NEW YORK, July 17, 2026, 10:31 EDT
- Economic pessimism climbed to 61%, marking the highest level since December 2023. Just 25% of Americans expressed optimism.
- Advance retail sales for June increased by 6.7% over the previous year, while monthly growth was limited to 0.2%.
- Consumer staples rose 0.62% in early trading on Friday, while discretionary stocks declined 0.74%.
The share of Americans with a pessimistic view of the economy climbed to 61%, marking the highest level since December 2023. However, advance June retail sales were still 6.7% higher compared to the same period last year. The divergence is more significant than the individual data points.
Investor sentiment could now play a greater role in shaping spending patterns than overall demand. Households may continue with essential purchases, while postponing more substantial discretionary buying.
At 10:31 a.m. EDT, U.S. markets were in session. Regular trading on the NYSE begins at 9:30 a.m. and concludes at 4 p.m. ET.
At approximately 10:15 a.m., shares of the SPDR S&P 500 ETF Trust NYSEARCA:SPY slipped 0.58%. The Consumer Staples Select Sector SPDR Fund (NYSEARCA:XLP) advanced 0.62%, while the Consumer Discretionary Select Sector SPDR Fund (NYSEARCA:XLY) lost 0.74%.
| Investor signal | Calculation | Latest gap | Market reading |
|---|---|---|---|
| Consumer mood | 61% pessimistic minus 25% optimistic | 36 points | Confidence remains sharply lower |
| Sales versus inflation | 6.7% retail growth minus 3.5% CPI | 3.2 points | Consumer spending still resilient |
| Sector performance | XLP +0.62% versus XLY -0.74% | 1.36 points | Defensive stocks outperform |
The sales-CPI spread offers an approximate comparison, and should not be interpreted as an inflation-adjusted sales metric.
The CNBC survey interviewed 1,000 adults and had a margin of error of ±3.1 points. Just 25% expressed confidence in both current and future conditions.
President Donald Trump held a 42% approval rating on the economy, while 55% disapproved. According to CNBC, the net minus-13 result marked the lowest point for Trump’s economic performance in either term.
The University of Michigan’s early Friday reading showed sentiment increasing by 9.9% from June to reach 54.4. However, it was still 11.8% lower than in July 2025.
Survey director Joanne Hsu said consumers were “hardly ebullient about the economy.” She cautioned that rising gasoline prices might slow the recovery. ISRAEL
Relief is recent and partial. Consumer prices in June dropped by 0.4% compared to May, but were 3.5% higher over 12 months. Gasoline prices stayed 26.7% above last year’s levels.
Retail sales are reported in nominal terms and do not account for price fluctuations. Deducting headline inflation from yearly sales growth results in a 3.2-point buffer. This does not represent an exact volume estimate since the contents of the baskets vary.
However, that buffer suggests a sudden drop in demand is unlikely. The caution points instead to strain on optional volumes and profit margins. The 1.36-point gain in staples on Friday underscores this defensive stance.
Risks: June retail data are preliminary and are expressed in nominal terms. Over 70% of Michigan respondents were surveyed prior to new U.S. strikes on July 7. The sentiment recovery could be offset by rising fuel prices.
The investable takeaway is specific. Despite consumer pessimism, spending has not significantly declined. Current data still supports staples above discretionary sectors.
