According to Bespoke Investment Group the current stock market rally has been fueled mostly by individual investors:
"Individual investors may be moving back into stocks, as gains in the Standard & Poor’s 500 Index this month occur at the start of the trading day, the time when they enter most transactions, Bespoke Investment Group LLC said."
in Bloomberg
Bespoke adds, "Investors are looking out of the side window and reacting to the financial news of the day or hour, for that matter.”
The S&P 500’s average hourly change between the prior close and 10 a.m. is 0.45 percent, higher than the 0.18 percent that occurs in the next 60 minutes until 11 a.m., according to a Sept. 17 report sent to clients by Bespoke. The difference during the remaining one-hour segments of a session is less than 0.1 percent. The benchmark index for American equities has risen more than 8 percent this month.
The increase in the hourly percent change is a reversal from the last two weeks of August, when most of the declines happened in the first half hour of trading, Bespoke said. The S&P 500 averaged a drop of 0.43 percent each day through 10 a.m. during that period.
The declines in the early part of the sessions in August created a bullish signal in the “Smart Money Indicator,” the report said. The SMI says retail investors, or individuals, trade near the start of sessions, while institutional investment actions are carried out mainly near the close.
Related stocks: Apple Inc. (NASDAQ:AAPL) , Exxon Mobil Corporation (NYSE:XOM) , JPMorgan Chase & Co. (NYSE:JPM), Google Inc. (NASDAQ:GOOG), Ford Motor Company (NYSE:F), Freeport-McMoRan Copper & Gold Inc. (NYSE:FCX)
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