Institutional investors in North American have curbed their optimism according to the results of the State Street Investor Confidence Index for May 2007.

Global investor confidence fell by 1.8 points to 91.2 from April’s revised reading of 93.0. Looking regionally, the confidence of North American institutional investors decreased from 102.6 to 99.9, but confidence elsewhere improved, with European sentiment seeing an improvement from 90.5 to 94.2, and Asian sentiment rising from 81.7 to 84.3.

Developed through State Street Global Markets’ research partnership, State Street Associates, by Harvard University professor Ken Froot and State Street Associates Director Paul O’Connell, the State Street Investor Confidence Index measures investor confidence on a quantitative basis by analyzing the actual buying and selling patterns of institutional investors.

“In the wake of a weak domestic first quarter, U.S. investors continue to behave with some trepidation,” commented Froot, in a news release. “However, globally, prospects remain good as worldwide demand remained strong through the first quarter, impacting inventories. This provides the backdrop for the improved sentiment outside the U.S.”

“This month saw a slight see-saw in flows,” added O’Connell, “as institutional investors evinced caution in the early part of May before returning in strength to a broad array of global equity markets in the most recent weeks.”

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