Investor confidence decreased across the American and Asian markets, with the European market the only one to rise, according to State Street Global Exchange.
According to State Street, the global Investor Confidence Index (ICI) decreased by 7.4 points to 94.3 after a rise in July had the reading at 101.8.
The decrease can be attributed to falling confidence in the North American ICI which fell by 10.6 points from 103.1 to 92.5.
The fall has meant that the North American ICI is now at the lowest point it has been in 2018.
The European ICI rose over August by 8.1 points to 99.5 while the Asia ICI had a slight decreased by 0.9 points to 102.6.
State Street ICI co-developer Kenneth Froot said investors have started to display risk-averse behaviour after months of turmoil.
“After a few months of caution and measured risk appetite, global institutional investors have started to display risk-averse behaviour as they navigate through elevated trade uncertainty and geopolitical turmoil,” said Mr Foot.
State Street Associates head of investor behaviour research Rajeev Bhargava said that the breakdown showed volatility in the European ICI.
“Looking at the regional breakdown, the European ICI has exhibited a lot of volatility this year. President Trump’s trade policies continue to stir up investor uncertainty, in addition to the renewed worries over Italy’s debt burden,” said Mr Bhargava.
The ICI measures investors’ risk appetite by analysing the buying and selling patterns of institutional investors, with a higher reading denoting higher risk appetite and, a ‘neutral’ reading of 100 signifying investors were neither increasing nor decreasing allocations to assets.
Eliot Hastie is a journalist at Momentum Media, writing primarily for its wealth and financial services platforms.
Eliot joined the team in 2018 having previously written on Real Estate Business with Momentum Media as well.
Eliot graduated from the University of Westminster, UK with a Bachelor of Arts (Journalism).
You can email him on: [email protected]
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