Spectrem Group's gauge reverses course after a precipitous slide in June. U.S. millionaires' confidence in investment markets increased slightly in July, according to Spectrem Group's Millionaire Investor Index (SMII). The gauge, which tracks the investment mood of financial decision-makers in households with at least $1 million in investable assets, rose 4 points in July to -16.

Last month's modest rise in the SMII follows 17-point slide in June -- the largest single-month decline since the SMII's inception in February 2004.

Spectrem's broader Affluent Investor Index (SAII) -- which tracks market sentiment among financial decision-makers in U.S. households with at least $500,000 in investable assets -- advanced by 1 point in July to -19.

At -16 and -19 respectively, the SMII and the SAII are in "mildy bearish" territory, according to Spectrem. In February 2009 both gauges were in full-howl bear territory with the SMII at -34 and the SAII at -38.

Cautious optimism

"Millionaires and the broader affluent population saw their investment optimism improve modestly in July, signaling continued caution following June's significant declines," says Spectrem's president George Walper. "Despite recent stock-market gains, the nation's wealthiest investors most likely will remain cautious until concerns such as unemployment and political uncertainty surrounding the healthcare debate have stabilized."

When asked last month what most influenced their investment plans, affluent investors cited tstock market conditions (26%), the economy (16%), household cash flow (8%), the political climate (7%)m retirement (3%)m and household income (2%).

Millionaires were a bit more worried about the stock market (28%) and the economy (22%) in July than the affluent.

Chicago-based Spectrem, a consultancy that specializes in the high-net-worth and retirement markets, bases its affluent and millionaire indexes on 250 monthly telephone interviews, each about 10 minutes long. Around 100 of the interviews focused on millionaire households.

The SMII is based on interviews with a sub-set of its broader "affluent" universe -- in other words, the SAII includes the views of millionaire households, but they're mixed with insights from a larger sampling of lower-wealth householders. -FWR

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