FYI | May 24 2006
By Rudi Filapek-Vandyck
At face value State Street’s Investor Confidence Index has climbed further in May, but the latest update appears to be yet another "things are not always what they seem" event.
According to State Street’s methodology of measuring professional investors’ appetite to take on more or less risk, global investor confidence continues to bounce back from its lows in the first months of calendar 2006.
The State Street index has risen to 85.9 in May, the second highest reading over the past twelve months only beaten by the 87.5 in September last year. However, confidence has fallen in Europe and the Asia Pacific region, making a rather big jump in North America solely responsible for the continued advance of the index.
State Street remains on the positive side of the fence, commenting "the overall backdrop is one that suggests institutional investors see improved opportunities in the medium term".
According to the May index, institutional investor confidence globally increased by 2.9 points to 85.9 from April’s revised reading of 83.0. The increase was supported by confidence of North American institutional investors jumping from 93.1 to 98.8. The confidence of European investors fell from 96.4 to 91.9 while the confidence of Asian investors slid to 76.1 from 78.5.
It is unclear whether the events of the past few days have had an impact on these figures.