NEW YORK: The strength of the U.S. consumer has been often cited as a pillar of the economy and one of the reasons the S&P 500 has recently scaled new heights, but consumer discretionary stocks have skipped the party for several months.
Graphic: Consumer discretionary in a downtrend, https://fingfx.thomsonreuters.com/gfx/mkt/12/8766/8680/Pastedper cent20Image.jpg "Earnings across the board have been pretty lackluster - it may be reflective of the consumer taking a little bit of a pause. Consumer spending has been solid but it hasn’t been robust," said David Joy, chief market strategist at Ameriprise Financial in Boston.
Another round of tariffs on about US$156 billion in Chinese imports is scheduled to take effect on Dec. 15, raising prices on many consumer products, such as cell phones. Negotiators for the two countries are attempting to reach a deal to cancel current tariffs in phases. "If you back the lens up and say 'How has consumer discretionary done for the whole year and when did it top out?', it topped out right when we started to cycle into the things that hadn't been working," said Art Hogan, chief market strategist at National Securities in New York.
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