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COPYRIGHT 2008 Voxant, Inc.
Original Source: NIGHTLY BUSINESS REPORT
PAUL KANGAS, NIGHTLY BUSINESS REPORT ANCHOR: From the grocery check out line to the pain at the pump, Americans are spending more money and they`re not happy about it. Fresh data show U.S. consumer sentiment is at its lowest level in 28 years.
SUSIE GHARIB, NIGHTLY BUSINESS REPORT ANCHOR: Oil prices have doubled in the last year and many wonder what`s behind that rise: supply and demand or speculators. The government is asking that same question. We talk about the investigation with Walter Lukken, the acting head of the Commodity Futures Trading Commission.
KANGAS: Tonight`s "Market Monitor" guest says telltale signs of bullish tailwinds are developing in the markets. He`s Bernie Schaeffer, chairman of Schaeffer`s Investment Research.
GHARIB: Shares of Tiffany and Company sparkled on Wall Street today. Earnings surged at the upscale jeweler, thanks to big sales at its flagship Manhattan store.
KANGAS: I`m Paul Kangas.
GHARIB: And I`m Susie Gharib. This is NIGHTLY BUSINESS REPORT for Friday, May 30.
Good evening, everyone. American consumers are feeling really downbeat these days. A new report today showed consumer confidence fell to its lowest level in 28 years this month, under the crush of record prices for gas and food. In a separate report, the Commerce Department said both consumer spending and personal income slowed in April. As Scott Gurvey explains, these new data suggest a difficult outlook for the U.S. economy.
SCOTT GURVEY, NIGHTLY BUSINESS REPORT CORRESPONDENT: Consumers are still the most important players in the American economy. So it doesn`t help when they become convinced the economy is in recession, as the Reuters/University of Michigan report released today indicated. The report also shows that our expectations for the next six months have fallen. That measure predicts consumer spending in the months ahead. While consumer confidence is falling, a separate report from the Commerce Department shows that consumer spending is only slowing. But as economist David Wyss of Standard & Poor`s explains, that number is deceiving.
DAVID WYSS, CHIEF ECONOMIST, STANDARD & POOR`S: You have to realize, part of the reason why people are so pessimistic and part of the reason why the University of Michigan number is at a 28 year low, is because of the high prices they`re seeing on food, on gasoline. But that increases spending because they`re buying the gasoline and that raises at least the nominal amount of money that they`re spending keeps that saving rate low. So they`re scared because they`re spending too much money.
GURVEY: In fact, while the report shows that personal income rose slightly in April, the gain was completely offset by the increases in fuel and food costs. It is the second month in a row that income, adjusted for inflation, has been flat. Consumers have cut back in some areas most notably in autos and in goods closely associated with homebuilding. But some sectors are holding up well, such as electronics. Best Buy manager Juan Alverado says sales are still strong at his store.
JUAN ALVERADO, CUSTOMER ASSISTANCE MANAGER, BEST BUY: We haven`t slowed down as far as sales. Sales are still going; they`re still trending up. And the trend, the trend that we see right now is selling a lot of portable stuff as well. We`re selling a lot of cameras, a lot of portable, portable notebooks, GPSs and the economy hasn`t really affected us very, a lot.
GURVEY: Today`s reports were compiled before the tax stimulus checks began to be issued. Retailers are expecting to see a boost as they get spent. Scott Gurvey, NIGHTLY BUSINESS REPORT, New York.
KANGAS: Wall Street opened mostly higher as bullish conviction was helped along by gains over the previous three sessions and reaction to Dell`s better than expected earnings which we told you about last night. After an hour of trading, the Dow posted a 34 point gain and the NASDAQ was up 17. The market maintained a modestly positive bias amid end of portfolio adjustments this...
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