The IBD/TIPP Economic Optimism Index held steady at 51.3 in June, just below its level before Donald Trump's surprise election fueled a short-lived surge in spirits that carried the index to a 12-year high of 56.4 in February.
The index held above the neutral 50 level, signaling optimism for the ninth straight month. Yet below the surface, June's poll reveal increased optimism about the near-term direction for the economy, deeper pessimism about the direction of federal policies, and an unprecedented gap in economic confidence based on gender and race.
The polling, from May 30 to June 6, came as the Labor Department reported slower job growth amid falling unemployment and the major stock indexes hit record highs as shares of Amazon (AMZN) and then Alphabet (GOOGL), Google's parent company, eclipsed 1,000. Amazon and Alphabet are part of the four FANG internet giants taking a lead role in the market's strong run this year.
Advertisement
In the June poll, economic optimism among men rose 2.9 points to 58.8, while falling 2.6 points to 44.1 among women. The 14.7-point gap exceeded April's 10-point gap (56.7 vs. 46.7), the prior record for the IBD/TIPP Poll. Just ahead of the election, men and women were equally optimistic (51.4).
Meanwhile, the optimism gap based on race also widened to a IBD/TIPP Poll record 20.2 points, with a reading of 56.7 among whites and 36.5 among black and Hispanic respondents.
The pullback in optimism since February has come amid turmoil in Washington over the FBI's investigation of the Trump campaign's Russia ties and a battle over the future of ObamaCare, as the GOP aims to pass a TrumpCare alternative that the Congressional Budget Office says would add 23 million people to the ranks of the uninsured.
The Economic Optimism Index is a composite of three major subindexes that track views of near-term economic prospects, the outlook for personal finances over the coming six months and views of how well government economic policies are working.
IBD'S TAKE: Financial markets' negative take on Friday's jobs report helped sink Treasury yields and bank stocks, but markets got the report completely wrong.
In June, the gauge of the six-month economic outlook rose 1.6 points to 51.2, after slipping slightly into negative territory in May, still well below the four-year high of 56.3 in December.
The personal financial outlook index edged up a tenth of a point to 57.2, after sinking 4.2 points in May to an 18-month low.
The measure of confidence in federal economic policies lost 1.7 points to 45.4, suggesting growing concern with the Trump administration. The index had signaled optimism for the first time in a decade in February.
Slow Hiring, 16-Year Low Jobless Rate Shift Fed Outlook
Amazon (AMZN) Stock Quotes, Company News And Chart Analysis
Alphabet (GOOGL) Stock Quotes, Company News And Chart Analysis