Gain in U.S. Consumer Confidence Lifts Spending Outlook: Economy

Posted by Bloomberg

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American consumers turned more confident in December as hiring picked up, brightening the outlook for spending heading into 2014.

The Conference Board said its sentiment indexclimbed to 78.1 from 72 in November, exceeding the median forecast of economists surveyed by Bloomberg and the strongest year-end reading since 2007. Other reports showed home pricesclimbed at the fastest pace in more than seven years and manufacturing was in a sustained expansion.

The biggest employment gain in eight years, the rebound in housing and record stock values are boosting household wealth, which will help support spending in the new year. Companies from Ford Motor Co. (F) to Apple Inc. (AAPL) are pledging to expand operations in the U.S. as demand improves, a sign the world’s biggest economy will strengthen in 2014.

“We’re ending 2013 with good momentum,” said Stephen Stanley, chief economist at Pierpont Securities LLC in Stamford,Connecticut, and the second-best forecaster of consumer confidence over the past two years, according to data compiled by Bloomberg. “We’ve seen progress in the labor market. The rise in home values along with the run-up in equity prices is a big element of why people are feeling better.”

U.S. stocks rose, with the Standard & Poor’s 500 Index poised for its biggest annual advance since 1997, as data showed an improving economy. The S&P 500 climbed 0.3 percent to 1,846.72 at 12:13 p.m. in New York.