The percentage of investors who believe they’re in a better financial position today than they were two years ago rose to 43% in the first quarter, compared with 33% in the last quarter of 2011.
Investors’ positive feelings about the markets soared in the first quarter, according to the most recent reading of an investor sentiment index.
The John Hancock index of investor sentiment rose to 21, up from 15 in the fourth quarter of 2011. More than half of investors (56%) are bullish on stocks and balanced mutual funds (54%), according to the firm.
By sectors, for those who anticipate investing over the next half year, at the top of the list is energy (55%), followed by technology (53%) and healthcare companies (42%).
Approximately two-thirds of investors also say they plan to invest in a 401(k) plan over the next 12 months.
Feelings are not as warm toward cash, given the interest rate environment. Nearly two-thirds say it’s a bad time to hold cash in the form of CDs or money market funds, according to John Hancock. As for bonds, views are divided, with almost 30% saying it’s a good time to buy bonds, and 26% saying it’s a bad time.
The percentage of investors who believe they’re in a better financial position today than they were two years ago rose to 43% in the first quarter, compared with 33% in the last quarter of 2011. The share of investors who say they are very concerned about the unemployment rate, meanwhile, dropped to 44% from 54% in the prior quarter.
More investors now see inflation ahead, with 34% saying the inflation rate will be 4% or higher in two years, up from 23% who believed that in the last quarter of 2011.
The John Hancock index is a quarterly measure of investors’ views and is derived from a poll of about 1,000 investors.
Danielle Reed writes for Financial Planning.
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