State Street investor confidence index rises

Global investor confidence increased by 12.7 points to 72.9 in February, from January’s revised level of 60.2, said State Street Global Markets, the investment and trading arm of State Street Corp., the Boston company that provides financial services to institutional investors.

The index was developed by Harvard University professor Ken Froot and State Street Associates director Paul O’Connell, and it seeks to measure investor confidence on a quantitative basis by analyzing the actual buying and selling patterns of institutional investors.

"As with last month, the increase was driven by North American institutional investors, whose confidence climbed 13.0 points to 64.5," State Street Global Markets said in a press release. "Elsewhere risk appetite was somewhat more subdued, as evidenced by a decline of 3.2 points in the European Index to 69.8, and a decline in the Asian Index of 2.7 points to 83.8."

The graph of the index that accompanies this post was provided by State Street.

“With two consecutive 12-point increases in Global Investor Confidence, there is evidence that institutional investors appear to have left behind the extreme gloom that characterized their outlook towards the end of 2008,” Froot said in a statement. “However, while institutional investors have been willing to add exposure across a number of the peripheral and emerging markets from which they had divested towards the end of last year, flows across developed markets remain somewhat tepid.”
(By Chris Reidy, Globe staff)