I’m not surprised consumer sentiment came in better than consensus and higher in November than October.  I am surprised how well it's doing when politics have seeped so deeply into every part of our lives, including consumer surveys.  Apparently, democrat consumers are still bracing for a recession, while republican consumers are looking for “uninterrupted expansion” in the year ahead. 

Interestingly, when the survey was broken up along income distribution, those saying their current personal finances improved came in at 54%, just shy of the all-time record of 57% with optimism equally shared across all income brackets.

In fact, for employed consumers under 45 years old, there is an expectation of a 4.6% wage gain next year. Meanwhile, this is the second-best streak of strong consumer sentiment ever.  According to the report, 30 of the past 35 months has seen the sentiment index at 95.0 or higher, only trailing the period from January 1998 to December 2000, where the survey averaged a read of 106.0.

US Manufacturing Alive and Kicking

This morning, IHS Markit released its US Flash Composite Purchasing Managers Index. Highlights include:

• Output 51.9 (four month-high)

• Services Business Activity 51/6 (four month-high)

• Manufacturing PMI (seven month-high)

• Manufacturing Output 53/1 (ten month-high)

The news is helping the market, but it has gone largely unreported.  If the numbers were the exact opposite, there would be breathless reporting on the great manufacturing recession.  That’s the new unfortunate wrinkle and challenge for investors.  “Bad” news is illuminated and presented in the most ominous manner possible, and “good” news barely gets a mention.