Schwab Survey: Bullish Sentiment Surges Among Retail Traders

Business Wire
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More than half of traders have a bullish outlook for the first quarter – the highest level of bullishness since 2021

WESTLAKE, Texas, February 22, 2024--(BUSINESS WIRE)--Trader sentiment has turned bullish according to the latest Charles Schwab Trader Sentiment Survey, a quarterly study that explores the outlooks, expectations, and perspectives of traders at Charles Schwab. More than half of respondents (53%) report a bullish outlook on the U.S. stock market – the highest level since the survey began in 2021 and a significant increase from the 32% who were bullish in the fourth quarter of last year. Additionally, 49% of traders believe it’s a good time to invest in equities, up from 41% last quarter.

Traders’ outlook for the economy has also become more optimistic. Nearly half (48%) of traders think the U.S. will likely avoid a recession in 2024, up from 23% last quarter.

"As the economy continues to show signs of improvement, trader optimism is on the rise with bullishness at its highest level since we began the survey," said James Kostulias, head of Trading Services at Charles Schwab. "That said, there is still plenty of uncertainty out there, from global conflicts to the upcoming election to the path of inflation."

Trader concerns and confidence

In the first part of 2024, geopolitical and global macroeconomic issues emerged as the top concern weighing on traders’ minds (18%), followed by the political landscape in Washington, D.C. (16%). This represents a shift from recent months; in Q4 2023, the political landscape dominated traders’ concerns. Worry over the potential for a recession, meanwhile, has dropped steadily since its peak in Q2 2023.

Primary concerns around investing

1Q ‘24

4Q ‘23

3Q ‘23

2Q ‘23

1Q ‘23

Geopolitical or global macroeconomic issues

18%

5%

8%

10%

9%

Political landscape in D.C.

16%

21%

13%

13%

12%

Market correction

9%

8%

10%

7%

6%

Uncertainty/potential increase in market volatility

9%

7%

7%

6%

7%

Potential of a recession

9%

11%

14%

18%

15%

Inflation

9%

11%

10%

8%

12%

Fed holding rates steady

6%

3%

1%

n/a

n/a

Traders point to the U.S. presidential election (42%), the direction of the federal funds rate (37%) inflation (34%) and geopolitical conflict (31%) as the factors that will have the biggest impacts on the markets this year.

Concerns aside, traders’ confidence in their own decision-making, similar to bullishness, hit the highest level since Schwab began its survey at 68%. Additionally, the number of traders who say they feel better off financially compared to a year ago reached 54%, up 21 percentage points quarter-over-quarter.

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