IE 11 is not supported. For an optimal experience visit our site on another browser.

Consumer confidence jumps in Nov.

U.S. consumer confidence surged more than expected in November, market sources said on Friday, boosted by recent job growth and a stronger stock market.
/ Source: Reuters

U.S. consumers showed a sudden and unexpected burst of confidence in November, market sources said Friday, taking heart from an improving employment situation and recent strength in the stock market.

The University of Michigan’s index of consumer sentiment for November increased far more than expected in a preliminary reading, smashing economists’ forecasts to hit 93.5, its highest level since May 2002. This was well above both the median projection of 91.0 and October’s final reading of 89.6.

The survey’s current conditions index rose to 102.8 from 99.9 and the expectations index, which tracks perceptions about the economy over the next 12 months, jumped to 87.6 from 83.0.

“The sentiment numbers respond to equity market performance and, to some extent, labor conditions, and those have improved recently,” said Gemma Wright, director of market strategy with Barclays Capital.

The survey, released only to paying customers, is based on telephone interviews with 500 U.S. households over the month on personal finances and business and buying conditions. The preliminary survey, released about midway through the month, is based on the first 250 of those interviews.

Some of those interviews would likely have been infused with optimism after the October jobs report released on Nov. 7 showed the United States had enjoyed three straight months of rising payrolls and that unemployment finally ticked lower.

Analysts watch indexes of consumer confidence for clues on consumer spending, but often note consumers’ reported mood does not always match their behavior at the shopping mall.

Earlier on Friday, U.S. October retail sales were reported down 0.3 percent, although excluding the autos sector, sales were up 0.2 percent, in line with expectations. September sales were revised to down 0.4 percent from down 0.2 percent.

U.S. Treasury yields ticked down on the confidence report, suggesting the market might have been anticipating a stronger figure. The dollar slipped, while the main U.S. stock market indexes held small gains.