US CONSUMER CONFIDENCE AND STOCKS © Leo Haviland, May 19, 2011
Many intertwined factors of course influence economic and stock marketplace levels and trends. Both Wall Street and Main Street know United States consumer spending greatly affects United States economic growth and significantly influences that elsewhere. In general, won’t happy and confident consumers tend to spend more freely? As Memorial Day weekend beckons, why not remember key consumer confidence measures? The Conference Board asserts that its “Consumer Confidence Index ® (CCI) is a barometer of the health of the U.S. economy from the perspective of the consumer.” (“Technical Note- February 2011”).
A review of the Conference Board’s Consumer Confidence Index over the past four decades reveals that this measure sometimes can provide helpful guidance regarding the identification (confirmation) of major highs, lows and trends in US equity benchmarks such as the S+P 500. Given the close ties between stock and overall commodity marketplace trends in recent years, commodity players should monitor the Confidence Index.
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