EUROPE – Investor confidence declined in January, according to two measures released today.
Both the State Street and ZEW's indices of investor confidence revealed declines compared to December.
The State Street index fell to 105.9, from a revised 109.0 last month, which was a 12-month high. The Mannheim-based ZEW economic institute’s index which tracks German institutional investor and analyst sentiment fell to 72.9 from 73.4 in December, which was the highest since June 2000.
“Institutional investors continue to display a tendency to increase their allocation to risky assets,” said Paul O’Connell of State Street Associates, who co-developed the measure. The comments were borne out by the latest Merrill Lynch global fund managers survey, which found managers’ appetite for risk has grown.
“The large amount of optimism has hardly changed and is increasingly confirmed by important business indicators,'' said ZEW. “Despite the continuing strength of the euro, industrial production and the volume of incoming orders increased.'”
ZEW claims its data is a month ahead of the widely-read business- expectations index published by the Ifo institute.