeing another record-high and it may just reach it…