European debt concerns have rattled the confidence of Canadian investors in recent months, according to the latest Russell Financial Health Index.

The index, which is based on an online calculator that gauges the overall financial health of Canadian investors, decreased in the second quarter of 2010 to 47 points. This is down from 51.1 in the first quarter.

“According to the Russell Financial Health Index, investors’ confidence in their financial health declined to the lowest levels since the benchmark was established in early 2008,” says Fred Pinto, managing director of distribution services at Russell Investments Canada Limited.

Increasingly prominent areas of concern for Canadians include being able to lead an active and healthy lifestyle and having a reliable source of income in retirement, the index shows. Investors are also more concerned about having sufficient income to cover their essential expenses, and the financial impact on medical and healthcare needs.

The latest survey also shows widespread uncertainty around the potential impact of Greece’s debt situation on the global economy.

“These results reflect the anxiety and much less positive mood of some investors as the market has reacted to economic indicators and global factors, such as the situation in southern Europe,” Pinto said.

He said investors should keep in mind that the Canadian and U.S. economies are showing signs of stability.

“Positive economic indicators may result in strong capital market returns going forward,” Pinto said.

He noted that in the latest Russell Investment Manager Outlook, 63% of Canadian investment managers indicated that they are bullish on Canadian equities, and 61% said they’re optimistic about U.S. equities.

IE