Investor confidence rises towards year end: State Street

 @ibtimes
on December 29 2009 12:16 PM

Institutional investors are ending the year with a burst of optimism, breaking a three-month decline in confidence, State Street said on Tuesday.

The U.S. financial services firm said its global investor confidence index rose to 103.9 in December from 100.8 in November.

A reading of 100 is neutral.

In Asia, investor confidence rebounded by 6.3 points, rising to 97.5 from November's reading of 91.2.

State Street said confidence remained largely constant in other regions with sentiment in North America at 103.1 versus 102.2 and Europe declining slightly to 104.6 from 104.8.

This month's up-tick in global investor confidence stemmed largely from an improvement in the mood in Asia, where risk appetite rose to an eight-month high, said Harvard Professor Ken Froot, a co-developer of the index.

Elsewhere portfolio reallocations were modest. With three of the four indices over the neutral level of 100, institutions are continuing to add to their risky asset positions, but at a slower pace than was evident earlier in the year.

Froot said investors would be watching for signs of renewed economic growth and well-designed stimulus exit strategies from central banks before adding significant risk in the new year.

The data is extrapolated from movements in around $17.9 trillion of assets State Street holds as custodian and administrator for institutional investors.

(Editing by Andy Bruce)

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