U.S. consumer spending increased in January, hitting a seven-month high, the Commerce Department said on Feb 26. The rise came as the $600 stimulus checks started reaching Americans last month.
The jump in consumer spending also comes along with a rise in personal income. This once again proves that the economy is gradually recovering and that people are feeling more confident about spending.
Consumer Spending Jumps in January
U.S. consumer spending rose a solid 2.4% in January for the first time in three months. This is also the highest level since June when the first round of coronavirus relief aid was announced. January’s jump came as millions of Americans started receiving their $600 checks as part of the government’s $1.9 trillion COVID-19 fiscal stimulus package.
Data from the Bureau of Economic Analysis also showed that the rise in consumer spending in January coincided with a solid 10% increase in personal income in the month. The stimulus checks have given people more purchasing power.
Moreover, the enhanced unemployment benefits are also allowing people to spend more.
People Showing Confidence in Economy
People spent freely on automobiles, recreational goods, food and beverages, and services such as restaurants and hotel bookings. Also, many bought new homes, which helped home sales grow.
Peoples’ growing confidence in economic recovery is also evident. This helped retail sales, which saw a jump of 5.3% in January, to hit a seven-month high. Also, consumer confidence increased to a three-month high.
Needless to say, as the vaccination drive further gathers pace, people will feel more confident and spend more freely. We suggest five stocks that are expected to perform well in the near term.
Tapestry, Inc. ( TPR Quick Quote TPR - Free Report) is the designer and marketer of fine accessories and gifts for women and men in the United States and internationally. The company offers lifestyle products, which include handbags, women’s and men’s accessories, footwear, jewelry, seasonal apparel collections, sunwear, travel bags, fragrances and watches.
The company’s expected earnings growth rate for the current year is more than 100%. The Zacks Consensus Estimate for current-year earnings has improved 13.3% over the past 60 days. Tapestry sports a Zacks Rank #2 (Buy). You can see
the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Boot Barn Holdings, Inc. ( BOOT Quick Quote BOOT - Free Report) operates as a lifestyle retail chain devoted to western and work-related footwear, apparel and accessories.
The company’s expected earnings growth rate for the current year is 2.6%. The Zacks Consensus Estimate for current-year earnings has improved 21.2% over the past 60 days. The company sports a Zacks Rank #1.
Ethan Allen Interiors Inc. ( ETH Quick Quote ETH - Free Report) is a leading interior design company, and a manufacturer and retailer of quality home furnishings. The company offers free interior design service to its clients and sells a full range of furniture products and decorative accessories through ethanallen.com and a network of the Design Centers in the United States and abroad.
The company’s expected earnings growth rate for the current year is more than 100%. The Zacks Consensus Estimate for current-year earnings has improved 44.4% over the past 60 days. Ethan Allen has a Zacks Rank #1.
Full House Resorts, Inc. ( FLL Quick Quote FLL - Free Report) develops and manages gaming facilities. The company has a management agreement with the Nottawaseppi Huron Band of Potawatomi Indians for the development and management of a first-class casino/resort with gaming devices in the Battle Creek, Michigan area, which is currently in the pre-development stage.
The company’s expected earnings growth rate for the current year is more than 100%. The company’s shares have gained 13.9% in the past 30 days. It carries a Zacks Rank #2.
Churchill Downs, Incorporated ( CHDN Quick Quote CHDN - Free Report) has Five racetracks, Six casinos, Big Fish Games, the world's largest distributor of casual games, the country's leading online wagering business, TwinSpires.com, a video poker business, and a multi-state network of off-track betting (OTB) facilities
The company’s expected earnings growth rate for the current year is more than 100%. The Zacks Consensus Estimate for current-year earnings has improved 4.8% over the past 60 days. It has a Zacks Rank #2.
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