UNIVERSITY OF MICHIGAN CONSUMER SENTIMENT - TALKING POINTS:
- UofM Consumer sentiment misses estimates coming in at 96.9 vs estimates of 98.2
- The index is still well off its 2 year low in January
- Consumer sentiment remains at historically high levels compared to previous decades
The University of Michigan preliminary reading on consumer sentiment came in at 96.9 this morning, missing estimates of 98.2. The miss on estimates is largely insignificant as the index remains near historically high levels following years of economic expansion resulting in a healthy environment for American consumers.
The Michigan data saw consumers seeing less of an impact from last years tax cuts which could be indicating that its impact on the economy did not flow down into households as well as some thought. Consumers are also still concerned with home prices which could continue to predict trouble for the home market as home sales have seen some hiccups early this year.
The market largely shrugged off the miss with the S&P 500 up over half a percent, thanks to a strong start to earnings season with JP Morgan posting record profits and revenue. However, with consumer spending making up over 70% of the American economy, investors will continue to closely follow this metric, as the economy nears a point many consider to be the peak, or near the peak, of this economic expansion cycle.
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