Market news : Consumer comfort number best since 2008

Consumer sentiment climbed last week to its highest level in more than five years as Americans felt the most upbeat about spending since before the recession began.

The Bloomberg Consumer Comfort Index improved to minus 28.9 in the week ended April 28, its highest since January 2008, from minus 29.9 the week earlier. The buying-climate gauge rose to minus 32.5, the best reading since November 2007, a month before the worst economic slump since the Great Depression began.

The gain in sentiment is being driven by high-income earners as rising home and stock values bolster balance sheets, which may help underpin consumer spending. While easing fuel costs may help those at the other end of the pay scale, the higher payroll tax that took effect in January may be starting to hurt those households.

“We had a nice big bounce at the upper end, that’s an indication that they’re feeling a lot more confident due to the rise in equity prices,” said Joseph Brusuelas, a senior economist at Bloomberg LP in New York. “ That is one of the ongoing stories at this point in the U.S. expansion.”

The number of Americans filing claims for jobless benefits fell by 18,000 to 324,000 in the week ended April 27, the fewest since January 2008, Labor Department figures showed in Washington. Economists forecast 345,000 claims, according to the median estimate in a Bloomberg survey. A Labor Department official said there was nothing unusual in the data.

Stocks rose as the European Central Bank cut its key interest rate and U.S. jobless claims unexpectedly declined. The Standard & Poor’s 500 Index advanced 0.4 percent to 1,589.16 at 9:40 a.m. in New York.

Buying Climate

Of the three components of the comfort index, views on whether this is a good time to buy sustained the biggest gain, climbing from minus 34.8, the survey fo....

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By Jeanna Smialek though Bloomberg.com