The AAII Sentiment Survey released on September 18, 2026, showed a sharp deterioration in individual investors’ six-month outlook for stocks. Bearish sentiment rose 14 percentage points in one week to 53.3%, its highest level since May 2025, while bullish sentiment fell 9.2 points to 28.8%, its lowest reading in roughly 16 months. Neutral sentiment declined 4.8 points to 17.9%. The shift came as elevated oil prices, geopolitical tensions linked to the Iran conflict and the Federal Reserve’s unexpected 25-basis-point rate increase weighed on markets. The hike was the Fed’s first tightening action since 2023. Global equity funds recorded $23.21 billion in net outflows during the survey period, while U.S. equity funds saw $31.44 billion leave. The AAII readings are well outside historical averages, with bullish sentiment normally at 37.5%, neutral sentiment at 31.0% and bearish sentiment at 31.5%. Extreme pessimism can act as a contrarian signal, but the combination of worsening sentiment, fund outflows, higher borrowing costs and commodity-driven inflation could make the bearish view more persistent. Market breadth also weakened, with 30% of stocks trading above their 50-day moving average, while the S&P 500 remained on track for a second consecutive weekly decline and its third lower week in five.