In the interests of balance, I thought I'd update an earlier blog in which I looked at Bespoke Investment Group's take on the recent consumer confidence number from the United States. They noted that when consumer confidence plunged by 15 per cent or more, the S&P 500 tended to perform well in the following week and 12 months.
Well, here comes a different take from James Bianco, via The Big Picture. When consumer confidence falls 10 points or more, the S&P 500 tends to decline that month and the following month. One month, of course, is a different time horizon than that used by Bespoke. But the Bianco research goes back to 1978.
You can see the full chart here.