A rough end to the month.
First the scoreboard:
Dow: 15,116, -204.4 pts, -1.3%
S&P 500: 1,630, -23.6 pts, -1.4%
NASDAQ: 3,455, -35.3 pts, -1.0%
And now the top stories:
- The April personal income and spending report was disappointing. Income was flat, which was worse than the modest 0.1% gain expected by economists. Spending unexpectedly fell by 0.2%. “Despite surging prices for homes and equities, consumer spending is contracting,” said economic bear Lakshman Achuthan as he reiterated his recession call. “Quite simply, the wealth effect is rendered moot by languishing incomes.”
- “The 0.2% m/m decline in the nominal value of US monthly consumption in April is not quite as bad as is looks, since it partly reflects the drop back in gasoline prices,” said Capital Economics’ Paul Ashworth offering a bit of optimism. “Overall, a sobering report for those expecting GDP growth to accelerate sharply.”
- But there was also some good news today. The Chicago PMI report surged to 58.7 in May from 49.0 last month. Economists were looking for a reading of 50.0.
- Consumer confidence jumped to 84.5 in May from 76.4 in April. Economists were looking for a reading of 83.7.
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