Trump Effect: US Consumer Optimism Strongest Since November 2000

Trump Effect: US Consumer Optimism Strongest Since November 2000

Trump Effect: US Consumer Optimism Strongest Since November 2000

$DIA, $SPY, $QQQ, $VXX

Consumer sentiment climbed in early April to 3-month highs as consumer optimism on current economic conditions under President Donald Trump rose to its strongest marks since November 2000.

The University of Michigan Surveys of Consumers (MSI) said its preliminary April consumer sentiment index rose to 98.0, up from a final March reading of 96.9.

Analysts polled by Reuters had forecast a reading of 96.

The Key Points

  1. Preliminary sentiment index rose to 98 (forecast was 96.5) from 96.9 in March
  2. Current conditions gauge, which measures Americans’ perceptions of their personal finances, increased to 115.2, the highest since November 2000, from 113.2 the prior month
  3. Expectations measure improved in April to 86.9 from 86.5

The Big Picture

Americans have kept up a solid run of optimism, supported by a labor market and confidence that growth-boosting policies will take shape under The Trump Administration. Some 52% of respondents to the Michigan survey reported that their finances had recently improved, the highest share since Y 2000. The more favorable assessment reflected higher incomes and wealth, as well as low prices.

The report indicated that US households would respond to greater optimism by making big purchases. Perceptions of favorable conditions for purchases of durable goods were cited by 82% of respondents, the largest share since Y 2005.

The University’s expectations measure remains divided along party lines, as 69% of Republicans cited favorable news about employment and economic policies, compared with only 28% among Democrats.

 

Economist Takeaways

“Much more progress on shrinking the partisan gap is needed to bring economic expectations in line with reality,” the Director of the University of Michigan consumer survey, said in a statement.

The report also showed “year-ahead inflation expectations remained at 2.5% in March and April, and well below last year’s 2.8%. These lows were supported by the fewest complaints that rising prices eroded their living standards,” he said.
Some Other Details

Favorable home buying attitudes were held by 82% of respondents, the most since Y 2005 and just below the record of 84% in Y 1999.

US consumers saw inflation rate in the next year at 2.5%, unchanged from the prior month.

Inflation rate over next 5 – 10 years seen at 2.4%, the same as in March.

Commodities

  1. June Gold +0.8% at 1288.60 oz
  2. May Silver +1.2% at 18.52 oz
  3. May Copper +1.2% at 2.57 lb
  4. May WTI Crude Oil +0.1% at 53.18 bbl

Thursday, the major US stock market indexes finished at: DJIA -138.61 at 6730.86, NAS Comp -31.01 at 5805.15, S&P 500-15.98 at 2328.95

Volume: Trade on the NYSE came in at 912-M/shares exchanged.

  • NAS Comp +7.8% YTD
  • S&P 500 +4.0% YTD
  • DJIA +3.5% YTD
  • Russell 2000 -0.9% YTD
HeffX-LTN Analysis for DIA: Overall Short Intermediate Long
Neutral (-0.08) Neutral (-0.23) Neutral (-0.17) Neutral (0.17)
HeffX-LTN Analysis for SPY: Overall Short Intermediate Long
Neutral (-0.00) Neutral (-0.13) Neutral (-0.08) Neutral (0.21)
heffX-LTN Analysis for QQQ: Overall Short Intermediate Long
Neutral (0.18) Neutral (0.05) Neutral (-0.02) Very Bullish (0.50)
HeffX-LTN Analysis for VXX: Overall Short Intermediate Long
Neutral (0.11) Neutral (0.24) Neutral (0.05) Neutral (0.04)

 

The US Financial markets are closed for Good Friday, have a terrific Easter Weekend.

 

 

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Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

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