U.S. consumers spent more in October, but just barely.
Personal consumption expenditures for the month rose 0.1 percent, or $8.2 billion, versus the prior month, when spending increased a much swifter 0.7 percent, according to a Commerce Department report today. Consumers were not as ready to spend as hoped. Economists projected a 0.4 percent gain for October.
Spending on what’s referred to as “non-durable goods,” such as apparel, fell by $4.9 billion. It’s not necessarily that people didn’t have more money coming in. Personal income increased by 0.4 percent or $48.1 million — the biggest jump since March.
It’s unclear how much of that income bump will go into retail tills. Spending is expected to rise only modestly this holiday season and those chains that thrive are largely expected to do so by balancing inventories successfully and selling more goods at something approaching full price.
Wall Street got off to a poor start. In the opening minutes of trading, the S&P Retail Index fell 0.6 percent, or 3.09 points, to 511.64, as the Dow Jones Industrial Average sank 1.1percent, or 129.11 points, to 11,364.61.
Debt worries in Europe and weakness in the Chinese manufacturing sector weighed on global markets.
The Hang Seng Index fell 2.1 percent to 17,864.43 in Hong Kong. And the FTSE 100 slipped 0.8 percent to 5,167.21 in London and the CAC 40 fell 0.7 percent to 2,850.70 in Paris as the close approached.