NEW YORK, October 16, 2023–(BUSINESS WIRE)–Morgan Stanley Wealth Management today announced results from its quarterly individual investor pulse survey:
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- Bearishness ticks up. Bearish sentiment notched up 4 percentage points to 49% from last quarter—nearing Q1 levels (52%).
- Views on the economy remain cautiously optimistic. Slightly over half of investors (55%) believe the economy will be in better shape by the end of the year and think we’ll see inflation normalize (52%). Further, just over two in five investors (41%) think the Fed will cut rates in the first half of 2024 or sooner.
- Yet, inflation continues to be a top concern. When it comes to investment portfolios, investors ranked high inflation as their top concern (51%), followed by a recession, (32%) and market volatility (31%).
“As we approach the end of 2023, headwinds abound with continued elevated inflation and geopolitical tensions on the rise,” said Mike Loewengart, Head of Model Portfolio Construction for Morgan Stanley Portfolio Solutions. “Yet somewhat remarkably, the economy has continued to chug along—particularly on the jobs front. This leaves investors facing a conundrum—a resilient economy coupled with a volatile market. Environments like these show the power of a diversified portfolio, which can help an investor weather whatever may be ahead for the market. The goal is to invest through the volatility, not react to it.”
The survey explored investor views on sector opportunities for the fourth quarter of 2023:
- Energy – Interest in energy spiked 4 percentage points and took the top spot in investment opportunities this quarter as oil prices were driven higher. Elevated crude prices can translate to potential gains in the sector.
- IT – Technology continues to be a mainstay in investor portfolios with interest remaining strong (46%) but dropping 5 percentage points quarter over quarter.
- Health care – Amid volatility, investors tend to focus on historically defensive areas of the market like health care. Interest remained relatively flat (36%) and rounded out the top 3 investment choices for the quarter.
About the Survey
This wave of the survey was conducted from October 2 to October 16 of 2023 among an online US sample of 908 self-directed investors, investors who fully delegate investment account management to financial professionals, and investors who utilize both. The survey has a margin of error of ±3.20 percent at the 95 percent confidence level. It was fielded and administered by Dynata. The panel is broken into thirds by investable assets: less than $500k, between $500k to $1 million, and over $1 million. The panel is 60% male and 40% female and self-select as having moderate+ investing experience, with an even distribution across geographic regions, and age bands.
About Morgan Stanley Wealth Management
Morgan Stanley Wealth Management, a global leader, provides access to a wide range of products and services to individuals, businesses, and institutions, including brokerage and investment advisory services, financial and wealth planning, cash management and lending products and services, annuities and insurance, retirement and trust services.
About Morgan Stanley
Morgan Stanley (NYSE: MS) is a leading global financial services firm providing a wide range of investment banking, securities, wealth management, and investment management services. With offices in 42 countries, the Firm’s employees serve clients worldwide including corporations, governments, institutions, and individuals. For further information about Morgan Stanley, please visit www.morganstanley.com.
This has been prepared for informational purposes only and is not a solicitation of any offer to buy or sell any security or other financial instrument or to participate in any trading strategy. This material does not provide individually tailored investment advice. It has been prepared without regard to the individual financial circumstances and objectives of the persons who receive it. Morgan Stanley recommends that investors independently evaluate particular investments and strategies and encourages investors to seek the advice of a Financial Advisor.
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This material contains forward-looking statements and there can be no guarantee that they will come to pass.
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This material should not be viewed as investment advice or recommendations with respect to asset allocation or any particular investment.
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Referenced Data
| When it comes to the current market are you? | ||||
| Q1‘23 | Q2’23 | Q3’23 | Q4’23 | |
| Total | Total | Total | Total | |
| Bearish | 52% | 48% | 45% | 49% |
| Bullish | 48% | 52% | 55% | 51% |
| Please rate how much you agree or disagree with the following statements: The U.S. economy will be in better shape than it currently is by the end of this quarter. | |
| Q4’23 | |
| Total | |
| Top 2 | 55% |
| Strongly agree | 23% |
| Somewhat agree | 32% |
| Neither agree nor disagree | 18% |
| Somewhat disagree | 17% |
| Strongly disagree | 10% |
| Please rate how much you agree or disagree with the following statements: Inflation will continue to slow, and we will reach normal levels of inflation by the end of the year. | |
| Q4’23 | |
| Total | |
| Top 2 | 52% |
| Strongly agree | 18% |
| Somewhat agree | 34% |
| Neither agree nor disagree | 17% |
| Somewhat disagree | 19% |
| Strongly disagree | 12% |
| When do you expect the Fed to first cut rates? | |
| Q4’23 | |
| Total | |
| Top 2 | 41% |
| Q4 2023 | 11% |
| 1H 2024 | 30% |
| 2H 2024 | 26% |
| Not until 2025 | 16% |
| I don’t know | 11% |
| I don’t think they will cut rates | 6% |
| Which of the following are you most concerned about when it comes to your portfolio? | |
| Q4’23 | |
| Total | |
| High inflation | 51% |
| A recession | 32% |
| Market volatility | 31% |
| Energy costs | 18% |
| Earnings | 18% |
| Fed monetary policy | 17% |
| Russia/Ukraine conflict | 10% |
| Narrow market driven by mega-caps | 4% |
| None | 1% |
| Other | 1% |
| What industries do you think offer the most potential this quarter? (Top three) | ||
| Q3’23 | Q4’23 | |
| Total | Total | |
| Energy | 43% | 47% |
| Information technology | 51% | 46% |
| Health care | 34% | 36% |
| Financials | 28% | 29% |
| Real estate | 30% | 28% |
| Utilities | 25% | 24% |
| Consumer staples | 22% | 23% |
| Communication services | 18% | 20% |
| Industrials | 18% | 19% |
| Materials | 17% | 17% |
| Consumer discretionary | 14% | 11% |
