Every week, Bloomberg reports its "Consumer Comfort" index, a gauge of Americans' perceptions on the economy, personal finances, and "whether it's a good time to buy needed goods or services." "The comfort index can range from 100, indicating every participant in the survey had a positive response to all three components, to minus 100, signaling all views were negative."
The most recent data put the index at minus 47.6 for the last week of July, the lowest figure since May. Consumers were understandably unnerved by the approaching debt ceiling, due August 2, and sluggish economic and labor conditions, John Herrmann of State Street Global Markets LLC told Bloomberg.
Moreover, market participants witnessed "the biggest one-week drop in the Standard & Poor's 500 Index in a year," writes Jillian Berman of Bloomberg.
"The Bloomberg Consumer Comfort Index has been minus 40 or less, a region typically associated with recessions and their aftermath, for 170 of the past 172 weeks," Berman adds.
Consumers drive the majority of the American economy -- consumer spending, or consumption, constitutes over 70 percent of GDP. Souring sentiment among already-downtrodden consumers could impede economic recovery.
In particular, declining consumer confidence in the US, the biggest consumer market in the world, could hurt many domestic and global consumer goods retailers.
So, which consumer stocks appear vulnerable? For ideas, we collected short-seller data, and identified a list of consumer goods stocks that have seen a sharp increase in shares shorted over the last month.
Short-sellers seem to think the weakening consumer sentiment will drag down these companies -- do you agree?
List sorted by increase in shares shorted as a percentage of the share float. (Click here to access free, interactive tools to analyze these ideas.)
1. Lululemon Athletica
2. Goodyear Tire & Rubber
3. Tesla Motors
5. Campbell Soup
6. Hormel Foods
7. Crown Holdings
8. Dr Pepper Snapple Group
10. ConAgra Foods
Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the stocks mentioned above. Analyst ratings sourced from Zacks Investment Research.
Kapitall's Andrew Dominguz does not own any of the shares mentioned above. Data sourced from Finviz and Yahoo! Finance.