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The latest Investor's Intelligence survey was released this morning and
showed a continued deterioration in the percentage of newsletter writers
who are
considered bearish, from 17.6% last week to 16.7% this week.
The current reading is the 3rd-lowest percentage since 1987, with the
only other weeks with fewer bears being June 6th and June 13th of 2003.
The chart below shows the daily performance in the S&P 500 after the
bears initially dropped below the current level from June 2003.
It's pretty evident from that chart that the S&P had some difficulty
maintaining upside momentum when so many were complacent about the
market's prospects. While there were more outright bulls in 2003
(as opposed to those longer-term bullish but expecting a correction like
now), traditionally when we've seen such a dearth of skepticism it has
led to sub-par returns in equities over the next month or so.
The 10 Lowest I.I. Bear
Percentages In The Past Decade
Date
II
Bears 1
Week
Later 1
Month
Later 3
Months
Later 6
Months
Later
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Forwarding or other distribution of this email is prohibited without the express permission of Sundial Capital Research, Inc. If you do not possess a firm-wide license, then forwarding this message will violate your subscription agreement.
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December
2, 2009
