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Business Title: U.S. Consumer Sentiment Unexpectedly Drops Amid Pessimism Over Job Market April 16 (Bloomberg) -- Confidence among U.S. consumers unexpectedly fell in April to the lowest level in five months, indicating Americans are discouraged about the labor market. The Reuters/University of Michigan preliminary index of consumer sentiment dropped to 69.5 from a reading of 73.6 in March. The gauge was projected to rise to 75, according to the median forecast in a Bloomberg News survey of 69 economists. Lagging confidence threatens to restrain household spending, which accounts for about 70 percent of the economy. While recent figures showed retail sales picked up in March, a 9.7 percent unemployment rate and mounting home foreclosures are risks for the recovery. “This raises doubts about the consumer and leaves one feeling uncertain about the pace of the recovery,” said Rob Carnell, chief international economist at ING Financial Markets in London. “We’re not seeing much in the way of labor market progress. People are still worried about home prices.” Stocks fell after six days of gains as Google Inc.’s profit trailed some analysts’ estimates. The Standard & Poor’s 500 Index declined 0.5 percent to 1,205.93 at 10:37 a.m. in New York. The decrease in the April sentiment index from a month earlier was the biggest since July 2009. Estimates for the consumer sentiment index ranged from 73 to 80, according to the Bloomberg survey. Housing Starts Housing starts rose in March and builders took out permits at the fastest pace in more than a year, Commerce Department figures showed earlier today. New-home construction climbed at an annual rate of 626,000 last month, up 1.6 percent. Building permits, a sign of future construction, increased to the highest level since October 2008. The gauge of current conditions, which reflects Americans’ perceptions of their financial situation and whether it is a good time to buy big-ticket items like cars, dropped to 80.7, the lowest level this year, from 82.4. The index of consumer expectations for six months from now, which more closely projects the direction of consumer spending, slumped to 62.3, the weakest reading since March 2009, from 67.9. Consumers in the survey said they expect an inflation rate of 2.9 percent over the next 12 months, up from 2.7 percent in the prior survey. Inflation Expectations Over the next five years, the figures tracked by Federal Reserve policy makers, Americans expected a 2.7 percent rate of inflation, the same as last month. The preliminary Reuters/University of Michigan consumer confidence report reflects about 300 responses, compared with 500 households for the final survey. Sales at stores open at least a year rose 12.7 percent in March at Saks Inc., the New York-based luxury department-store chain, and increased 10 percent at Minneapolis-based Target, the second-largest U.S. discount retailer. Same-store sales climbed 11 percent at Gap, which owns Gap, Banana Republic and Old Navy stores and is based in San Francisco. Talbots Inc., a women’s clothing chain based in Hingham, Massachusetts, this week said total sales may rise as much as 5 percent this year from the prior year. ‘Good Start’ “We are off to a good start with anticipated growth in first-quarter sales and operating profit,” Trudy Sullivan, president and chief executive officer, said on an April 13 conference call with investors. Household purchases will rise at a 2.5 percent pace this quarter and at a 2.4 percent rate from July to September, according to the median forecast in a Bloomberg monthly survey taken April 1 to April 8. Economists raised estimates for both quarters from the 2.2 percent gain they projected last month. The unemployment rate, which was 9.7 percent in March, is projected to end the year at 9.4 percent, according to the Bloomberg monthly survey. “Consumer spending should be aided by a gradual pickup in jobs and earnings, the recovery in household wealth from recent lows, and some improvement in credit availability,” Fed Chairman Ben S. Bernanke said April 14 in prepared testimony to the Joint Economic Committee of Congress. Even so, “a significant amount of time will be required to restore the 8 1/2 million jobs that were lost during the past two years.”
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#1. To: Brian S (#0)
(Edited)
Small business optimism, espeically at the "turn-key" level, isn't doing very well either but there appears to be some anecdotal evidence that "truck" busineses - roofers, remodelers, etc etc etc, are picking up. I've been saying for a while that the economy is going to pause. Pretty sure there will be a push for a stim by Summer.
#67. To: war (#48) Keep hiding behind the bozo, bozo. (laughing) You've always been a world class pussy. Badeye posted on 2010-01-14 16:12:48 ET Reply Trace
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