CB Consumer Confidence Breakdown

CB Consumer Confidence Breakdown
Highlights:

- The Conference Board Consumer Confidence Index dropped to 97.0 in April 2024 from a downwardly revised 103.1 in March.
- The Present Situation Index declined to 142.9 in April from a downwardly revised 146.8 in March, while the Expectations Index fell to 66.4 from a slightly upwardly revised 74.0.
- Confidence among consumers of all age groups and almost all income groups declined in April, with households with incomes below $25,000 and those above $75,000 reporting the largest deteriorations.

Good Parts:

- Assessments of the present situation weakened but remain relatively optimistic, with consumers continuing to rate current business conditions positively.
- Confidence among consumers earning less than $50,000 has been stable over a six-month basis.

Bad Parts:

- The overall Consumer Confidence Index dropped for the third consecutive month, reaching its lowest level since July 2022.
- Expectations for the next six months slipped to the lowest level since July 2022, driven by a more pessimistic outlook for future business conditions, labor market conditions, and income expectations.

Revisions:

- Revised down from 104.7 to 103.1

Implications for the Economy:

- The decline in consumer confidence suggests weakening optimism about the economy, which may lead to reduced consumer spending and economic activity.
- Pessimistic outlooks for future business conditions, labor market conditions, and income expectations indicate potential challenges ahead for economic growth and recovery.

Stocks That May Be Impacted:

- Consumer discretionary stocks: Companies producing non-essential goods and services such as restaurants, clothing retailers, and entertainment providers may see decreased demand if consumers cut back on discretionary spending.
- Retail stocks: Companies selling big-ticket items such as appliances and homes, as well as those in the travel and vacation industry, may experience declines in sales and revenue.
- Interest-sensitive sectors: Sectors such as real estate and financial services may be impacted by consumers' expectations of higher interest rates, potentially leading to reduced demand for housing and borrowing.

Summary:

The Conference Board Consumer Confidence Index declined in April 2024 for the third consecutive month, reaching its lowest level since July 2022. Confidence among consumers weakened across all age and income groups, with concerns about future business conditions, labor market conditions, and income expectations. This decline in consumer confidence may lead to reduced consumer spending and economic activity, affecting various sectors including consumer discretionary, retail, and interest-sensitive industries.