The IBD/TIPP Economic Optimism Index rose further into moderately optimistic territory in May, gaining one point to 53.6. But the positive vibes came mostly from self-described investors. The rest of the country was slightly pessimistic, with the index registering at 49.9, just below the neutral 50 level.
Optimism and pessimism also were linked to income levels in May. Americans earning at least $50,000 were optimistic (53.3) and those earning more than $75,000 even more so (59.6). Yet Americans earning less than $50,000 were somewhat pessimistic (48.9 or lower).
The stabilizing stock market may have helped perk up investors' mood over the past month. Apple said it would buy back $100 billion in stock and boost dividend payments thanks at least in part to the recent corporate tax cut. Apple (AAPL) stock skyrocketed last week, pushing the Nasdaq above its 50-day line, while the Dow Jones and S&P 500 index found support at the 200-day line.
On a similar note, the National Federation of Independent Business said Tuesday that a record share of small businesses reported improving profits in the 45-year history of its monthly survey.
While perceptions of the Trump tax reform may change over time, the IBD/TIPP Poll results gibe with other surveys suggesting most people haven't noticed their tax cut in their paychecks via lower withheld federal income taxes.
The IBD/TIPP Poll reflects 900 responses collected from April 26 to May 4. The drop in the jobless rate to 3.9% in April didn't make news until the final day of polling.
Americans Upbeat About Economic Outlook
The Economic Optimism Index is a composite of three major subindexes.
The six-month economic outlook gauge rose 1.6 points to 51.3, back into optimistic territory. That's well below the readings that topped 55 in the two months after President Trump signed the tax cuts into law in December.
The six-month personal financial outlook index ticked up three-tenths of a point to 61, still below January's 14-year high of 64.
Meanwhile, the measure of confidence in federal economic policies rose 1.1 points to 48.5. The gauge has only cracked into optimistic territory in a single month since 2007, during the brief honeymoon after Donald Trump's election.
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