Courtesy of John Nyaradi.
Consumers feel better and spend more as sentiment and spending rise
The all important consumer sector (AMEX:XLP) received a boost today as reports showed that October Consumer Sentiment rose to 60.9 from last month’s 57.5 and September spending rose +0.6% compared to last months +0.2%. However, incomes only rose +0.1% for September, indicating that consumers tapped into savings and debt to support the increased levels of spending, and of course, this could prove to be unstainable in months going forward. Consumer giant Whirlpool (NYSE:WHR) was pounded for a double digit loss during the day as it reported softening demand, production cuts and layoffs. Job cuts could exceed 5,000, or 10% of its workforce, says demand in the United States continues to fall more than expected and no growth overseas.
Dow component (AMEX:DIA) Chevron Corporation (NYSE:CVX) reported that 3Q profits doubled as oil prices and production declined and overall results beat analyst estimates and the energy leader took the energy sector (AMEX:XLE) higher.
Bottom line: The energy sector (AMEX:XLE) remains in a significant uptrend as hopes for an improving economy drive oil prices higher. The Consumer Sector (AMEX:XLY) remains in a solid uptrend on both technical and fundamental levels, in spite of the consumer being stressed by lingering high unemployment.
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