Info-Graphs

Global Consumer Sentiment Update

The November readings of the Thomson Reuters/Ipsos Consumer Sentiment indexes revealed a picture of solid consumer confidence at a global level.  The global GDP weighted reading was up +0.13pts to 57.76 with Developed Economies up +0.08pts to 54.04 and Emerging Markets up +0.17pts to 61.35.  This follows on from a strong round of PMI data for October – the chart below shows the global manufacturing PMI accelerating alongside the upturn in the consumer sentiment i

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ndicator.  That both consumer and manufacturing confidence is on the rise says something about the strength of the global economic upturn.
The rise of consumer sentiment has coincided with a strong run in global stock markets. This is an important observation because consumer sentiment is both affected by rising stock prices, and a reflection of the economic currents which drive corporate earnings.  In this respect it serves as a good confirming indicator for global equity strategy, but should also be on watch for any divergences or indeed a lack of confirmation in the direction of global stock prices.
While leading and lagging at different times both consumer sentiment and manufacturing confidence have risen to strong levels; reflecting a strengthening global economic cycle.

The steady march higher in the global consumer confidence reading has been met with a steady rise in the MSCI All Countries World Index (global equities).  It serves as a good confirming economic indicator for global equity strategy.

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