Morgan Stanley Wealth Management has released the findings of its latest quarterly retail investor pulse survey. The results indicate that investor sentiment remains largely optimistic as the new year begins, despite a change in administration.
The survey reveals that 58% of investors are bullish about the market, a slight decrease from 59% in the previous quarter. Furthermore, 64% of participants anticipate a market rise by the end of the current quarter.
Inflation continues to be a primary concern for investors, with 45% expressing worries about its impact on their portfolios. Market volatility is also on investors' minds, increasing slightly to 24%. However, concerns over political changes have decreased by 13 percentage points since last quarter.
A significant portion of investors, nearly 59%, still support interest rate cuts by the Federal Reserve this quarter. This figure has dropped by nine percentage points compared to previous data.
Chris Larkin, Managing Director and Head of Trading and Investing at E*TRADE from Morgan Stanley, commented on these findings: "As with any new administration coming in, potential policy changes can cause uncertainty in the markets," he said. "That said, investors remain optimistic and resilient amid a soft start to 2025."
The survey also assessed investor perspectives on sector opportunities for the first quarter of 2025. Information Technology remains favored by 52% of respondents due to growth prospects. Interest in energy has risen to 46%, driven by increasing oil and gas prices. Conversely, interest in healthcare has declined by four percentage points to 32%.
Conducted between January 6 and January 16, 2025, the survey included an online sample of 909 self-directed investors and those who delegate investment management or use both approaches. The margin of error stands at ±3.20 percent at a confidence level of 95%. Dynata fielded and administered the survey.
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