Americans Turned Bearish on Stocks at Fastest Pace Since 2007

(Bloomberg) -- A growing cohort of investors say they’re ready to throw in the towel on U.S. stocks, even as they remain near record highs.

The number of Americans expecting equities to decline over the next year jumped the most since 2007 and for the first time since January exceeds those who expect gains, according to the latest sentiment reading from the Conference Board. The 33% with a bearish view compared with 31% who predict an advance, a figure that fell at the fastest pace in eight years.

The swing in sentiment reflects investors’ unease as stocks sit near record highs even amid the back and forth over U.S.-China trade and softer economic data. Speculation that Federal Reserve policy makers will cut interest rates this year has pushed the S&P 500 up 6.6% this month and sent bond yields to multi-year lows, even as concern remains about the underlying strength of the economy.

The survey also found a deterioration in overall consumer confidence, with the headline reading slipping to the lowest level since September 2017. According to BMO Capital Markets’ Jon Hill, the confidence metric missed analysts’ expectations by the most since 2009.

“The consumer was holding steadfast despite the headwinds swirling from the slowing global economy and rising trade tensions, but now consumers are starting to worry,” Chris Rupkey, the chief financial economist at MUFG Union Bank in New York, wrote in an email. “The consumer has been hit between the eyes too many times with tweets and new tariffs and sanctions.”

--With assistance from Felice Maranz.

To contact the reporter on this story: Sarah Ponczek in New York at sponczek2@bloomberg.net

To contact the editors responsible for this story: Jeremy Herron at jherron8@bloomberg.net, Brendan Walsh, Rita Nazareth

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