Bear's perspective: labor market is weakening
Bull's perspective: The sentiment is not as bad and not indicative of recession. Post rate cut will see an improvement in Oct. Plus the news of end of Jensen Huang's stock sales.
What is Consumer Confidence Index and is it important?
Conducted by Nielsen, it is basically a monthly market research that comprises of 5 questions about present situation and expectations 6 months from now.
What's the current sentiments?
Current assessment of business conditions turned negative, and current appraisals of labor market has deteriorated. 18.3% perceive jobs as hard to get, 20.2% said business conditions were bad.
Is this important?
We honestly don't think Consumer Confidence Index is a reliable metric of the economy (only if it drops to 80), as this is more of a sentiment indicator not an actual job report. And this survey was also conducted prior the rate cut, we will only see the effect of the rate cut next month.
Sentiment Indicators are good counterbalance to technical indicators, but oftentimes not sufficient on its own.
We would advise practicing caution this week as jobless claim will be coming up next, and it would not be a surprise if the numbers aren't impressive. However, this does not mean we are in a recession.
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