While key stock U.S. benchmarks record fresh record highs, optimism among investors keeps rising too. The latest survey from the American Association of Individual Investors found that optimism about the short-term direction of the stock market spiked to a four-year high. The percentage of people expecting markets to rise over the next six months rose to nearly 58%, according to the latest survey from the American Association of Individual Investors. Bullishness is at its highest level since Dec. 2010. Investors' upbeat sentiment has remained above historical average for 13 out of past 14 weeks, the survey said. Neutral sentiment plunged to the lowest levels since March of last year. Bearish sentiment, or expectations that markets will fall over the next six months rebounded slightly to 19.3%, but still remain below historical average of 30%. Historically, when investor sentiment hits extreme euphoric levels, stock market returns over the next 12 months have been flat, according to AAII.
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