> Testable hypotheses about the relationship between stock prices and consumer confidence seem to appear in the business press whenever new consumer survey data is released. Headlines like “Rise in Consumer Sentiment Sends Share Prices Higher” 1 and “Stocks Tumble, Spurred by Dive in Consumer Confidence” 2 suggest that stock prices respond directly to measures of consumer confidence. Previous research into the matter, however, suggests that the headline writers have it backwards – that the direction of influence runs only one way, from stock prices to consumer confidence, and that any stock price response to new information about consumer confidence is ephemeral.

https://www.rose-hulman.edu/~bremmer/professional/consumer_c...