More Newsletters Turn Bullish on Stocks

Optimism about U.S. stocks rose this week to its highest level since the week of Aug. 10, according to a poll of independent investment newsletter writers by Investors Intelligence.

The percentage of newsletters considering themselves bullish, or optimistic about the market, climbed to 49% last week from 48.4% the previous week. Bullishness hit a four-year low of 33.7% after the Sept. 11 terrorist attacks.

The percentage of newsletters considering themselves bearish, or pessimistic, also rose, to 27.5% from 27.3% the week before

Those newsletters that aren’t bullish or bearish expect a modest near-term pullback in stocks.

Historically, peaks in optimism in the Investors Intelligence survey often have signaled near-term tops in the market. When most investors are bullish, they already have committed most of their funds to the market.

The bullish reading rose as high as 61.8% in early February of last year--just as the market began to plunge after January’s big rally.

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Bloomberg News, Times Staff