WATERLOO, ON, Oct. 20, 2011 – According to the most recent results of the Manulife Financial Investor Sentiment Index, a wide variety of international business, political and natural events have had a measurably negative impact on Canadians’ confidence in their investment options during the third quarter of 2011.
Results of a third quarter survey, which was conducted for Manulife Financial between September 6 and 11, clearly demonstrate the influence a number of global events have had on Canadians’ investment decisions. According to an Angus Reid Forum survey of 1,002 randomly selected Canadian adults:
- Over a third of Canadians (34%) reported that the American debt ceiling debate and credit downgrade had a negative impact on their investment decisions.
- A quarter of Canadians reported a negative impact on their investment optimism as a result of both the instability in Greece around austerity measures (24%), and the aftermath of the tsunami in Japan (25%).
- Political instability in the Middle East was cited as having negative consequences for investment choices by one in five (19%) of those surveyed for the Index.
Other international events such as the death of Osama bin Laden and oil drilling in the Gulf had much less effect on Canadians’ investment decisions.
Closer to home, the 2011 Canadian federal election positively impacted the investment decisions of 17% of Canadians, while it impacted negatively on 16% of Canadians.
Investor Sentiment Index
Reversing gains made earlier in the year, Manulife Financial’s Investor Sentiment Index dropped eight points from the second quarter of 2011 to a total of +21, one point ahead of where it began the year.
The Index Sentiment Index is a quarterly poll of 1,000 Canadians that reflects the percentage of respondents who say they believe it is a good or very good time to invest, minus those who feel the opposite. This quarter’s survey was conducted by Research House, an Environics Company, and has a margin of error of +/- 3.1%, 19 times out of 20.
While Canadians continue to remain optimistic about investing in their own homes, investor confidence decreased in almost all investment categories, including stocks, fixed income funds, real estate, investment property and balanced funds. Cash investments were an exception this quarter, showing no change.
Despite an 11 per cent drop in the S&P/TSX Composite Index in the six months preceding the survey, Canadians are not persuaded that stocks are a good buy. Those who said it was a good or very good time to buy stocks were outnumbered by those who felt it was bad or very bad time to buy stocks, resulting in a 16-point drop in the stock subindex this quarter, to -9.
When asked about the their optimism for specific investment vehicles such as tax free savings accounts, RESPs, RRSP, segregated funds and mutual funds, Canadians continue to feel most confident investing in tax free savings accounts.
About Manulife Financial
Manulife Financial is a leading Canadian-based financial services group operating in 21 countries and territories worldwide. For more than 120 years, clients have looked to Manulife for strong, reliable, trustworthy and forward-thinking solutions for their most significant financial decisions. Our international network of employees, agents and distribution partners offers financial protection and wealth management products and services to millions of clients. We provide asset management services to institutional customers worldwide as well as reinsurance solutions, specializing in property and casualty retrocession. Funds under management by Manulife Financial and its subsidiaries were Cdn$481billion (US$498 billion) as at June 30, 2011. The Company operates as Manulife Financial in Canada and Asia and primarily as John Hancock in the United States.
Manulife Financial Corporation trades as ‘MFC’ on the TSX, NYSE and PSE, and under ‘945’ on the SEHK. Manulife Financial can be found on the Internet at www.manulife.com.