Investor Sentiment Jumps in 2014's Final Quarter

- John Hancock Investor Sentiment Index® rises three points after leveling off for the three previous quarters

- Positive feelings toward stocks helps propel Index score to +26, matching its prior record high in Q2 2013

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Jan 05, 2015, 10:00 ET

BOSTON, Jan. 5, 2015 /PRNewswire/ -- Investor sentiment took a jump upward in the fourth quarter of 2014 after remaining level for the previous year, according to the John Hancock Investor Sentiment Index®, a quarterly measure of investors' views on a range of investment choices, life goals, and economic outlook. Investors' positive feelings about stocks helped drive the Index score to +26, matching its previous record high in the second quarter of 2013.

John Hancock's Investor Sentiment Index Q4 2014

The John Hancock Investor Sentiment Index® reflects the percentage of investors who say they believe it is a "good" or "very good" time to invest, minus those who feel the opposite. The fourth quarter survey was conducted in mid- to late November of 2014.

Six in ten investors said they are confident about investing in stocks, while a similar share expressed optimism about investing in balanced mutual funds. Nearly 30 percent believe that blue chip stocks will be the market's top performers over the next six months, a jump in expectation from Q3 of 2014 when 22 percent thought this would be the case. Among sectors, technology, healthcare and energy companies offer the best investment opportunities in the next six months, investors say.

Saving for retirement remains a key priority. Eight in ten said that now is a good time to put money away in 401(k) plans or IRAs. About two in five are positive toward investing in Target Risk Funds and Target Date Funds. Half of investors have positive views of contributing to 529 college Savings plans.

"Investors are indicating a strong positive outlook beyond the investment arena, as well," said Megan Greene, Chief Economist, John Hancock Asset Management. "Nearly 30 percent feel it is a good time to start a business compared with 21 percent in Q1 of 2014, and 31 percent say it's a good time to change jobs, up significantly from Q1 when 19 percent said so. In terms of their own personal financial situation, half say they are better off than they were two years ago, and half believe their situation will improve over the next two years."

A quarter of investors cite their savings and investment portfolios as the main reason they believe their financial situation will be better in the future. Eighteen percent chalked their optimism up to having paid down debt. Of the eight percent of investors who predict their financial situation will be worse in two years, one-third cite government and politics as the main reason.

The future is not without worry, however, investors say. The cost of healthcare is of major concern to 54 percent of investors surveyed. Four in ten are very concerned about unrest in the Middle East, a share that has increased significantly from last year (from 29 percent in Q4 2013). Worry over the prices of oil and gasoline prices took a big drop, with only one in six expressing great concern, compared with 26 percent in Q3 of 2014 and 33 percent in Q2 of 2014.

About the John Hancock Investor Sentiment Survey
John Hancock's Investor Sentiment Survey is a quarterly poll of affluent investors. The survey measures investors' feelings about the current economic climate and their evaluations of what represents a good or bad investment given the current environment. The poll also asks consumers about their confidence in reaching key financial goals and their attitudes toward specific financial products and services. This online survey was conducted by independent research firm Greenwald & Associates. A total of 1,139 investors were surveyed from November 10th to November 21st, 2014. To qualify, respondents were required to participate at least to some extent in their household's financial decision-making process, have a household income of at least $75,000, and assets of $100,000 or more. The data were weighted by age and education to reflect the population of Americans matching the survey's qualification requirements. In a similarly-sized random sample survey, the margin of error would be plus or minus 2.96 percentage points at the 95 percent confidence level. Due to rounding and missing categories, numbers presented may not always total to 100 percent.

About John Hancock Financial and Manulife
John Hancock Financial is a division of Manulife, a leading Canada-based financial services group with principal operations in Asia, Canada and the United States. Operating as Manulife in Canada and Asia, and primarily as John Hancock in the United States, our group of companies offers clients a diverse range of financial protection products and wealth management services through its extensive network of employees, agents and distribution partners. Funds under management by Manulife and its subsidiaries were C$663 billion (US$591 billion) as at September 30, 2014. Manulife Financial Corporation trades as 'MFC' on the TSX, NYSE and PSE, and under '945' on the SEHK. Manulife can be found on the Internet at manulife.com.

The John Hancock unit, through its insurance companies, comprises one of the largest life insurers in the United States. John Hancock offers and administers a broad range of financial products, including life insurance, annuities, investments, 401(k) plans, long-term care insurance, college savings, and other forms of business insurance. Additional information about John Hancock may be found at johnhancock.com.

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SOURCE John Hancock Financial