Consumer Sentiment Is Low; History Shows That Could Actually Be Good for U.S. Stocks

Yet S&P 500 returns over the next year turned out to be pretty good. To start, I pulled each of the monthly Consumer Sentiment Index readings going back as far as was easily accessible, which was 1985. I also pulled month-end S&P 500 index values for the same period. For example, if the report was for January 1985, I looked at S&P 500 returns from Feb. 1, 1985 to Jan. 31, 1986. S&P 500 returns over the next 12 months tend to be higher when Consumer Sentiment Index readings are lower.