The S&P 500 closed at an all-time high yesterday, but don't tell that to individual investors. Looking at the latest sentiment figures from the American Association of Individual Investors (AAII), bullish sentiment dropped from 32.4% down to 29.6%. This is the lowest weekly reading of bullish sentiment since 5/8. While the 2.7 percentage point decline in bullish sentiment wasn't necessarily large, it is notable due to the fact that there are now fewer bullish investors (29.6%) than bearish investors (29.9%). The last time this happened was also back in May.
Normally, when the equity market is making new highs you expect to see bullish sentiment rise along with it. Not so in this bull market. In what has been a trademark of the last five years, investors with bad memories of the bear markets in 2000 and 2008 are determined not to make the same mistake again. Therefore, the higher equities go, the more nervous they become.