This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Bulls Have Bears on the Run to Start 2012

Stocks in this article: NFLX BAC DNR WMB ANF ^GSPC ^IXIC ^DJI SPY

NEW YORK ( TheStreet) -- Maybe it's that false sense of optimism that comes with a fresh calendar but the little guy is feeling pretty darn optimistic about stocks right now.

The latest weekly sentiment survey from the American Association of Individual Investors finds the level of bullishness among the organization's roughly 150,000 members at an 11-month high.

Thanks to a jump of 8.3 percentage points, the bull camp -- those who expect the S&P 500 to gain ground over the next six months -- swelled to 48.9% this past week, the highest reading since the week ended Feb. 10, 2010, and well above the long-term average of 39%.

Bearishness took a major turn lower, losing 13.7 percentage points to just 17.2%. That reading constitutes the lowest measure of pessimism about stocks since the week ended Dec. 23, 2010.

"It is also more than one standard deviation below the historical average of 30%, making this an unusually low reading," noted the AAII, which doesn't disclose how many of its members take the survey each week.

It got more crowded on the fence as well with the percentage of those saying stocks will stay flat for the next six months rising 5.4 percentage points to 34%, making for the second time in the past three weeks that neutral sentiment has come in above its long-term average of 31%.

The AAII also asked its members this week which group of stocks they expect to perform best in 2011, large-cap, mid-cap, small-cap or micro-cap. The majority are expecting large-caps to outperform "especially those that pay dividends," the organization said, adding that mid-caps were a "distant second" followed by small-caps.

"Dividends and safety matter," said one investor in response to the survey question. "Exposure to emerging markets can be attained through high-quality large-cap stocks."

Despite a mixed performance on Friday, the major U.S. stock indices are on pace to record modest gains in the first week of 2012, a good sign for believers in the January effect, the name given to the historical trend for a positive showing in the first month being indicative of gains for the full year.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,387.21 -291.49 -1.65%
S&P 500 2,029.55 -27.54 -1.34%
NASDAQ 4,681.4970 -90.2660 -1.89%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs