US stocks rise as consumer sentiment index perks up
10 Dec 2011
US stocks ended higher on Friday on the back of a significant increase of an index measuring consumer sentiment and following an agreement by a majority of members of the European Union to tighten fiscal integration.
The Dow Jones Industrial Average was up by 1.55 per cent, the S&P 500 gained 1.69 per cent and the Nasdaq Composite rallied by 1.94 per cent. The US trade deficit for October also fell to $43.5 billion from $44.2 billion a month earlier, the commerce department announced on Friday. This was the lowest level in 2011.
US consumer sentiment shot up to its highest level in six months climbing to 67.7 for December, as against 64.1 in November and 55.7 in August. The index had averaged 89 for five years before the 2008 recession.
''News about recent economic developments were much more positive in early December,'' said Richard Curtin, director, Thomson Reuters/University of Michigan Surveys of Consumers. ''Reports of net job growth have increased in each of the past three months, as have assessments of current conditions in the economy.''
Other indicators in the consumer survey were also up. The index of current economic conditions was up at 77.9 (from 77.6 in November), while the index of consumer expectations rose to 61.1 (55.4 in November). Consumers' outlook of one-year inflation dipped to 3.1, while the five-to-ten year outlook remained unchanged at 2.7.
Sentiments on Wall Street also improved following an agreement by 26 of the 27 members of the European Union to ensure fiscal discipline and improve integration.
