Democrats are coming around on the stock market
About 57% of Democrats feel optimistic about the short-term outlook for stocks, a significant increase from just 10% in October, according to a survey conducted by UBS. Their sentiment on the S&P 500 has climbed steadily since the presidential election, the data show.
That groundswell of confidence has mirrored a similar improvement in the overall economic outlook across all political parties. About 61% of investors are optimistic on the US economic outlook, up from 42% last summer, according to the survey.
Further, while US investors are currently holding around 20% of their investable assets in cash, UBS found that more than half of them are willing and ready to deploy that capital - so long as they see more progress from Trump, especially on policies that will further boost economic growth.
They're specifically interested in lower personal income taxes and higher infrastructure spending. About 40% of survey respondents said they need to see steps taken towards those initiatives before they put more cash to work in the market.
Business owners, however, are ready to deploy capital right now, the survey finds. About two-thirds of them are planning to invest more in their business, while 56% said they'll increase hiring. Both readings are more than double the portions of business owners expecting to invest less or downsize their workforce, respectively.
Investor stock market confidence matches expectations from strategists across Wall Street, who see the S&P 500 climbing another 2% by year-end, according to a 19-person Bloomberg survey. Binky Chadha of Deutsche Bank, the most bullish of all with a price target of 2,600, sees the index rising 7.7% from Monday's close.
UBS surveyed 2,272 affluent and high net worth investors, as well as 383 business owners with at least one employee besides themselves. The firm also conducted follow-up interviews with 90 respondents.