LIVE MARKETS-UMich: Consumers cheer up while keeping a suspicious eye on AI

Welcome to the home for real-time coverage of markets brought to you by Reuters reporters. You can share your thoughts with us at markets.research@thomsonreuters.com

UMICH: CONSUMERS CHEER UP WHILE KEEPING A SUSPICIOUS EYE ON AI

Today's economic also-ran, the University of Michigan's (UMich) initial take on November consumer sentiment, provided another reason for optimism that the US economy is not headed to the abyss.

The report showed that the mood of the US consumer — whose spending accounts for about 70% of the economy — has unexpectedly brightened, rising three points to land at 51, as we approach the crucial holiday shopping period.

Analysts expected it to stand pat at 48.

Survey participants' assessment of current conditions improved by 7.1%, while near-term expectations grew 4.3% rosier.

But there remained some clouds lurking on the horizon.

"While sentiment lifted for lower- and middle-wealth consumers, it fell 5% for those with the largest stock portfolios in the wake of a relatively turbulent period in stock markets," writes Joanne Hsu, UMich's director of consumer surveys. "Moreover, consumers’ comments revealed growing anxiety over a possible AI bubble."

"AI worries, however, were dwarfed by cost of living concerns, which continue to be at the forefront of consumers’ minds across the population," Hsu adds.

Inflation expectations cooled.

Respondents now expect year-on-year inflation of 4.3% a year from now, down from 4.7% last month. Even so, those expectations are 1.7 percentage points hotter than the most recent core CPI reading.

Longer-term, consumers see 3.4% inflation five years from now, or 0.1 ppt cooler than the final October reading.

(Stephen Culp)

EARLIER ON LIVE MARKETS:

CLICK HERE

BLUE WAVE COULD REDRAW US DATA-CENTER FOOTPRINT, UBS SAYS CLICK HERE

YOU BETTER WORK: A JOBS REPORT DEEP DIVE CLICK HERE

AI SELLOFF TESTS INVESTMENT BOOM; ANALYSTS SEE DE-RISKING, NOT FUNDAMENTAL RESET CLICK HERE

TECH, CHIPS RALLY, DAY AFTER SHARP SELLOFF CLICK HERE

NASDAQ, S&P 500 EMINIS HIGHER, BUT TRIM GAINS AFTER PAYROLLS CLICK HERE

BLUEBAY ADDS FRENCH, ITALIAN DEBT EXPOSURE CLICK HERE

HALF-TIME IN EUROPE: STOXX EXTENDS DECLINES, TECH STEADY CLICK HERE

GERMANY'S FISCAL BOOST IS TAKING HOLD CLICK HERE

STOXX SUFFERS, BUT STAYS STEADY ACROSS THE WEEK CLICK HERE

BEFORE THE BELL: TECH WORRIES CRASH ASHORE IN EUROPE? CLICK HERE

AI'S REALITY CHECK CLICK HERE