Investor Confidence Index Rises to 85.9 in MayState Street Investor Confidence Index: May 2006 (Graphic: Business Wire)
May 23 2006 - 10:00AM
Business Wire
State Street Global Markets, the investment research and trading
arm of State Street Corporation (NYSE:STT), released today the
results of the State Street Investor Confidence Index(R) for May
2006. According to the May index, investor confidence increased by
2.9 points to 85.9 from April's revised reading of 83.0. Looking
regionally, the confidence of North American institutional
investors displayed a solid increase from 93.1 to 98.8. By
contrast, the confidence of European investors declined from 96.4
to 91.9, and the confidence of Asian investors slid to 76.1 from
78.5. Developed through State Street Global Markets' research
partnership, State Street Associates, by Harvard University
professor Ken Froot and State Street Associates Director Paul
O'Connell, the State Street Investor Confidence Index(R) measures
investor confidence on a quantitative basis, analyzing actual
buying and selling patterns of institutional investors. The index
is based on financial theory that assigns precise meaning to
changes in investor risk sentiment, or the willingness of investors
to hold proportionally more or less of their portfolio in equities.
The more of their portfolio that institutional investors are
willing to devote to equities, the greater their risk appetite or
confidence. "Globally, investor confidence has bounced solidly off
the lows it attained in January and February of this year,"
commented Froot. "While we have seen some nervousness very recently
associated with volatility in commodities prices and inflation
expectations, the overall backdrop is one that suggests
institutional investors see improved opportunities in the medium
term." "The increase in global confidence masks some regional
divergence," added O'Connell. "European investors, who have been
ebullient this year, showed a tendency toward consolidation this
month. Asian investors continued to display a diminished appetite
for risky assets, as yield differentials continue to improve the
relative attractiveness of cash. North American institutional
investors saw a continuation of the improvement in confidence that
began last March." Since its launch in September of 2003, the State
Street Investor Confidence Index(R) has become a key economic
indicator for asset owners, investment managers and central banks.
As the only index providing a quantitative measure tracking the
common buying patterns of institutional investors around the world,
the State Street Investor Confidence Index(R) offers a unique look
into the investment behavior and decisions of thousands of
professional investors and their investment decisions. About State
Street Global Markets: State Street Global Markets provides
specialized investment research and trading in foreign exchange,
equities, fixed income and derivatives. Its goal is to enhance and
preserve portfolio values for asset managers and asset owners. From
its unique position at the crossroads of the global markets, it
creates and unlocks value for its clients with original flow-based
research, innovative portfolio strategies, trade process
optimization, and global connectivity across multiple asset classes
and markets. State Street Global Markets' research team of leading
academic and industry experts is committed to continually advancing
the science, including theory and application of its proprietary
investor behavior research and innovative portfolio & risk
management technologies to help its clients challenge conventional
thinking, shape ideas, make more informed investment decisions and
deliver measurable results. About the State Street Investor
Confidence Index(R): The index is released globally at 10 a.m.
Eastern time in Boston on the second to last Tuesday of each month.
More information on the State Street Investor Confidence Index,
including frequently asked questions and a calendar of release
dates, is available at
http://www.statestreet.com/investorconfidenceindex. The previous
month's calculations for the index are revised to account for
trading activity through the end of the reporting period. About
State Street: State Street Corporation (NYSE: STT) is the world's
leading specialist in providing institutional investors with
investment servicing, investment management and investment research
and trading services. With $10.7 trillion in assets under custody
and $1.5 trillion in assets under management (as of March 31,
2006), State Street operates in 26 countries and more than 100
geographic markets worldwide. For more information, visit State
Street's web site at www.statestreet.com. This news announcement
contains forward-looking statements as defined by United States
securities laws, including statements about the financial outlook
and business environment. Those statements are based on current
expectations and involve a number of risks and uncertainties,
including those related to the pace at which State Street adds new
clients or at which existing clients use additional services, the
value of global and regional financial markets, the pace of
cross-border investment activity, changes in interest rates, the
pace of worldwide economic growth and rates of inflation, the
extent of volatility in currency markets, consolidations among
clients and competitors, State Street's business mix, the dynamics
of markets State Street serves, and State Street's success at
integrating and converting acquisitions into its business. Other
important factors that could cause actual results to differ
materially from those indicated by any forward-looking statements
are set forth in State Street's 2005 annual report and subsequent
SEC filings. State Street encourages investors to read the
corporation's annual report, particularly the section on factors
that may affect financial results, and its subsequent SEC filings
for additional information with respect to any forward-looking
statements and prior to making any investment decision. The
forward-looking statements contained in this press release speak
only as of the date hereof, May 23, 2006, and the company will not
undertake efforts to revise those forward-looking statements to
reflect events after this date.
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