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Consumer sentiment - What to know in markets Friday

Heidi Chung

Investors will get a peek into the U.S. consumer’s outlook on the economy on Friday. The University of Michigan will be releasing its index reading for the month of January. Economists polled by Bloomberg are expecting a reading of 96.4, down from 98.3 in December.

The partial government shutdown has affected the release of a handful of key economic data over the past 4 weeks, but the University of Michigan index reading is one of the few glimpses market watchers will have into consumer sentiment.

“The upcoming preliminary January report could reflect consumers’ reaction to the ongoing partial government shutdown. While we do not expect a material downgrade in consumer sentiment in reaction to the government shutdown, a substantial deterioration in this indicator would be noteworthy,” Nomura wrote in a note on Friday.

December’s index reading was near 15-year highs despite the extreme market volatility during the month. Capital Economics expects January’s reading to remain high. “We estimate that the University of Michigan consumer confidence index strengthened slightly in January, suggesting that spending growth should hold up fairly well over the coming months,” the research company wrote in a note.

As the first week of earnings season draws to a close, rail company Kansas City Southern (KSU), oil services giant Schlumberger (SLB), and State Street (STT) will release earnings before the bell on Friday.

Analysts polled by Bloomberg are estimating that Kansas City Southern will report earnings of $1.53 per share on $685.2 million in revenue, and earnings of 38 cents per share on $8.04 billion in revenue for Schlumberger. State Street is expected to have earned $1.67 per share on $2.96 billion in revenue during Q4.

Heidi Chung is a reporter at Yahoo Finance. Follow her on Twitter: @heidi_chung.

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