Investors Boost The IMX In February, But Seem Wary Of What The Future Holds

After a prolonged downturn that saw it reach its lowest score in the index's recent history, TD Ameritrade’s Investor Movement Index (IMX) bounced in February to post its first uptick in five months.

The broker’s monthly survey of client sentiment hit a year-to-date high of 4.59 in February, a 7.24-percent increase over January’s reading. That marks the IMX’s largest month-over-month increase since June 2018.

Consumers Take Center Stage

Although the latest index report showed TD Ameritrade clients were again net buyers overall, equity was generally sold in favor of more defensive assets like bonds and other fixed-income vehicles following an uptick in CBOE’s volatility index (VIX) in the final days of January.

This defensive approach comes through in the concentration of stocks TDA clients were focused on over the month. Names representative of the consumer staples and health care sector like Altria Group Inc. MO -- which received a positive nods for its investment in Juul e-cigarettes -- and CVS Health Corp. CVS -- which was the only major increase in Omega Advisors' portfolio over the fourth quarter -- were among the most popular stocks in February.

More volatile consumer-facing stocks like Ford Motor Company F and Tesla Inc. TSLA were also net buys among TDA investors. Although both automotive stocks finished the month mostly flat, both dipped from their February entry by 4-6 percent.

Finally, Amazon.com, Inc. AMZN was again a net buy among TDA clients after the company reported another strong quarter in late January. This, despite Amazon issuing weaker 2019 guidance and its price hovering at year-to-date highs.

But Shoppers Also Got Sold

Investors weren’t wholly bullish on spenders throughout February. Procter and Gamble Co. PG, a prime example of a thriving consumer staple in 2019, was net sold on the month after hitting an all-time high of $100.45.

Another stock hitting highs in February, Chipotle Mexican Grill, Inc. CMG was also net sold on the month after the restaurant reported strong fourth-quarter sales numbers, which boosted the stock to a 52-week high.

Two other net sold consumer names, Home Depot Inc. HD and Alibaba Group Holding Ltd. BABA, saw good momentum over the month thanks to positive signals in trade negotiations between the United States and China. While the former is still struggling to climb above a $190 ceiling it fell below last October, Alibaba has continued a climb from year lows it set in January to achieve a new six-month high.

Click here to read February’s full IMX report.